-----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, D9hmJEW59p1qb1M6Eands1QUtP79kUvW91OEUBNwm53hWBOZobBupFRAV43/i8+6 GqTE6TSmoLi/e/dxVW8+dQ== 0000276461-04-000073.txt : 20041208 0000276461-04-000073.hdr.sgml : 20041208 20041207173722 ACCESSION NUMBER: 0000276461-04-000073 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20040930 FILED AS OF DATE: 20041208 DATE AS OF CHANGE: 20041207 EFFECTIVENESS DATE: 20041208 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST INVESTORS SERIES FUND CENTRAL INDEX KEY: 0000842939 IRS NUMBER: 000000000 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-05690 FILM NUMBER: 041189201 BUSINESS ADDRESS: STREET 1: 95 WALL ST CITY: NEW YORK STATE: NY ZIP: 10005 BUSINESS PHONE: 1-212-858-8000 MAIL ADDRESS: STREET 1: 581 MAIN STREET CITY: WOODBRIDGE STATE: NJ ZIP: 07095 FORMER COMPANY: FORMER CONFORMED NAME: FIRST INVESTORS FUND DATE OF NAME CHANGE: 19900422 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST INVESTORS GLOBAL FUND INC CENTRAL INDEX KEY: 0000352564 IRS NUMBER: 133094384 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-03169 FILM NUMBER: 041189202 BUSINESS ADDRESS: STREET 1: 95 WALL ST CITY: NEW YORK STATE: NY ZIP: 10005 BUSINESS PHONE: 1-212-858-8000 MAIL ADDRESS: STREET 1: 581 MAIN ST CITY: WOODBRIDGE STATE: NJ ZIP: 07095 FORMER COMPANY: FORMER CONFORMED NAME: FIRST INVESTORS INTERNATIONAL SECURITIES FUND INC DATE OF NAME CHANGE: 19891213 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST INVESTORS SERIES FUND II INC CENTRAL INDEX KEY: 0000886048 IRS NUMBER: 133663175 STATE OF INCORPORATION: MD FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-06618 FILM NUMBER: 041189203 BUSINESS ADDRESS: STREET 1: 95 WALL ST CITY: NEW YORK STATE: NY ZIP: 10005 BUSINESS PHONE: 1-212-858-8000 MAIL ADDRESS: STREET 1: 581 MAIN ST CITY: WOODBRIDGE STATE: NJ ZIP: 07095 N-CSR 1 equity0930.txt FIRST INVESTORS EQUITY FUNDS UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 -------- FORM N-CSR -------- CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES INVESTMENT COMPANY ACT FILE NUMBERS 811-5690; 811-6618; 811-3169 FIRST INVESTORS SERIES FUND FIRST INVESTORS SERIES FUND II, INC. FIRST INVESTORS GLOBAL FUND, INC. (Exact name of registrant as specified in charter) 95 Wall Street New York, NY 10005 (Address of principal executive offices) (Zip code) Joseph I. Benedek First Investors Management Company, Inc. 581 Main Street Woodbridge, NJ 07095 1-732-855-2712 (Name and address of agent for service) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 1-212-858-8000 DATE OF FISCAL YEAR END: SEPTEMBER 30, 2004 DATE OF REPORTING PERIOD: SEPTEMBER 30, 2004 Item 1. Reports to Stockholders The Annual Report to Stockholders follows [First Investors Logo] EQUITY FUNDS TOTAL RETURN VALUE BLUE CHIP GROWTH & INCOME ALL-CAP GROWTH MID-CAP OPPORTUNITY SPECIAL SITUATIONS FOCUSED EQUITY GLOBAL ANNUAL REPORT September 30, 2004 Portfolio Managers' Letter FIRST INVESTORS TOTAL RETURN FUND Dear Investor: This is the annual report for the First Investors Total Return Fund for the fiscal year ended September 30, 2004. During the period, the Fund's return on a net asset value basis was 9.7% for Class A shares and 8.9% for Class B shares, including dividends of 20.0 cents per share on Class A shares and 11.8 cents per share on Class B shares. The primary drivers of the Fund's performance were the improving economy, the rise in energy prices and solid performance of the equity markets. Given the solid rise in equity prices during the fiscal year, the Fund was helped by its 64% average equity allocation. More than three-quarters of the return of the equity portion of the portfolio was attributable to four groups: the energy, financials, consumer discretionary and industrials sectors. To a lesser extent, the Fund's focus on firms with dividends benefited performance, as their shares outperformed non-paying ones. An underweight position in the consumer staples sector also aided returns. In addition, the Fund's multi-cap strategy aided performance, as mid- and small-cap equities outperformed their larger capitalization counterparts. The Fund's average bond allocation of 31.5% made it slightly underweight in bonds. The bond portion of the Fund had approximately two-thirds of its assets in investment grade corporate bonds, and one-third in mortgage-backed bonds. Both sectors outperformed the bond market in general as yield spreads on corporate and mortgage-backed bonds narrowed versus Treasury securities. Thank you for placing your trust in First Investors. As always, we appreciate the opportunity to serve your investment needs. Sincerely, /s/ EDWIN D. MISKA Edwin D. Miska Director of Equities /s/ CLARK D. WAGNER Clark D. Wagner Director of Fixed Income October 29, 2004 Understanding Your Fund's Expenses FIRST INVESTORS EQUITY FUNDS As a mutual fund shareholder, you incur two types of costs: (1) transaction costs, including a sales charge (load) on purchase payments (on Class A shares only), a contingent deferred sales charge on redemptions (on Class B shares only); and (2) ongoing costs, including advisory fees; distribution and service fees (12b-1); and other expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds. The examples are based on an investment of $1,000 in each Fund at the beginning of the period, April 1, 2004, and held for the entire six-month period ended September 30, 2004. The calculations assume that no shares were bought or sold during the period. Your actual costs may have been higher or lower, depending on the amount of your investment and the timing of any purchases or redemptions. Actual Expenses Example: These lines help you to estimate the actual expenses that you paid over the period. The "Ending Account Value" shown is derived from the Fund's actual return, and the "Expenses Paid During Period" shows the dollar amount that would have been paid by an investor who started with $1,000 in each Fund. You may use the information here, together with the amount you invested, to estimate the expenses that you paid over the period. To estimate the expense you paid on your account during this period, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60), then multiply the result by the number given for your Fund under the heading "Expenses Paid During Period". Hypothetical Expenses Example: These lines of the table provide information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio for Class A and Class B shares, and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. Please note that the expenses shown in the table are meant to highlight and help you compare your ongoing costs only and do not reflect any transaction costs, such as front-end or contingent deferred sales charges (loads). Therefore, the hypothetical expense example is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher. Fund Expenses FIRST INVESTORS TOTAL RETURN FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing those costs with those of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples.
- ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - ---------------------------------------------------------------------------------------------- Actual $1,000.00 $989.43 $7.06 Hypothetical (5% return before expenses) $1,000.00 $1,017.90 $7.16 - ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - ---------------------------------------------------------------------------------------------- Actual $1,000.00 $986.04 $10.53 Hypothetical (5% return before expenses) $1,000.00 $1,014.40 $10.68 - ---------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.42% for Class A shares and 2.12% for Class B shares, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period). Expenses paid during the period are net of expenses waived.
Portfolio Composition TOP TEN SECTORS (BAR CHART: Top Ten Sectors) Financials 19.7% Consumer Discretionary 11.5% Information Technology 10.7% Health Care 9.8% Mortgage-Backed Certificates 9.5% Industrials 9.1% Consumer Staples 8.1% Energy 5.6% Materials 5.5% Utilities 3.1% Portfolio's holdings and allocations are subject to change. Percentages are as of September 30, 2004, and are based on total market value of investments. Cumulative Performance Information FIRST INVESTORS TOTAL RETURN FUND Comparison of change in value of $10,000 investment in the First Investors Total Return Fund (Class A shares), the Lehman Brothers U.S. Government Bond/Credit Index, the Merrill Lynch U.S. Corporate & Government Master Index+ and the Standard & Poor's 500 Index. FIRST INVESTORS TOTAL RETURN FUND GRAPH PLOT POINTS As of September 30, 2004 MERRILL LYNCH LEHMAN U.S CORPORATE TOTAL RETURN U.S. GOV/BOND S&P 500 AND GOVERNMENT FUND CREDIT INDEX INDEX MASTER INDEX Dec-94 $9,425 $10,000 $10,000 $10,000 Dec-95 11,957 11,924 13,758 11,906 Dec-96 13,226 12,270 16,917 12,252 Dec-97 15,618 13,468 22,561 13,451 Sep-98 16,104 14,725 23,915 14,699 Sep-99 18,205 14,486 30,565 14,481 Sep-00 21,589 15,462 34,625 15,452 Sep-01 17,888 17,498 25,408 17,524 Sep-02 15,855 19,099 20,203 19,120 Sep-03 18,326 20,342 25,132 20,308 Sep-04 20,019 21,019 28,617 20,984 (INSET BOX IN CHART READS:) Average Annual Total Return* Class A Shares N.A.V. Only S.E.C. Standardized One Year 9.65% 3.38% Five Years 1.95% 0.76% Ten Years 7.62% 6.98% Class B Shares One Year 8.92% 4.92% Five Years 1.23% 0.85% Since Inception (1/12/95) 7.27% 7.27% The graph compares a $10,000 investment in the First Investors Total Return Fund (Class A shares) beginning 12/31/94 with theoretical investments in the Lehman Brothers U.S. Government Bond/Credit Index, the Merrill Lynch Corporate & Government Master Index and the Standard & Poor's 500 Index (the "Indices"). The Lehman Brothers U.S. Government Bond/Credit Index combines the Lehman Brothers U.S. Government Bond Index with the Lehman Brothers U.S. Credit Index. The U.S. Government Bond Index is made up of the Treasury Bond Index (all public obligations of the U.S. Treasury) and the Agency Bond Index (all publicly issued debt of U.S. Government agencies and quasi-federal corporations, and corporate debt guaranteed by the U.S. Government). The U.S. Credit Index includes all publicly issued, fixed-rate, nonconvertible investment grade dollar-denominated, S.E.C.-registered corporate debt. All issues in each Index have at least one year to maturity and an outstanding par value of at least $150 million. The Merrill Lynch U.S. Corporate & Government Master Index tracks the performance of U.S. dollar-denominated investment grade U.S. Government and corporate public debt issued in the U.S. domestic bond market, excluding collateralized products such as Mortgage Pass-Through and Assets Backed securities. Qualifying bonds have at least one year to maturity, a fixed coupon schedule and minimum amount outstanding of $1 billion for U.S. Treasuries and $150 million for all other securities. The Standard & Poor's 500 Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure the performance of the broad domestic economy through changes in the aggregate market value of such stocks, which represent all major industries. It is not possible to invest directly in these Indices. In addition, the Indices do not take into account fees and expenses that an investor would incur in purchasing securities in these Indices. For purposes of the graph and the accompanying table, unless otherwise indicated, it has been assumed that the maximum sales charge was deducted from the initial $10,000 investment in the Fund and all dividends and distributions were reinvested. Class B shares performance may be greater than or less than that shown in the line graph above for Class A shares based on differences in sales loads and fees paid by shareholders investing in the different classes. Cumulative Performance Information (continued) FIRST INVESTORS TOTAL RETURN FUND * Average Annual Total Return figures (for the periods ended 9/30/04) include the reinvestment of all dividends and distributions. "N.A.V. Only" returns are calculated without sales charges. The Class A "S.E.C. Standardized" returns shown are based on the maximum sales charge of 5.75% (prior to 6/17/02, the maximum sales charge was 6.25%). The Class B "S.E.C. Standardized" returns are adjusted for the applicable deferred sales charge (maximum of 4% in the first year). During the periods shown, some of the expenses of the Fund were waived or assumed. If such expenses had been paid by the Fund, the Class A "S.E.C. Standardized" Average Annual Total Returns for One Year, Five Years and Ten Years would have been 3.17%, .52% and 6.72%, respectively. The Class B "S.E.C. Standardized" Average Annual Total Returns for One Year, Five Years and Since Inception would have been 4.72%, .61% and 7.01%, respectively. Results represent past performance and do not indicate future results.The graph and the returns shown do not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. Lehman Brothers U.S. Government Bond/Credit Index figures are from Lehman Brothers, Inc., Merrill Lynch U.S. Corporate & Government Master Index figures are from Merrill Lynch & Co., Standard & Poor's 500 Index figures are from Standard & Poor's and all other figures are from First Investors Management Company, Inc. + We have added a comparison to the Merrill Lynch U.S. Corporate & Government Master Index this year because that Index is more representative of the Fund's current investment universe. After this year, we will not show a comparison to the Lehman Brothers U.S. Government Bond/Credit Index. 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Portfolio of Investments FIRST INVESTORS TOTAL RETURN FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--62.3% Consumer Discretionary--8.4% 55,400 * AnnTaylor Stores Corporation $1,296,360 $48 62,500 Blockbuster, Inc. - Class "A" 474,375 18 14,400 Clear Channel Communications, Inc. 448,848 17 39,800 * Cost Plus, Inc. 1,408,124 53 3,900 * Domino's Pizza, Inc. 57,330 2 38,200 * Fox Entertainment Group, Inc. - Class "A" 1,059,668 40 51,400 * GameStop Corporation - Class "A" 951,414 36 22,200 Gap, Inc. 415,140 15 14,400 Genuine Parts Company 552,672 21 20,400 Harley-Davidson, Inc. 1,212,576 45 32,200 Hasbro, Inc. 605,360 23 68,000 * Hollywood Entertainment Corporation 671,160 25 29,400 Home Depot, Inc. 1,152,480 43 44,100 J.C. Penney Company, Inc. (Holding Company) 1,555,848 58 17,700 Lear Corporation 963,765 36 43,500 Leggett & Platt, Inc. 1,222,350 46 48,700 Mattel, Inc. 882,930 33 73,500 McDonald's Corporation 2,060,205 77 90,000 * Office Depot, Inc. 1,352,700 51 28,100 Pier 1 Imports, Inc. 508,048 19 35,600 Polo Ralph Lauren Corporation - Class "A" 1,294,772 48 24,700 Ross Stores, Inc. 578,968 22 19,200 Sherwin-Williams Company 844,032 32 26,400 Viacom, Inc. - Class "B" 885,984 33 - ---------------------------------------------------------------------------------------------------------------------- 22,455,109 841 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--4.3% 29,400 Altria Group, Inc. 1,382,976 52 29,400 American Italian Pasta Company - Class "A" 768,810 29 17,500 Anheuser-Busch Companies, Inc. 874,125 33 17,000 Bunge, Ltd. 679,660 25 14,500 Coca-Cola Company 580,725 22 33,300 Hormel Foods Corporation 891,774 33 18,400 Kimberly-Clark Corporation 1,188,456 45 14,700 PepsiCo, Inc. 715,155 27 21,800 Procter & Gamble Company 1,179,816 44 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS TOTAL RETURN FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples (continued) 35,300 * Smithfield Foods, Inc. $882,500 $33 17,200 Tootsie Roll Industries, Inc. 502,584 19 22,100 Wal-Mart Stores, Inc. 1,175,720 44 22,500 WD-40 Company 643,500 24 - ---------------------------------------------------------------------------------------------------------------------- 11,465,801 430 - ---------------------------------------------------------------------------------------------------------------------- Energy--5.0% 22,000 Anadarko Petroleum Corporation 1,459,920 55 75,000 Chesapeake Energy Corporation 1,187,250 44 14,400 ConocoPhillips 1,193,040 45 14,400 EOG Resources, Inc. 948,240 36 37,600 ExxonMobil Corporation 1,817,208 68 23,500 * Noble Corporation 1,056,325 40 44,100 Suncor Energy, Inc. 1,411,640 53 37,300 * Swift Energy Company 893,708 33 45,600 * Transocean, Inc. 1,631,568 61 53,000 XTO Energy, Inc. 1,721,440 64 - ---------------------------------------------------------------------------------------------------------------------- 13,320,339 499 - ---------------------------------------------------------------------------------------------------------------------- Financials--12.7% 20,600 American Express Company 1,060,076 40 20,600 American International Group, Inc. 1,400,594 52 32,200 AmSouth Bancorporation 785,680 29 57,006 Bank of America Corporation 2,470,070 93 13,100 Bear Stearns Companies, Inc. 1,259,827 47 44,100 Citigroup, Inc. 1,945,692 73 36,800 Colonial BancGroup, Inc. 752,560 28 35,800 Endurance Specialty Holdings, Ltd. 1,150,970 43 14,600 Fannie Mae 925,640 35 14,700 GreenPoint Financial Corporation 682,227 26 45,600 JPMorgan Chase & Company 1,811,688 68 13,900 Lehman Brothers Holdings, Inc. 1,108,108 41 29,600 Marsh & McLennan Companies, Inc. 1,354,496 51 50,000 MBNA Corporation 1,260,000 47 10,200 Merrill Lynch & Company, Inc. 507,144 19 38,200 Montpelier Re Holdings, Ltd. 1,401,176 52 16,200 Morgan Stanley 798,660 30 18,600 National City Corporation 718,332 27 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Financials (continued) 61,300 New York Community Bancorp, Inc. $1,259,102 $47 66,300 NewAlliance Bancshares, Inc. 951,405 36 28,550 Old Republic International Corporation 714,607 27 22,000 Plum Creek Timber Company, Inc. (REIT) 770,660 29 28,300 Safeco Corporation 1,291,895 48 14,700 South Financial Group, Inc. 414,540 16 58,800 Sovereign Bancorp, Inc. 1,283,016 48 49,900 U.S. Bancorp 1,442,110 54 28,800 Wachovia Corporation 1,352,160 51 36,700 Washington Mutual, Inc. 1,434,236 54 20,500 Wells Fargo & Company 1,222,415 46 5,700 Willis Group Holdings, Ltd. 213,180 8 - ---------------------------------------------------------------------------------------------------------------------- 33,742,266 1,265 - ---------------------------------------------------------------------------------------------------------------------- Health Care--8.4% 47,000 Abbott Laboratories 1,990,920 75 29,400 * Accredo Health, Inc. 692,958 26 11,800 Aetna, Inc. 1,179,174 44 13,500 * Amgen, Inc. 765,180 29 27,900 * Anthem, Inc. 2,434,275 91 78,100 * Boston Scientific Corporation 3,102,913 116 8,800 Eli Lilly & Company 528,440 20 18,900 * Forest Laboratories, Inc. 850,122 32 5,800 * Genentech, Inc. 304,036 11 25,800 Guidant Corporation 1,703,832 64 4,560 * Hospira, Inc. 139,536 5 29,400 Johnson & Johnson 1,656,102 62 15,400 * Laboratory Corporation of America Holdings 673,288 25 14,800 Medtronic, Inc. 768,120 29 23,500 Merck & Company, Inc. 775,500 29 88,080 Pfizer, Inc. 2,695,248 101 42,800 * Priority Healthcare Corporation 862,420 32 35,300 Wyeth 1,320,220 50 - ---------------------------------------------------------------------------------------------------------------------- 22,442,284 841 - ---------------------------------------------------------------------------------------------------------------------- Industrials--7.2% 15,100 3M Company 1,207,547 45 60,300 * AGCO Corporation 1,363,985 51 14,900 Alexander & Baldwin, Inc. 505,706 19 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS TOTAL RETURN FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Industrials (continued) 74,100 American Power Conversion Corporation $1,288,599 $49 9,300 Caterpillar, Inc. 748,185 28 29,800 Cendant Corporation 643,680 24 29,500 Chicago Bridge & Iron Company NV - NY Shares 884,705 33 10,600 Eaton Corporation 672,146 25 15,000 Engineered Support Systems, Inc. 684,600 26 14,800 Harsco Corporation 664,520 25 26,200 Honeywell International, Inc. 939,532 35 17,800 Lockheed Martin Corporation 992,884 37 57,900 Masco Corporation 1,999,287 75 32,500 Northrop Grumman Corporation 1,733,225 65 59,300 * Pinnacle Airlines Corporation 598,930 23 17,500 Pitney Bowes, Inc. 771,750 29 20,700 Rockwell Automation, Inc. 801,090 30 34,100 SPX Corporation 1,207,140 45 14,600 United Technologies Corporation 1,363,348 51 - ---------------------------------------------------------------------------------------------------------------------- 19,070,859 715 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--9.6% 4,400 Analog Devices, Inc. 170,632 6 59,500 * Cisco Systems, Inc. 1,076,950 40 29,400 Diebold, Inc. 1,372,980 51 42,900 * Electronics for Imaging, Inc. 696,696 26 103,000 * EMC Corporation 1,188,620 45 168,600 * Entrust, Inc. 426,558 16 41,376 First Data Corporation 1,799,856 68 58,800 Hewlett-Packard Company 1,102,500 41 51,700 Intel Corporation 1,037,102 39 23,600 Intersil Corporation - Class "A" 375,948 14 14,500 Intuit, Inc. 658,300 25 74,900 * Lexar Media, Inc. 628,410 24 72,200 * McAfee, Inc. 1,451,220 54 103,300 Microsoft Corporation 2,856,245 107 9,100 * NAVTEQ 324,324 12 87,800 Nokia Corporation - Class "A" (ADR) 1,204,616 45 57,300 * Paxar Corporation 1,299,564 49 46,000 QUALCOMM, Inc. 1,795,840 67 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Information Technology (continued) 41,800 * SanDisk Corporation $1,217,216 $46 19,100 StarTek, Inc. 598,976 22 36,800 * Storage Technology Corporation 929,568 35 54,385 * Taiwan Semiconductor Manufacturing Co., Ltd. (ADR) 388,309 15 23,800 * Tech Data Corporation 917,490 34 28,500 * Thermo Electron Corporation 770,070 29 65,100 * VERITAS Software Corporation 1,158,780 43 10,400 * Xilinx, Inc. 280,800 11 - ---------------------------------------------------------------------------------------------------------------------- 25,727,570 964 - ---------------------------------------------------------------------------------------------------------------------- Materials--4.0% 19,200 Dow Chemical Company 867,456 33 23,700 Freeport-McMoRan Copper & Gold, Inc. - Class "B" 959,850 36 42,700 Georgia-Pacific Corporation 1,535,065 58 35,500 Lubrizol Corporation 1,228,300 46 41,200 MeadWestvaco Corporation 1,314,280 49 13,200 PPG Industries, Inc. 808,896 30 17,500 Praxair, Inc. 747,950 28 60,900 RPM International, Inc. 1,074,885 40 16,400 United States Steel Corporation 616,968 23 23,700 Weyerhaeuser Company 1,575,576 59 - ---------------------------------------------------------------------------------------------------------------------- 10,729,226 402 - ---------------------------------------------------------------------------------------------------------------------- Other--.8% 26,500 Nasdaq - 100 Index Tracking Stock 930,680 35 10,300 SPDR Trust Series "1" 1,151,334 43 - ---------------------------------------------------------------------------------------------------------------------- 2,082,014 78 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--.7% 41,200 SBC Communications, Inc. 1,069,140 40 22,100 Verizon Communications, Inc. 870,298 33 - ---------------------------------------------------------------------------------------------------------------------- 1,939,438 73 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS TOTAL RETURN FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Utilities--1.2% 34,600 Atmos Energy Corporation $871,574 $32 22,100 Consolidated Edison, Inc. 929,084 35 12,200 Dominion Resources, Inc. 796,050 30 26,500 ONEOK, Inc. 689,530 26 - ---------------------------------------------------------------------------------------------------------------------- 3,286,238 123 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $140,079,365) 166,261,144 6,231 - ---------------------------------------------------------------------------------------------------------------------- CORPORATE BONDS--18.9% Aerospace/Defense--.6% $500M Boeing Capital Corp., 4.75%, 2008 521,779 20 Precision Castparts Corp.: 500M 8.75%, 2005 513,060 19 500M 5.6%, 2013 512,775 19 - ---------------------------------------------------------------------------------------------------------------------- 1,547,614 58 - ---------------------------------------------------------------------------------------------------------------------- Automotive--.3% DaimlerChrysler NA Holdings Corp.: 350M 8%, 2010 407,402 16 350M 6.5%, 2013 380,412 14 - ---------------------------------------------------------------------------------------------------------------------- 787,814 30 - ---------------------------------------------------------------------------------------------------------------------- Chemicals--.5% 1,075M Rohm & Haas Co., 7.4%, 2009 1,236,213 47 - ---------------------------------------------------------------------------------------------------------------------- Consumer Non-Durables--.4% 900M Clorox Co., 6.125%, 2011 995,477 37 - ---------------------------------------------------------------------------------------------------------------------- Energy--.2% 600M Texaco Capital, Inc., 8.25%, 2006 663,127 24 - ---------------------------------------------------------------------------------------------------------------------- Financial--2.5% CIT Group, Inc.: 500M 4.75%, 2010 507,852 19 750M 7.75%, 2012 888,888 33 1,250M ERAC USA Finance Enterprise Co., 7.35%, 2008 + 1,399,970 53 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Financial (continued) $400M Ford Motor Credit Co., 7.75%, 2007 $435,459 $16 350M General Electric Capital Corp., 8.5%, 2008 409,562 15 General Motors Acceptance Corp.: 500M 4.5%, 2006 508,047 19 650M 7.75%, 2010 715,038 27 750M Household Finance Corp., 6.5%, 2008 826,017 31 885M SLM Corp., 5%, 2015 878,092 33 - ---------------------------------------------------------------------------------------------------------------------- 6,568,925 246 - ---------------------------------------------------------------------------------------------------------------------- Financial Services--2.8% 500M Bank of America Corp., 6.5%, 2011 551,602 21 750M Bank One Corp., 7.6%, 2007 830,340 31 638M Bank United Corp., 8%, 2009 744,792 28 1,250M Fifth Third Bank, 3.375%, 2008 1,239,828 46 1,000M Lincoln National Corp., 6.5%, 2008 1,092,720 41 725M Manufacturers & Traders Trust Co., 8%, 2010 869,303 33 270M National City Bank of Indiana, 4.875%, 2007 280,761 10 853M National City Bank of Kentucky, 6.3%, 2011 949,729 36 737M Washington Mutual, Inc., 8.25%, 2010 873,237 33 - ---------------------------------------------------------------------------------------------------------------------- 7,432,312 279 - ---------------------------------------------------------------------------------------------------------------------- Food/Beverage/Tobacco--.8% 1,000M Coca-Cola Co., 5.75%, 2011 1,090,429 41 1,030M Coca-Cola Enterprises, Inc., 7.125%, 2009 1,179,445 43 - ---------------------------------------------------------------------------------------------------------------------- 2,269,874 84 - ---------------------------------------------------------------------------------------------------------------------- Food/Drug--1.1% 600M Delhaize America, Inc., 8.125%, 2011 688,214 26 1,000M Kroger Co., 7.8%, 2007 1,114,603 42 996M Safeway, Inc., 7%, 2007 1,084,680 41 - ---------------------------------------------------------------------------------------------------------------------- 2,887,497 109 - ---------------------------------------------------------------------------------------------------------------------- Forest Products/Containers--.4% 1,100M International Paper Co., 6.75%, 2011 1,227,464 45 - ---------------------------------------------------------------------------------------------------------------------- Gaming/Leisure--.3% 750M MGM Mirage, Inc., 8.5%, 2010 855,938 32 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS TOTAL RETURN FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Health Care--.7% $1,000M HCA, Inc., 5.25%, 2008 $1,024,856 $39 800M Wyeth, 6.95%, 2011 890,758 33 - ---------------------------------------------------------------------------------------------------------------------- 1,915,614 72 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--.4% International Business Machines Corp.: 500M 4.875%, 2006 519,290 20 500M 5.4%, 2009 534,129 20 - ---------------------------------------------------------------------------------------------------------------------- 1,053,419 40 - ---------------------------------------------------------------------------------------------------------------------- Manufacturing--.7% 700M Newell Rubbermaid, Inc., 6.75%, 2012 796,945 30 900M United Technologies Corp., 7.125%, 2010 1,041,792 39 - ---------------------------------------------------------------------------------------------------------------------- 1,838,737 69 - ---------------------------------------------------------------------------------------------------------------------- Media-Broadcasting--.5% 705M Comcast Cable Communications, Inc., 8.375%, 2007 787,999 29 500M Cox Communications, Inc., 5.5%, 2015 477,189 18 - ---------------------------------------------------------------------------------------------------------------------- 1,265,188 47 - ---------------------------------------------------------------------------------------------------------------------- Media-Diversified--.8% 750M AOL Time Warner, Inc., 6.75%, 2011 833,156 31 500M Cox Enterprises, Inc., 8%, 2007 + 536,911 20 705M Viacom, Inc., 8.625%, 2012 872,004 33 - ---------------------------------------------------------------------------------------------------------------------- 2,242,071 84 - ---------------------------------------------------------------------------------------------------------------------- Metals/Mining--.2% 500M Thiokol Corp., 6.625%, 2008 550,181 21 - ---------------------------------------------------------------------------------------------------------------------- Real Estate Investment Trusts--1.6% 910M AvalonBay Communities, Inc., 6.875%, 2007 1,003,880 38 750M Boston Properties, Inc., 5%, 2015 728,935 27 700M EOP Operating LP, 8.1%, 2010 816,423 31 700M Mack-Cali Realty LP, 7.75%, 2011 812,382 30 800M Simon Property Group LP, 7.375%, 2018 925,348 35 - ---------------------------------------------------------------------------------------------------------------------- 4,286,968 161 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Retail-General Merchandise--.5% $500M Federated Department Stores, Inc., 7.45%, 2017 $588,334 $22 600M Target Corp., 7.5%, 2010 706,460 27 - ---------------------------------------------------------------------------------------------------------------------- 1,294,794 49 - ---------------------------------------------------------------------------------------------------------------------- Telecommunications--.3% 600M New York Telephone Co., 6.125%, 2010 639,994 24 100M SBC Communications, Inc., 6.25%, 2011 109,845 4 - ---------------------------------------------------------------------------------------------------------------------- 749,839 28 - ---------------------------------------------------------------------------------------------------------------------- Transportation--1.2% Burlington Northern Santa Fe Corp.: 1,000M 7.875%, 2007 1,110,337 42 250M 6.75%, 2011 281,178 10 400M Canadian National Railway Co., 6.45%, 2006 422,553 16 Union Pacific Corp.: 200M 7.25%, 2008 223,857 8 1,100M 7.375%, 2009 1,258,329 47 - ---------------------------------------------------------------------------------------------------------------------- 3,296,254 123 - ---------------------------------------------------------------------------------------------------------------------- Utilities--1.7% 750M Consumers Energy Co., 6.375%, 2008 812,252 30 800M DPL, Inc., 6.875%, 2011 852,000 32 750M Duke Capital Corp., 8%, 2019 898,991 34 750M Nisource Finance Corp., 7.875%, 2010 887,404 33 900M PP&L Capital Funding, Inc., 8.375%, 2007 1,000,738 38 - ---------------------------------------------------------------------------------------------------------------------- 4,451,385 167 - ---------------------------------------------------------------------------------------------------------------------- Waste Management--.4% 1,000M Waste Management, Inc., 6.875%, 2009 1,117,906 42 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Corporate Bonds (cost $47,962,313) 50,534,611 1,894 - ---------------------------------------------------------------------------------------------------------------------- MORTGAGE-BACKED CERTIFICATES--8.9% Fannie Mae--4.9% 7,209M 5.5%, 4/1/33-10/1/33 7,324,265 275 1,980M 6.5%, 11/1/33 2,091,374 78 3,473M 7%, 3/1/32-8/1/32 3,721,642 140 - ---------------------------------------------------------------------------------------------------------------------- 13,137,281 493 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS TOTAL RETURN FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Principal For Each Amount or $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Freddie Mac--2.1% $2,800M 5.5%, 3/1/33-7/1/33 $2,845,817 $107 775M 6%, 9/1/32 801,673 30 1,739M 6.5%, 1/1/34 1,826,900 68 - ---------------------------------------------------------------------------------------------------------------------- 5,474,390 205 - ---------------------------------------------------------------------------------------------------------------------- Government National Mortgage Association--1.9% 4,181M 5.5%, 4/15/33-6/15/34 4,274,637 160 474M 6.5%, 7/15/28 501,652 19 229M 7%, 8/15/32 244,545 9 - ---------------------------------------------------------------------------------------------------------------------- 5,020,834 188 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Mortgage-Backed Certificates (cost $23,349,022) 23,632,505 886 - ---------------------------------------------------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCKS--1.5% Financials--1.1% Chubb Corporation: 26,800 7%, 2005 - Series "A" 763,264 29 14,800 7%, 2006 - Series "B" 416,250 16 28,600 Hartford Financial Services Group, Inc., 6%, 2006 - Class "A" 1,708,850 64 - ---------------------------------------------------------------------------------------------------------------------- 2,888,364 109 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--.4% 23,500 ALLTEL Corporation, 7.75%, 2005 1,219,063 45 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Convertible Preferred Stocks (cost $3,579,873) 4,107,427 154 - ---------------------------------------------------------------------------------------------------------------------- MUNICIPAL BONDS--.5% $1,500M Tobacco Settlement Financing Corp., NJ Rev. Bonds, 6.75%, 2039 (cost $1,442,294) 1,440,000 54 - ---------------------------------------------------------------------------------------------------------------------- PASS THROUGH CERTIFICATES--.4% Transportation 753M Continental Airlines, Inc., 8.388%, 2020 572,626 22 623M NWA Trust, 10.23%, 2012 544,923 20 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Pass Through Certificates (cost $1,421,688) 1,117,549 42 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS TOTAL RETURN FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM U.S. GOVERNMENT AGENCY OBLIGATIONS--.5% $1,200M Fannie Mae, 1.72%, 10/1/04 (cost $1,200,000) $1,200,000 $45 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM CORPORATE NOTES--.4% 1,000M ChevronTexaco Corp., 1.73%, 10/8/04 (cost $999,664) 999,664 37 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $220,034,219) 93.4% 249,292,900 9,343 Other Assets, Less Liabilities 6.6 17,522,989 657 - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $266,815,889 $10,000 ====================================================================================================================== * Non-income producing + Security exempt from registration under Rule 144A of the Securities Act of 1933 (see Note 6). Summary of Abbreviations: ADR American Depositary Receipts REIT Real Estate Investment Trust See notes to financial statements
Portfolio Manager's Letter FIRST INVESTORS VALUE FUND Dear Investor: This is the annual report for the First Investors Value Fund for the fiscal year ended September 30, 2004. During the period, the Fund's return on a net asset value basis was 20.6% for Class A shares and 19.9% for Class B shares, including dividends of 6.5 cents per share on Class A shares and 2.9 cents per share on Class B shares. The Fund's performance was primarily driven by the improving economy, good performance in the equity markets, the general outperformance of value stocks and rising energy and commodity prices. The Fund generated strong returns across multiple sectors and market capitalization classes. A key reason for the Fund's outperformance compared with the Standard & Poor's 500 Index was its multi-cap approach. While the largest portion of the Fund is invested in large-cap stocks, the Fund's multi-cap strategy aided performance by providing the flexibility to seek compelling opportunities in the mid- and small-cap areas. In particular, the Fund's mid-cap allocation helped performance, as our holdings in the sector outperformed the other capitalization classes. Brascan, a Canadian asset management company with major investments in real estate and power generation, was one of our top performing mid-cap stocks. Diamond Offshore Drilling, an offshore driller of oil and gas wells, was also a significant contributor. Another factor in the Fund's outperformance was the strong performance of its holdings in the financial sector. FleetBoston Financial, a large regional bank that was acquired by Bank of America, and Allstate, a major insurance provider, generated exceptional returns. The Fund was slightly overweighted in the group as well. The Fund's holdings in the technology, consumer discretionary, energy and consumer staples sectors also aided performance. The energy sector's strong performance for the fiscal year was driven by a sharp increase in oil prices. ConocoPhillips was among the top-performing energy stocks for the Fund. Among the Fund's consumer discretionary holdings, J.C. Penney posted strong performance, in part due to the sale of its struggling Eckerd drugstore business. Thank you for placing your trust in First Investors. As always, we appreciate the opportunity to serve your investment needs. Sincerely, /s/ MATTHEW S. WRIGHT Matthew S. Wright Portfolio Manager October 29, 2004 Fund Expenses FIRST INVESTORS VALUE FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing those costs with those of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples.
