-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, pon1mNmHGEyT7fCBfXvox3B1eWt87wqV0qZEr/J6CESvvgowrZDqYXoAJVPtkdzI QiQtrc4wQHVyLJwIOZrGCQ== 0000806176-94-000008.txt : 19940701 0000806176-94-000008.hdr.sgml : 19940701 ACCESSION NUMBER: 0000806176-94-000008 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19940430 FILED AS OF DATE: 19940628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PREMIER STATE MUNICIPAL BOND FUND CENTRAL INDEX KEY: 0000806176 STANDARD INDUSTRIAL CLASSIFICATION: 0000 STATE OF INCORPORATION: MA FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-04906 FILM NUMBER: 94536319 BUSINESS ADDRESS: STREET 1: 144 GENN CURTISS BLVD CITY: NUIONDALE STATE: NY ZIP: 11556 BUSINESS PHONE: 2129226805 FORMER COMPANY: FORMER CONFORMED NAME: PREMIER SERIES TAX EXEMPT BOND FUND DATE OF NAME CHANGE: 19870224 N-30D 1 ANNUAL REPORT PRESIDENT'S LETTER Dear Shareholder: As the fiscal year ended on April 30, 1994, the net asset value of Class A shares of the Premier State Municipal Bond Fund, Georgia Series was $12.69 per share, which was $.58 (4.37%) lower than the closing net asset value per share on April 30, 1993. Income dividends of approximately $.73 per share were paid during this period, which translates into a distribution rate per share of 5.53%, based on the closing maximum offering price on April 30, 1994. The net asset value of Class B shares of the Series was $12.69 per share