- -------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - -------------------------------------------------------------------------------------------- Actual $1,000.00 $1,029.78 $7.31 Hypothetical (5% return before expenses) $1,000.00 $1,017.80 $7.26 - -------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - -------------------------------------------------------------------------------------------- Actual $1,000.00 $1,027.06 $10.84 Hypothetical (5% return before expenses) $1,000.00 $1,014.30 $10.78 - -------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.44% for Class A shares and 2.14% for Class B shares, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period).
Portfolio Composition TOP TEN SECTORS (BAR CHART: Top Ten Sectors) Financials 24.7% Consumer Discretionary 13.3% Energy 9.7% Industrials 9.1% Consumer Staples 8.6% Materials 7.5% Health Care 6.4% Utilities 6.2% Telecommunication Services 4.5% Information Technology 4.0% Portfolio's holdings and allocations are subject to change. Percentages are as of September 30, 2004, and are based on total market value of investments. Cumulative Performance Information FIRST INVESTORS VALUE FUND Comparison of change in value of $10,000 investment in the First Investors Value Fund (Class A shares) and the Standard & Poor's 500 Index. First Investors Value Fund Graph Plot Points for the periods Ended 9/30/04 Value S&P 500 Fund Index Oct-94 $ 9,425 $10,000 Oct-95 11,298 12,644 Oct-96 12,704 15,691 Oct-97 14,338 20,730 Sep-98 16,639 23,386 Sep-99 18,633 29,888 Sep-00 21,909 33,858 Sep-01 16,435 24,845 Sep-02 12,106 19,755 Sep-03 14,412 24,575 Sep-04 17,327 27,982 (INSET BOX IN CHART READS:) Average Annual Total Return* Class A Shares N.A.V. Only S.E.C. Standardized One Year 20.57% 13.74% Five Years (1.39%) (2.55%) Ten Years 6.58% 5.95% Class B Shares One Year 19.91% 15.91% Five Years (2.05%) (2.44%) Since Inception (1/12/95) 5.95% 5.95% The graph compares a $10,000 investment in the First Investors Value Fund (Class A shares) beginning 10/31/94 with a theoretical investment in the Standard & Poor's 500 Index (the "Index"). The Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure the performance of the broad domestic economy through changes in the aggregate market value of such stocks, which represent all major industries. It is not possible to invest directly in this Index. In addition, the Index does not take into account fees and expenses that an investor would incur in purchasing securities in this Index. For purposes of the graph and the accompanying table, unless otherwise indicated, it has been assumed that the maximum sales charge was deducted from the initial $10,000 investment in the Fund and all dividends and distributions were reinvested. Class B shares performance may be greater than or less than that shown in the line graph above for Class A shares based on differences in sales loads and fees paid by shareholders investing in the different classes. * Average Annual Total Return figures (for the periods ended 9/30/04) include the reinvestment of all dividends and distributions. "N.A.V. Only" returns are calculated without sales charges. The Class A "S.E.C. Standardized" returns shown are based on the maximum sales charge of 5.75% (prior to 6/17/02 the maximum sales charge was 6.25%). The Class B "S.E.C. Standardized" returns are adjusted for the applicable deferred sales charge (maximum of 4% in the first year). During certain of the periods shown, some of the expenses of the Fund were waived or assumed. If such expenses had been paid by the Fund, the Class A "S.E.C. Standardized" Average Annual Total Return for Ten Years would have been 5.86% and the Class B "S.E.C. Standardized" Average Annual Total Return Since Inception would have been 5.85%. Results represent past performance and do not indicate future results.The graph and the returns shown do not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. Standard & Poor's 500 Index figures are from Standard & Poor's and all other figures are from First Investors Management Company, Inc.
Portfolio of Investments FIRST INVESTORS VALUE FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--90.4% Consumer Discretionary--13.2% 46,100 Clear Channel Communications, Inc. $1,436,937 $69 47,300 Genuine Parts Company 1,815,374 87 45,100 Hancock Fabrics, Inc. 540,298 26 39,600 Home Depot, Inc. 1,552,320 75 59,300 J.C. Penney Company, Inc. (Holding Company) 2,092,104 100 12,500 Jones Apparel Group, Inc. 447,500 21 59,574 Kimball International, Inc. - Class "B" 826,887 40 36,100 Lee Enterprises, Inc. 1,672,874 80 63,700 Leggett & Platt, Inc. 1,789,970 86 16,100 Liberty Corporation 639,814 31 96,600 Limited Brands 2,153,214 103 14,200 Magna International, Inc. - Class "A" 1,051,936 50 55,700 May Department Stores Company 1,427,591 69 104,600 McDonald's Corporation 2,931,938 141 95,700 Natuzzi SpA (ADR) 1,033,560 50 32,300 Newell Rubbermaid, Inc. 647,292 31 33,300 OshKosh B'Gosh, Inc. - Class "A" 672,660 32 162,900 Pearson PLC (ADR) 1,764,207 85 29,900 Tupperware Corporation 507,702 24 110,800 Walt Disney Company 2,498,540 120 - ---------------------------------------------------------------------------------------------------------------------- 27,502,718 1,320 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--8.6% 39,400 American Italian Pasta Company - Class "A" 1,030,310 49 37,200 Brown-Forman Corporation - Class "B" 1,703,760 82 50,000 Coca-Cola Company 2,002,500 96 71,800 ConAgra Foods, Inc. 1,845,978 89 15,541 * Del Monte Foods Company 163,025 8 40,700 Diageo PLC (ADR) 2,052,501 99 22,900 Fomento Economico Mexicano, SA de CV (ADR) 1,011,722 49 44,200 H.J. Heinz Company 1,592,084 76 28,300 Kimberly-Clark Corporation 1,827,897 88 65,200 Ruddick Corporation 1,280,528 61 42,800 Sara Lee Corporation 978,408 47 58,200 Tasty Baking Company 465,600 22 46,600 UST, Inc. 1,876,116 90 - ---------------------------------------------------------------------------------------------------------------------- 17,830,429 856 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS VALUE FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Energy--9.6% 27,600 Anadarko Petroleum Corporation $1,831,536 $88 36,000 BP PLC (ADR) 2,071,080 99 36,400 ChevronTexaco Corporation 1,952,496 94 30,600 ConocoPhillips 2,535,210 122 47,900 Diamond Offshore Drilling, Inc. 1,580,221 76 38,200 Kerr-McGee Corporation 2,186,950 105 51,700 Marathon Oil Corporation 2,134,176 102 40,200 Royal Dutch Petroleum Company - NY Shares (ADR) 2,074,320 100 52,600 Tidewater, Inc. 1,712,130 82 46,900 Unocal Corporation 2,016,700 97 - ---------------------------------------------------------------------------------------------------------------------- 20,094,819 965 - ---------------------------------------------------------------------------------------------------------------------- Financials--23.1% 43,900 A.G. Edwards, Inc. 1,519,818 73 11,100 ACE, Ltd. 444,666 21 52,600 Allstate Corporation 2,524,274 121 62,400 AmSouth Bancorporation 1,522,560 73 74,500 Aon Corporation 2,141,130 103 50,864 Bank of America Corporation 2,203,937 106 70,200 Bank of New York Company, Inc. 2,047,734 98 47,100 Banknorth Group, Inc. 1,648,500 79 76,900 Brascan Corporation - Class "A" 2,322,380 111 43,855 Cincinnati Financial Corporation 1,807,703 87 25,200 Comerica, Inc. 1,495,620 72 38,500 CRT Properties, Inc. (REIT) 825,825 40 34,200 Erie Indemnity Company - Class "A" 1,744,884 84 30,300 FBL Financial Group, Inc. - Class "A" 793,557 38 30,600 Jefferson-Pilot Corporation 1,519,596 73 56,400 KeyCorp 1,782,240 85 30,700 Lincoln National Corporation 1,442,900 69 43,400 Merrill Lynch & Company, Inc. 2,157,848 104 37,700 Montpelier Re Holdings, Ltd. 1,382,836 66 40,300 Morgan Stanley 1,986,790 95 20,500 New York Community Bancorp, Inc. 421,070 20 73,500 NewAlliance Bancshares, Inc. 1,054,725 51 18,200 One Liberty Properties, Inc. (REIT) 328,510 16 50,900 Plum Creek Timber Company, Inc. (REIT) 1,783,027 86 29,200 PNC Financial Services Group 1,579,720 76 46,300 Protective Life Corporation 1,820,053 87 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Financials (continued) 72,300 Sky Financial Group, Inc. $1,807,500 $87 25,500 SunTrust Banks, Inc. 1,795,455 86 42,900 T. Rowe Price Group, Inc. 2,185,326 105 34,000 Wells Fargo & Company 2,027,420 97 - ---------------------------------------------------------------------------------------------------------------------- 48,117,604 2,309 - ---------------------------------------------------------------------------------------------------------------------- Health Care--5.9% 47,200 Abbott Laboratories 1,999,392 96 37,100 GlaxoSmithKline PLC (ADR) 1,622,383 78 4,520 * Hospira, Inc. 138,312 7 35,700 Johnson & Johnson 2,010,981 96 56,100 Merck & Company, Inc. 1,851,300 89 33,200 Novartis AG 1,549,444 74 56,500 Pfizer, Inc. 1,728,900 83 77,100 Schering-Plough Corporation 1,469,526 71 - ---------------------------------------------------------------------------------------------------------------------- 12,370,238 594 - ---------------------------------------------------------------------------------------------------------------------- Industrials--9.1% 23,000 A.O. Smith Corporation 560,050 27 29,800 * Adesa, Inc. 489,614 24 2,600 Alexander & Baldwin, Inc. 88,244 4 34,800 Baldor Electric Company 823,368 40 24,000 CNF, Inc. 983,760 47 33,500 Dover Corporation 1,302,145 63 43,600 Federal Signal Corporation 810,088 39 20,300 General Dynamics Corporation 2,072,630 99 58,400 Honeywell International, Inc. 2,094,224 101 63,200 Masco Corporation 2,182,296 105 63,300 Norfolk Southern Corporation 1,882,542 90 69,800 Pall Corporation 1,708,704 82 43,700 Pitney Bowes, Inc. 1,927,170 92 15,300 SPX Corporation 541,620 26 28,600 Stewart & Stevenson Services, Inc. 505,362 24 20,300 Teleflex, Inc. 862,750 41 - ---------------------------------------------------------------------------------------------------------------------- 18,834,567 904 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS VALUE FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Information Technology--4.0% 48,100 Automatic Data Processing, Inc. $1,987,492 $96 63,900 AVX Corporation 757,215 36 87,000 Hewlett-Packard Company 1,631,250 78 60,900 Methode Electronics, Inc. - Class "A" 778,911 37 64,700 Motorola, Inc. 1,167,188 56 84,000 Nokia Corporation - Class "A" (ADR) 1,152,480 55 26,700 Paychex, Inc. 805,005 39 - ---------------------------------------------------------------------------------------------------------------------- 8,279,541 397 - ---------------------------------------------------------------------------------------------------------------------- Materials--7.4% 31,500 Air Products & Chemicals, Inc. 1,712,970 82 58,800 Alcoa, Inc. 1,975,092 95 37,300 Compass Minerals International, Inc. 828,060 40 47,300 Du Pont (E.I.) de Nemours & Company 2,024,440 97 75,900 Glatfelter 940,401 45 39,700 Great Lakes Chemical Corporation 1,016,320 49 59,300 Lubrizol Corporation 2,051,780 98 42,130 Myers Industries, Inc. 461,324 22 75,900 Sonoco Products Company 2,006,796 96 18,200 Vulcan Materials Company 927,290 45 23,400 Weyerhaeuser Company 1,555,632 75 - ---------------------------------------------------------------------------------------------------------------------- 15,500,105 744 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--3.9% 57,500 BellSouth Corporation 1,559,400 75 31,500 CT Communications, Inc. 434,385 21 22,000 D&E Communications, Inc. 253,000 12 39,000 Nippon Telegraph and Telephone Corporation (ADR) 779,220 37 55,400 SBC Communications, Inc. 1,437,630 69 21,100 Telephone & Data Systems, Inc. 1,775,987 85 48,528 Verizon Communications, Inc. 1,911,033 92 - ---------------------------------------------------------------------------------------------------------------------- 8,150,655 391 - ---------------------------------------------------------------------------------------------------------------------- Utilities--5.6% 9,933 ALLETE, Inc. 322,833 15 34,550 American States Water Company 860,295 41 39,200 KeySpan Corporation 1,536,640 74 41,200 MDU Resources Group, Inc. 1,084,796 52 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Utilities (continued) 86,900 NiSource, Inc. $1,825,769 $88 37,700 Northwest Natural Gas Company 1,196,221 57 43,100 ONEOK, Inc. 1,121,462 54 12,100 South Jersey Industries, Inc. 577,775 28 51,200 Southwest Gas Corporation 1,226,240 59 48,700 United Utilities PLC (ADR) 991,532 48 39,700 Vectren Corporation 999,646 48 - ---------------------------------------------------------------------------------------------------------------------- 11,743,209 564 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $150,765,734) 188,423,885 9,044 - ---------------------------------------------------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCKS--2.1% Financials--1.4% 49,200 Chubb Corporation, 7%, 2005 - Series "A" 1,401,216 67 7,700 State Street Corporation, 6.75%, 2006 1,535,765 74 - ---------------------------------------------------------------------------------------------------------------------- 2,936,981 141 - ---------------------------------------------------------------------------------------------------------------------- Health Care--.4% 8,100 Anthem, Inc., 6%, 2004 813,038 39 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--.3% 12,400 ALLTEL Corporation, 7.75%, 2005 643,250 31 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Convertible Preferred Stocks (cost $2,413,193) 4,393,269 211 - ---------------------------------------------------------------------------------------------------------------------- PREFERRED STOCKS--.5% Telecommunication Services--.3% 20,300 Verizon South, Inc., 7%, 2041 - Series "F" 530,439 25 - ---------------------------------------------------------------------------------------------------------------------- Utilities--.2% 18,300 Entergy Louisiana, Inc., 7.6%, 2032 488,976 24 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Preferred Stocks (cost $2,507,862) 1,019,415 49 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS VALUE FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- CORPORATE BONDS--.3% Utilities $500M Union Electric Co., 6.75%, 2008 (cost $499,294) $551,806 $26 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM U.S. GOVERNMENT AGENCY OBLIGATIONS--5.3% 11,000M Fannie Mae, 1.72%, 10/1/04 (cost $11,000,000) 11,000,000 528 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM CORPORATE NOTES--.6% 1,300M Coca-Cola Co., 1.74%, 10/19/04 (cost $1,298,869) 1,298,869 62 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $168,484,952) 99.2% 206,687,244 9,920 Other Assets, Less Liabilities .8 1,665,496 80 - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $208,352,740 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations ADR American Depositary Reciepts REIT Real Estate Investment Trust See notes to financial statements
Portfolio Manager's Letter FIRST INVESTORS BLUE CHIP FUND Dear Investor: This is the annual report for the First Investors Blue Chip Fund for the fiscal year ended September 30, 2004. During the period, the Fund's return on a net asset value basis was 9.0% for Class A shares and 8.3% for Class B shares. An improved economic environment and a better outlook for corporate earnings drove the Fund's positive absolute return for the year. However, the Fund underperformed the Standard & Poor's 500 Index. This relative underperformance was mostly due to the Fund's focus on the "mega cap" sector (those companies with market capitalizations in excess of $25 billion) and an overweight position in the large-cap technology sector, both of which proved to be poor relative performers during the period. The Fund held large positions in a number of companies whose stocks turned in disappointing performances during the reporting period. Among our consumer discretionary holdings, International Gaming Technology, a large gaming company, posted poor results. In the health care area, Fund performance was hurt by our position in Cardinal Health, which was plagued by allegations of improper accounting practices. In addition, the Fund's overweight position in the semiconductor sector hurt performance, as manufacturers posted disappointing results. Many of the Fund's holdings in the energy sector aided performance, as the sector was boosted by higher oil and natural gas prices. In addition, many of the Fund's holdings in the basic materials sector did well, thanks to high overseas demand, particularly from China. Thank you for placing your trust in First Investors. As always, we appreciate the opportunity to serve your investment needs. Sincerely, /s/ DENNIS T. FITZPATRICK Dennis T. Fitzpatrick Vice President and Portfolio Manager October 29, 2004 Fund Expenses FIRST INVESTORS BLUE CHIP FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing those costs with those of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples.
- -------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - -------------------------------------------------------------------------------------------- Actual $1,000.00 $967.90 $7.18 Hypothetical (5% return before expenses) $1,000.00 $1,017.70 $7.36 - -------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - -------------------------------------------------------------------------------------------- Actual $1,000.00 $964.41 $10.61 Hypothetical (5% return before expenses) $1,000.00 $1,014.20 $10.88 - -------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.46% for Class A shares and 2.16% for Class B shares, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period). Expenses paid during the period are net of expenses waived.
Portfolio Composition TOP TEN SECTORS (BAR CHART: Top Ten Sectors) Financials 19.1% Information Technology 17.7% Health Care 12.6% Consumer Discretionary 11.8% Industrials 11.2% Consumer Staples 9.0% Energy 8.4% Materials 4.8% Telecommunication Services 2.6% Utilities 1.9% Portfolio's holdings and allocations are subject to change. Percentages are as of September 30, 2004, and are based on total market value of investments. Cumulative Performance Information FIRST INVESTORS BLUE CHIP FUND Comparison of change in value of $10,000 investment in the First Investors Blue Chip Fund (Class A shares) and the Standard & Poor's 500 Index. First Investors Blue Chip Fund Graph Plot Points for the periods Ended 9/30/04 Blue Chip S&P 500 Fund Index Dec-94 $ 9,425 $10,000 Dec-95 12,632 13,758 Dec-96 15,228 16,917 Dec-97 19,195 22,561 Sep-98 18,284 23,915 Sep-99 23,600 30,565 Sep-00 28,672 34,625 Sep-01 19,817 25,408 Sep-02 15,075 20,203 Sep-03 17,747 25,132 Sep-04 19,352 28,617 (INSET BOX IN CHART READS:) Average Annual Total Return* Class A Shares N.A.V. Only S.E.C. Standardized One Year 9.04% 2.75% Five Years (3.89%) (5.03%) Ten Years 7.30% 6.67% Class B Shares One Year 8.30% 4.30% Five Years (4.56%) (4.95%) Since Inception (1/12/95) 6.69% 6.69% The graph compares a $10,000 investment in the First Investors Blue Chip Fund (Class A shares) beginning 12/31/94 with a theoretical investment in the Standard & Poor's 500 Index (the "Index"). The Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure the performance of the broad domestic economy through changes in the aggregate market value of such stocks, which represent all major industries. It is not possible to invest directly in this Index. In addition, the Index does not take into account fees and expenses that an investor would incur in purchasing securities in the Index. For purposes of the graph and the accompanying table, unless otherwise indicated, it has been assumed that the maximum sales charge was deducted from the initial $10,000 investment in the Fund and all dividends and distributions were reinvested. Class B shares performance may be greater than or less than that shown in the line graph above for Class A shares based on differences in sales loads and fees paid by shareholders investing in the different classes. * Average Annual Total Return figures (for the periods ended 9/30/04) include the reinvestment of all dividends and distributions. "N.A.V. Only" returns are calculated without sales charges. The Class A "S.E.C. Standardized" returns shown are based on the maximum sales charge of 5.75% (prior to 6/17/02, the maximum sales charge was 6.25%). The Class B "S.E.C. Standardized" returns are adjusted for the applicable deferred sales charge (maximum of 4% in the first year). During the periods shown, some of the expenses of the Fund were waived or assumed. If such expenses had been paid by the Fund, the Class A "S.E.C. Standardized" Average Annual Total Returns for One Year, Five Years and Ten Years would have been 2.65%, (5.13%) and 6.52%, respectively. The Class B "S.E.C. Standardized" Average Annual Total Returns for One Year, Five Years and Since Inception would have been 4.20%, (5.04%) and 6.54%, respectively. Results represent past performance and do not indicate future results.The graph and the returns shown do not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. Standard & Poor's 500 Index figures are from Standard & Poor's and all other figures are from First Investors Management Company, Inc.
Portfolio of Investments FIRST INVESTORS BLUE CHIP FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--98.4% Consumer Discretionary--11.7% 14,800 Brunswick Corporation $677,248 $14 40,600 Carnival Corporation 1,919,974 40 71,996 * Comcast Corporation - Class "A" 2,033,167 43 48,900 * Comcast Corporation - Special Class "A" 1,365,288 29 14,700 Eastman Kodak Company 473,634 10 18,500 * eBay, Inc. 1,700,890 36 19,900 Gannett Company, Inc. 1,666,824 35 66,300 Gap, Inc. 1,239,810 26 92,400 Hilton Hotels Corporation 1,740,816 37 160,500 Home Depot, Inc. 6,291,600 132 129,000 International Game Technology 4,637,550 97 92,200 * Kohl's Corporation 4,443,118 93 48,700 Lowe's Companies, Inc. 2,646,845 56 131,700 McDonald's Corporation 3,691,551 78 58,900 NIKE, Inc. 4,641,320 98 147,000 * Office Depot, Inc. 2,209,410 46 86,400 Target Corporation 3,909,600 82 228,700 * Time Warner, Inc. 3,691,218 78 110,700 Viacom, Inc. - Class "B" 3,715,092 78 125,900 Walt Disney Company 2,839,045 60 - ---------------------------------------------------------------------------------------------------------------------- 55,534,000 1,168 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--8.9% 69,800 Altria Group, Inc. 3,283,392 69 36,100 Anheuser-Busch Companies, Inc. 1,803,195 38 91,200 Coca-Cola Company 3,652,560 77 47,900 Costco Wholesale Corporation 1,990,724 42 66,300 CVS Corporation 2,793,219 59 81,200 General Mills, Inc. 3,645,880 77 53,700 Kimberly-Clark Corporation 3,468,483 73 104,100 PepsiCo, Inc. 5,064,465 106 129,000 Procter & Gamble Company 6,981,480 147 62,800 Walgreen Company 2,250,124 47 139,400 Wal-Mart Stores, Inc. 7,416,080 156 - ---------------------------------------------------------------------------------------------------------------------- 42,349,602 891 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Energy--8.4% 184,200 Chesapeake Energy Corporation $2,915,886 $61 183,600 ChevronTexaco Corporation 9,848,304 207 106,900 EnCana Corporation 4,949,470 104 189,500 ExxonMobil Corporation 9,158,535 193 217,700 * Grant Prideco, Inc. 4,460,673 94 49,300 Schlumberger, Ltd. 3,318,383 70 11,100 Sunoco, Inc. 821,178 17 92,300 * Transocean, Inc. 3,302,494 70 11,100 Valero Energy Corporation 890,331 19 - ---------------------------------------------------------------------------------------------------------------------- 39,665,254 835 - ---------------------------------------------------------------------------------------------------------------------- Financials--18.9% 36,800 Allstate Corporation 1,766,032 37 118,100 American Express Company 6,077,426 128 121,900 American International Group, Inc. 8,287,981 174 215,766 Bank of America Corporation 9,349,141 197 145,400 Bank of New York Company, Inc. 4,241,318 89 750 * Berkshire Hathaway, Inc. - Class "B" 2,153,250 45 114,300 Chubb Corporation 8,033,004 169 217,400 Citigroup, Inc. 9,591,688 202 33,000 Compass Bancshares, Inc. 1,446,060 30 26,500 Fannie Mae 1,680,100 35 41,800 Freddie Mac 2,727,032 57 167,268 JPMorgan Chase & Company 6,645,558 140 34,900 Marsh & McLennan Companies, Inc. 1,597,024 34 155,100 Merrill Lynch & Company, Inc. 7,711,572 162 48,900 Morgan Stanley 2,410,770 51 158,600 New York Community Bancorp, Inc. 3,257,644 69 37,000 * Primus Guaranty, Ltd. 499,500 11 180,800 UnumProvident Corporation 2,836,752 60 63,400 Washington Mutual, Inc. 2,477,672 52 121,100 Wells Fargo & Company 7,221,193 152 - ---------------------------------------------------------------------------------------------------------------------- 90,010,717 1,894 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS BLUE CHIP FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Health Care--12.5% 64,200 Abbott Laboratories $2,719,512 $57 57,500 * Amgen, Inc. 3,259,100 69 29,500 * Boston Scientific Corporation 1,172,035 25 124,300 Bristol-Myers Squibb Company 2,942,181 62 37,000 Cooper Companies, Inc. 2,536,350 53 44,200 Eli Lilly & Company 2,654,210 56 156,300 Johnson & Johnson 8,804,379 185 116,200 Medtronic, Inc. 6,030,780 127 228,000 Novartis AG 10,640,760 224 305,160 Pfizer, Inc. 9,337,896 196 129,200 UnitedHealth Group, Inc. 9,527,208 200 - ---------------------------------------------------------------------------------------------------------------------- 59,624,411 1,254 - ---------------------------------------------------------------------------------------------------------------------- Industrials--11.1% 35,000 3M Company 2,798,950 59 22,100 Boeing Company 1,140,802 24 74,100 Cendant Corporation 1,600,560 34 22,100 Cummins, Inc. 1,632,969 34 95,800 Deere & Company 6,183,890 130 30,400 Emerson Electric Company 1,881,456 40 423,700 General Electric Company 14,227,846 299 55,100 Honeywell International, Inc. 1,975,886 42 66,900 Lockheed Martin Corporation 3,731,682 78 153,200 Masco Corporation 5,289,996 111 35,400 Northrop Grumman Corporation 1,887,882 40 125,500 Tyco International, Ltd. 3,847,830 81 30,000 United Parcel Service, Inc. - Class "B" 2,277,600 48 47,400 United Technologies Corporation 4,426,212 93 - ---------------------------------------------------------------------------------------------------------------------- 52,903,561 1,113 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--17.6% 313,600 * Alvarion, Ltd. 4,057,984 85 235,100 * Amdocs, Ltd. 5,132,233 108 44,200 * ASML Holding NV - NY Shares 568,854 12 364,100 * Cisco Systems, Inc. 6,590,210 139 295,000 * Corning, Inc. 3,268,600 69 133,700 * Dell, Inc. 4,759,720 100 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Information Technology (continued) 544,600 * EMC Corporation $6,284,684 $132 99,600 First Data Corporation 4,332,600 91 312,600 Intel Corporation 6,270,756 132 62,800 International Business Machines Corporation 5,384,472 113 700 * JAMDAT Mobile, Inc. 16,149 1 18,400 * Marvell Technology Group, Ltd. 480,792 10 514,400 Microsoft Corporation 14,223,160 299 258,200 Motorola, Inc. 4,657,928 98 47,900 * National Semiconductor Corporation 741,971 16 368,700 Nokia Corporation - Class "A" (ADR) 5,058,564 106 99,800 * SanDisk Corporation 2,906,176 61 516,300 * Sonus Networks, Inc. 2,906,769 61 104,400 Texas Instruments, Inc. 2,221,632 47 201,100 * Veritas Software Corporation 3,579,580 75 - ---------------------------------------------------------------------------------------------------------------------- 83,442,834 1,755 - ---------------------------------------------------------------------------------------------------------------------- Materials--4.8% 276,800 * AK Steel Holding Corporation 2,258,688 48 51,600 Alcoa, Inc. 1,733,244 36 25,800 Cameco Corporation 2,044,392 43 92,800 Dow Chemical Company 4,192,704 88 59,000 Georgia-Pacific Corporation 2,121,050 45 228,700 Newmont Mining Corporation 10,412,711 219 - ---------------------------------------------------------------------------------------------------------------------- 22,762,789 479 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--2.6% 202,200 * Nextel Communications, Inc. - Class "A" 4,820,448 102 124,800 SBC Communications, Inc. 3,238,560 68 104,000 Verizon Communications, Inc. 4,095,520 86 - ---------------------------------------------------------------------------------------------------------------------- 12,154,528 256 - ---------------------------------------------------------------------------------------------------------------------- Utilities--1.9% 172,700 Duke Energy Corporation 3,953,103 83 202,000 ONEOK, Inc. 5,256,040 111 - ---------------------------------------------------------------------------------------------------------------------- 9,209,143 194 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $379,481,826) 467,656,839 9,839 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS BLUE CHIP FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM U.S. GOVERNMENT AGENCY OBLIGATIONS--.5% $2,300M Fannie Mae, 1.72%, 10/8/04 (cost $2,299,230) $2,299,230 $48 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM CORPORATE NOTES--.4% 2,100M General Electric Co., 1.75%, 10/6/04 (cost $2,099,490) 2,099,490 44 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $383,880,546) 99.3% 472,055,559 9,931 Other Assets, Less Liabilities .7 3,270,959 69 - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $475,326,518 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts See notes to financial statements
Portfolio Manager's Letter FIRST INVESTORS GROWTH & INCOME FUND Dear Investor: This is the annual report for the First Investors Growth & Income Fund for the fiscal year ended September 30, 2004. During the period, the Fund's return on a net asset value basis was 14.0% for Class A shares and 13.3% for Class B shares, including dividends of 3.0 cents per share on Class A shares. The Fund's positive performance was driven largely by the improving economy, the rise in energy prices and the solid performance of the equity markets. Fund performance was largely the result of investments in the energy, financials, consumer discretionary and industrials sectors. More than three-quarters of the Fund's performance came from these groups. In addition, the Fund's multi-cap strategy aided performance, as it enabled the Fund to invest in mid- and small-cap equities, which outperformed their larger-capitalization counterparts. The Fund's focus on firms with dividends also helped performance during the period, as dividend-paying companies outperformed non-paying ones. An underweight allocation in the consumer staples sector also aided returns. The Fund's best overall contributing sector was energy, which benefited from strong commodity pricing and increased demand from the world's economies. Both oil and gas companies, as well as equipment and services firms, did well. Holdings in the financials sector also performed well, driven by merger and acquisition activity and favorable economic factors. Commercial banks were the best performing group. Within the consumer discretionary sector, shares of retailers, restaurants and household durables performed best. Industrial company holdings benefited from increased revenues and aggressive cost cutting programs. Shares of defense firms, machinery and building products also posted strong results. Thank you for placing your trust in First Investors. As always, we appreciate the opportunity to serve your investment needs. Sincerely, /s/ EDWIN D. MISKA Edwin D. Miska Director of Equities and Portfolio Manager October 29, 2004 Fund Expenses FIRST INVESTORS GROWTH & INCOME FUND. The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing those costs with those of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples.
- -------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - -------------------------------------------------------------------------------------------- Actual $1,000.00 $985.00 $6.95 Hypothetical (5% return before expenses) $1,000.00 $1,018.00 $7.06 - -------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - -------------------------------------------------------------------------------------------- Actual $1,000.00 $982.25 $10.41 Hypothetical (5% return before expenses) $1,000.00 $1,014.50 $10.58 - -------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.40% for Class A shares and 2.10% for Class B shares, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period).
Portfolio Composition TOP TEN SECTORS (BAR CHART: Top Ten Sectors) Financials 21.5% Information Technology 15.1% Health Care 13.3% Consumer Discretionary 13.2% Industrials 11.2% Energy 7.8% Consumer Staples 6.7% Materials 6.3% Utilities 1.9% Telecommunication Services 1.8% Portfolio's holdings and allocations are subject to change. Percentages are as of September 30, 2004, and are based on total market value of investments. Cumulative Performance Information FIRST INVESTORS GROWTH & INCOME FUND Comparison of change in value of $10,000 investment in the First Investors Growth & Income Fund (Class A shares) and the Standard & Poor's 500 Index. First Investors Growth & Income Fund Graph Plot Points for the periods Ended 9/30/04 Growth & Income S&P 500 Fund Index Oct-94 $ 9,425 $10,000 Oct-95 11,192 12,644 Oct-96 13,617 15,691 Oct-97 17,185 20,730 Sep-98 18,704 23,386 Sep-99 23,145 29,888 Sep-00 28,078 33,858 Sep-01 20,804 24,845 Sep-02 16,532 19,755 Sep-03 20,086 24,575 Sep-04 22,869 27,982 (INSET BOX IN CHART READS:) Average Annual Total Return* Class A Shares N.A.V. Only S.E.C. Standardized One Year 13.95% 7.41% Five Years (0.22%) (1.40%) Ten Years 9.47% 8.81% Class B Shares One Year 13.26% 9.26% Five Years (0.91%) (1.31%) Since Inception (1/12/95) 9.04% 9.04% The graph compares a $10,000 investment in the First Investors Growth & Income Fund (Class A shares) beginning 10/31/94 with a theoretical investment in the Standard & Poor's 500 Index (the "Index"). The Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure the performance of the broad domestic economy through changes in the aggregate market value of such stocks, which represent all major industries. It is not possible to invest directly in this Index. In addition, the Index does not take into account fees and expenses that an investor would incur in purchasing securities in the Index. For purposes of the graph and the accompanying table, unless otherwise indicated, it has been assumed that the maximum sales charge was deducted from the initial $10,000 investment in the Fund and all dividends and distributions were reinvested. Class B shares performance may be greater than or less than that shown in the line graph above for Class A shares based on differences in sales loads and fees paid by shareholders investing in the different classes. * Average Annual Total Return figures (for the periods ended 9/30/04) include the reinvestment of all dividends and distributions. "N.A.V. Only" returns are calculated without sales charges. The Class A "S.E.C. Standardized" returns shown are based on the maximum sales charge of 5.75% (prior to 6/17/02 the maximum sales charge was 6.25%). The Class B "S.E.C. Standardized" returns are adjusted for the applicable deferred sales charge (maximum of 4% in the first year). During certain of the periods shown, some of the expenses of the Fund were waived or assumed. If such expenses had been paid by the Fund, the Class A "S.E.C. Standardized" Average Annual Total Return for ten years would have been 8.72% and the Class B "S.E.C. Standardized" Average Annual Total Return Since Inception would have been 8.94%. Results represent past performance and do not indicate future results.The graph and the returns shown do not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. Standard & Poor's 500 Index figures are from Standard & Poor's and all other figures are from First Investors Management Company, Inc.
Portfolio of Investments FIRST INVESTORS GROWTH & INCOME FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--97.2% Consumer Discretionary--13.2% 190,000 * AnnTaylor Stores Corporation $4,446,000 $76 212,500 Blockbuster, Inc. - Class "A" 1,612,875 28 50,000 Clear Channel Communications, Inc. 1,558,500 27 135,000 * Cost Plus, Inc. 4,776,300 82 13,300 * Domino's Pizza, Inc. 195,510 3 130,000 * Fox Entertainment Group, Inc. - Class "A" 3,606,200 62 174,600 * GameStop Corporation - Class "A" 3,231,846 56 77,500 Gap, Inc. 1,449,250 25 50,000 Genuine Parts Company 1,919,000 33 70,000 Harley-Davidson, Inc. 4,160,800 72 109,400 Hasbro, Inc. 2,056,720 35 230,100 * Hollywood Entertainment Corporation 2,271,087 39 100,000 Home Depot, Inc. 3,920,000 67 150,000 J.C. Penney Company, Inc. (Holding Company) 5,292,000 91 60,000 Lear Corporation 3,267,000 56 150,000 Leggett & Platt, Inc. 4,215,000 73 165,000 Mattel, Inc. 2,991,450 51 250,000 McDonald's Corporation 7,007,500 121 305,300 * Office Depot, Inc. 4,588,659 79 100,000 Pier 1 Imports, Inc. 1,808,000 31 120,000 Polo Ralph Lauren Corporation - Class "A" 4,364,400 75 80,000 Ross Stores, Inc. 1,875,200 32 65,000 Sherwin-Williams Company 2,857,400 49 90,000 Viacom, Inc. - Class "B" 3,020,400 52 - ---------------------------------------------------------------------------------------------------------------------- 76,491,097 1,315 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--6.7% 100,000 Altria Group, Inc. 4,704,000 81 100,000 American Italian Pasta Company - Class "A" 2,615,000 45 60,000 Anheuser-Busch Companies, Inc. 2,997,000 50 57,900 Bunge, Ltd. 2,314,842 40 50,000 Coca-Cola Company 2,002,500 34 113,300 Hormel Foods Corporation 3,034,174 52 62,500 Kimberly-Clark Corporation 4,036,875 69 50,000 PepsiCo, Inc. 2,432,500 42 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples (continued) 75,000 Procter & Gamble Company $4,059,000 $70 120,000 * Smithfield Foods, Inc. 3,000,000 52 57,300 Tootsie Roll Industries, Inc. 1,674,306 29 75,000 Wal-Mart Stores, Inc. 3,990,000 69 75,700 WD-40 Company 2,165,020 37 - ---------------------------------------------------------------------------------------------------------------------- 39,025,217 670 - ---------------------------------------------------------------------------------------------------------------------- Energy--7.8% 75,000 Anadarko Petroleum Corporation 4,977,000 86 255,000 Chesapeake Energy Corporation 4,036,650 69 50,000 ConocoPhillips 4,142,500 71 49,300 EOG Resources, Inc. 3,246,405 56 130,000 ExxonMobil Corporation 6,282,900 108 80,000 * Noble Corporation 3,596,000 62 150,000 Suncor Energy, Inc. 4,801,500 82 125,000 * Swift Energy Company 2,995,000 51 155,000 * Transocean, Inc. 5,545,900 95 180,175 XTO Energy, Inc. 5,852,084 101 - ---------------------------------------------------------------------------------------------------------------------- 45,475,939 781 - ---------------------------------------------------------------------------------------------------------------------- Financials--19.8% 70,000 American Express Company 3,602,200 62 70,000 American International Group, Inc. 4,759,300 82 110,000 AmSouth Bancorporation 2,684,000 46 197,718 Bank of America Corporation 8,567,121 147 45,000 Bear Stearns Companies, Inc. 4,327,650 74 150,000 Citigroup, Inc. 6,618,000 114 125,000 Colonial BancGroup, Inc. 2,556,250 44 120,000 Endurance Specialty Holdings, Ltd. 3,858,000 66 50,000 Fannie Mae 3,170,000 54 50,000 GreenPoint Financial Corporation 2,320,500 40 155,000 JPMorgan Chase & Company 6,158,150 106 47,500 Lehman Brothers Holdings, Inc. 3,786,700 65 100,000 Marsh & McLennan Companies, Inc. 4,576,000 79 170,000 MBNA Corporation 4,284,000 74 35,000 Merrill Lynch & Company, Inc. 1,740,200 30 130,000 Montpelier Re Holdings, Ltd. 4,768,400 82 55,000 Morgan Stanley 2,711,500 46 65,000 National City Corporation 2,510,300 43 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS GROWTH & INCOME FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Financials (continued) 208,333 New York Community Bancorp, Inc. $4,279,160 $73 225,000 NewAlliance Bancshares, Inc. 3,228,750 55 100,000 Old Republic International Corporation 2,503,000 43 75,000 Plum Creek Timber Company, Inc. (REIT) 2,627,250 45 96,105 Safeco Corporation 4,387,193 75 50,000 South Financial Group, Inc. 1,410,000 24 200,000 Sovereign Bancorp, Inc. 4,364,000 75 170,000 U.S. Bancorp 4,913,000 84 100,000 Wachovia Corporation 4,695,000 81 125,000 Washington Mutual, Inc. 4,885,000 84 70,000 Wells Fargo & Company 4,174,100 72 18,300 Willis Group Holdings, Ltd. 684,420 12 - ---------------------------------------------------------------------------------------------------------------------- 115,149,144 1,977 - ---------------------------------------------------------------------------------------------------------------------- Health Care--13.1% 160,000 Abbott Laboratories 6,777,600 116 100,000 * Accredo Health, Inc. 2,357,000 41 40,000 Aetna, Inc. 3,997,200 69 46,700 * Amgen, Inc. 2,646,956 45 95,000 * Anthem, Inc. 8,288,750 142 260,000 * Boston Scientific Corporation 10,329,800 177 30,000 Eli Lilly & Company 1,801,500 31 65,000 * Forest Laboratories, Inc. 2,923,700 50 20,000 * Genentech, Inc. 1,048,400 18 87,500 Guidant Corporation 5,778,500 99 16,000 * Hospira, Inc. 489,600 8 100,000 Johnson & Johnson 5,633,000 97 52,800 * Laboratory Corporation of America Holdings 2,308,416 40 50,000 Medtronic, Inc. 2,595,000 45 80,000 Merck & Company, Inc. 2,640,000 45 300,000 Pfizer, Inc. 9,180,000 158 145,000 * Priority Healthcare Corporation 2,921,750 50 120,000 Wyeth 4,488,000 77 - ---------------------------------------------------------------------------------------------------------------------- 76,205,172 1,308 - ---------------------------------------------------------------------------------------------------------------------- Industrials--11.1% 52,000 3M Company 4,158,440 71 205,000 * AGCO Corporation 4,637,100 80 50,400 Alexander & Baldwin, Inc. 1,710,576 29 250,000 American Power Conversion Corporation 4,347,500 75 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Industrials (continued) 30,000 Caterpillar, Inc. $2,413,500 $41 100,000 Cendant Corporation 2,160,000 37 100,200 Chicago Bridge & Iron Company NV - NY Shares 3,004,998 52 36,000 Eaton Corporation 2,282,760 39 50,000 Engineered Support Systems, Inc. 2,282,000 39 50,000 Harsco Corporation 2,245,000 39 90,000 Honeywell International, Inc. 3,227,400 55 60,000 Lockheed Martin Corporation 3,346,800 57 200,000 Masco Corporation 6,906,000 119 110,000 Northrop Grumman Corporation 5,866,300 101 200,000 * Pinnacle Airlines Corporation 2,020,000 35 60,000 Pitney Bowes, Inc. 2,646,000 45 70,000 Rockwell Automation, Inc. 2,709,000 47 115,800 SPX Corporation 4,099,320 70 50,000 United Technologies Corporation 4,669,000 80 - ---------------------------------------------------------------------------------------------------------------------- 64,731,694 1,111 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--15.0% 15,000 Analog Devices, Inc. 581,700 10 200,000 * Cisco Systems, Inc. 3,620,000 62 100,000 Diebold, Inc. 4,670,000 80 135,000 * Electronics for Imaging, Inc. 2,192,400 38 350,000 * EMC Corporation 4,039,000 70 665,000 * Entrust, Inc. 1,682,450 29 140,000 First Data Corporation 6,090,000 105 200,000 Hewlett-Packard Company 3,750,000 64 175,000 Intel Corporation 3,510,500 60 80,000 Intersil Corporation - Class "A" 1,274,400 22 50,000 * Intuit, Inc. 2,270,000 39 252,100 * Lexar Media, Inc. 2,115,119 36 245,000 * McAfee, Inc. 4,924,500 85 350,000 Microsoft Corporation 9,677,500 166 31,000 NAVTEQ 1,104,840 19 300,000 Nokia Corporation - Class "A" (ADR) 4,116,000 71 195,000 * Paxar Corporation 4,422,600 76 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS GROWTH & INCOME FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Information Technology (continued) 160,000 QUALCOMM, Inc. $6,246,400 $107 140,000 * SanDisk Corporation 4,076,800 70 65,000 StarTek, Inc. 2,038,400 35 125,000 * Storage Technology Corporation 3,157,500 54 184,820 * Taiwan Semiconductor Manufacturing Co., Ltd. (ADR) 1,319,615 23 80,000 * Tech Data Corporation 3,084,000 53 96,900 * Thermo Electron Corporation 2,618,238 45 220,000 * VERITAS Software Corporation 3,916,000 67 35,000 * Xilinx, Inc. 945,000 16 - ---------------------------------------------------------------------------------------------------------------------- 87,442,962 1,502 - ---------------------------------------------------------------------------------------------------------------------- Materials--6.3% 65,000 Dow Chemical Company 2,936,700 50 80,000 Freeport-McMoRan Copper & Gold, Inc. - Class "B" 3,240,000 56 145,000 Georgia-Pacific Corporation 5,212,750 89 121,500 Lubrizol Corporation 4,203,900 72 140,000 MeadWestvaco Corporation 4,466,000 77 45,000 PPG Industries, Inc. 2,757,600 47 60,000 Praxair, Inc. 2,564,400 44 207,000 RPM International, Inc. 3,653,550 63 55,300 United States Steel Corporation 2,080,386 36 80,400 Weyerhaeuser Company 5,344,992 92 - ---------------------------------------------------------------------------------------------------------------------- 36,460,278 626 - ---------------------------------------------------------------------------------------------------------------------- Other--1.2% 90,000 Nasdaq - 100 Index Tracking Stock 3,160,800 54 35,000 SPDR Trust - Series "1" 3,912,300 67 - ---------------------------------------------------------------------------------------------------------------------- 7,073,100 121 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--1.1% 140,000 SBC Communications, Inc. 3,633,000 62 75,000 Verizon Communications, Inc. 2,953,500 51 - ---------------------------------------------------------------------------------------------------------------------- 6,586,500 113 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Utilities--1.9% 115,400 Atmos Energy Corporation $2,906,926 $50 75,000 Consolidated Edison, Inc. 3,153,000 54 42,000 Dominion Resources, Inc. 2,740,500 47 90,000 ONEOK, Inc. 2,341,800 40 - ---------------------------------------------------------------------------------------------------------------------- 11,142,226 191 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $469,679,356) 565,783,329 9,715 - ---------------------------------------------------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCKS--2.5% Financials--1.7% Chubb Corporation: 90,800 7%, 2005 - Series "A" 2,585,984 45 50,000 7%, 2006 - Series "B" 1,406,250 24 97,000 Hartford Financial Services Group, Inc., 6%, 2006 - Class "A" 5,795,750 100 - ---------------------------------------------------------------------------------------------------------------------- 9,787,984 169 - ---------------------------------------------------------------------------------------------------------------------- Health Care--.1% 16,000 Baxter International, Inc., 7%, 2006 860,000 14 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--.7% 80,000 ALLTEL Corporation, 7.75%, 2005 4,150,000 71 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Convertible Preferred Stocks (cost $12,653,193) 14,797,984 254 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $482,332,549) 99.7% 580,581,313 9,969 Other Assets, Less Liabilities .3 1,778,361 31 - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $582,359,674 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts REIT Real Estate Investment Trust See notes to financial statements
Portfolio Manager's Letter FIRST INVESTORS ALL-CAP GROWTH FUND Dear Investor: This is the annual report for the First Investors All-Cap Growth Fund for the fiscal year ended September 30, 2004. During the period, the Fund's return on a net asset value basis was 15.6% for Class A shares and 14.8% for Class B shares. The Fund's positive overall performance during the reporting period was driven by the improving economy and solid performance of the equity markets. In addition, the Fund's multi-cap strategy aided performance, as it enabled the Fund to invest in mid- and small-cap equities, which outperformed their larger-capitalization counterparts. The Fund's relative outperformance of the Russell 3000 Growth Index was largely due to strong security selection, primarily within the information technology and financials sectors. Top contributors included Yahoo!, which benefited from double-digit growth in the online advertising business, and Countrywide Financial, a diversified financial firm that experienced growth in banking and mortgage origination. During the reporting period, sector allocation overall detracted from performance. Although individual holdings in information technology were strong, our overweight in the sector detracted from performance as this sector underperformed the Index. Thank you for placing your trust in First Investors. As always, we appreciate the opportunity to serve your investment needs. Sincerely, /s/ ANDREW J. SHILLING Andrew J. Shilling Portfolio Manager October 29, 2004 Fund Expenses FIRST INVESTORS ALL-CAP GROWTH FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing those costs with those of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples.
- ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - ---------------------------------------------------------------------------------------------- Actual $1,000.00 $986.09 $7.89 Hypothetical (5% return before expenses) $1,000.00 $1,017.05 $8.02 - ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - ---------------------------------------------------------------------------------------------- Actual $1,000.00 $983.16 $11.35 Hypothetical (5% return before expenses) $1,000.00 $1,013.55 $11.53 - ---------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.59% for Class A shares and 2.29% for Class B shares, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period).
Portfolio Composition BY SECTOR (BAR CHART DATA:) Information Technology 39.0% Health Care 17.7% Industrials 10.7% Financials 10.5% Consumer Discretionary 10.0% Energy 2.6% Telecommunication Services 2.4% Consumer Staples 0.9% Materials 0.8% Portfolio's holdings and allocations are subject to change. Percentages are as of September 30, 2004, and are based on total market value of investments. FIRST INVESTORS ALL-CAP GROWTH FUND Cumulative Performance Information Comparison of change in value of $10,000 investment in the First Investors All-Cap Growth Fund (Class A shares) and the Russell 3000 Growth Index. First Investors All-Cap Growth Fund Graph Plot Points for the periods Ended 9/30/04 All-Cap Russell Growth 3000 Growth Fund Index Oct-00 $ 9,425 $10,000 Sep-01 6,155 6,001 Sep-02 5,024 4,667 Sep-03 6,362 5,925 Sep-04 7,352 6,388 Average Annual Total Return* Class A Shares N.A.V. Only S.E.C. Standardized One Year 15.56% 8.94% Since Inception (10/25/00) (6.12%) (7.52%) Class B Shares One Year 14.83% 10.83% Since Inception (10/25/00) (6.77%) (7.49%) The graph compares a $10,000 investment in the First Investors All-Cap Growth Fund (Class A shares) beginning 10/25/00 (inception date) with a theoretical investment in the Russell 3000 Growth Index (the "Index"). The Index is an unmanaged index composed of the 3000 largest U.S. companies, as determined by market capitalization, and represents approximately 98% of the investable U.S. equity market. It is not possible to invest directly in this Index. In addition, the Index does not take into account fees and expenses that an investor would incur in purchasing securities in the Index. For purposes of the graph and the accompanying table, unless otherwise indicated, it has been assumed that the maximum sales charge was deducted from the initial $10,000 investment in the Fund. Class B shares performance may be greater than or less than that shown in the line graph above for Class A shares based on differences in the sales loads and fees paid by shareholders investing in the different classes. * Average Annual Total Return figures are for the periods ended 9/30/04. "N.A.V. Only" returns are calculated without sales charges. The Class A "S.E.C. Standardized" returns shown are based on the maximum sales charge of 5.75% (prior to 6/17/02, the maximum sales charge was 6.25%). The Class B "S.E.C. Standardized" returns are adjusted for the applicable deferred sales charge (maximum of 4% in the first year). During the periods shown, some of the expenses of the Fund were waived or assumed. If such expenses had been paid by the Fund, the Class A "S.E.C. Standardized" Total Return Since Inception would have been (7.69%) and the Class B "S.E.C. Standardized" Total Return Since Inception would have been (7.63%). Results represent past performance and do not indicate future results.The graph and the returns shown do not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. Russell 3000 Growth Index figures are from Frank Russell and Company and all other figures are from First Investors Management Company, Inc.
Portfolio of Investments FIRST INVESTORS ALL-CAP GROWTH FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--95.3% Consumer Discretionary--10.1% 14,050 * A.C. Moore Arts & Crafts, Inc. $347,457 $23 52,030 * eBay, Inc. 4,783,638 317 36,720 * Fleetwood Enterprises, Inc. 557,410 37 10,100 * Helen of Troy, Ltd. 274,922 18 14,730 Landry's Restaurants, Inc. 401,982 27 16,400 Lennar Corporation 780,640 52 72,140 * Lions Gate Entertainment Corporation 627,618 42 22,800 Michaels Stores, Inc. 1,349,988 89 53,750 Omnicom Group, Inc. 3,926,975 261 9,800 * Pixar 773,220 51 170,490 * Sirius Satellite Radio, Inc. 545,568 36 46,870 * TiVo, Inc. 310,279 21 14,400 * Williams-Sonoma, Inc. 540,720 36 - ---------------------------------------------------------------------------------------------------------------------- 15,220,417 1,010 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--1.0% 34,370 Gillette Company 1,434,604 95 - ---------------------------------------------------------------------------------------------------------------------- Energy--2.6% 10,680 Cabot Oil & Gas Corporation 479,532 32 15,100 EOG Resources, Inc. 994,335 66 20,100 Petro-Canada 1,044,195 69 17,770 * Whiting Petroleum Corporation 540,208 36 27,275 XTO Energy, Inc. 885,892 59 - ---------------------------------------------------------------------------------------------------------------------- 3,944,162 262 - ---------------------------------------------------------------------------------------------------------------------- Financials--10.5% 6,485 * Affiliated Managers Group, Inc. 347,207 23 6,460 * Arch Capital Group, Ltd. 251,552 17 59,460 Citigroup, Inc. 2,623,375 174 207,670 Countrywide Financial Corporation 8,180,121 543 12,850 Fannie Mae 814,690 54 31,030 Freddie Mac 2,024,397 134 16,640 IndyMac Bancorp, Inc. 602,368 40 12,900 Legg Mason, Inc. 687,183 46 25,290 * U.S.I. Holdings Corporation 345,209 23 - ---------------------------------------------------------------------------------------------------------------------- 15,876,102 1,054 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS ALL-CAP GROWTH FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Health Care--17.8% 25,640 Abbott Laboratories $1,086,110 $72 20,930 * Abgenix, Inc. 206,370 14 107,770 AstraZeneca PLC (ADR) 4,432,580 294 23,970 Cardinal Health, Inc. 1,049,167 70 12,600 * Cephalon, Inc. 603,540 40 70,510 Eli Lilly & Company 4,234,126 281 26,910 * Forest Laboratories, Inc. 1,210,412 80 100,360 Guidant Corporation 6,627,774 440 27,700 * Medco Health Solutions, Inc. 855,930 57 18,310 * Medicines Company 442,003 29 64,490 Medtronic, Inc. 3,347,031 222 89,600 * Millennium Pharmaceuticals, Inc. 1,228,416 81 15,290 * NPS Pharmaceuticals, Inc. 333,016 22 107,160 * Service Corporation International 665,464 44 7,730 * Symbion, Inc. 124,492 8 14,100 * Watson Pharmaceuticals, Inc. 415,386 28 - ---------------------------------------------------------------------------------------------------------------------- 26,861,817 1,782 - ---------------------------------------------------------------------------------------------------------------------- Industrials--10.8% 92,140 * Apollo Group, Inc. - Class "A" 6,760,312 449 11,700 Arkansas Best Corporation 428,454 28 18,000 * DiamondCluster International, Inc. 219,600 14 17,700 * Education Management Corporation 471,528 31 10,570 General Dynamics Corporation 1,079,197 72 71,570 General Electric Company 2,403,321 159 27,270 Jackson Hewitt Tax Service, Inc. 551,672 37 20,330 * Navigant Consulting, Inc. 446,447 30 16,400 PACCAR, Inc. 1,133,568 75 10,400 Parker-Hannifin Corporation 612,144 41 27,700 Rockwell Collins, Inc. 1,028,778 68 33,070 * Sirva, Inc. 757,303 50 7,330 * Yellow Roadway Corporation 343,704 23 - ---------------------------------------------------------------------------------------------------------------------- 16,236,028 1,077 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Information Technology--39.3% 27,300 * Accenture, Ltd. - Class "A" $738,465 $49 21,700 Acxiom Corporation 515,158 34 74,300 * Aeroflex, Inc. 785,351 52 38,300 * Amdocs, Ltd. 836,089 56 92,810 Analog Devices, Inc. 3,599,172 239 14,600 CDW Corporation 847,238 56 149,070 * Cisco Systems, Inc. 2,698,167 179 27,000 * Cognizant Technology Solutions Corporation - Class "A" 823,770 55 237,240 * Corning, Inc. 2,628,619 174 153,740 * Dell, Inc. 5,473,144 363 95,360 * Electronic Arts, Inc. 4,385,606 291 138,210 * EMC Corporation 1,594,943 106 122,170 First Data Corporation 5,314,395 353 7,500 * Intuit, Inc. 340,500 23 101,740 * MEMC Electronic Materials, Inc. 862,755 57 119,080 Microsoft Corporation 3,292,562 219 37,950 * MPS Group, Inc. 319,160 21 21,580 * NAVTEQ 769,111 51 52,200 * Network Appliance, Inc. 1,200,600 80 8,180 Plantronics, Inc. 353,703 23 28,370 * Polycom, Inc. 562,293 37 20,600 * Red Hat, Inc. 252,144 17 114,740 * Research in Motion, Ltd. 8,759,252 581 46,510 * Sapient Corporation 354,871 24 19,160 * SERENA Software, Inc. 320,547 21 15,200 * Symantec Corporation 834,176 55 63,400 * Tellabs, Inc. 582,646 39 19,490 * THQ, Inc. 379,275 25 17,500 * VeriSign, Inc. 347,900 23 86,390 Xilinx, Inc. 2,332,530 155 208,090 * Yahoo!, Inc. 7,056,332 468 - ---------------------------------------------------------------------------------------------------------------------- 59,160,474 3,926 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS ALL-CAP GROWTH FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Materials--.8% 18,740 Arch Coal, Inc. $665,083 $44 36,290 * GrafTech International, Ltd. 506,246 34 - ---------------------------------------------------------------------------------------------------------------------- 1,171,329 78 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--2.4% 81,080 * American Tower Corporation - Class "A" 1,244,578 83 96,620 * Crown Castle International Corporation 1,437,706 95 39,800 * Nextel Communications, Inc. - Class "A" 948,830 63 - ---------------------------------------------------------------------------------------------------------------------- 3,631,114 241 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $120,494,286) 143,536,047 9,525 - ---------------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENT--5.4% $8,150M BNP Paribas, 1.72%, dated 9/30/04, to be repurchased at $8,150,389 on 10/1/04 (collateralized by U.S. Treasury Bonds, 10.75%, 8/15/05, valued at $8,310,246) (cost $8,150,000) 8,150,000 540 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $128,644,286) 100.7% 151,686,047 10,065 Excess of Liabilities Over Other Assets (.7) (985,442) (65) - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $150,700,605 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts See notes to financial statements
Portfolio Managers' Letter FIRST INVESTORS MID-CAP OPPORTUNITY FUND Dear Investor: This is the annual report for the First Investors Mid-Cap Opportunity Fund for the fiscal year ended September 30, 2004. During the period, the Fund's return on a net asset value basis was 18.4% for Class A shares and 17.6% for Class B shares. The Fund's performance was largely driven by rising oil and natural gas prices, consolidation in commercial banking, solid performance of the mid-cap stock sector and asset allocation decisions. Performance on an absolute basis was attributable to investments in two key sectors: energy and financials. Shares of commercial banks and thrift institutions were key contributors in the financials sector, aided by merger and acquisition activity. Meaningful contributions also came from the consumer discretionary, health care and industrials sectors. On a relative basis, the Fund outperformed the Standard & Poor's 400 Midcap Index due to its overweight positions within the energy and health care sectors. Within the energy sector, strength came from the oil and gas exploration and equipment companies. Among health care sector holdings, shares of HMOs, pharmacy benefit managers and medical supply firms rose sharply. Thank you for placing your trust in First Investors. As always, we appreciate the opportunity to serve your investment needs. Sincerely, /s/ EDWIN D. MISKA Edwin D. Miska Director of Equities and Co-Portfolio Manager /s/ STEVEN S. HILL Steven S. Hill Co-Portfolio Manager October 29, 2004 Fund Expenses FIRST INVESTORS MID-CAP OPPORTUNITY FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing those costs with those of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples.
- -------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - -------------------------------------------------------------------------------------------- Actual $1,000.00 $994.74 $7.63 Hypothetical (5% return before expenses) $1,000.00 $1,017.35 $7.72 - -------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - -------------------------------------------------------------------------------------------- Actual $1,000.00 $991.07 $11.10 Hypothetical (5% return before expenses) $1,000.00 $1,013.85 $11.23 - -------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.53% for Class A shares and 2.23% for Class B shares, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period). Expenses paid during the period are net of expenses waived.
Portfolio Composition TOP TEN SECTORS (BAR CHART: Top Ten Sectors) Financials 20.2% Consumer Discretionary 16.1% Information Technology 15.2% Health Care 14.1% Industrials 10.6% Energy 9.0% Materials 4.9% Consumer Staples 3.9% Utilities 2.1% Other 0.8% Portfolio's holdings and allocations are subject to change. Percentages are as of September 30, 2004, and are based on total market value of investments. Cumulative Performance Information FIRST INVESTORS MID-CAP OPPORTUNITY FUND Comparison of change in value of $10,000 investment in the First Investors Mid-Cap Opportunity Fund (Class A shares) and the Standard & Poor's 400 Midcap Index. First Investors Mid-Cap Opportunity Fund Graph Plot Points for the periods Ended 9/30/04 S&P 400 Mid-Cap MIDCAP Fund Index Oct-94 $ 9,425 $10,000 Oct-95 11,664 12,123 Oct-96 13,022 14,228 Oct-97 16,550 18,873 Sep-98 13,833 18,483 Sep-99 20,011 23,190 Sep-00 29,298 33,213 Sep-01 19,712 26,903 Sep-02 17,633 25,640 Sep-03 21,432 32,513 Sep-04 25,377 38,221 (INSET BOX IN CHART READS:) Average Annual Total Return* Class A Shares N.A.V. Only S.E.C. Standardized One Year 18.41% 11.60% Five Years 4.87% 3.63% Ten Years 10.70% 10.05% Class B Shares One Year 17.55% 13.55% Five Years 4.13% 3.79% Since Inception (1/12/95) 9.55% 9.55% The graph compares a $10,000 investment in the First Investors Mid-Cap Opportunity Fund (Class A shares) beginning 10/31/94 with a theoretical investment in the Standard & Poor's 400 Midcap Index (the "Index"). The Index is an unmanaged capitalization-weighted index of 400 stocks designed to measure the performance of the mid-range sector of the U.S. stock market where the median market capitalization is approximately $700 million. It is not possible to invest directly in this Index. In addition, the Index does not take into account fees and expenses that an investor would incur in purchasing securities in the Index. For purposes of the graph and the accompanying table, unless otherwise indicated, it has been assumed that the maximum sales charge was deducted from the initial $10,000 investment in the Fund and all dividends and distributions were reinvested. Class B shares performance may be greater than or less than that shown in the line graph above for Class A shares based on differences in sales loads and fees paid by shareholders investing in the different classes. * Average Annual Total Return figures (for the periods ended 9/30/04) include the reinvestment of all dividends and distributions. "N.A.V. Only" returns are calculated without sales charges. The Class A "S.E.C. Standardized" returns shown are based on the maximum sales charge of 5.75% (prior to 6/17/02, the maximum sales charge was 6.25%). The Class B "S.E.C. Standardized" returns are adjusted for the applicable deferred sales charge (maximum of 4% in the first year). During the periods shown, some of the expenses of the Fund were waived or assumed. If such expenses had been paid by the Fund, the Class A "S.E.C. Standardized" Average Annual Total Returns for One Year, Five Years and Ten Years would have been 11.42%, 3.41% and 9.62%, respectively. The Class B "S.E.C. Standardized" Average Annual Total Returns for One Year, Five Years and Since Inception would have been 13.38%, 3.55% and 9.10%, respectively. Results represent past performance and do not indicate future results.The graph and the returns shown do not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. Standard & Poor's 400 Midcap Index figures are from Standard & Poor's and all other figures are from First Investors Management Company, Inc.
Portfolio of Investments FIRST INVESTORS MID-CAP OPPORTUNITY FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--97.0% Consumer Discretionary--16.1% 55,000 American Axle & Manufacturing Holdings, Inc. $1,609,300 $50 27,200 American Eagle Outfitters, Inc. 1,002,320 31 120,000 * AnnTaylor Stores Corporation 2,808,000 87 56,250 Applebee's International, Inc. 1,422,000 44 27,500 * Barnes & Noble, Inc. 1,017,500 31 105,000 Blockbuster, Inc. - Class "A" 796,950 25 49,000 BorgWarner, Inc. 2,121,210 66 35,000 * Chico's FAS, Inc. 1,197,000 37 45,000 * Coach, Inc. 1,908,900 59 75,000 * Cost Plus, Inc. 2,653,500 82 220,000 * GameStop Corporation - Class "A" 4,072,200 126 52,100 Hasbro, Inc. 979,480 30 115,000 * Hollywood Entertainment Corporation 1,135,050 35 82,500 K-Swiss, Inc. - Class "A" 1,588,125 49 40,000 Landry's Restaurants, Inc. 1,091,600 34 30,000 Lear Corporation 1,633,500 50 80,000 Leggett & Platt, Inc. 2,248,000 69 45,000 Mattel, Inc. 815,850 25 75,000 Movie Gallery, Inc. 1,314,750 41 167,000 * Office Depot, Inc. 2,510,010 78 125,000 * Pacific Sunwear of California, Inc. 2,631,250 81 65,000 Pier 1 Imports, Inc. 1,175,200 36 56,100 Polo Ralph Lauren Corporation - Class "A" 2,040,357 63 140,000 * Quiksilver, Inc. 3,558,800 110 60,000 Regis Corporation 2,413,200 75 50,000 Ross Stores, Inc. 1,172,000 36 27,500 Tiffany & Company 845,350 26 62,800 TJX Companies, Inc. 1,384,112 43 20,000 * Tuesday Morning Corporation 618,400 19 50,000 Tupperware Corporation 849,000 26 13,500 * Warnaco Group, Inc. 300,105 9 30,000 * Williams-Sonoma, Inc. 1,126,500 35 - ---------------------------------------------------------------------------------------------------------------------- 52,039,519 1,608 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--3.9% 30,000 Altria Group, Inc. $1,411,200 $43 200,000 * Chiquita Brands International, Inc. 3,482,000 108 30,000 Coca-Cola Enterprises, Inc. 567,000 17 58,900 Hormel Foods Corporation 1,577,342 49 60,000 * Performance Food Group Company 1,422,000 44 120,000 * Smithfield Foods, Inc. 3,000,000 93 39,800 Tootsie Roll Industries, Inc. 1,162,956 36 - ---------------------------------------------------------------------------------------------------------------------- 12,622,498 390 - ---------------------------------------------------------------------------------------------------------------------- Energy--9.0% 40,000 Anadarko Petroleum Corporation 2,654,400 82 155,000 Chesapeake Energy Corporation 2,453,650 76 46,900 EOG Resources, Inc. 3,088,365 95 75,000 * Grant Prideco, Inc. 1,536,750 47 40,000 Patterson-UTI Energy, Inc. 762,800 24 80,000 Suncor Energy, Inc. 2,560,800 79 120,000 * Swift Energy Company 2,875,200 89 142,500 Talisman Energy, Inc. 3,690,750 114 77,500 * Transocean, Inc. 2,772,950 86 50,000 * Weatherford International, Ltd. 2,551,000 79 126,366 XTO Energy, Inc. 4,104,368 127 - ---------------------------------------------------------------------------------------------------------------------- 29,051,033 898 - ---------------------------------------------------------------------------------------------------------------------- Financials--20.3% 40,000 Ambac Financial Group, Inc. 3,198,000 99 35,000 Astoria Financial Corporation 1,242,150 38 80,000 Banknorth Group, Inc. 2,800,000 87 30,000 Bear Stearns Companies, Inc. 2,885,100 89 37,488 Citigroup, Inc. 1,653,971 51 30,000 City National Corporation 1,948,500 60 50,000 Colonial BancGroup, Inc. 1,022,500 32 100,000 * Conseco, Inc. 1,766,000 55 56,250 Doral Financial Corporation 2,332,688 72 73,000 Endurance Specialty Holdings, Ltd. 2,346,950 73 35,000 Greater Bay Bancorp 1,006,250 31 57,500 GreenPoint Financial Corporation 2,668,575 83 95,000 Hub International, Ltd. 1,717,600 53 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS MID-CAP OPPORTUNITY FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Financials (continued) 60,000 Independence Community Bank Corporation $2,343,000 $72 175,000 Janus Capital Group, Inc. 2,381,750 74 55,000 KeyCorp 1,738,000 54 60,000 Montpelier Re Holdings, Ltd. 2,200,800 68 80,000 National Commerce Financial Corporation 2,736,800 85 111,666 New York Community Bancorp, Inc. 2,293,620 71 135,000 NewAlliance Bancshares, Inc. 1,937,250 60 42,500 North Fork Bancorporation, Inc. 1,889,125 58 60,000 Old Republic International Corporation 1,501,800 47 44,400 PartnerRe, Ltd. 2,428,236 75 60,900 Protective Life Corporation 2,393,979 74 40,000 Provident Financial Services, Inc. 690,000 21 40,000 SAFECO Corporation 1,826,000 56 110,000 South Financial Group, Inc. 3,102,000 96 200,640 Sovereign Bancorp, Inc. 4,377,965 135 81,500 Willis Group Holdings, Ltd. 3,048,100 94 33,000 Zions Bancorporation 2,014,320 62 - ---------------------------------------------------------------------------------------------------------------------- 65,491,029 2,025 - ---------------------------------------------------------------------------------------------------------------------- Health Care--14.1% 84,150 * Accredo Health, Inc. 1,983,415 61 33,000 Aetna, Inc. 3,297,690 102 14,000 AmerisourceBergen Corporation 751,940 23 52,500 * Anthem, Inc. 4,580,625 142 40,000 * Barrier Therapeutics, Inc. 486,400 15 42,500 Beckman Coulter, Inc. 2,385,100 74 40,000 Biomet, Inc. 1,875,200 58 130,000 * Caremark Rx, Inc. 4,169,100 129 113,000 * Centene Corporation 4,811,540 149 54,000 * Charles River Laboratories International, Inc. 2,473,200 76 95,000 * Community Health Systems, Inc. 2,534,600 78 40,000 DENTSPLY International, Inc. 2,077,600 64 10,000 * Express Scripts, Inc. 653,400 20 32,500 * Forest Laboratories, Inc. 1,461,850 45 50,000 * Gilead Sciences, Inc. 1,869,000 58 35,000 * Henry Schein, Inc. 2,180,850 68 75,000 * Idenix Pharmaceuticals, Inc. 1,200,000 37 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Health Care (continued) 35,000 * IDX Systems Corporation $1,135,750 $35 35,000 * Laboratory Corporation of America Holdings 1,530,200 47 25,600 * Neurocrine Biosciences, Inc. 1,207,296 37 85,000 * Priority Healthcare Corporation - Class "B" 1,712,750 53 40,000 * Triad Hospitals, Inc. 1,377,600 43 - ---------------------------------------------------------------------------------------------------------------------- 45,755,106 1,414 - ---------------------------------------------------------------------------------------------------------------------- Industrials--10.6% 123,100 * AGCO Corporation 2,784,522 86 135,000 American Power Conversion Corporation 2,347,650 73 29,300 Avery Dennison Corporation 1,927,354 60 93,500 Chicago Bridge & Iron Company NV - NY Shares 2,804,065 87 23,333 * ChoicePoint, Inc. 995,152 31 41,000 FedEx Corporation 3,513,290 109 20,000 L-3 Communications Holdings, Inc. 1,340,000 41 35,000 Manpower, Inc. 1,557,150 48 91,400 Masco Corporation 3,156,042 97 50,000 * Mobile Mini, Inc. 1,240,000 38 75,000 Northrop Grumman Corporation 3,999,750 124 225,000 * Pinnacle Airlines Corporation 2,272,500 70 30,900 Rockwell Automation, Inc. 1,195,830 37 62,500 * Shaw Group, Inc. 750,000 23 59,300 SPX Corporation 2,099,220 65 57,600 * United Defense Industries, Inc. 2,303,424 71 - ---------------------------------------------------------------------------------------------------------------------- 34,285,949 1,060 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--15.2% 75,200 * Amphenol Corporation - Class "A" 2,576,352 80 175,000 * Catalyst Semiconductor, Inc. 1,041,250 32 37,500 * CheckFree Corporation 1,037,625 32 125,000 * Comverse Technology, Inc. 2,353,750 73 65,000 * DigitalNet Holdings, Inc. 1,963,975 61 35,000 * DST Systems, Inc. 1,556,450 48 100,000 * Electronics for Imaging, Inc. 1,624,000 50 71,250 Fair Isaac Corporation 2,080,500 64 135,000 * Ingram Micro, Inc. - Class "A" 2,173,500 67 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS MID-CAP OPPORTUNITY FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Information Technology (continued) 27,900 * International Rectifier Corporation $956,970 $30 100,000 Intersil Corporation - Class "A" 1,593,000 49 62,500 * Intuit, Inc. 2,837,500 88 220,000 * Lexar Media, Inc. 1,845,800 57 59,700 * Manhattan Associates, Inc. 1,457,874 45 105,000 * McAfee, Inc. 2,110,500 65 17,700 * NAVTEQ Corporation 630,828 19 41,300 * Novellus Systems, Inc. 1,098,167 34 125,000 * Paxar Corporation 2,835,000 88 75,000 * SanDisk Corporation 2,184,000 68 35,000 * Semtech Corporation 670,950 21 80,000 * Storage Technology Corporation 2,020,800 62 75,600 * SunGard Data Systems, Inc. 1,797,012 56 85,000 * Sybase, Inc. 1,172,150 36 100,000 * Tellabs, Inc. 919,000 28 70,000 * Thermo Electron Corporation 1,891,400 58 160,000 * VERITAS Software Corporation 2,848,000 88 125,000 * Vishay Intertechnology, Inc. 1,612,500 50 50,000 * Waters Corporation 2,205,000 68 - ---------------------------------------------------------------------------------------------------------------------- 49,093,853 1,517 - ---------------------------------------------------------------------------------------------------------------------- Materials--4.9% 50,000 Freeport-McMoRan Copper & Gold, Inc. - Class "B" 2,025,000 62 60,000 Georgia-Pacific Corporation 2,157,000 67 50,000 * Headwaters, Inc. 1,543,000 48 65,000 Louisiana-Pacific Corporation 1,686,750 52 50,000 Lubrizol Corporation 1,730,000 53 80,000 MeadWestvaco Corporation 2,552,000 79 50,000 Praxair, Inc. 2,137,000 66 90,000 Sappi, Ltd. (ADR) 1,288,800 40 21,300 United States Steel Corporation 801,305 25 - ---------------------------------------------------------------------------------------------------------------------- 15,920,855 492 - ---------------------------------------------------------------------------------------------------------------------- Other--.8% 25,000 MidCap SPDR Trust - Series "1" 2,713,250 84 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Utilities--2.1% 59,500 AGL Resources, Inc. $1,830,815 $57 30,000 Equitable Resources, Inc. 1,629,300 50 47,000 SCANA Corporation 1,754,980 54 51,000 Wisconsin Energy Corporation 1,626,900 50 - ---------------------------------------------------------------------------------------------------------------------- 6,841,995 211 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $261,264,505) 313,815,087 9,699 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM CORPORATE NOTES--2.2% $1,400M Coca-Cola Co., 1.74%, 10/19/04 1,398,782 43 3,000M General Electric Co., 1.75%, 10/6/04 2,999,270 93 2,700M Toyota Motor Credit Co., 1.73%, 10/21/04 2,697,405 83 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Short-Term Corporate Notes (cost $7,095,457) 7,095,457 219 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM U.S. GOVERNMENT AGENCY OBLIGATIONS--.9% 3,000M Fannie Mae, 1.72%, 10/1/04 (cost $3,000,000) 3,000,000 93 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $271,359,962) 100.1% 323,910,544 10,011 Excess of Liabilities Over Other Assets (.1) (358,876) (11) - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $323,551,668 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations: ADR American Depositary Receipts See notes to financial statements
Portfolio Manager's Letter FIRST INVESTORS SPECIAL SITUATIONS FUND Dear Investor: This is the annual report for the First Investors Special Situations Fund for the fiscal year ended September 30, 2004. During the period, the Fund's return on a net asset value basis was 7.7% for Class A shares and 7.0% for Class B shares. The Fund's positive performance was driven largely by the improving economy, the rise in energy prices and the solid performance of the small-cap sector. Its performance was largely the result of investments in the consumer discretionary, industrials, energy and financials sectors, as almost all of the Fund's return during the reporting period can be attributed to these groups. On a relative basis, the Fund underperformed the Russell 2000 Index for the reporting period. The Fund's growth-orientation hurt performance, as shares of growth-oriented, small-cap investments underperformed their value counterparts during the fiscal year, reversing the trend from fiscal 2003. As evidenced by the comparative style benchmarks, the Russell 2000 Growth Index returned 11.42% versus the Russell 2000 Value Index, which gained 23.53%. Specifically, the Fund's underweight positions in the financials, materials and industrials sectors hurt relative performance. An overweight position in the technology sector also hurt performance, as shares of those companies underperformed. Notably, shares within the software and services industry were the most disappointing. Shares of eCollege.com fell on lowered growth expectations. Internet-based yellow pages service provider YP Corp. fell on management upheaval. Shares of Internet service provider United Online underperformed due to increased competition and large insider sales. Thank you for placing your trust in First Investors. As always, we appreciate the opportunity to serve your investment needs. Sincerely, /s/ EDWIN D. MISKA Edwin D. Miska Director of Equities and Portfolio Manager* October 29, 2004 * Mr. Miska became the Fund's Portfolio Manager on September 1, 2004. Fund Expenses FIRST INVESTORS SPECIAL SITUATIONS FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing those costs with those of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples.
- -------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - -------------------------------------------------------------------------------------------- Actual $1,000.00 $924.26 $7.79 Hypothetical (5% return before expenses) $1,000.00 $1,016.90 $8.17 - -------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - -------------------------------------------------------------------------------------------- Actual $1,000.00 $921.71 $11.16 Hypothetical (5% return before expenses) $1,000.00 $1,013.40 $11.68 - -------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.62% for Class A shares and 2.32% for Class B shares, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period). Expenses paid during the period are net of expenses waived.
Portfolio Composition TOP TEN SECTORS (BAR CHART: Top Ten Sectors) Information Technology 23.2% Health Care 20.7% Consumer Discretionary 14.4% Industrials 13.9% Financials 9.4% Energy 7.8% Materials 3.0% Telecommunication Services 2.7% Other 1.6% Consumer Staples 0.8% Portfolio's holdings and allocations are subject to change. Percentages are as of September 30, 2004, and are based on total market value of investments. Cumulative Performance Information FIRST INVESTORS SPECIAL SITUATIONS FUND Comparison of change in value of $10,000 investment in the First Investors Special Situations Fund (Class A shares) and the Russell 2000 Index. First Investors Special Situations Fund Graph Plot Points for the periods Ended 9/30/04 Special Russell Situations 2000 Fund Index Dec-94 $ 9,425 $10,000 Dec-95 11,682 12,621 Dec-96 13,032 14,709 Dec-97 15,136 17,981 Sep-98 12,167 15,094 Sep-99 15,968 17,986 Sep-00 22,846 22,233 Sep-01 13,053 17,543 Sep-02 10,901 15,917 Sep-03 13,458 21,732 Sep-04 14,500 25,823 (INSET BOX IN CHART READS:) Average Annual Total Return* Class A Shares N.A.V. Only S.E.C. Standardized One Year 7.74% 1.57% Five Years (1.91%) (3.07%) Ten Years 4.09% 3.48% Class B Shares One Year 7.03% 3.03% Five Years (2.60%) (3.00%) Since Inception (1/12/95) 3.75% 3.75% The graph compares a $10,000 investment in the First Investors Special Situations Fund (Class A shares) beginning 12/31/94 with a theoretical investment in the Russell 2000 Index (the "Index"). The Index consists of the smallest 2,000 companies in the Russell 3000 Index (which represents approximately 98% of the investable U.S. equity market). The Index is an unmanaged index generally considered as the premier of small capitalization stocks. It is not possible to invest directly in this Index. In addition, the Index does not take into account fees and expenses. For purposes of the graph and the accompanying table, unless otherwise indicated, it has been assumed that the maximum sales charge was deducted from the initial $10,000 investment in the Fund and all dividends and distributions were reinvested. Class B shares performance may be greater than or less than that shown in the line graph above for Class A shares based on differences in the sales loads and fees paid by shareholders investing in the different classes. * Average Annual Total Return figures (for the periods ended 9/30/04) include the reinvestment of all dividends and distributions. "N.A.V. Only" returns are calculated without sales charges. The Class A "S.E.C. Standardized" returns shown are based on the maximum sales charge of 5.75% (prior to 6/17/02, the maximum sales charge was 6.25%). The Class B "S.E.C. Standardized" returns are adjusted for the applicable deferred sales charge (maximum of 4% in the first year). During the periods shown, some of the expenses of the Fund were waived or assumed. If such expenses had been paid by the Fund, the Class A "S.E.C. Standardized" Average Annual Total Returns for One Year, Five Years and Ten Years would have been 1.34%, (3.30%) and 3.24%, respectively. The Class B "S.E.C. Standardized" Average Annual Total Returns for One Year, Five Years and Since Inception would have been 2.80%, (3.21%) and 3.50%, respectively. Results represent past performance and do not indicate future results.The graph and the returns shown do not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. Russell 2000 Index figures are from Frank Russell and Company and all other figures are from First Investors Management Company, Inc.
Portfolio of Investments FIRST INVESTORS SPECIAL SITUATIONS FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--97.3% Consumer Discretionary--14.4% 124,950 * Aeropostale, Inc. $3,273,690 $156 41,700 * Arbitron, Inc. 1,526,637 73 209,800 * Champion Enterprises, Inc. 2,158,842 103 80,100 Claire's Stores, Inc. 2,005,704 95 96,500 Foot Locker, Inc. 2,287,050 109 27,400 * Getty Images, Inc. 1,515,220 72 24,600 * Guitar Center, Inc. 1,065,180 51 77,900 * Jarden Corporation 2,842,571 135 55,687 * Jos. A. Bank Clothiers, Inc. 1,541,416 73 97,900 * Keystone Automotive Industries, Inc. 2,153,800 102 111,400 * Navigant International, Inc. 1,819,162 87 60,300 * Quiksilver, Inc. 1,532,826 73 78,200 * Scientific Games Corporation - Class "A" 1,493,620 71 102,300 * Source Interlink Companies, Inc. 994,356 47 48,200 * Urban Outfitters, Inc. 1,658,080 79 109,200 * Warnaco Group, Inc. 2,427,516 116 - ---------------------------------------------------------------------------------------------------------------------- 30,295,670 1,442 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--.8% 273,800 * Star Scientific, Inc. 1,620,896 77 - ---------------------------------------------------------------------------------------------------------------------- Energy--7.8% 47,200 Ashland, Inc. 2,646,976 126 87,900 Chesapeake Energy Corporation 1,391,457 66 105,800 * Energy Partners, Ltd. 1,722,424 82 45,700 Overseas Shipholding Group, Inc. 2,268,548 108 86,000 Patterson-UTI Energy, Inc. 1,640,020 78 61,000 Stelmar Shipping, Ltd. 2,306,410 110 71,700 * Swift Energy Company 1,717,932 82 56,450 * TETRA Technologies, Inc. 1,752,773 83 27,000 World Fuel Services Corporation 966,600 46 - ---------------------------------------------------------------------------------------------------------------------- 16,413,140 781 - ---------------------------------------------------------------------------------------------------------------------- Financials--9.3% 35,500 * Affiliated Managers Group, Inc. 1,900,670 91 41,100 * First Marblehead Corporation 1,907,040 91 51,800 HCC Insurance Holdings, Inc. 1,561,770 74 103,700 MoneyGram International, Inc. 1,771,196 84 30,600 Montpelier Re Holdings, Ltd. 1,122,408 54 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS SPECIAL SITUATIONS FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Financials (continued) 53,200 Odyssey Re Holdings Corporation $1,179,976 $56 182,800 Origen Financial, Inc. 1,345,408 64 62,300 RAIT Investment Trust 1,703,905 81 80,500 * Saxon Capital, Inc. (REIT) 1,730,750 82 52,800 Thornburg Mortgage, Inc. 1,531,728 73 78,000 Ventas, Inc. 2,021,760 96 43,300 Westcorp, Inc. 1,841,116 88 - ---------------------------------------------------------------------------------------------------------------------- 19,617,727 934 - ---------------------------------------------------------------------------------------------------------------------- Health Care--20.7% 69,100 * AmSurg Corporation 1,463,538 70 154,700 * Aspect Medical Systems, Inc. 2,798,523 133 71,000 * Centene Corporation 3,023,180 144 58,300 * CV Therapeutics, Inc. 728,750 35 70,100 * DaVita, Inc. 2,183,615 104 153,100 * Discovery Laboratories, Inc. 1,025,770 49 642,800 * Endocare, Inc. 1,780,556 85 21,600 * Fisher Scientific International, Inc. 1,259,928 60 23,700 * Gen-Probe, Inc. 944,919 45 75,900 * LabOne, Inc. 2,218,557 106 72,800 Matthews International Corporation - Class "A" 2,466,464 117 39,900 Medicis Pharmaceutical Corporation - Class "A" 1,557,696 74 62,500 * MGI Pharma, Inc. 1,668,125 79 289,500 * MIM Corporation 1,673,310 80 86,600 * Nabi Biopharmaceuticals 1,158,708 55 22,900 * Neurocrine Biosciences, Inc. 1,079,964 51 29,900 * Onyx Pharmaceuticals, Inc. 1,285,999 61 93,900 PolyMedica Corporation 2,892,120 138 79,700 * Psychiatric Solutions, Inc. 2,020,395 96 84,630 * SFBC International, Inc. 2,226,615 106 201,600 * SuperGen, Inc. 1,245,888 59 208,300 * TriPath Imaging, Inc. 1,703,894 81 93,000 * VCA Antech, Inc. 1,918,590 91 151,600 West Pharmaceutical Services, Inc. 3,160,860 150 - ---------------------------------------------------------------------------------------------------------------------- 43,485,964 2,069 - ---------------------------------------------------------------------------------------------------------------------- Industrials--13.8% 93,400 Angelica Corporation 2,323,792 111 110,600 * Commercial Vehicle Group, Inc. 1,751,904 83 42,400 * Education Management Corporation 1,129,536 54 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Industrials (continued) 30,500 * ESCO Technologies, Inc. $2,066,680 $98 261,700 * EVCI Career Colleges, Inc. 1,848,910 88 136,900 Healthcare Services Group, Inc. 2,458,724 117 45,500 * II-VI, Inc. 1,592,955 76 197,800 * Kansas City Southern 3,000,626 143 57,600 * MTC Technologies, Inc. 1,591,488 76 30,500 Oshkosh Truck Corporation 1,740,330 83 83,900 Ritchie Brothers Auctioneers, Inc. 2,571,535 122 109,700 * SI International, Inc. 2,824,199 134 82,200 United Industrial Corporation 2,703,558 129 70,300 Wabtec Corporation 1,313,907 62 - ---------------------------------------------------------------------------------------------------------------------- 28,918,144 1,376 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--23.2% 100,300 * ATMI, Inc. 2,054,144 98 88,200 BEI Technologies, Inc. 2,416,680 115 63,000 * Catapult Communications Corporation 1,186,920 56 72,600 * Cognizant Technology Solutions Corporation - Class "A" 2,215,026 105 434,200 * CyberSource Corporation 2,097,186 100 56,900 * Digital River, Inc. 1,694,482 81 100,000 * Epicor Software Corporation 1,203,000 57 125,600 * FindWhat.com 2,352,488 112 88,100 * Global Imaging Systems, Inc. 2,738,148 130 35,800 * Hyperion Solutions Corporation 1,216,842 58 55,500 * Integrated Circuit Systems, Inc. 1,193,250 57 72,200 * Intergraph Corporation 1,961,674 93 30,800 * International Rectifier Corporation 1,056,440 50 141,500 * Intervoice, Inc. 1,523,955 72 123,300 * Measurement Specialties, Inc. 3,064,005 146 269,600 * MEMC Electronic Materials, Inc. 2,286,208 109 51,200 * MICROS Systems, Inc. 2,563,584 122 379,200 * Optimal Group, Inc. 3,481,056 166 130,500 * Overland Storage, Inc. 1,825,695 87 205,500 QAD, Inc. 1,432,335 68 73,300 * Sigmatel, Inc. 1,554,693 74 61,400 StarTek, Inc. 1,925,504 92 180,900 * TIBCO Software, Inc. 1,539,459 73 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS SPECIAL SITUATIONS FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Information Technology (continued) 242,200 * Tyler Technologies, Inc. $2,141,048 $102 38,200 * Varian Semiconductor Equipment Associates, Inc. 1,180,380 56 129,600 * ZiLOG, Inc. 747,792 36 - ---------------------------------------------------------------------------------------------------------------------- 48,651,994 2,315 - ---------------------------------------------------------------------------------------------------------------------- Materials--3.0% 139,300 AMCOL International Corporation 2,663,416 127 97,200 * Headwaters, Inc. 2,999,592 143 39,300 Penford Corporation 684,213 32 - ---------------------------------------------------------------------------------------------------------------------- 6,347,221 302 - ---------------------------------------------------------------------------------------------------------------------- Other--1.6% 35,000 iShares S&P Midcap 400 Index 2,049,950 98 98,800 Technology Investment Capital Corporation 1,383,200 66 - ---------------------------------------------------------------------------------------------------------------------- 3,433,150 164 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--2.7% 46,200 * NII Holdings, Inc. - Class "B" 1,903,902 91 168,100 * PTEK Holdings, Inc. 1,440,617 68 87,200 * Western Wireless Corporation - Class "A" 2,241,912 107 - ---------------------------------------------------------------------------------------------------------------------- 5,586,431 266 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $169,768,012) 204,370,337 9,726 - ---------------------------------------------------------------------------------------------------------------------- SHORT-TERM U.S. GOVERNMENT AGENCY OBLIGATIONS--2.5% $5,300M Fannie Mae, 1.72% 10/1/04 (cost $5,300,000) 5,300,000 252 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $175,068,012) 99.8% 209,670,337 9,978 Other Assets, Less Liabilities .2 470,405 22 - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $210,140,742 $10,000 ====================================================================================================================== * Non-income producing Summary of Abbreviations: REIT Real Estate Investment Trust See notes to financial statements
Portfolio Manager's Letter FIRST INVESTORS FOCUSED EQUITY FUND Dear Investor: This is the annual report for the First Investors Focused Equity Fund for the fiscal year ended September 30, 2004. During the period, the Fund's return on a net asset value basis was 8.3% for Class A shares and 7.6% for Class B shares. The Fund's performance during the reporting period was driven by a combination of the solid performance of the equity markets and the concentrated nature of the Fund. The Fund's performance was helped by top absolute contributors Chevron and Schlumberger, which benefited from higher oil prices and refining margins. Several broad issues were factors in the Fund's underperformance relative to the Standard & Poor's 500 (S&P 500) Index. In general, the Fund was positioned for an economic recovery that did not play out as strongly as expected. The Fund's focus on high quality, large-cap stocks was a drag on performance, as they underperformed smaller capitalization classes. Specifically, stock selection was the primary contributor to the Fund's underperformance relative to the S&P 500 Index. The impact of stock selection has a greater effect on performance because the Fund is concentrated in less than 50 securities. In particular, stock selection within the financials, information technology and consumer discretionary sectors had a negative impact on performance. Inventory issues and slowing demand plagued Intel and other semiconductor stocks in the portfolio. Litigation issues hurt Fund holdings in Merrill Lynch and Citigroup. Sector allocation was also a moderate negative for Fund performance relative to the S&P 500 Index. Thank you for placing your trust in First Investors. As always, we appreciate the opportunity to serve your investment needs. Sincerely, /s/ MATTHEW E. MEGARGEL Matthew E. Megargel Portfolio Manager October 29, 2004 Fund Expenses FIRST INVESTORS FOCUSED EQUITY FUND The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing those costs with those of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples.
- ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - ---------------------------------------------------------------------------------------------- Actual $1,000.00 $979.97 $8.91 Hypothetical (5% return before expenses) $1,000.00 $1,016.00 $9.07 - ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - ---------------------------------------------------------------------------------------------- Actual $1,000.00 $976.66 $12.35 Hypothetical (5% return before expenses) $1,000.00 $1,012.50 $12.58 - ---------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.80% for Class A shares and 2.50% for Class B shares, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period).
Portfolio Composition BY SECTOR (BAR CHART DATA:) Information Technology 19.7% Financials 18.0% Health Care 14.9% Industrials 14.7% Energy 8.6% Consumer Discretionary 8.2% Consumer Staples 8.0% Materials 6.2% Telecommunication Services 1.4% Portfolio's holdings and allocations are subject to change. Percentages are as of September 30, 2004, and are based on total market value of investments. Cumulative Performance Information FIRST INVESTORS FOCUSED EQUITY FUND Comparison of change in value of $10,000 investment in the First Investors Focused Equity Fund (Class A shares) and the Standard & Poor's 500 Index. First Investors Focused Equity Fund Graph Plot Points for the periods Ended 9/30/04 Focused Equity S&P 500 Fund Index Mar-99 $ 9,425 $10,000 Sep-99 10,254 9,957 Sep-00 9,783 11,279 Sep-01 7,276 8,277 Sep-02 5,401 6,581 Sep-03 6,814 8,187 Sep-04 7,380 9,322 (INSET BOX IN CHART READS:) Average Annual Total Return* Class A Shares N.A.V. Only S.E.C. Standardized One Year 8.30% 2.09% Five Years (6.37%) (7.46%) Since Inception (3/22/99) (4.33%) (5.35%) Class B Shares One Year 7.57% 3.57% Five Years (7.03%) (7.40%) Since Inception (3/22/99) (5.00%) (5.18%) The graph compares a $10,000 investment in the First Investors Focused Equity Fund (Class A shares) beginning 3/22/99 (inception date) with a theoretical investment in the Standard & Poor's 500 Index (the "Index"). The Index is an unmanaged capitalization-weighted index of 500 stocks designed to measure the performance of the broad domestic economy through changes in the aggregate market value of such stocks, which represent all major industries. It is not possible to invest directly in this Index. In addition, the Index does not take into account fees and expenses that an investor would incur in purchasing securities in the Index. For purposes of the graph and the accompanying table, unless otherwise indicated, it has been assumed that the maximum sales charge was deducted from the initial $10,000 investment in the Fund. Class B shares performance may be greater than or less than that shown in the line graph above for Class A shares based on differences in sales loads and fees paid by shareholders investing in the different lasses. * Average Annual Total Return figures are for the periods ended 9/30/04. "N.A.V. Only" returns are calculated without sales charges. The Class A "S.E.C. Standardized" returns shown are based on the maximum sales charge of 5.75% (prior to 6/17/02 the maximum sales charge was 6.25%). The Class B "S.E.C. Standardized" returns are adjusted for the applicable deferred sales charge (maximum of 4% in the first year). During certain of the periods shown, some of the expenses of the Fund were waived or assumed. If such expenses had been paid by the Fund, the Class A "S.E.C. Standardized" Average Annual Total Returns for Five Years and Since Inception would have been (7.44%) and (5.36%), respectively. The Class B "S.E.C. Standardized" Average Annual Total Returns for Five Years and Since Inception would have been (7.38%) and (5.19%), respectively. Results represent past performance and do not indicate future results.The graph and the returns shown do not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. Standard & Poor's 500 Index figures are from Standard & Poor's and all other figures are from First Investors Management Company, Inc.
Portfolio of Investments FIRST INVESTORS FOCUSED EQUITY FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--99.9% Consumer Discretionary--8.2% 30,400 Lowe's Companies, Inc. $1,652,240 $275 12,600 NIKE, Inc. - Class "B" 992,880 165 141,700 * Time Warner, Inc. 2,287,038 381 - ---------------------------------------------------------------------------------------------------------------------- 4,932,158 821 - ---------------------------------------------------------------------------------------------------------------------- Consumer Staples--8.0% 22,600 Altria Group, Inc. 1,063,104 177 31,200 Gillette Company 1,302,288 217 28,600 PepsiCo, Inc. 1,391,390 231 19,200 Procter & Gamble Company 1,039,104 173 - ---------------------------------------------------------------------------------------------------------------------- 4,795,886 798 - ---------------------------------------------------------------------------------------------------------------------- Energy--8.6% 48,200 ChevronTexaco Corporation 2,585,448 430 19,500 GlobalSantaFe Corporation 597,675 99 29,700 Schlumberger, Ltd. 1,999,107 333 - ---------------------------------------------------------------------------------------------------------------------- 5,182,230 862 - ---------------------------------------------------------------------------------------------------------------------- Financials--18.1% 16,800 American Express Company 864,528 144 31,220 American International Group, Inc. 2,122,648 353 67,000 Bank of America Corporation 2,903,110 483 58,800 Citigroup, Inc. 2,594,256 432 28,700 Merrill Lynch & Company, Inc. 1,426,964 238 28,884 St. Paul Travelers Companies, Inc. 954,905 159 - ---------------------------------------------------------------------------------------------------------------------- 10,866,411 1,809 - ---------------------------------------------------------------------------------------------------------------------- Health Care--14.9% 36,100 Abbott Laboratories 1,529,196 254 17,900 Eli Lilly & Company 1,074,895 179 12,900 * Genzyme Corporation 701,889 117 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Health Care (continued) 28,000 Medtronic, Inc. $1,453,200 $242 77,200 Pfizer, Inc. 2,362,320 393 29,600 Schering-Plough Corporation 564,176 94 33,900 Wyeth 1,267,860 211 - ---------------------------------------------------------------------------------------------------------------------- 8,953,536 1,490 - ---------------------------------------------------------------------------------------------------------------------- Industrials--14.8% 4,200 Caterpillar, Inc. 337,890 56 29,600 CSX Corporation 982,720 164 11,700 FedEx Corporation 1,002,573 167 9,300 General Dynamics Corporation 949,530 158 79,900 General Electric Company 2,683,042 446 49,500 Tyco International, Ltd. 1,517,670 253 15,000 United Technologies Corporation 1,400,700 233 - ---------------------------------------------------------------------------------------------------------------------- 8,874,125 1,477 - ---------------------------------------------------------------------------------------------------------------------- Information Technology--19.7% 42,800 * Applied Materials, Inc. 705,772 117 64,500 * Cisco Systems, Inc. 1,167,450 194 55,800 * Corning, Inc. 618,264 103 30,300 * Dell, Inc. 1,078,680 179 33,800 First Data Corporation 1,470,300 245 50,700 Intel Corporation 1,017,042 169 128,600 Microsoft Corporation 3,555,790 592 43,300 Motorola, Inc. 781,132 130 31,800 Texas Instruments, Inc. 676,704 113 23,000 * Yahoo!, Inc. 779,930 130 - ---------------------------------------------------------------------------------------------------------------------- 11,851,064 1,972 - ---------------------------------------------------------------------------------------------------------------------- Materials--6.2% 31,100 Alcoa, Inc. 1,044,649 174 25,800 Du Pont (E.I.) de Nemours & Company 1,104,240 184 39,400 International Paper Company 1,592,154 265 - ---------------------------------------------------------------------------------------------------------------------- 3,741,043 623 - ---------------------------------------------------------------------------------------------------------------------- Telecommunication Services--1.4% 41,200 Sprint Corporation 829,356 138 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $57,271,571) 60,025,809 9,990 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS FOCUSED EQUITY FUND September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENT--.4% $213M BNP Paribas, 1.72%, dated 9/30/04, to be repurchased at $213,010 on 10/1/04 (collateralized by U.S. Treasury Bonds, 11.25%, 2/15/15, valued at $218,323) (cost $213,000) $213,000 $36 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $57,484,571) 100.3% 60,238,809 10,026 Excess of Liabilities Over Other Assets (.3) (154,938) (26) - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $60,083,871 $10,000 ====================================================================================================================== * Non-income producing See notes to financial statements
Portfolio Manager's Letter FIRST INVESTORS GLOBAL FUND, INC. Dear Investor: This is the annual report for the First Investors Global Fund for the fiscal year ended September 30, 2004. During the period, the Fund's return on a net asset value basis was 14.9% for Class A shares and 14.1% for Class B shares. The Fund's positive overall performance during the reporting period was driven by improving global economies and solid performance of equity markets. Foreign markets outperformed U.S. domestic markets during the period, illustrating the benefit of the Fund's global investment approach. The Pacific Basin (excluding Japan) led the way with 29.8%, and Europe was not far behind with 26.1% for the period. Emerging markets stocks also did well, climbing 23.6%. Stock selection was strong in the industrials and materials sectors. In industrials, British Airways benefited from increasing business traffic in the important trans-Atlantic market and a helpful exchange rate against the U.S. dollar. Corus Group, a steel company, also did well following internal restructuring and strong demand from China. Stock selection in the financials, consumer discretionary and consumer staples sectors detracted from performance. In financials, European reinsurance company Converium fell dramatically in value after it announced that it had under-reserved its U.S. business exposure. Consumer staples holding Ahold suffered from lingering concerns over its U.S. food service business due to a competitive pricing environment and rising inflation in the U.S. retail food market. Thank you for placing your trust in First Investors. As always, we appreciate the opportunity to serve your investment needs. Sincerely, /s/ TROND SKRAMSTAD Trond Skramstad Portfolio Manager October 29, 2004 Fund Expenses FIRST INVESTORS GLOBAL FUND, INC. The examples below show the ongoing costs (in dollars) of investing in your Fund and will help you in comparing those costs with those of other mutual funds. Please refer to page 3 for a detailed explanation of the information presented in these examples.
- ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - ---------------------------------------------------------------------------------------------- Actual $1,000.00 $983.41 $9.17 Hypothetical (5% return before expenses) $1,000.00 $1,015.75 $9.32 - ---------------------------------------------------------------------------------------------- Beginning Ending Account Account Expenses Paid Value Value During Period Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)* - ---------------------------------------------------------------------------------------------- Actual $1,000.00 $980.46 $12.63 Hypothetical (5% return before expenses) $1,000.00 $1,012.25 $12.83 - ---------------------------------------------------------------------------------------------- * Expenses are equal to the annualized expense ratio of 1.85% for Class A shares and 2.55% for Class B shares, multiplied by the average account value over the period, multiplied by 183/366 (to reflect the one-half year period).
Portfolio Composition TOP TEN COUNTRIES (BAR CHART: Top Ten Countries) United States 46.3% France 10.8% United Kingdom 10.0% Japan 7.8% Germany 3.8% Netherlands 3.6% Switzerland 3.1% Canada 2.6% South Korea 2.2% Belgium 1.5% Portfolio's holdings and allocations are subject to change. Percentages are as of September 30, 2004, and are based on total market value of investments. Cumulative Performance Information FIRST INVESTORS GLOBAL FUND, INC. Comparison of change in value of $10,000 investment in the First Investors Global Fund, Inc. (Class A shares) and the Morgan Stanley Capital International ("MSCI") All Country World Free Index. First Investors Global Fund Graph Plot Points for the periods Ended 9/30/04 MSCI Global All Country Fund Index Dec-94 $ 9,425 $10,000 Dec-95 11,098 11,946 Dec-96 12,700 13,523 Dec-97 13,713 15,551 Sep-98 13,542 15,657 Sep-99 17,555 20,496 Sep-00 19,613 22,138 Sep-01 13,951 15,908 Sep-02 11,327 13,078 Sep-03 13,817 16,580 Sep-04 15,879 19,570 (INSET BOX IN CHART READS:) Average Annual Total Return* Class A Shares N.A.V. Only S.E.C. Standardized One Year 14.92% 8.41% Five Years (1.99%) (3.13%) Ten Years 5.02% 4.40% Class B Shares One Year 14.05% 10.05% Five Years (2.67%) (3.06%) Since Inception (1/12/95) 4.81% 4.81% The graph compares a $10,000 investment in the First Investors Global Fund, Inc. (Class A shares) beginning 12/31/94 with a theoretical investment in the MSCI All Country World Free Index (the "Index"). The Index represents both the developed and the emerging markets. The Index includes 50 markets of which emerging markets represent approximately 5.0%. It is not possible to invest directly in this Index. In addition, the Index does not take into account fees and expenses that an investor would incur in purchasing securities in the Index. For purposes of the graph and the accompanying table, unless otherwise indicated, it has been assumed that the maximum sales charge was deducted from the initial $10,000 investment in the Fund and all dividends and distributions were reinvested. Class B shares performance may be greater than or less than that shown in the line graph above for Class A shares based on differences in sales loads and fees paid by shareholders investing in the different classes. * Average Annual Total Return figures (for the periods ended 9/30/04) include the reinvestment of all dividends and distributions. "N.A.V. Only" returns are calculated without sales charges. The Class A "S.E.C. Standardized" returns shown are based on the maximum sales charge of 5.75% (prior to 6/17/02, the maximum sales charge was 6.25%). The Class B "S.E.C. Standardized" returns are adjusted for the applicable deferred sales charge (maximum of 4% in the first year). Results represent past performance and do not indicate future results.The graph and the returns shown do not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. Investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than the original cost. MSCI All Country World Free Index figures are from Morgan Stanley & Co., Inc. and all other figures are from First Investors Management Company, Inc.
Portfolio of Investments FIRST INVESTORS GLOBAL FUND, INC. September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- COMMON STOCKS--97.6% United States--43.6% 46,100 Abbott Laboratories $1,952,796 $87 10,900 Air Products & Chemicals, Inc. 592,742 26 39,900 Alcoa, Inc. 1,340,241 60 29,100 Altria Group, Inc. 1,368,864 61 23,000 American Express Company 1,183,580 53 39,753 American International Group, Inc. 2,702,806 120 23,500 Analog Devices, Inc. 911,330 41 32,400 Apache Corporation 1,623,564 72 54,900 * Applied Materials, Inc. 905,301 40 32,600 Aramark Corporation - Class "B" 786,964 35 84,800 Bank of America Corporation 3,674,384 164 5,300 Caterpillar, Inc. 426,385 19 64,600 ChevronTexaco Corporation 3,465,144 154 83,000 * Cisco Systems, Inc. 1,502,300 67 75,649 Citigroup, Inc. 3,337,634 149 71,600 * Corning, Inc. 793,328 35 12,200 Countrywide Financial Corporation 480,558 21 55,900 CSX Corporation 1,855,880 83 38,900 * Dell, Inc. 1,384,840 62 32,800 DuPont (E.I.) de Nemours & Company 1,403,840 63 8,600 * Electronic Arts, Inc. 395,514 18 23,800 Eli Lilly & Company 1,429,190 64 15,100 FedEx Corporation 1,293,919 58 42,900 First Data Corporation 1,866,150 83 17,300 General Dynamics Corporation 1,766,330 79 101,600 General Electric Company 3,411,728 152 26,200 * Genzyme Corporation 1,425,542 63 9,000 * Gilead Sciences, Inc. 336,420 15 37,800 Gillette Company 1,577,772 70 24,800 GlobalSantaFe Corporation 760,120 34 4,800 Ingersoll-Rand Company - Class "A" 326,256 15 65,160 Intel Corporation 1,307,110 58 50,100 International Paper Company 2,024,541 90 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- United States (continued) 11,400 * KLA-Tencor Corporation $472,872 $21 18,600 * Lamar Advertising Company - Class "A" 773,946 34 37,600 Lowe's Companies, Inc. 2,043,560 91 18,800 Market 2000+ HOLDRs Trust 978,916 44 21,000 * Medco Health Solutions, Inc. 648,900 29 35,700 Medtronic, Inc. 1,852,830 82 37,900 Merrill Lynch & Company, Inc. 1,884,388 84 10,600 Michaels Stores, Inc. 627,626 28 162,700 Microsoft Corporation 4,498,655 200 55,800 Motorola, Inc. 1,006,632 45 49,500 * Nextel Communications, Inc. - Class "A" 1,180,080 53 16,200 NIKE, Inc. - Class "B" 1,276,560 57 15,200 Norfolk Southern Corporation 452,048 20 28,700 * Pactiv Corporation 667,275 30 36,800 PepsiCo, Inc. 1,790,320 80 11,400 PETsMART, Inc. 323,646 14 98,525 Pfizer, Inc. 3,014,865 134 51,800 * Polycom, Inc. 1,026,676 46 12,900 Precision Castparts Corporation 774,645 34 28,000 Principal Financial Group, Inc. 1,007,160 45 24,400 Procter & Gamble Company 1,320,528 59 22,800 Rockwell Collins, Inc. 846,792 38 87,400 Schering-Plough Corporation 1,665,844 74 38,100 Schlumberger, Ltd. 2,564,511 114 35,800 Southern Company 1,073,284 48 44,900 Sprint Corporation 903,837 40 36,925 St. Paul Travelers Companies, Inc. 1,220,741 54 29,200 Staples, Inc. 870,744 39 40,600 Texas Instruments, Inc. 863,968 38 181,500 * Time Warner, Inc. 2,929,410 130 63,000 Tyco International, Ltd. 1,931,580 86 19,000 United Technologies Corporation 1,774,220 79 40,900 * VeriSign, Inc. 813,092 36 41,800 Wyeth 1,563,320 70 29,600 * Yahoo!, Inc. 1,003,736 45 11,700 Zions Bancorporation 714,168 32 - ---------------------------------------------------------------------------------------------------------------------- 97,974,448 4,364 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS GLOBAL FUND, INC. September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- France--10.9% 56,200 AXA $1,137,048 $51 24,853 Essilor International SA 1,597,389 71 74,008 European Aeronautic Defence and Space Company 1,960,610 87 92,483 France Telecom SA 2,304,170 103 14,500 Groupe Danone 1,139,970 51 46,875 Lafarge SA 4,101,511 183 16,600 Pinault-Printemps-Redoute SA 1,524,642 68 25,700 PSA Peugeot Citroen 1,583,202 70 59,681 Societe Television Francaise 1 1,692,988 75 20,244 Total SA 4,123,460 184 39,100 Veolia Environment 1,125,186 50 83,100 * Vivendi Universal SA 2,129,226 95 - ---------------------------------------------------------------------------------------------------------------------- 24,419,402 1,088 - ---------------------------------------------------------------------------------------------------------------------- United Kingdom--10.0% 53,700 AstraZeneca PLC 2,200,963 98 80,000 GlaxoSmithKline PLC 1,724,138 77 98,800 Imperial Tobacco Group PLC 2,152,552 96 294,000 Kingfisher PLC 1,639,912 73 138,823 Reckitt Benckiser PLC 3,401,342 151 772,763 Rolls-Royce Group PLC 3,541,327 158 155,652 Royal Bank of Scotland Group PLC 4,495,291 200 1,419,612 Vodafone Group PLC 3,397,313 151 - ---------------------------------------------------------------------------------------------------------------------- 22,552,838 1,004 - ---------------------------------------------------------------------------------------------------------------------- Japan--7.8% 46,000 Canon, Inc. 2,161,956 96 65,000 Eisai Company, Ltd. 1,769,269 79 12,300 Electric Power Development Company, Ltd.** 301,320 13 262 Japan Tobacco, Inc. 2,191,752 98 38,000 Kao Corporation 839,541 37 13,300 Nintendo Company, Ltd. 1,626,675 72 739 NTT DoCoMo, Inc. 1,253,849 56 58,000 Olympus Corporation 1,118,269 50 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Japan (continued) 58,000 Sankyo Company, Ltd. $1,226,149 $55 29,600 Shin-Etsu Chemical Company, Ltd. 1,063,521 47 206,000 Sumitomo Metal Mining Company, Ltd. 1,427,973 64 254,000 Sumitomo Trust and Banking Company, Ltd. 1,502,590 67 16,270 Takefuji Corporation 1,040,725 46 - ---------------------------------------------------------------------------------------------------------------------- 17,523,589 780 - ---------------------------------------------------------------------------------------------------------------------- Germany--3.8% 42,500 Bayerische Motoren Werke (BMW) AG 1,749,823 78 30,900 DaimlerChrysler AG 1,272,224 57 76,100 * Deutsche Lufthansa AG - Registered 890,343 40 42,800 E.ON AG 3,149,588 140 15,800 Muenchener Rueckversicherungs - Gesellschaft AG - Registered 1,516,904 67 - ---------------------------------------------------------------------------------------------------------------------- 8,578,882 382 - ---------------------------------------------------------------------------------------------------------------------- Netherlands--3.6% 89,455 ABN AMRO Holding NV 2,032,076 91 131,500 * ASML Holding NV 1,692,026 75 89,442 ING Groep NV 2,257,287 101 321,300 * Koninklijke Ahold NV 2,051,141 91 - ---------------------------------------------------------------------------------------------------------------------- 8,032,530 358 - ---------------------------------------------------------------------------------------------------------------------- Switzerland--3.1% 8,172 Converium Holding AG 109,619 5 5,000 Converium Holding AG (ADR) 34,750 1 85,680 Novartis AG - Registered 3,993,414 178 40,870 UBS AG - Registered 2,876,970 128 - ---------------------------------------------------------------------------------------------------------------------- 7,014,753 312 - ---------------------------------------------------------------------------------------------------------------------- Canada--2.6% 25,800 Canadian National Railway Company 1,259,040 56 42,400 EnCana Corporation 1,954,913 87 15,900 * Research in Motion, Ltd. 1,213,806 54 57,000 Talisman Energy, Inc. 1,472,798 66 - ---------------------------------------------------------------------------------------------------------------------- 5,900,557 263 - ---------------------------------------------------------------------------------------------------------------------- Portfolio of Investments (continued) FIRST INVESTORS GLOBAL FUND, INC. September 30, 2004 - ---------------------------------------------------------------------------------------------------------------------- Amount Invested For Each $10,000 of Shares Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- South Korea--2.3% 131,620 Kia Motors Corporation $1,211,613 $54 29,560 LG Electronics, Inc. 1,699,410 76 24,740 SK Corporation 1,140,855 51 52,290 SK Telecom Company, Ltd. (ADR) 1,017,041 45 - ---------------------------------------------------------------------------------------------------------------------- 5,068,919 226 - ---------------------------------------------------------------------------------------------------------------------- Belgium--1.5% 49,377 * Belgacom SA 1,768,649 79 64,500 Fortis 1,533,286 68 - ---------------------------------------------------------------------------------------------------------------------- 3,301,935 147 - ---------------------------------------------------------------------------------------------------------------------- Italy--1.4% 140,048 ENI SpA 3,137,871 140 - ---------------------------------------------------------------------------------------------------------------------- Sweden--1.2% 145,700 Nordea Bank AB 1,190,785 53 483,070 * Telefonaktiebolaget LM Ericsson AB - Class "B" 1,499,599 67 - ---------------------------------------------------------------------------------------------------------------------- 2,690,384 120 - ---------------------------------------------------------------------------------------------------------------------- Taiwan--1.1% 340,419 Taiwan Semiconductor Manufacturing Company, Ltd. (ADR) 2,430,592 108 - ---------------------------------------------------------------------------------------------------------------------- Ireland--.9% 45,100 * Elan Corporation PLC (ADR) 1,055,340 47 37,800 * Ryanair Holdings PLC (ADR) 1,103,760 48 - ---------------------------------------------------------------------------------------------------------------------- 2,159,100 95 - ---------------------------------------------------------------------------------------------------------------------- India--.8% 30,500 Infosys Technologies, Ltd. (ADR) 1,726,300 77 - ---------------------------------------------------------------------------------------------------------------------- Spain--.7% 73,800 Iberdrola SA 1,530,715 68 - ---------------------------------------------------------------------------------------------------------------------- China--.7% 3,756,000 China Petroleum & Chemical Corporation 1,529,267 68 - ---------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------- Amount Invested Shares or For Each Principal $10,000 of Amount Security Value Net Assets - ---------------------------------------------------------------------------------------------------------------------- Hong Kong--.5% 233,000 Esprit Holdings, Ltd. $1,183,219 $53 - ---------------------------------------------------------------------------------------------------------------------- Indonesia--.5% 59,200 PT Telekomunikasi Indonesia (ADR) 1,047,248 47 - ---------------------------------------------------------------------------------------------------------------------- Russia--.4% 7,000 LUKOIL (ADR) 868,000 39 - ---------------------------------------------------------------------------------------------------------------------- Australia--.2% 136,206 WMC Resources, Ltd. 528,822 23 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Common Stocks (cost $192,028,099) 219,199,371 9,762 - ---------------------------------------------------------------------------------------------------------------------- PREFERRED STOCKS--.0% Brazil 23,000 * Vale Do Rio Doce - Class "B" (cost $0)** 165 -- - ---------------------------------------------------------------------------------------------------------------------- REPURCHASE AGREEMENT--2.9% $6,387M BNP Paribas, 1.72%, dated 9/30/04, to be repurchased at $6,387,305 on 10/1/04 (collateralized by U.S. Treasury Notes, 10.75%, 8/15/05, valued at $6,512,555) (cost $6,387,000) 6,387,000 285 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments (cost $198,415,099) 100.5% 225,586,536 10,047 Excess of Liabilities Over Other Assets (.5) (1,065,752) (47) - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $224,520,784 $10,000 ====================================================================================================================== * Non-income producing ** Security valued at fair value (see Note 1A) Summary of Abbreviations: ADR American Depositary Receipts See notes to financial statements
Portfolio of Investments (continued) FIRST INVESTORS GLOBAL FUND, INC. September 30, 2004 Sector diversification of the portfolio was as follows: - ---------------------------------------------------------------------------------------------------------------------- Percentage Sector of Net Assets Value - ---------------------------------------------------------------------------------------------------------------------- Pharmaceuticals & Biotechnology 10.4% $23,357,250 Energy 10.1 22,640,503 Capital Goods 7.6 17,061,193 Diversified Financials 6.7 15,121,030 Banks 6.3 14,089,852 Materials 5.9 13,150,631 Telecommunication Services 5.7 12,872,186 Software & Services 5.3 11,930,122 Technology Hardware & Equipment 4.7 10,589,137 Food, Beverage & Tobacco 3.8 8,643,458 Semiconductors & Semiconductor Equipment 3.8 8,583,199 Retailing 3.7 8,213,349 Media 3.4 7,525,570 Household & Personal Products 3.2 7,139,183 Utilities 3.1 6,878,773 Transportation 3.1 6,854,990 Insurance 3.0 6,721,868 Automobiles & Components 2.6 5,816,862 Health Care Equipment & Services 2.3 5,217,388 Consumer Durables & Apparel 1.3 2,975,971 Food & Staples Retailing .9 2,051,141 Pooled Vehicle .4 978,916 Commercial Services & Supplies .3 786,964 Repurchase Agreement 2.9 6,387,000 - ---------------------------------------------------------------------------------------------------------------------- Total Value of Investments 100.5 225,586,536 Excess of Liabilities Over Other Assets (.5) (1,065,752) - ---------------------------------------------------------------------------------------------------------------------- Net Assets 100.0% $224,520,784 ====================================================================================================================== See notes to financial statements
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Statements of Assets and Liabilities FIRST INVESTORS September 30, 2004 - --------------------------------------------------------------------------------------------------------------------------------- TOTAL GROWTH & ALL-CAP RETURN VALUE BLUE CHIP INCOME GROWTH - --------------------------------------------------------------------------------------------------------------------------------- Assets Investments in securities: At identified cost $220,034,219 $168,484,952 $383,880,546 $482,332,549 $128,644,286 ============ ============ ============ ============ ============ At value (Note 1A) $249,292,900 $206,687,244 $472,055,559 $580,581,313 $151,686,047 Cash 1,155,940 1,011,543 2,754,490 892,920 50,468 Receivables: Investment securities sold 15,575,922 597,982 8,556,906 1,330,427 523,265 Dividends and interest 1,085,739 434,059 442,966 452,332 40,215 Shares sold 393,644 592,367 286,750 972,050 436,090 Forward currency contracts (Note 4) -- -- -- -- -- Other assets 11,494 7,646 24,040 25,159 5,088 ------------ ------------ ------------ ------------ ------------ Total Assets 267,515,639 209,330,841 484,120,711 584,254,201 152,741,173 ------------ ------------ ------------ ------------ ------------ Liabilities Payables: Investment securities purchased 162,668 557,180 7,567,126 560,926 1,723,725 Shares redeemed 267,509 203,455 783,501 790,149 154,540 Dividends payable 15,237 13,941 -- 4,451 -- Accrued advisory fees 163,034 126,416 292,520 346,871 90,325 Accrued shareholder servicing costs 66,892 56,870 137,109 155,570 57,763 Accrued expenses 24,410 20,239 13,937 36,560 14,215 ------------ ------------ ------------ ------------ ------------ Total Liabilities 699,750 978,101 8,794,193 1,894,527 2,040,568 ------------ ------------ ------------ ------------ ------------ Net Assets $266,815,889 $208,352,740 $475,326,518 $582,359,674 $150,700,605 ============ ============ ============ ============ ============ Net Assets Consist of: Capital paid in $262,398,226 $229,809,489 $527,116,812 $566,568,642 $145,441,609 Undistributed net investment income (deficit) (264,926) 156,825 -- 1,142,907 -- Accumulated net realized loss on investments and foreign currency transactions (24,576,092) (59,815,866) (139,965,307) (83,600,639) (17,782,765) Net unrealized appreciation in value of investments and foreign currency transactions 29,258,681 38,202,292 88,175,013 98,248,764 23,041,761 ------------ ------------ ------------ ------------ ------------ Total $266,815,889 $208,352,740 $475,326,518 $582,359,674 $150,700,605 ============ ============ ============ ============ ============ Net Assets: Class A $231,196,720 $185,009,479 $414,363,548 $498,968,775 $130,323,261 Class B $35,619,169 $23,343,261 $60,962,970 $83,390,899 $20,377,344 Shares outstanding (Note 5): Class A 17,815,094 31,079,026 22,169,985 41,104,256 16,702,354 Class B 2,782,931 3,979,433 3,462,449 7,177,657 2,683,652 Net asset value and redemption price per share - Class A $12.98 $5.95 $18.69 $12.14 $7.80 ============ ============ ============ ============ ============ Maximum offering price per share - Class A (Net asset value/.9425)* $13.77 $6.31 $19.83 $12.88 $8.28 ============ ============ ============ ============ ============ Net asset value and offering price per share - Class B (Note 5) $12.80 $5.87 $17.61 $11.62 $7.59 ============ ============ ============ ============ ============ Statements of Assets and Liabilities (continued) FIRST INVESTORS September 30, 2004 - ------------------------------------------------------------------------------------------------------------- MID-CAP SPECIAL FOCUSED OPPORTUNITY SITUATIONS EQUITY GLOBAL - ------------------------------------------------------------------------------------------------------------- Assets Investments in securities: At identified cost $271,359,962 $175,068,012 $57,484,571 $198,415,099 ============ ============ ============ ============ At value (Note 1A) $323,910,544 $209,670,337 $60,238,809 $225,586,536 Cash 196,859 1,114,907 52,253 50,243 Receivables: Investment securities sold 758,160 83,698 676,899 2,659,759 Dividends and interest 155,949 70,676 45,617 314,417 Shares sold 819,736 182,522 29,455 91,021 Forward currency contracts (Note 4) -- -- -- 10,089 Other assets 11,994 10,176 3,114 31,939 ------------ ------------ ------------ ------------ Total Assets 325,853,242 211,132,316 61,046,147 228,744,004 ------------ ------------ ------------ ------------ Liabilities Payables: Investment securities purchased 1,562,836 419,520 661,423 3,659,620 Shares redeemed 407,352 329,009 213,110 276,878 Dividends payable -- -- -- -- Accrued advisory fees 194,599 126,749 37,335 183,559 Accrued shareholder servicing costs 108,902 82,940 31,505 68,520 Accrued expenses 27,885 33,356 18,903 34,643 ------------ ------------ ------------ ------------ Total Liabilities 2,301,574 991,574 962,276 4,223,220 ------------ ------------ ------------ ------------ Net Assets $323,551,668 $210,140,742 $60,083,871 $224,520,784 ============ ============ ============ ============ Net Assets Consist of: Capital paid in $283,335,277 $236,728,424 $84,252,209 $228,663,459 Undistributed net investment income (deficit) -- -- -- -- Accumulated net realized loss on investments and foreign currency transactions (12,334,191) (61,190,007) (26,922,576) (31,322,315) Net unrealized appreciation in value of investments and foreign currency transactions 52,550,582 34,602,325 2,754,238 27,179,640 ------------ ------------ ------------ ------------ Total $323,551,668 $210,140,742 $60,083,871 $224,520,784 ============ ============ ============ ============ Net Assets: Class A $277,416,113 $189,569,661 $49,475,440 $209,334,832 Class B $46,135,555 $20,571,081 $10,608,431 $15,185,952 Shares outstanding (Note 5): Class A 12,215,875 11,254,142 6,316,638 35,318,259 Class B 2,186,113 1,324,101 1,408,007 2,752,991 Net asset value and redemption price per share - Class A $22.71 $16.84 $7.83 $5.93 ============ ============ ============ ============ Maximum offering price per share - Class A (Net asset value/.9425)* $24.10 $17.87 $8.31 $6.29 ============ ============ ============ ============ Net asset value and offering price per share - Class B (Note 5) $21.10 $15.54 $7.53 $5.52 ============ ============ ============ ============ * On purchases of $100,000 or more, the sales charge is reduced. See notes to financial statements
Statements of Operations FIRST INVESTORS Year Ended September 30, 2004 - ----------------------------------------------------------------------------------------------------------------------------------- TOTAL GROWTH & ALL-CAP RETURN VALUE BLUE CHIP INCOME GROWTH - ----------------------------------------------------------------------------------------------------------------------------------- Investment Income Dividends $3,023,045 $4,709,074 $7,374,247 $10,809,021 $655,500 Interest 4,259,537 174,492 -- 19,175 53,653 ------------ ------------ ------------ ------------ ------------ Total income 7,282,582 4,883,566 7,374,247 10,828,196 709,153 ------------ ------------ ------------ ------------ ------------ Expenses (Notes 1 and 3): Advisory fees 2,331,936 1,358,970 4,164,190 4,079,182 951,351 Distribution plan expenses - Class A 631,706 478,739 1,268,209 1,415,337 326,332 Distribution plan expenses - Class B 336,896 216,163 659,409 846,374 180,693 Shareholder servicing costs 745,746 625,249 1,735,973 1,805,154 668,091 Professional fees 37,620 39,916 68,038 66,579 28,795 Custodian fees 42,751 24,465 64,660 57,160 16,405 Registration fees 32,538 33,338 32,816 34,492 34,148 Reports to shareholders 28,800 23,760 67,364 70,282 26,432 Directors/trustees' fees 9,014 7,265 16,554 18,949 5,767 Other expenses 56,948 31,410 91,681 99,280 21,320 ------------ ------------ ------------ ------------ ------------ Total expenses 4,253,955 2,839,275 8,168,894 8,492,789 2,259,334 Less: Expenses waived (500,000) -- (500,000) -- -- Expenses paid indirectly (9,269) (6,476) (10,862) (6,284) (928) ------------ ------------ ------------ ------------ ------------ Net expenses 3,744,686 2,832,799 7,658,032 8,486,505 2,258,406 ------------ ------------ ------------ ------------ ------------ Net investment income (loss) 3,537,896 2,050,767 (283,785) 2,341,691 (1,549,253) ------------ ------------ ------------ ------------ ------------ Realized and Unrealized Gain (Loss) on Investments and Foreign Currency Transactions (Note 2): Net realized gain on investments and foreign currency transactions 8,318,115 4,056,548 25,571,788 36,796,326 3,952,080 Net unrealized appreciation (depreciation) of investments and foreign currency transactions 8,527,394 25,404,854 14,361,975 27,753,508 12,347,189 ------------ ------------ ------------ ------------ ------------ Net gain on investments and foreign currency transactions 16,845,509 29,461,402 39,933,763 64,549,834 16,299,269 ------------ ------------ ------------ ------------ ------------ Net Increase in Net Assets Resulting from Operations $20,383,405 $31,512,169 $39,649,978 $66,891,525 $14,750,016 ============ ============ ============ ============ ============ Statements of Operations (continued) FIRST INVESTORS Year Ended September 30, 2004 - -------------------------------------------------------------------------------------------------------------- MID-CAP SPECIAL FOCUSED OPPORTUNITY SITUATIONS EQUITY GLOBAL - -------------------------------------------------------------------------------------------------------------- Investment Income Dividends $3,116,815 $1,083,700 $979,979 $3,883,851+ Interest 53,790 87,262 6,162 73,209 ------------ ------------ ------------ ------------ Total income 3,170,605 1,170,962 986,141 3,957,060 ------------ ------------ ------------ ------------ Expenses (Notes 1 and 3): Advisory fees 2,671,873 2,107,110 475,507 2,281,707 Distribution plan expenses - Class A 738,998 576,140 156,290 636,175 Distribution plan expenses - Class B 432,503 223,692 113,042 161,125 Shareholder servicing costs 1,245,203 1,036,238 388,545 859,913 Professional fees 43,013 44,986 24,704 55,909 Custodian fees 35,779 39,842 10,466 261,883 Registration fees 32,492 31,992 33,288 36,444 Reports to shareholders 49,739 41,379 34,020 36,409 Directors/trustees' fees 10,562 8,239 3,259 8,585 Other expenses 56,038 41,556 15,505 20,417 ------------ ------------ ------------ ------------ Total expenses 5,316,200 4,151,174 1,254,626 4,358,567 Less: Expenses waived (500,000) (498,992) -- -- Expenses paid indirectly (5,791) (7,979) (396) (1,424) ------------ ------------ ------------ ------------ Net expenses 4,810,409 3,644,203 1,254,230 4,357,143 ------------ ------------ ------------ ------------ Net investment income (loss) (1,639,804) (2,473,241) (268,089) (400,083) ------------ ------------ ------------ ------------ Realized and Unrealized Gain (Loss) on Investments and Foreign Currency Transactions (Note 2): Net realized gain on investments and foreign currency transactions 20,378,683 26,478,497 1,822,147 30,025,702 Net unrealized appreciation (depreciation) of investments and foreign currency transactions 24,729,598 (9,729,555) 3,279,568 690,941 ------------ ------------ ------------ ------------ Net gain on investments and foreign currency transactions 45,108,281 16,748,942 5,101,715 30,716,643 ------------ ------------ ------------ ------------ Net Increase in Net Assets Resulting from Operations $43,468,477 $14,275,701 $4,833,626 $30,316,560 ============ ============ ============ ============ + Net of $338,353 foreign taxes withheld See notes to financial statements
Statements of Changes in Net Assets FIRST INVESTORS - -------------------------------------------------------------------------------------------------------------------------------- TOTAL RETURN VALUE ---------------------------- ---------------------------- Year Ended September 30 2004 2003 2004 2003 - -------------------------------------------------------------------------------------------------------------------------------- Increase (Decrease) in Net Assets From Operations Net investment income (loss) $3,537,896 $2,595,772 $2,050,767 $1,994,571 Net realized gain (loss) on investments 8,318,115 (4,976,396) 4,056,548 (7,805,613) Net unrealized appreciation of investments 8,527,394 27,102,984 25,404,854 27,059,981 ------------ ------------ ------------ ------------ Net increase in net assets resulting from operations 20,383,405 24,722,360 31,512,169 21,248,939 ------------ ------------ ------------ ------------ Dividends to Shareholders Net investment income - Class A (3,344,902) (2,745,536) (1,866,906) (1,748,084) Net investment income - Class B (318,565) (285,333) (112,863) (160,660) ------------ ------------ ------------ ------------ Total dividends (3,663,467) (3,030,869) (1,979,769) (1,908,744) ------------ ------------ ------------ ------------ Share Transactions* Class A: Proceeds from shares sold 67,816,731 49,222,767 51,007,936 26,361,060 Reinvestment of dividends 3,288,426 2,709,146 1,814,820 1,695,885 Cost of shares redeemed (31,026,815) (23,367,193) (19,645,255) (18,006,487) ------------ ------------ ------------ ------------ 40,078,342 28,564,720 33,177,501 10,050,458 ------------ ------------ ------------ ------------ Class B: Proceeds from shares sold 9,344,252 7,886,210 5,777,938 3,447,342 Reinvestment of dividends 316,238 283,519 111,791 159,358 Cost of shares redeemed (4,776,454) (4,531,666) (4,941,142) (4,191,112) ------------ ------------ ------------ ------------ 4,884,036 3,638,063 948,587 (584,412) ------------ ------------ ------------ ------------ Net increase (decrease) from share transactions 44,962,378 32,202,783 34,126,088 9,466,046 ------------ ------------ ------------ ------------ Net increase in net assets 61,682,316 53,894,274 63,658,488 28,806,241 Net Assets Beginning of year 205,133,573 151,239,299 144,694,252 115,888,011 ------------ ------------ ------------ ------------ End of year + $266,815,889 $205,133,573 $208,352,740 $144,694,252 ============ ============ ============ ============ +Includes undistributed net investment income (deficit) of $(264,926) $( 312,490) $156,825 $85,827 ============ ============ ============ ============ *Shares Issued and Redeemed Class A: Sold 5,268,212 4,332,265 8,950,654 5,561,598 Issued for dividends reinvested 252,536 239,990 310,958 364,982 Redeemed (2,410,468) (2,092,115) (3,441,839) (3,944,699) ------------ ------------ ------------ ------------ Net increase (decrease) in Class A shares outstanding 3,110,280 2,480,140 5,819,773 1,981,881 ============ ============ ============ ============ Class B: Sold 737,727 705,304 1,032,020 736,536 Issued for dividends reinvested 24,614 25,554 19,427 35,022 Redeemed (375,421) (414,061) (882,554) (931,856) ------------ ------------ ------------ ------------ Net increase (decrease) in Class B shares outstanding 386,920 316,797 168,893 (160,298) ============ ============ ============ ============ Statements of Changes in Net Assets FIRST INVESTORS - ------------------------------------------------------------------------------------------------------------------------------- BLUE CHIP GROWTH & INCOME ---------------------------- ---------------------------- Year Ended September 30 2004 2003 2004 2003 - ------------------------------------------------------------------------------------------------------------------------------- Increase (Decrease) in Net Assets From Operations Net investment income (loss) $(283,785) $(425,904) $2,341,691 $1,371,212 Net realized gain (loss) on investments 25,571,788 (27,055,645) 36,796,326 (17,943,080) Net unrealized appreciation of investments 14,361,975 94,207,242 27,753,508 97,389,824 ------------ ------------ ------------ ------------ Net increase in net assets resulting from operations 39,649,978 66,725,693 66,891,525 80,817,956 ------------ ------------ ------------ ------------ Dividends to Shareholders Net investment income - Class A -- -- (1,198,784) (1,561,227) Net investment income - Class B -- -- -- -- ------------ ------------ ------------ ------------ Total dividends -- -- (1,198,784) (1,561,227) ------------ ------------ ------------ ------------ Share Transactions* Class A: Proceeds from shares sold 59,861,560 53,450,998 105,331,802 69,467,305 Reinvestment of dividends -- -- 1,186,897 1,545,811 Cost of shares redeemed (62,755,398) (60,801,572) (63,168,639) (55,627,119) ------------ ------------ ------------ ------------ (2,893,838) (7,350,574) 43,350,060 15,385,997 ------------ ------------ ------------ ------------ Class B: Proceeds from shares sold 8,311,100 8,941,786 14,981,290 11,899,634 Reinvestment of dividends -- -- -- -- Cost of shares redeemed (15,084,253) (12,841,105) (17,923,509) (14,006,947) ------------ ------------ ------------ ------------ (6,773,153) (3,899,319) (2,942,219) (2,107,313) ------------ ------------ ------------ ------------ Net increase (decrease) from share transactions (9,666,991) (11,249,893) 40,407,841 13,278,684 ------------ ------------ ------------ ------------ Net increase in net assets 29,982,987 55,475,800 106,100,582 92,535,413 Net Assets Beginning of year 445,343,531 389,867,731 476,259,092 383,723,679 ------------ ------------ ------------ ------------ End of year + $475,326,518 $445,343,531 $582,359,674 $476,259,092 ============ ============ ============ ============ +Includes undistributed net investment income (deficit) of $-- $-- $1,142,907 $-- ============ ============ ============ ============ *Shares Issued and Redeemed Class A: Sold 3,172,176 3,344,515 8,833,243 7,092,953 Issued for dividends reinvested -- -- 97,777 160,200 Redeemed (3,335,866) (3,864,778) (5,290,872) (5,818,365) ------------ ------------ ------------ ------------ Net increase (decrease) in Class A shares outstanding (163,690) (520,263) 3,640,148 1,434,788 ============ ============ ============ ============ Class B: Sold 466,882 588,924 1,312,512 1,263,648 Issued for dividends reinvested -- -- -- -- Redeemed (846,873) (860,901) (1,568,845) (1,523,474) ------------ ------------ ------------ ------------ Net increase (decrease) in Class B shares outstanding (379,991) (271,977) (256,333) (259,826) ============ ============ ============ ============ See notes to financial statements
Statements of Changes in Net Assets FIRST INVESTORS - ---------------------------------------------------------------------------------------------------------------------------------- ALL-CAP GROWTH MID-CAP OPPORTUNTITY ---------------------------- ---------------------------- Year Ended September 30 2004 2003 2004 2003 - ---------------------------------------------------------------------------------------------------------------------------------- Increase (Decrease) in Net Assets From Operations Net investment loss $(1,549,253) $(857,716) $(1,639,804) $(1,684,478) Net realized gain (loss) on investments 3,952,080 (1,931,995) 20,378,683 (9,144,785) Net unrealized appreciation (depreciation) of investments 12,347,189 18,163,770 24,729,598 47,400,847 ------------ ------------ ------------ ------------ Net increase in net assets resulting from operations 14,750,016 15,374,059 43,468,477 36,571,584 ------------ ------------ ------------ ------------ Share Transactions * Class A: Proceeds from shares sold 52,765,310 27,790,360 79,643,493 51,795,794 Cost of shares redeemed (11,769,360) (7,697,061) (31,414,210) (21,887,533) ------------ ------------ ------------ ------------ 40,995,950 20,093,299 48,229,283 29,908,261 ------------ ------------ ------------ ------------ Class B: Proceeds from shares sold 6,200,445 4,175,360 11,173,893 7,921,873 Cost of shares redeemed (1,739,011) (1,410,633) (5,939,582) (4,116,563) ------------ ------------ ------------ ------------ 4,461,434 2,764,727 5,234,311 3,805,310 ------------ ------------ ------------ ------------ Net increase (decrease) from share transactions 45,457,384 22,858,026 53,463,594 33,713,571 ------------ ------------ ------------ ------------ Net increase in net assets 60,207,400 38,232,085 96,932,071 70,285,155 Net Assets Beginning of year 90,493,205 52,261,120 226,619,597 156,334,442 ------------ ------------ ------------ ------------ End of year $150,700,605 $90,493,205 $323,551,668 $226,619,597 ============ ============ ============ ============ *Shares Issued and Redeemed Class A: Sold 6,871,429 4,464,318 3,631,663 3,001,097 Redeemed (1,531,123) (1,288,511) (1,427,534) (1,294,434) ------------ ------------ ------------ ------------ Net increase (decrease) in Class A shares outstanding 5,340,306 3,175,807 2,204,129 1,706,663 ============ ============ ============ ============ Class B: Sold 827,213 685,202 548,606 487,764 Redeemed (231,955) (241,915) (289,487) (261,744) ------------ ------------ ------------ ------------ Net increase (decrease) in Class B shares outstanding 595,258 443,287 259,119 226,020 ============ ============ ============ ============ Statements of Changes in Net Assets (continued) FIRST INVESTORS - ---------------------------------------------------------------------------------------------------------------------------------- SPECIAL SITUATIONS FOCUSED EQUITY ---------------------------- ---------------------------- Year Ended September 30 2004 2003 2004 2003 - ---------------------------------------------------------------------------------------------------------------------------------- Increase (Decrease) in Net Assets From Operations Net investment loss $(2,473,241) $(2,174,743) $(268,089) $(255,382) Net realized gain (loss) on investments 26,478,497 (8,547,634) 1,822,147 (3,672,111) Net unrealized appreciation (depreciation) of investments (9,729,555) 46,021,471 3,279,568 15,896,024 ------------ ------------ ------------ ------------ Net increase in net assets resulting from operations 14,275,701 35,299,094 4,833,626 11,968,531 ------------ ------------ ------------ ------------ Share Transactions * Class A: Proceeds from shares sold 32,272,999 21,524,779 7,719,981 7,578,453 Cost of shares redeemed (24,508,853) (21,840,556) (10,216,270) (7,332,359) ------------ ------------ ------------ ------------ 7,764,146 (315,777) (2,496,289) 246,094 ------------ ------------ ------------ ------------ Class B: Proceeds from shares sold 4,172,232 2,582,621 1,199,744 1,101,769 Cost of shares redeemed (5,431,921) (3,464,531) (2,128,058) (1,629,642) ------------ ------------ ------------ ------------ (1,259,689) (881,910) (928,314) (527,873) ------------ ------------ ------------ ------------ Net increase (decrease) from share transactions 6,504,457 (1,197,687) (3,424,603) (281,779) ------------ ------------ ------------ ------------ Net increase in net assets 20,780,158 34,101,407 1,409,023 11,686,752 Net Assets Beginning of year 189,360,584 155,259,177 58,674,848 46,988,096 ------------ ------------ ------------ ------------ End of year $210,140,742 $189,360,584 $60,083,871 $58,674,848 ============ ============ ============ ============ *Shares Issued and Redeemed Class A: Sold 1,863,325 1,599,285 977,797 1,128,365 Redeemed (1,421,872) (1,660,681) (1,296,757) (1,112,790) ------------ ------------ ------------ ------------ Net increase (decrease) in Class A shares outstanding 441,453 (61,396) (318,960) 15,575 ============ ============ ============ ============ Class B: Sold 259,292 204,411 157,973 168,390 Redeemed (338,579) (282,940) (280,246) (262,445) ------------ ------------ ------------ ------------ Net increase (decrease) in Class B shares outstanding (79,287) (78,529) (122,273) (94,055) ============ ============ ============ ============ See notes to financial statements
Statements of Changes in Net Assets FIRST INVESTORS - -------------------------------------------------------------------------------------------------- GLOBAL ---------------------------- Year Ended September 30 2004 2003 - -------------------------------------------------------------------------------------------------- Increase (Decrease) in Net Assets From Operations Net investment loss $(400,083) $(471,515) Net realized gain (loss) on investments and foreign currency transactions 30,025,702 (3,393,379) Net unrealized appreciation of investments and foreign currency transactions 690,941 42,419,475 ------------ ------------ Net increase in net assets resulting from operations 30,316,560 38,554,581 ------------ ------------ Share Transactions* Class A: Proceeds from shares sold 16,930,869 13,212,580 Cost of shares redeemed (28,122,035) (30,106,459) ------------ ------------ (11,191,166) (16,893,879) ------------ ------------ Class B: Proceeds from shares sold 1,931,105 1,392,241 Cost of shares redeemed (3,892,357) (3,012,650) ------------ ------------ (1,961,252) (1,620,409) ------------ ------------ Net decrease from share transactions (13,152,418) (18,514,288) ------------ ------------ Net increase in net assets 17,164,142 20,040,293 Net Assets Beginning of year 207,356,642 187,316,349 ------------ ------------ End of year $224,520,784 $207,356,642 ============ ============ *Shares Issued and Redeemed Class A: Sold 2,881,046 2,823,401 Redeemed (4,801,535) (6,467,613) ------------ ------------ Net decrease in Class A shares outstanding (1,920,489) (3,644,212) ============ ============ Class B: Sold 353,684 315,712 Redeemed (706,156) (690,288) ------------ ------------ Net decrease in Class B shares outstanding (352,472) (374,576) ============ ============ See notes to financial statements
Notes to Financial Statements September 30, 2004 1. Significant Accounting Policies--First Investors Total Return Fund, First Investors Blue Chip Fund and First Investors Special Situations Fund, each a series of First Investors Series Fund ("Series Fund"), a Massachusetts business trust; First Investors Value Fund (formerly Utilities Income), First Investors Growth & Income Fund, First Investors All-Cap Growth Fund, First Investors Mid-Cap Opportunity Fund and First Investors Focused Equity Fund, each a series of First Investors Series Fund II, Inc. ("Series Fund II"), a Maryland corporation; and First Investors Global Fund, Inc. ("Global Fund"), a Maryland corporation, are registered under the Investment Company Act of 1940 (the "1940 Act") as diversified, open-end management investment companies, with the exception of First Investors Focused Equity Fund, which is registered as a non-diversified series of the investment company. Each Fund accounts separately for the assets, liabilities, and operations of the Fund. Series Fund offers two additional series which are not included in this report. The objective of each Fund is as follows: Total Return Fund seeks high, long-term total investment return consistent with moderate investment risk. Value Fund seeks total return. Blue Chip Fund seeks high total investment return consistent with the preservation of capital. Growth & Income Fund seeks long-term growth of capital and current income. All-Cap Growth Fund seeks long-term growth of capital. Mid-Cap Opportunity Fund seeks long-term capital growth. Special Situations Fund seeks long-term growth of capital. Focused Equity Fund seeks capital appreciation. Global Fund primarily seeks long-term capital growth and, secondarily, a reasonable level of current income. A. Security Valuation--Except as provided below, a security listed or traded on an exchange or the Nasdaq Stock Market is valued at its last sale price on the exchange or market where the security is principally traded, and lacking any sales, the security is valued at the mean between the closing bid and asked prices. Securities traded in the over-the-counter ("OTC") market (including securities listed on exchanges whose primary market is believed to be OTC) are valued at the mean between the last bid and asked prices based upon quotes furnished by a market maker for such securities. Securities may also be priced by a pricing service approved by the applicable Fund's Notes to Financial Statements (continued) September 30, 2004 Board of Directors/Trustees (the "Board"). The pricing service considers security type, rating, market condition and yield data as well as market quotations, prices provided by market makers and other available information in determining value. Short-term debt securities that mature in 60 days or less are valued at amortized cost. The Funds monitor for significant events occurring after the close of foreign markets but prior to the close of trading on the New York Stock Exchange that could have a material impact on the value of any foreign securities that are held by the Funds. Examples of such events include natural disasters, political events, issuer-specific developments such as bankruptcies and significant fluctuations in securities markets. If the Valuation Committee decides that such events warrant using fair value estimates for foreign securities, it will take such events into consideration in determining the fair values of such securities. If market quotations or prices are not readily available or determined to be unreliable, the securities will be valued at fair value as determined in good faith pursuant to procedures adopted by the Board. At September 30, 2004, the Global Fund held two securities that were fair valued by its Valuation Committee with an aggregate value of $301,485 representing .1% of the Fund's net assets. For valuation purposes, where applicable, quotations of foreign securities in foreign currency are translated to U.S. dollar equivalents using the foreign exchange quotation in effect. B. Federal Income Taxes--No provision has been made for federal income taxes on net income or capital gains since it is the policy of each Fund to continue to comply with the special provisions of the Internal Revenue Code applicable to investment companies and to make sufficient distributions of income and capital gains (in excess of any available capital loss carryovers) to relieve it from all, or substantially all, such taxes. At September 30, 2004, capital loss carryovers were as follows:
Year Capital Loss Carryovers Expire -------------------------------------------------------------------------------- Fund Total 2008 2009 2010 2011 2012 - ---- ----- ---- ---- ---- ---- ---- Total Return $22,473,294 $ -- $ -- $ 3,370,272 $19,103,022 $ -- Value 59,796,762 -- 5,133,146 18,257,137 36,406,479 -- Blue Chip 129,277,387 -- -- 60,089,848 69,187,539 -- Growth & Income 78,057,817 -- -- 13,237,225 64,820,592 -- All-Cap Growth 17,185,776 -- -- 6,375,516 10,810,260 -- Mid-Cap Opportunity 12,290,944 -- -- 5,604,079 6,686,865 -- Special Situations 60,973,556 -- -- 34,927,376 26,046,180 -- Focused Equity 26,520,358 553,800 12,951,888 1,712,582 9,856,986 1,445,102 Global 30,872,163 -- -- -- 30,872,163 --
C. Distributions to Shareholders--Dividends from net investment income, if any, of Total Return Fund, Value Fund, Blue Chip Fund and Growth & Income Fund are declared and paid quarterly. Dividends from net investment income, if any, of All-Cap Growth Fund, Mid-Cap Opportunity Fund, Special Situations Fund, Focused Equity Fund and Global Fund are declared and paid annually. Distributions from net realized capital gains, if any, are normally declared and paid annually. Income dividends and capital gain distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for capital loss carryforwards, deferral of wash sales losses, post-October capital losses, net operating losses and foreign currency transactions. D. Expense Allocation--Expenses directly charged or attributable to a Fund are paid from the assets of that Fund. General expenses of Series Fund and Series Fund II are allocated among and charged to the assets of each Fund in the Series on a fair and equitable basis, which may be based on the relative assets of each Fund or the nature of the services performed and relative applicability to each Fund. E. Repurchase Agreements--Securities pledged as collateral for repurchase agreements entered into by the All-Cap Growth Fund, Focused Equity Fund, and Global Fund are held by each Fund's custodian until maturity of the repurchase agreement. The agreements provide that the Funds will receive, as collateral, securities with a market value which will at all times be at least equal to 100% of the amount invested by the Funds. 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 revenue and expense during the reporting period. Actual results could differ from those estimates. G. Foreign Currency Translations--The accounting records of Global Fund are maintained in U.S. dollars. Portfolio securities and other assets and liabilities denominated in foreign currencies are translated to U.S. dollars at the date of valuation. Purchases and sales of investment securities, dividend income and certain expenses are translated to U.S. dollars at the rates of exchange prevailing on the respective dates of such transactions. Global Fund does not isolate that portion of gains and losses on investments which is due to changes in foreign exchange rates from that which is due to changes in market Notes to Financial Statements (continued) September 30, 2004 prices of the investments. Such fluctuations are included with the net realized and unrealized gains and losses from investments. Net realized and unrealized gains and losses on foreign currency transactions include gains and losses from the sales of foreign currency and gains and losses on accrued foreign dividends and related withholding taxes. H. Other--Security transactions are accounted for on the date the securities are purchased or sold. Cost is determined, and gains and losses are based, on the identified cost basis for both financial statement and federal income tax purposes. Dividend income is recorded on the ex-dividend date. Interest income and estimated expenses are accrued daily. Bond discounts and premiums are accreted or amortized using the interest method. For the year ended September 30, 2004, the Bank of New York, custodian for the Series Fund and Series Fund II, has provided total credits in the amount of $34,476 against custodian charges based on the uninvested cash balances of these Funds. The Funds also reduced expenses through brokerage service arrangements. For the year ended September 30, 2004, the Funds' expenses were reduced by $14,933 under these arrangements. 2. Security Transactions--For the year ended September 30, 2004, purchases and sales of securities and long-term U.S. Government obligations (excluding U.S. Treasury bills, repurchase agreements, short-term securities and foreign currencies) were as follows: Long-Term U.S. Securities Government Obligations --------------------------- --------------------------- Cost of Proceeds Cost of Proceeds Fund Purchases from Sales Purchases from Sales - ---- ------------ ------------ ------------ ------------ Total Return $105,000,090 $ 71,844,070 $22,871,756 $22,562,644 Value 48,800,890 17,965,141 -- -- Blue Chip 446,911,205 455,594,176 -- -- Growth & Income 220,982,166 178,505,586 -- -- All-Cap Growth 133,813,051 91,820,378 -- -- Mid-Cap Opportunity 158,232,375 113,067,035 -- -- Special Situations 251,691,015 246,272,461 -- -- Focused Equity 24,487,618 27,442,586 -- -- Global 230,606,554 242,428,575 -- -- At September 30, 2004 aggregate cost and net unrealized appreciation of securities for federal income tax purposes were as follows: Gross Gross Net Aggregate Unrealized Unrealized Unrealized Fund Cost Appreciation Depreciation Appreciation - ---- ------------ ------------ ------------ ------------ Total Return $222,811,590 $ 32,549,313 $ 6,068,003 $26,481,310 Value 168,504,056 40,253,651 2,070,463 38,183,188 Blue Chip 394,568,466 85,184,080 7,696,987 77,487,093 Growth & Income 487,875,371 112,888,251 20,182,309 92,705,942 All-Cap Growth 129,241,275 27,162,469 4,717,697 22,444,772 Mid-Cap Opportunity 271,403,209 64,692,183 12,184,848 52,507,335 Special Situations 175,284,463 42,723,628 8,337,754 34,385,874 Focused Equity 57,886,789 5,906,553 3,554,533 2,352,020 Global 198,881,046 32,127,158 5,421,668 26,705,490 3. Advisory Fee and Other Transactions With Affiliates--Certain officers and directors/trustees of the Funds are officers and directors of the Funds' investment adviser, First Investors Management Company, Inc. ("FIMCO"), their underwriter, First Investors Corporation ("FIC"), their transfer agent, Administrative Data Management Corp. ("ADM") and/or First Investors Federal Savings Bank, ("FIFSB"), custodian of the Funds' retirement accounts. Directors/trustees of the Funds who are not "interested persons" of the Funds as defined in the 1940 Act are remunerated by the Funds. For the year ended September 30, 2004, total directors/trustees fees accrued by the Funds amounted to $88,194. The Investment Advisory Agreements provide as compensation to FIMCO, an annual fee, payable monthly, at the following rates: Total Return, Blue Chip, Mid-Cap Opportunity and Special Situations Funds-- 1% on the first $200 million of each Fund's average daily net assets, .75% on the next $300 million, declining by .03% on each $250 million thereafter, down to .66% on average daily net assets over $1 billion. FIMCO has waived 25% of the 1% annual fee on the first $200 million of each Fund's average daily net assets for the year ended September 30, 2004. Value, Growth & Income, All-Cap Growth and Focused Equity Funds-- .75% on the first $300 million of each Fund's average daily net assets, .72% on the next $200 million, .69% on the next $250 million and .66% on average daily net assets over $750 million. Notes to Financial Statements (continued) September 30, 2004 Global Fund--1% on the first $250 million of the Fund's average daily net assets, declining by .03% on each $250 million thereafter, down to .91% on average daily net assets over $750 million. For the year ended September 30, 2004, total advisory fees accrued to FIMCO by the Funds were $20,421,826 of which $1,998,992 was waived. For the year ended September 30, 2004, FIC, as underwriter, received $17,338,405 in commissions from the sale of shares of the Funds, after allowing $15,592 to other dealers. Shareholder servicing costs included $6,283,485 in transfer agent fees accrued to ADM and $1,959,567 in retirement accounts custodian fees accrued to FIFSB. Pursuant to Distribution Plans adopted under Rule 12b-1 of the 1940 Act, each Fund is authorized to pay FIC a fee up to .30% of the average daily net assets of the Class A shares and 1% of the average daily net assets of the Class B shares on an annualized basis each fiscal year, payable monthly. The fee consists of a distribution fee and a service fee. The service fee is paid for the ongoing servicing of clients who are shareholders of that Fund. For the year ended September 30, 2004, total distribution plan fees accrued to FIC by the Funds amounted to $9,397,823. Wellington Management Company, LLP ("Wellington") serves as investment subadviser to All-Cap Growth Fund, Focused Equity Fund and Global Fund. The subadviser is paid by FIMCO and not by the Funds. 4. Forward Currency Contracts--A forward currency contract is an obligation to purchase or sell a specific currency for an agreed-upon price at a future date. When a Fund purchases or sells foreign securities it customarily enters into a forward currency contract to minimize foreign exchange risk between the trade date and the settlement date of such transactions. The Fund could be exposed to risk if counter parties to the contracts are unable to meet the terms of their contracts or if the value of the foreign currency changes unfavorably. Forward currency contracts are "marked-to-market" daily at the applicable translation rate and the resulting unrealized gains or losses are reflected in the Fund's assets. Global Fund had the following forward currency contracts outstanding at September 30, 2004: Contracts to Buy Unrealized Foreign Currency In Exchange for Settlement Date Gain - ---------------------------- --------------- --------------- ---------- 54,158,935 Japanese Yen US$ 486,188 10/1/04 US$ 5,205 20,616,962 Japanese Yen 186,017 10/4/04 1,045 730,019 Australian Dollar 523,080 10/5/04 5,709 26,846,377 Japanese Yen 242,954 10/5/04 628 33,210,000 Japanese Yen 298,544 10/6/04 2,776 --------------- ---------- $1,736,783 $15,363 =============== ---------- Contracts to Sell Unrealized Foreign Currency In Exchange for Settlement Date Gain (Loss) - ---------------------------- --------------- --------------- ---------- 213,689 British Pound US$ 387,334 10/1/04 US$ 652 524,445 Euro 646,168 10/1/04 (5,192) 45,628 Swiss Franc 36,247 10/1/04 (293) 67,591 Swiss Franc 53,688 10/4/04 (441) --------------- ---------- $1,123,437 $(5,274) =============== ---------- Net Unrealized Gain on Forward Currency Contracts $10,089 ========== 5. Capital--Each Fund sells two classes of shares, Class A and Class B, each with a public offering price that reflects different sales charges and expense levels. Class A shares are sold with an initial sales charge of up to 5.75% of the amount invested and together with the Class B shares are subject to distribution plan fees as described in Note 3. Class B shares are sold without an initial sales charge, but are generally subject to a contingent deferred sales charge which declines in steps from 4% to 0% over a six-year period. Class B shares automatically convert into Class A shares after eight years. Realized and unrealized gains or losses, investment income and expenses (other than distribution plan fees and certain other class expenses) are allocated daily to each class of shares based upon the relative proportion of net assets of each class. The Series Fund has established an unlimited number of no par value shares of beneficial interest for both Class A and Class B shares. Of the 100,000,000 $0.001 par value shares originally designated to each Fund, Series Fund II has classified 50,000,000 shares as Class A and 50,000,000 shares as Class B for each Fund. Of the 100,000,000 $1.00 par value Global Fund shares originally authorized, the Fund has designated 65,000,000 shares as Class A and 35,000,000 shares as Class B. Notes to Financial Statements (continued) September 30, 2004 6. Restricted Securities--Certain restricted securities are exempt from the registration requirements under Rule 144A of the Securities Act of 1933 and may only be sold to qualified institutional investors. At September 30, 2004, Total Return Fund held two 144A securities with an aggregate value of $1,936,881 representing .7% of the Fund's net assets. These securities are valued as set forth in Note 1A. 7. Tax Components of Capital and Distributions to Shareholders--The tax character of distributions declared for the years ended September 30, 2004 and 2003 were as follows: Distributions Declared from Ordinary Income --------------------------------- Fund in 2004 in 2003 - ---- -------------- -------------- Total Return $3,663,467 $3,030,869 Value 1,979,769 1,908,744 Blue Chip -- -- Growth & Income 1,198,784 1,561,227 All-Cap Growth -- -- Mid-Cap Opportunity -- -- Special Situations -- -- Focused Equity -- -- Global -- -- As of September 30, 2004, the components of distributable earnings on a tax basis were as follows: Total Undistributed Capital Distributable Ordinary Loss Unrealized Income Fund Income Carryovers Appreciation (Deficit) - ---- ------------ ------------ ------------ ------------ Total Return $ 409,647 $(22,473,294) $26,481,310 $ 4,417,663 Value 156,825 (59,796,762) 38,183,188 (21,456,749) Blue Chip -- (129,277,387) 77,487,093 (51,790,294) Growth & Income 1,142,907 (78,057,817) 92,705,942 15,791,032 All-Cap Growth -- (17,185,776) 22,444,772 5,258,996 Mid-Cap Opportunity -- (12,290,944) 52,507,335 40,216,391 Special Situations -- (60,973,556) 34,385,874 (26,587,682) Focused Equity -- (26,520,358) 2,352,020 (24,168,338) Global 15,795 (30,872,163) 26,713,693 (4,142,675) This page intentionally left blank.
Financial Highlights FIRST INVESTORS The following table sets forth the per share operating performance data for a share outstanding, total return, ratios to average net assets and other supplemental data for each fiscal year ended September 30, except as otherwise indicated. - ----------------------------------------------------------------------------------------------------- P E R S H A R E D A T A ---------------------------------------------------------------------------------------- Less Distributions Investment Operations from ------------------------------------- ---------------------- Net Asset Net Realized Value, Net and Unrealized Total from Net Net Beginning Investment Gain (Loss) on Investment Investment Realized Total of Period Income Investments Operations Income Gain Distributions - ----------------------------------------------------------------------------------------------------- TOTAL RETURN FUND - ----------------- Class A - ------- 2000 $14.34 $ .31 $ 2.29 $ 2.60 $ .27 $ .40 $ .67 2001 16.27 .26 (2.86) (2.60) .32 1.07 1.39 2002++ 12.28 .22 (1.59) (1.37) .32 -- .32 2003 10.59 .20 1.44 1.64 .21 -- .21 2004 12.02 .20 .96 1.16 .20 -- .20 Class B - ------- 2000 14.17 .21 2.24 2.45 .17 .40 .57 2001 16.05 .18 (2.84) (2.66) .21 1.07 1.28 2002++ 12.11 .15 (1.59) (1.44) .21 -- .21 2003 10.46 .09 1.44 1.53 .13 -- .13 2004 11.86 .12 .94 1.06 .12 -- .12 - ----------------------------------------------------------------------------------------------------- VALUE FUND+++ - ----------------- Class A - ------- 2000 $ 7.99 $ .13 $ 1.21 $ 1.34 $ .13 $ .60 $ .73 2001 8.60 .10 (2.10) (2.00) .11 .56 .67 2002++ 5.93 .11 (1.65) (1.54) .13 -- .13 2003 4.26 .08 .73 .81 .08 -- .08 2004 4.99 .07 .96 1.03 .07 -- .07 Class B - ------- 2000 7.88 .08 1.18 1.26 .07 .60 .67 2001 8.47 .06 (2.07) (2.01) .06 .56 .62 2002++ 5.84 .07 (1.63) (1.56) .08 -- .08 2003 4.20 .05 .71 .76 .04 -- .04 2004 4.92 .03 .95 .98 .03 -- .03 - ----------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------- R A T I O S / S U P P L E M E N T A L D A T A - ------------------------ -------------------------------------------------------------------------------- Ratio to Average Net Ratio to Average Net Assets Before Expenses Assets** Waived or Assumed Net Asset -------------------- ---------------------- Value, Net Assets Net Net Portfolio End of Total End of Period Investment Investment Turnover Period Return* (in millions) Expenses Income Expenses Income Rate - ----------------------------------------------------------------------------------------------------------- TOTAL RETURN FUND - ----------------- Class A - ------- 2000 $16.27 18.67% $120 1.33% 2.00% 1.58% 1.75% 118% 2001 12.28 (17.31) 121 1.37 2.02 1.62 1.77 130 2002++ 10.59 (11.44) 129 1.47 1.91 1.72 1.66 185 2003 12.02 15.58 177 1.52 1.72 1.77 1.47 80 2004 12.98 9.65 231 1.44 1.60 1.65 1.39 41 Class B - ------- 2000 16.05 17.79 16 2.03 1.30 2.28 1.05 118 2001 12.11 (17.82) 19 2.07 1.32 2.32 1.07 130 2002++ 10.46 (12.09) 22 2.17 1.21 2.42 .96 185 2003 11.86 14.71 28 2.22 1.02 2.47 .77 80 2004 12.80 8.92 36 2.14 .90 2.35 .69 41 - ----------------------------------------------------------------------------------------------------------- VALUE FUND+++ - ----------------- Class A - ------- 2000 $ 8.60 17.58% $187 1.31% 1.57% N/A N/A 46% 2001 5.93 (24.98) 149 1.37 1.47 N/A N/A 51 2002++ 4.26 (26.34) 99 1.51 1.93 N/A N/A 40 2003 4.99 19.04 126 1.67 1.69 N/A N/A 198 2004 5.95 20.57 185 1.48 1.21 N/A N/A 11 Class B - ------- 2000 8.47 16.77 32 2.01 .87 N/A N/A 46 2001 5.84 (25.46) 26 2.07 .77 N/A N/A 51 2002++ 4.20 (26.94) 17 2.21 1.23 N/A N/A 40 2003 4.92 18.26 19 2.37 .99 N/A N/A 198 2004 5.87 19.91 23 2.18 .51 N/A N/A 11 - -----------------------------------------------------------------------------------------------------------
Financial Highlights (continued) FIRST INVESTORS - ----------------------------------------------------------------------------------------------------- P E R S H A R E D A T A ---------------------------------------------------------------------------------------- Less Distributions Investment Operations from ------------------------------------- ---------------------- Net Asset Net Net Realized Value, Investment and Unrealized Total from Net Net Beginning Income Gain (Loss) on Investment Investment Realized Total of Period (Loss) Investments Operations Income Gain Distributions - ----------------------------------------------------------------------------------------------------- BLUE CHIP FUND - -------------------- Class A - ------- 2000 $27.15 $(.09) $ 5.68 $ 5.59 $ -- $1.65 $1.65 2001 31.09 -- (8.64) (8.64) .01 3.30 3.31 2002 19.14 (.03) (4.55) (4.58) -- -- -- 2003 14.56 -- 2.58 2.58 -- -- -- 2004 17.14 .01 1.54 1.55 -- -- -- Class B - ------- 2000 26.61 (.25) 5.50 5.25 -- 1.65 1.65 2001 30.21 (.16) (8.33) (8.49) -- 3.30 3.30 2002 18.42 (.16) (4.35) (4.51) -- -- -- 2003 13.91 (.11) 2.46 2.35 -- -- -- 2004 16.26 (.13) 1.48 1.35 -- -- -- - ----------------------------------------------------------------------------------------------------- GROWTH & INCOME FUND - -------------------- Class A - ------- 2000 $15.18 $ .01 $ 2.98 $ 2.99 $.01 $1.55 $1.56 2001 16.61 .06 (3.99) (3.93) .03 1.49 1.52 2002++ 11.16 .03 (2.31) (2.28) .05 -- .05 2003 8.83 .04 1.85 1.89 .04 -- .04 2004 10.68 .06 1.43 1.49 .03 -- .03 Class B - ------- 2000 14.90 (.08) 2.90 2.82 -- 1.55 1.55 2001 16.17 (.01) (3.88) (3.89) -- 1.49 1.49 2002++ 10.79 (.04) (2.24) (2.28) -- -- -- 2003 8.51 (.03) 1.78 1.75 -- -- -- 2004 10.26 (.03) 1.39 1.36 -- -- -- - ----------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------- R A T I O S / S U P P L E M E N T A L D A T A - ------------------------ -------------------------------------------------------------------------------- Ratio to Average Net Ratio to Average Net Assets Before Expenses Assets** Waived or Assumed -------------------- ---------------------- Net Asset Net Net Value, Net Assets Investment Investment Portfolio End of Total End of Period Income Income Turnover Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate - ----------------------------------------------------------------------------------------------------------- BLUE CHIP FUND - -------------------- Class A - ------- 2000 $31.09 21.49% $615 1.27% (.31)% 1.34% (.38)% 125% 2001 19.14 (30.88) 445 1.35 (.02) 1.43 (.10) 117 2002 14.56 (23.93) 333 1.48 (.17) 1.58 (.27) 144 2003 17.14 17.72 383 1.56 -- 1.68 (.12) 111 2004 18.69 9.04 414 1.47 .03 1.58 (.08) 94 Class B - ------- 2000 30.21 20.60 105 1.97 (1.01) 2.04 (1.08) 125 2001 18.42 (31.33) 78 2.05 (.72) 2.13 (.80) 117 2002 13.91 (24.48) 57 2.18 (.87) 2.28 (.97) 144 2003 16.26 16.90 62 2.26 (.70) 2.38 (.82) 111 2004 17.61 8.30 61 2.17 (.67) 2.28 (.78) 94 - ----------------------------------------------------------------------------------------------------------- GROWTH & INCOME FUND - -------------------- Class A - ------- 2000 $16.61 21.31% $494 1.28% .05% N/A N/A 142% 2001 11.16 (25.91) 383 1.34 .47 N/A N/A 168 2002++ 8.83 (20.53) 318 1.46 .33 N/A N/A 169 2003 10.68 21.49 400 1.52 .44 N/A N/A 70 2004 12.14 13.95 499 1.42 .53 N/A N/A 32 Class B - ------- 2000 16.17 20.49 107 1.98 (.65) N/A N/A 142 2001 10.79 (26.38) 82 2.04 (.23) N/A N/A 168 2002++ 8.51 (21.13) 65 2.16 (.37) N/A N/A 169 2003 10.26 20.56 76 2.22 (.26) N/A N/A 70 2004 11.62 13.26 83 2.12 (.17) N/A N/A 32 - -----------------------------------------------------------------------------------------------------------
Financial Highlights (continued) FIRST INVESTORS - ----------------------------------------------------------------------------------------------------- P E R S H A R E D A T A ---------------------------------------------------------------------------------------- Less Distributions Investment Operations from ------------------------------------- ---------------------- Net Asset Net Net Realized Value, Investment and Unrealized Total from Net Net Beginning Income Gain (Loss) on Investment Investment Realized Total of Period (Loss) Investments Operations Income Gain Distributions - ----------------------------------------------------------------------------------------------------- ALL-CAP GROWTH FUND - ------------------- Class A - ------- 2001(a) $10.00 $(.05) $(3.42) $(3.47) -- -- -- 2002 6.53 (.06) (1.14) (1.20) -- -- -- 2003 5.33 (.06) 1.48 1.42 -- -- -- 2004 6.75 (.07) 1.12 1.05 -- -- -- Class B - ------- 2001(a) 10.00 (.08) (3.43) (3.51) -- -- -- 2002 6.49 (.10) (1.13) (1.23) -- -- -- 2003 5.26 (.09) 1.44 1.35 -- -- -- 2004 6.61 (.12) 1.10 .98 -- -- -- - ----------------------------------------------------------------------------------------------------- MID-CAP OPPORTUNITY FUND - ------------------------ Class A - ------- 2000 $21.02 (.10) $ 8.02 $ 7.92 -- $2.28 $2.28 2001 26.66 (.05) (7.67) (7.72) -- 1.30 1.30 2002 17.64 (.13) (1.73) (1.86) -- -- -- 2003 15.78 (.12) 3.52 3.40 -- -- -- 2004 19.18 (.09) 3.62 3.53 -- -- -- Class B - ------- 2000 20.35 (.20) 7.67 7.47 -- 2.28 2.28 2001 25.54 (.18) (7.32) (7.50) -- 1.30 1.30 2002 16.74 (.24) (1.63) (1.87) -- -- -- 2003 14.87 (.23) 3.31 3.08 -- -- -- 2004 17.95 (.23) 3.38 3.15 -- -- -- - ----------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------- R A T I O S / S U P P L E M E N T A L D A T A - ------------------------ -------------------------------------------------------------------------------- Ratio to Average Net Ratio to Average Net Assets Before Expenses Assets** Waived or Assumed -------------------- ---------------------- Net Asset Net Net Value, Net Assets Investment Investment Portfolio End of Total End of Period Income Income Turnover Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate - ----------------------------------------------------------------------------------------------------------- ALL-CAP GROWTH FUND - ------------------- Class A - ------- 2001(a) $ 6.53 (34.70)% $ 35 1.75%+ (.90)%+ 2.10%+ (1.25)%+ 84% 2002 5.33 (18.38) 44 1.75 (1.03) 1.98 (1.26) 138 2003 6.75 26.64 77 1.94 (1.15) 1.96 (1.17) 126 2004 7.80 15.56 130 1.68 (1.12) N/A N/A 75 Class B - ------- 2001(a) 6.49 (35.10) 8 2.45+ (1.60)+ 2.80+ (1.95)+ 84 2002 5.26 (18.95) 9 2.45 (1.73) 2.68 (1.96) 138 2003 6.61 25.67 14 2.64 (1.85) 2.66 (1.87) 126 2004 7.59 14.83 20 2.38 (1.82) N/A N/A 75 - ----------------------------------------------------------------------------------------------------------- MID-CAP OPPORTUNITY FUND - ------------------------ Class A - ------- 2000 $26.66 41.41% $120 1.42% (.52)% 1.67% (.77)% 180% 2001 17.64 (30.34) 109 1.51 (.27) 1.76 (.52) 123 2002 15.78 (10.55) 131 1.70 (.82) 1.95 (1.07) 112 2003 19.18 21.55 192 1.73 (.80) 1.97 (1.04) 37 2004 22.71 18.41 277 1.56 (.46) 1.73 (.63) 40 Class B - ------- 2000 25.54 40.46 24 2.12 (1.22) 2.37 (1.47) 180 2001 16.74 (30.84) 22 2.21 (.97) 2.46 (1.22) 123 2002 14.87 (11.17) 25 2.40 (1.52) 2.65 (1.77) 112 2003 17.95 20.71 35 2.43 (1.50) 2.67 (1.74) 37 2004 21.10 17.55 46 2.26 (1.16) 2.43 (1.33) 40 - -----------------------------------------------------------------------------------------------------------
Financial Highlights (continued) FIRST INVESTORS - ----------------------------------------------------------------------------------------------------- P E R S H A R E D A T A ---------------------------------------------------------------------------------------- Less Distributions Investment Operations from ------------------------------------- ---------------------- Net Asset Net Net Realized Value, Investment and Unrealized Total from Net Net Beginning Income Gain (Loss) on Investment Investment Realized Total of Period (Loss) Investments Operations Income Gain Distributions - ----------------------------------------------------------------------------------------------------- SPECIAL SITUATIONS FUND - -------------------------- Class A - ------- 2000 $23.40 $(.18) $ 9.81 $ 9.63 -- $1.21 $1.21 2001 31.82 (.18) (11.59) (11.77) -- 4.89 4.89 2002 15.16 (.19) (2.31) (2.50) -- -- -- 2003 12.66 (.17) 3.14 2.97 -- -- -- 2004 15.63 (.18) 1.39 1.21 -- -- -- Class B - ------- 2000 22.62 (.33) 9.38 9.05 -- 1.21 1.21 2001 30.46 (.29) (11.00) (11.29) -- 4.89 4.89 2002 14.28 (.29) (2.15) (2.44) -- -- -- 2003 11.84 (.25) 2.93 2.68 -- -- -- 2004 14.52 (.30) 1.32 1.02 -- -- -- - ----------------------------------------------------------------------------------------------------- FOCUSED EQUITY FUND - ------------------- Class A - ------- 2000 $10.88 $(.08) $ (.42) $ (.50) -- -- -- 2001 10.38 (.03) (2.63) (2.66) -- -- -- 2002 7.72 (.07) (1.92) (1.99) -- -- -- 2003 5.73 (.02) 1.52 1.50 -- -- -- 2004 7.23 (.02) .62 .60 -- -- -- Class B - ------- 2000 10.84 (.15) (.43) (.58) -- -- -- 2001 10.26 (.09) (2.59) (2.68) -- -- -- 2002 7.58 (.13) (1.86) (1.99) -- -- -- 2003 5.59 (.07) 1.48 1.41 -- -- -- 2004 7.00 (.08) .61 .53 -- -- -- - ----------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------- R A T I O S / S U P P L E M E N T A L D A T A - ------------------------ -------------------------------------------------------------------------------- Ratio to Average Net Ratio to Average Net Assets Before Expenses Assets** Waived or Assumed -------------------- ---------------------- Net Asset Net Net Value, Net Assets Investment Investment Portfolio End of Total End of Period Income Income Turnover Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate - ----------------------------------------------------------------------------------------------------------- SPECIAL SITUATIONS FUND - -------------------------- Class A - ------- 2000 $31.82 43.07% $276 1.41% (.68)% 1.60% (.87)% 161% 2001 15.16 (42.86) 164 1.54 (.94) 1.75 (1.15) 183 2002 12.66 (16.49) 138 1.69 (1.24) 1.93 (1.48) 153 2003 15.63 23.46 169 1.80 (1.26) 2.05 (1.51) 111 2004 16.84 7.74 190 1.63 (1.08) 1.86 (1.31) 119 Class B - ------- 2000 30.46 41.94 34 2.11 (1.38) 2.30 (1.57) 161 2001 14.28 (43.26) 21 2.24 (1.64) 2.45 (1.85) 183 2002 11.84 (17.09) 18 2.39 (1.94) 2.63 (2.18) 153 2003 14.52 22.63 20 2.50 (1.96) 2.75 (2.21) 111 2004 15.54 7.03 21 2.33 (1.78) 2.56 (2.01) 119 - ----------------------------------------------------------------------------------------------------------- FOCUSED EQUITY FUND - ------------------- Class A - ------- 2000 $10.38 (4.60)% $ 75 1.62% (.76)% 1.52% (.66)% 178% 2001 7.72 (25.63) 51 1.75 (.35) N/A N/A 240 2002 5.73 (25.78) 38 1.83 (.90) N/A N/A 150 2003 7.23 26.18 48 1.99 (.35) N/A N/A 49 2004 7.83 8.30 49 1.85 (.30) N/A N/A 39 Class B - ------- 2000 10.26 (5.35) 18 2.32 (1.46) 2.22 (1.36) 178 2001 7.58 (26.12) 13 2.45 (1.05) N/A N/A 240 2002 5.59 (26.25) 9 2.53 (1.60) N/A N/A 150 2003 7.00 25.22 11 2.69 (1.05) N/A N/A 49 2004 7.53 7.57 11 2.55 (1.00) N/A N/A 39 - -----------------------------------------------------------------------------------------------------------
Financial Highlights (continued) FIRST INVESTORS - ----------------------------------------------------------------------------------------------------- P E R S H A R E D A T A ---------------------------------------------------------------------------------------- Less Distributions Investment Operations from ------------------------------------- ---------------------- Net Asset Net Net Realized Value, Investment and Unrealized Total from Net Net Beginning Income Gain (Loss) on Investment Investment Realized Total of Period (Loss) Investments Operations Income Gain Distributions - ----------------------------------------------------------------------------------------------------- GLOBAL FUND - ----------- Class A - ------- 2000 $ 8.11 $(.02) $ .91 $ .89 -- $ .89 $ .89 2001 8.11 (.01) (2.13) (2.14) -- .76 .76 2002 5.21 (.01) (.96) (.97) -- -- -- 2003 4.24 (.01) .93 .92 -- -- -- 2004 5.16 (.01) .78 .77 -- -- -- Class B - ------- 2000 7.88 (.07) .88 .81 -- .89 .89 2001 7.80 (.06) (2.03) (2.09) -- .76 .76 2002 4.95 -- (.95) (.95) -- -- -- 2003 4.00 (.04) .88 .84 -- -- -- 2004 4.84 (.05) .73 .68 -- -- -- - ----------------------------------------------------------------------------------------------------- * Calculated without sales charges. ** Net of expenses waived or assumed by the investment adviser (Note 3). + Annualized ++ Prior to October 1, 2001, the Total Return Fund, Growth & Income Fund, and Value Fund did not amortize premiums on debt securities. The per share data and ratios prior to 2001 have not been restated. The cumulative effect of this accounting change had no impact on the total net assets of the Funds. +++ Prior to December 31, 2002, known as Utilities Income Fund. (a) For the period October 25, 2000 (commencement of operations) to September 30, 2001. See notes to financial statements - ----------------------------------------------------------------------------------------------------------- R A T I O S / S U P P L E M E N T A L D A T A - ------------------------ -------------------------------------------------------------------------------- Ratio to Average Net Ratio to Average Net Assets Before Expenses Assets** Waived or Assumed -------------------- ---------------------- Net Asset Net Net Value, Net Assets Investment Investment Portfolio End of Total End of Period Income Income Turnover Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate - ----------------------------------------------------------------------------------------------------------- GLOBAL FUND - ----------- Class A - ------- 2000 $ 8.11 11.73% $350 1.65% (.26)% N/A N/A 102% 2001 5.21 (28.87) 234 1.77 (.21) N/A N/A 116 2002 4.24 (18.62) 173 1.87 (.35) N/A N/A 125 2003 5.16 21.70 192 1.98 (.19) N/A N/A 112 2004 5.93 14.92 209 1.86 (.13) N/A N/A 105 Class B - ------- 2000 7.80 10.99 26 2.35 (.96) N/A N/A 102 2001 4.95 (29.42) 18 2.47 (.91) N/A N/A 116 2002 4.00 (19.19) 14 2.57 (1.05) N/A N/A 125 2003 4.84 21.00 15 2.68 (.89) N/A N/A 112 2004 5.52 14.05 15 2.56 (.83) N/A N/A 105 - -----------------------------------------------------------------------------------------------------------
Report of Independent Registered Public Accounting Firm To the Shareholders and Boards of Directors/Trustees of First Investors Series Fund First Investors Series Fund II, Inc. First Investors Global Fund, Inc. We have audited the accompanying statements of assets and liabilities, including the portfolios of investments of the Blue Chip Fund, Special Situations Fund and Total Return Fund (each a series of First Investors Series Fund), the All-Cap Growth Fund, Focused Equity Fund, Growth & Income Fund, Mid-Cap Opportunity Fund and Value Fund (each a series of First Investors Series Fund II, Inc.), and First Investors Global Fund, Inc. as of September 30, 2004, the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods indicated thereon. These financial statements and financial highlights are the responsibility of the Funds' management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of September 30, 2004, by correspondence with the custodian and brokers. Where brokers have not replied to our confirmation requests, we have carried out other appropriate auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the Blue Chip Fund, Special Situations Fund, Total Return Fund, All-Cap Growth Fund, Focused Equity Fund, Growth & Income Fund, Mid-Cap Opportunity Fund, Value Fund, and Global Fund as of September 30, 2004, and the results of their operations for the year then ended, changes in their net assets for each of the two years in the period then ended, and their financial highlights for the periods presented, in conformity with accounting principles generally accepted in the United States of America. Tait, Weller & Baker Philadelphia, Pennsylvania November 1, 2004 This page intentionally left blank.
FIRST INVESTORS EQUITY FUNDS Directors/Trustees and Officers* Position(s) Held with Principal Number of Other Funds and Occupation(s) Portfolios in Trusteeships Name, Year of Birth Length of During Past Fund Complex Directorships and Address Service 5 Years Overseen Held - ------------------- ------------------ ------------------ ------------ ------------ DISINTERESTED DIRECTORS/TRUSTEES Robert M. Grohol 1932 Director/Trustee None/Retired 50 None c/o First Investors since 6/30/00 Management Company, Inc. 95 Wall Street New York, NY 10005 Rex R. Reed 1922 Director/Trustee None/Retired 50 None c/o First Investors since 3/31/84 Management Company, Inc. 95 Wall Street New York, NY 10005 Herbert Rubinstein 1921 Director/Trustee None/Retired 50 None c/o First Investors since 9/20/79 Management Company, Inc. 95 Wall Street New York, NY 10005 James M. Srygley 1932 Director/Trustee Owner 50 None c/o First Investors since 1/19/95 Hampton Management Company, Inc. Properties 95 Wall Street New York, NY 10005 Robert F. Wentworth 1929 Director/Trustee None/Retired 50 None c/o First Investors since 10/15/92 Management Company, Inc. 95 Wall Street New York, NY 10005 Position(s) Held with Principal Number of Other Funds and Occupation(s) Portfolios in Trusteeships Name, Year of Birth Length of During Past Fund Complex Directorships and Address Service 5 Years Overseen Held - ------------------- ------------------ ------------------ ------------ ------------ INTERESTED DIRECTORS/TRUSTEES** Glenn O. Head 1925 Director/Trustee Chairman of 50 None c/o First Investors since 1968 First Investors Management Company, Inc. Corporation, 95 Wall Street First Investors New York, NY 10005 Consolidated Corporation, First Investors Management Company, Inc., and Administrative Data Management Corp., and officer of other affiliated companies*** Kathryn S. Head 1955 Director/Trustee Vice President 50 None c/o First Investors since 3/17/94 of First Investors Management Company, Inc. Corporation, 581 Main Street President President of Woodbridge, NJ 07095 since 11/15/01 First Investors Consolidated Corporation, President of First Investors Management Company, Inc., President of Administrative Data Management Corp., Chairman of First Investors Federal Savings Bank and officer of other affiliated companies*** FIRST INVESTORS EQUITY FUNDS Directors/Trustees and Officers* (continued) Position(s) Held with Principal Number of Other Funds and Occupation(s) Portfolios in Trusteeships Name, Year of Birth Length of During Past Fund Complex Directorships and Address Service 5 Years Overseen Held - ------------------- ------------------ ------------------ ------------ ------------ INTERESTED DIRECTORS/TRUSTEES (continued) John T. Sullivan 1932 Director/Trustee Of Counsel 50 None c/o First Investors since 9/20/79 Hawkins, Management Company, Inc. Delafield & 95 Wall Street Wood; Director New York, NY 10005 and Chairman of Executive Committee of First Investors Corporation * Each Director/Trustee serves for an indefinite term with the Funds, until his/her successor is elected. ** Mr. Head and Ms. Head are interested directors/trustees because (a) they are indirect owners of more than 5% of the voting stock of the adviser and principal underwriter of the Funds, (b) they are officers, directors and employees of the adviser and principal underwriter of the Funds, and (c) they are officers of the Funds. Ms. Head is the daughter of Mr. Head. Mr. Sullivan is an interested director/trustee because he is a director and Chairman of the Executive Committee of First Investors Corporation and he indirectly owns securities issued by the adviser and principal underwriter of the Funds. *** Other affiliated companies consist of: First Investors Realty Company, Inc., First Investors Life Insurance Company, First Investors Leverage Corporation, Route 33 Realty Corporation, First Investors Credit Funding Corporation, N.A.K. Realty Corporation, Real Property Development Corporation, School Financial Management Services, Inc., First Investors Federal Savings Bank, First Investors Credit Corporation and First Investors Resources, Inc. Position(s) Held with Principal Number of Other Funds and Occupation(s) Portfolios in Trusteeships Name, Year of Birth Length of During Past Fund Complex Directorships and Address Service 5 Years Overseen Held - ------------------- ------------------ ------------------ ------------ ------------ OFFICER(S) WHO ARE NOT DIRECTORS/TRUSTEES Joseph I. Benedek 1957 Treasurer Treasurer 50 None c/o First Investors since 1988 and Principal Management Company, Inc. Accounting Officer 581 Main Street Woodbridge, NJ 07095 Dennis T. Fitzpatrick 1958 Vice President Portfolio Manager 2 None c/o First Investors Series Funs, of First Investors Management Company, Inc. since 1998 Management 95 Wall Street Company, Inc. New York, NY 10005 George V. Ganter 1952 Vice President, Portfolio Manager 2 None c/o First Investors Series Fund, of First Investors Management Company, Inc. since 2000 Management 95 Wall Street Company, Inc. New York, NY 10005 Clark D. Wagner 1959 Vice President Director of 27 None c/o First Investors Series Fund, Fixed Income Management Company, Inc. since 1991 (previously Chief 95 Wall Street Investment Officer) New York, NY 10005 of First Investors Management Company, Inc.
FIRST INVESTORS EQUITY FUNDS Shareholder Information - ----------------------- Investment Adviser First Investors Management Company, Inc. 95 Wall Street New York, NY 10005 Subadviser (All-Cap Growth Fund, Focused Equity Fund and Global Fund only) Wellington Management Company, LLP 75 State Street Boston, MA 02109 Underwriter First Investors Corporation 95 Wall Street New York, NY 10005 Custodian The Bank of New York One Wall Street New York, NY 10286 Custodian (Global Fund only) Brown Brothers Harriman & Co. 40 Water Street Boston, MA 02109 Transfer Agent Administrative Data Management Corp. 581 Main Street Woodbridge, NJ 07095-1198 Legal Counsel Kirkpatrick & Lockhart LLP 1800 Massachusetts Avenue, N.W. Washington, DC 20036 Auditors Tait, Weller & Baker 1818 Market Street Philadelphia, PA 19103 It is the Funds' practice to mail only one copy of their annual and semi-annual reports to all family members who reside in the same household. Additional copies of the reports will be mailed if requested by any shareholder in writing or by calling 800-423-4026. The Funds will ensure that separate reports are sent to any shareholder who subsequently changes his or her mailing address. This report is authorized for distribution only to existing shareholders, and, if given to prospective shareholders, must be accompanied or preceded by the Funds' prospectus. The Statement of Additional Information includes additional information about the Funds' directors/trustees and is available without charge, upon request in writing or by calling 800-423-4026. A description of the policies and procedures that the Funds use to vote proxies relating to a portfolio's securities is available, without charge, upon request by calling toll free 800-423-4026 or can be viewed online or downloaded from the EDGAR database on the Securities and Exchange Commission's ("SEC") internet website at http://www.sec.gov. In addition, commencing on August 31, 2004, information regarding how the Funds voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, will be available, without charge, upon request in writing or by calling 800-423-4026 and on the SEC's internet website at http://www.sec.gov. The Funds will file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year (beginning the 1st quarter ending December 31, 2004) on Form N-Q. The Funds' Form N-Q will be available on the SEC's website at http://www.sec.gov; and may also be reviewed and copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 800-SEC-0330. The schedule of portfolio holdings will also be available, without charge, upon request in writing or by calling 800-423-4026. NOTES NOTES Item 2. Code of Ethics As of the end of the period, September 30, 2004, the Registrant has adopted a Code of Ethics that applies to the First Investors Funds' ("Funds") principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the Funds or a third party. A copy of the code of ethics is attached to this report as Exhibit A. During the period of the report, there have been no amendments to the Code of Ethics or waivers, implicit or otherwise, from its provisions. Item 3. Audit Committee Financial Expert The independent director currently serving as the audit committee financial expert is Robert F. Wentworth. The Registrant's Board has unanimously determined that Mr. Wentworth satisfied the definition of an audit committee financial expert as set forth in the instructions to Form N-CSR under the Investment Company Act of 1940. Specifically, the Board determined that Mr. Wentworth has all of the following: (i) an understanding of generally accepted accounting principles and financial statements; (ii) the ability to assess the general application of such principles in connection with the accounting for estimates, accruals, and reserves; (iii) experience preparing, auditing, analyzing or evaluating financial statements that present the breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the Funds' financial statements, or experience actively supervising one or more persons engaged in such activities; (iv) an understanding of internal controls and procedures for financial reports; and (v) an understanding of audit committee functions. Furthermore, he had acquired these attributes through education and many years of relevant experience in various financial positions with American Telephone and Telegraph Company, including the positions of Director - Accounting, Director - Finance, Director - Financial Reporting and Analysis, Controller, and Director of Business Planning. Mr. Wentworth also has many years experience serving on the Audit Committees of First Investors Funds and other organizations. Finally, Mr. Wentworth is independent as defined in the instructions to the Form. Item 4. Principal Accountant Fees and Services Fiscal Year Ended December 31, ----------------- 2003 2002 ---- ---- (a) Audit Fees First Investors Series Fund Total Return Fund $ 14,900 $ 14,900 Blue Chip Fund 33,900 33,900 Special Situations Fund 24,900 24,900 Series Fund II, Inc. Value Fund 20,900 20,900 Growth & Income Fund 32,900 32,900 All-Cap Growth Fund 10,900 10,900 Mid-Cap Opportunity Fund 13,900 13,900 Focused Equity Fund 10,900 10,900 Global Fund, Inc. 34,900 34,900 (b) Audit-Related Fees First Investors Series Fund Total Return Fund $ 0 $ 0 Blue Chip Fund 0 0 Special Situations Fund 0 0 Series Fund II, Inc. Value Fund 0 0 Growth & Income Fund 0 0 All-Cap Growth Fund 0 0 Mid-Cap Opportunity Fund 0 0 Focused Equity Fund 0 0 Global Fund, Inc. 0 0 (c) Tax Fees First Investors Series Fund Total Return Fund $ 3,500 $ 3,500 Blue Chip Fund 3,500 3,500 Special Situations Fund 3,500 3,500 Series Fund II, Inc. Value Fund 3,500 3,500 Growth & Income Fund 3,500 3,500 All-Cap Growth Fund 3,500 3,500 Mid-Cap Opportunity Fund 3,500 3,500 Focused Equity Fund 3,500 3,500 Global Fund, Inc. 3,500 3,500 Nature of fees: tax returns preparation and tax compliance (d) All Other Fees First Investors Series Fund Total Return Fund $ 0 $ 0 Blue Chip Fund 0 0 Special Situations Fund 0 0 Series Fund II, Inc. Value Fund 0 0 Growth & Income Fund 0 0 All-Cap Growth Fund 0 0 Mid-Cap Opportunity Fund 0 0 Focused Equity Fund 0 0 Global Fund, Inc. 0 0 (e)(1) Audit committee's pre-approval policies The Audit Committee has adopted a charter under which it has the duties, among other things, (a) to pre-approve, and to recommend to the full Board, the selection, retention or termination of the independent auditors to provide audit, review or attest services to the Funds and, in connection therewith, evaluate the independence of the auditors and to obtain the auditors' specific representations as to their independence; (b) to pre-approve all non-audit services to be provided to the Funds by the independent auditor; (c) to pre-approve all non-audit services to be provided by the Funds' independent auditor to the Funds' investment adviser or to any entity that controls, is controlled by or is under common control with the Funds investment adviser ("adviser affiliate") and that provides ongoing services to the Funds, if the engagement relates directly to the operations and financial reporting of the Funds; (d) to establish, if deemed necessary or appropriate as an alternative to Audit Committee pre-approved of services to be provided by the independent auditor as required by paragraphs (b) and (c) above, policies and procedures to permit such services to be pre-approved by other means, such as by action of a designated member and members of the Audit Committee, subject to subsequent Committee review and oversight; (e) to consider whether the non-audit services provided by the Funds' independent auditors to the Funds' investment adviser or any adviser affiliate that provides ongoing services to the Funds, which services were not pre-approved by the Audit Committee, are compatible with maintaining the auditors' independence; (f) to meet with the Funds' independent auditors, including meetings without management representatives, as necessary (i) to review the arrangements for, and scope of, the annual audit, any special audits and any other services to be provided to the Fund's by the auditors; (ii) to discuss any matters of concern relating to the Fund's financial statements, including any adjustments to such statements recommended by the auditors, or other results of said audit(s); and (iii) to review the form of opinion the auditors propose to render to the Board and shareholders; (g) to receive and consider (i) information and comments from the auditors with respect to the Funds' accounting and financial reporting policies, procedures and internal control over financial reporting (including the Funds' critical accounting policies and practices) and to consider management's responses to any such comments; (ii) reports from the auditors regarding any material written communications between the auditors and management; and (iii) reports from the auditors regarding all non-audit services provided to any entity in the Funds' investment company complex that were not pre-approved by the Audit Committee or pursuant to pre-approved policies and procedures established by the Audit Committee and associated fees; (h) to consider the effect upon the Funds of any changes in accounting principles or practices proposed by management or the auditors; (i) to review and approve the fees proposed to be charged to the Funds by the auditors for each audit and non-audit service; (j) to receive reports from Fund management in connection with the required certifications on Form N-CSR under the 1940 Act of any significant deficiencies in the design or operation of the Funds' internal control over financial reporting or material weakness therein and any reported evidence of fraud, whether or not material, involving management or other employees of the Funds who have a significant role in the Funds' internal control over financial reporting; (k) to investigate improprieties or suspected improprieties in the Funds' accounting or financial reporting brought to the attention of the Audit Committee; (l) to receive and consider reports from attorneys, in accordance with the "Up-the-Ladder" Reporting Policies for attorneys who appear or practice before the Securities and Exchange Commission in the representation of the Funds and in accordance with applicable federal law, and auditors relating to possible material violations of federal or state law or fiduciary duty; (m) to report its activities to the full Board on a regular basis and to make such recommendations with respect to the above and other matters as the Audit Committee may deem necessary or appropriate; (n) to meet with the Treasurer of the Funds and, as necessary, with internal auditors, if any, for the management company; and (o) to perform such other functions and to have such powers as may be necessary or appropriate in the efficient and lawful discharge of the powers provided in this Charter. (e)(2) None, or 0%, of the services relating to the Audit-Related Fees, Tax Fees and All Other Fees paid by the Registrant and Related Entities disclosed above were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X (which permits audit committee approval after the start of the engagement with respect to services other than audit review or attest services, if certain conditions are satisfied). (f) Not Applicable (g) Aggregate non-audit fees billed by the Registrant's accountant for services rendered to the Registrant and the Registrant's investment adviser or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the Registrant for the two fiscal years ended September 30, 2004 and 2003 were $0 and $0, respectively. (h) Not Applicable Item 5. Audit Committee of Listed Registrants Audit Committee Members - Robert M. Grohol Rex R. Reed Herbert Rubinstein James M. Srygley Robert F. Wentworth Item 6. Schedule of Investments Schedule is included as part of the report to shareholders filed under Item 1 of this Form. Item 7. Disclosure of Proxy Voting Policies & Procedures for Closed-End Management Investment Companies Not applicable to the Registrant Item 8. Purchases of Equity Securities by Closed-End Management Investment Companies and Affiliated Purchasers Not applicable to the Registrant Item 9. Submission of Matters to a Vote of Security Holders The Nominating and Compensation Committee (the "Committee") of the Board of Directors/Trustees of the First Investors Family of Funds (the "Board") was established in November 2004. The Committee is comprised of all the Independent Directors/Trustees. The Committee is responsible for, among other things, selecting and nominating persons to serve as Independent Directors/Trustees on the Board, evaluating candidates' qualifications, reviewing the composition of the Board to determine whether it may be appropriate to add other Independent Directors/Trustees, and reviewing director/trustee compensation. When the Board has, or expects to have, vacancies, the Committee shall consider shareholder recommendations for nominations to fill such vacancies if such recommendations are submitted in writing and addressed to the Committee at the Funds' offices at: First Investors Funds, 95 Wall Street, New York, NY 10005. Item 10. Controls and Procedures (a) The Registrant's Principal Executive Officer and Principal Financial Officer have concluded that the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) are effective, based on their evaluation of these disclosure controls and procedures as of a date within 90 days of the filing date of this report. (b) There were no significant changes in the Registrant's internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Item 11. Exhibits (a) Code of Ethics - Filed herewith (b) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Filed herewith (c) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 - Filed herewith SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant have duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. First Investors Series Fund First Investors Series Fund II, Inc. First Investors Global Fund, Inc. (Registrant) By /S/ KATHRYN S. HEAD Kathryn S. Head President and Principal Executive Officer Date: December 7, 2004 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. First Investors Series Fund First Investors Series Fund II, Inc. First Investors Global Fund, Inc. (Registrant) By /S/ JOSEPH I. BENEDEK Joseph I. Benedek Treasurer and Principal Financial Officer Date: December 7, 2004 EX-99.302 CERT 2 equity302.txt CERTIFICATION SECTION 302 CERTIFICATIONS I, Kathryn S. Head, certify that: 1. I have reviewed this report on Form N-CSR of First Investors Series Fund, First Investors Series Fund II, Inc., and First Investors Global Fund, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the Registrant as of, and for, the periods presented in this report; 4. The Registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the Registrant and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c) Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and d) Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal half-year (the Registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and 5. The Registrant's other certifying officer(s) and I have disclosed, to the Registrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions): a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize, and report financial information; and b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting. By: /S/ KATHRYN S. HEAD Kathryn S. Head President and Principal Executive Officer Date: December 7, 2004 CERTIFICATIONS I, Joseph I. Benedek, certify that: 1. I have reviewed this report on Form N-CSR of First Investors Series Fund, First Investors Series Fund II, Inc., and First Investors Global Fund, Inc.; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the Registrant as of, and for, the periods presented in this report; 4. The Registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the Registrant and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c) Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and d) Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal half-year (the Registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and 5. The Registrant's other certifying officer(s) and I have disclosed, to the Registrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions): a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize, and report financial information; and b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting. By: /S/ JOSEPH I. BENEDEK Joseph I. Benedek Treasurer and Principal Financial Officer Date: December 7, 2004 EX-99.906 CERT 3 equity906.txt CERTIFICATION SECTION 906 CERTIFICATION CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 I, Kathryn S. Head, President and Principal Executive Officer of the First Investors Series Fund, First Investors Series Fund II, Inc., and First Investors Global Fund, Inc. (the "Registrant"), certify, pursuant to 18 U.S.C. Section 1350 as enacted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge: 1. The Registrant's periodic report on Form N-CSR of the First Investors Series Fund, First Investors Series Fund II, Inc., and First Investors Global Fund, Inc. for the year ended September 30, 2004, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in such Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant. Dated: December 7, 2004 /S/ KATHRYN S. HEAD Kathryn S. Head President and Principal Executive Officer, First Investors Series Fund, First Investors Series Fund II, Inc., First Investors Global Fund, Inc. A signed original of this written statement required by Section 906 has been provided to First Investors Series Fund, First Investors Series Fund II, Inc., and First Investors Global Fund, Inc. and will be retained by First Investors Series Fund, First Investors Series Fund II, Inc., and First Investors Global Fund, Inc. and furnished to the Securities and Exchange Commission or its staff upon request. CERTIFICATION CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 I, Joseph I. Benedek, Treasurer and Principal Financial Officer of the First Investors Series Fund, First Investors Series Fund II, Inc., and First Investors Global Fund, Inc. (the "Registrant"), certify, pursuant to 18 U.S.C. Section 1350 as enacted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge: 1. The Registrant's periodic report on Form N-CSR of the First Investors Series Fund, First Investors Series Fund II, Inc., and First Investors Global Fund, Inc. for the year ended September 30, 2004, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in such Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant. Dated: December 7, 2004 /S/ JOSEPH I. BENEDEK Joseph I. Benedek Treasurer and Principal Financial Officer, First Investors Series Fund, First Investors Series Fund II, Inc., First Investors Global Fund, Inc. A signed original of this written statement required by Section 906 has been provided to First Investors Series Fund, First Investors Series Fund II, Inc., and First Investors Global Fund, Inc. and will be retained by First Investors Series Fund, First Investors Series Fund II, Inc., and First Investors Global Fund, Inc. and furnished to the Securities and Exchange Commission or its staff upon request. EX-99.CODE ETH 4 ethicsexhibit.txt CODE OF ETHICS CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND FINANCIAL OFFICERS OF THE FIRST INVESTORS FUNDS Adopted August 21, 2003 I. Purpose of the Code In accordance with Section 406 of the Sarbanes-Oxley Act of 2002, and the instructions for Form N-CSR (1), the First Investors family of mutual funds (collectively, "Funds" and individually, "Fund") have adopted this code of ethics ("Code") to govern the conduct of their principal executive officers and financial officers ("Covered Officers") (2). This Code is intended to promote: Honest and ethical conduct by the Covered Officers of the Funds, including the honest and ethical handling of actual or apparent conflicts of interest between their personal and professional relationships; Full, fair, accurate, timely and understandable disclosure in reports and documents that the Funds file with, or submit to, the Securities and Exchange Commission ("SEC") and in other public communications made by the Funds; Compliance with applicable laws and governmental rules and regulations; The prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and Accountability for adherence to the Code. Each Covered Officer should adhere to a high standard of business ethics and should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest. (1) Form N-CSR implements Section 406 of the Sarbanes-Oxley Act of 2002 insofar as it applies to mutual funds. Item 2 of Form N-CSR requires a registered management investment company to disclose annually whether, as of the end of the period covered by the report, it has adopted a code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these officers are employed by registrant or a third party. If the registrant has not adopted such a code of ethics, it must explain why it has not done so. The registrant must also (1) file with the SEC a copy of its code as an exhibit to its annual report on Form N-CSR; (2) post the text of its code on its Internet website and disclose, in its most recent report on Form N-CSR, its Internet address and the fact that it has posted the code on its Internet website; or (3) undertake in its most recent report on Form N-CSR to provide to any person without charge, upon request, a copy of its code and explain the manner in which such request may be made. The registrant must also disclose in its annual Form N-CSR any amendments to, or waivers (including implicit waivers) from, the provisions of the code. (2) The Covered Officers of the First Investors Funds are identified in Exhibit A to this Code. II. Conflicts of Interest A. Definition of Conflict of Interests for Purposes of this Code For purposes of this Code, a "conflict of interest" occurs when a Covered Officer's "personal interests" interfere with the interests of, or his or her service to, any of the Funds. For example, a conflict of interest would arise if a Covered Officer, directly or indirectly, were to receive improper personal benefits as a result of the Covered Officer's position with the Funds. This Code applies to all conflicts of interest between the personal interests of Covered Officers and the interests of the Funds, whether or not such conflicts of interest are prohibited by the Investment Company Act of 1940 ("1940 Act"), the Investment Advisers Act of 1940 ("Investment Advisers Act"), or the rules adopted by the SEC under these laws. For example, this Code prohibits individual transactions between Covered Officers and the Funds, notwithstanding the fact that such transactions may already be prohibited by law. This Code does not apply to conflicts of interest that arise solely because Covered Officers are employees or direct or indirect shareholders of the investment adviser of the Funds or the affiliates of the adviser. This Code recognizes that the Covered Officers will, in the normal course of their duties, be involved in establishing policies and implementing decisions that will have different effects on the adviser (and its affiliates) and the Funds. The participation of the Covered Officers in such activities is inherent in the contractual relationships between the Funds and the adviser (and its affiliates) and is consistent with the performance by the Covered Officers of their duties as officers of the Funds. These conflicts are not deemed to involve the "personal interests" of Covered Officers for purposes of this Code. B. Standards of Conduct With Respect to Conflicts of Interest The following standards govern the conduct of Covered Officers with respect to any actual or apparent conflicts of interest that arise between their personal interests and the interests of the Funds. The overarching principle of each standard is that the personal interests of a Covered Officer should not be placed improperly before the interests of the Funds. Each Covered Officer must: Not engage in any personal transaction that would violate the conflict of interest provisions of the 1940 Act, the Investment Advisers Act, or the SEC's rules thereunder; Not use his or her personal influence or personal relationships improperly to influence investment decisions or financial reporting by the Funds whereby the Covered Officer would benefit personally to the detriment of the Funds; Not cause the Funds to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit of the Funds; and, Not use material, non-public knowledge of portfolio transactions made or contemplated for the Funds to trade personally or cause others to trade personally in contemplation of the market effect of such transactions. C. Reporting of Potential Conflicts At least annually, the Covered Officers are required to complete a Directors and Officers Questionnaire ("Questionnaire"), which contains information about potential personal conflicts of interest. These Questionnaires are required to be submitted to the Investment Compliance Manager of the Funds, who is charged with the responsibility of reviewing them for actual or potential conflicts of interest. Covered Officers are also required to report, as soon as possible, to the Investment Compliance Manager, any transactions or arrangements, not previously disclosed in their annual Questionnaires, that they reasonably believe may present a potential conflict of interest between their personal interests and the interests of the Funds. Examples of the potential conflicts that should be reported include: Serving as a Board of Director or Trustee of any public or private company; The acceptance of any gift, other than a gift of nominal value (i.e., having a value of less than $100) from any company with which the Funds has a current or prospective business dealings (other than the Funds' adviser and its affiliates); The acceptance of entertainment, other than occasional meals, tickets to sporting events, or the like that are not so frequent or extensive as to raise questions of impropriety, from any company with which the Funds has current or prospective business dealings (other than the Funds' adviser and its affiliates); Any ownership interest in, or any consulting or employment relationship with, any of the Funds' service providers (other than the Funds' adviser and its affiliates); and A direct or indirect financial interest in commissions, transaction charges or spreads paid by the Funds for effecting portfolio transactions or for selling or redeeming shares other than an interest in arising from the Covered Officer's employment, such as compensation or equity ownership. The willful or knowing failure of a Covered Officer to report a potential conflict of interest in the manner set forth above shall be considered a violation of this Code. In the event that any potential conflicts of interest are reported to or otherwise are detected by the Investment Compliance Manager, he is required to inform the General Counsel. As discussed below, the General Counsel is responsible for conducting any investigation that may be necessary, interpreting the provisions of the Code, determining whether there is an actual or apparent conflict of interest and if so, making a recommendation to the Board for appropriate action. III. Compliance with Applicable Laws and Regulations It is the responsibility of each Covered Officer to promote compliance with the laws, rules and regulations that are applicable to the Funds. Each covered Officer should: Make reasonable efforts to familiarize himself or herself with the disclosure and other requirements applicable to the Funds; Not knowingly misrepresent, or cause others to misrepresent, facts about the Funds to others, whether within or outside the Funds, including to the Funds' directors, trustees and auditors, and to governmental regulators and self-regulatory organizations; and, To the extent appropriate within his or her area of responsibility, consult with other officers and employees of the Funds and the adviser with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents the Funds file with, or submit to, the SEC and in other public communications made by the Funds. IV. Certifications and Reports of Violations Each Covered Officer must: Upon adoption of the Code (or thereafter as applicable, upon becoming a Covered Officer), certify in writing to the Investment Compliance Manager that he or she has received, read and understands the Code and any amendments thereto (Exhibit B); Annually thereafter affirm to the Investment Compliance Manager that he or she has complied with the requirements of the Code (Exhibit C); Notify the Investment Compliance Manager promptly if he or she knows of any violation of this Code; and Not retaliate against any other Covered Officer or any employee of the Funds or their affiliated persons for reporting potential violations of, or carrying out their responsibilities under, this Code. The Investment Compliance Manager shall promptly report to the General Counsel any evidence of a violation of this Code. V. Interpretations and Investigations The General Counsel is responsible for interpreting this Code as it applies to particular situations, investigating potential violations of the Code, reporting violations of the Code to the Board of Directors/Trustees of the Funds ("Board"), and making recommendations of any changes to the Code that he believes are necessary and appropriate. The following policies and procedures will apply in connection with investigations of any potential violations of this Code by a Covered Officer: The General Counsel will take such steps as he deems necessary and appropriate to investigate any potential violations that are reported to or that otherwise become known to him; If, after such investigation, the General Counsel believes that no violation has occurred, the General Counsel is not required to take any further action; If the General Counsel concludes that a violation of this Code has occurred, he will report it the Board no later than its next formal meeting; Under no circumstances shall the General Counsel waive compliance with the Code if he believes that it has been violated; If the Board concurs that a violation has occurred, it will determine what action should be taken, which may include requiring a Covered Officer to disgorge any gains obtained as a result of a conflict, imposing restrictions on the Covered Officer's future activities, or recommending a suspension or dismissal of the Covered Officer; and The Board shall also have authority to waive, by majority vote, any disciplinary action for a violation of this Code in appropriate circumstances, such as for a good faith but erroneous belief that a transaction did not involve a conflict of interest covered by this Code. On at least an annual basis, the General Counsel will provide a report to the Board concerning overall compliance with the Code, any significant interpretive issues that have arisen during the year, and his suggestions for changes, if any. VI. Other Codes of Conduct and Policies and Procedures This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act. The Covered Officers are required to continue to comply with other codes of ethics, policies and procedures that apply to their conduct. However, the other codes of ethics, policies and procedures are not part of this Code. For example, Covered Officers must continue to comply with the code of ethics that has been adopted by the Funds and their adviser, and principal underwriter pursuant to Rule 17j-1 ("Rule 17j-1 Code of Ethics") as long as they are deemed to be access persons under it. However, a violation of the Rule 17j-1 Code of Ethics would not be a violation of this Code unless the conduct at issue independently violated the terms of this Code. VII. Amendments Any amendments to this Code must be approved or ratified by a majority vote of the Board. In the event that an amendment to this Code is made between formal Board meetings, it will be presented to the Board for ratification by the next formal meeting. VIII. Confidentiality All reports and records prepared or maintained pursuant to this Code will be considered privileged and confidential and shall be maintained and protected accordingly. IX. Internal Use The Code is intended solely for the internal use by the Funds and does not constitute an admission, by or on behalf of any Fund or person, as to any fact, circumstance, or legal conclusion. Exhibit A COVERED OFFICERS OF THE FIRST INVESTORS FUNDS Kathryn S. Head - - President of the First Investors Funds Joseph I. Benedek - - Treasurer of the First Investors Funds Exhibit B INITIAL CERTIFICATION I hereby certify that I have received and read a copy of the Code of Ethics For Principal Executive and Financial Officers of the First Investors Funds and understand that as a "Covered Officer" I am subject to its provisions and any amendments thereto. I also understand that as a "Covered Officer" I will certify annually to the Investment Compliance Manager that I have complied with the requirements of this Code. DATED ________________ Signature _____________________________ Name (please print) ______________________ Title __________________________________ Please return to: Investment Compliance Manager FIMCO 95 Wall Street - 23rd Floor New York, New York 10005 Exhibit C ANNUAL CERTIFICATION I hereby certify that I have received and read a copy of the Code of Ethics For Principal Executive and Financial Officers of the First Investors Funds and understand that as a "Covered Officer" I am subject to its provisions and any amendments thereto. I have complied with all of the requirements of the Code including, but not limited to reporting any actual or apparent conflicts of interest or any violations of this Code to the Investment Compliance Manager. DATED ________________ Signature ______________________________ Name (please print) ______________________ Title __________________________________ Please return to: Investment Compliance Manager FIMCO 95 Wall Street - 23rd Floor New York, New York 10005 -----END PRIVACY-ENHANCED MESSAGE-----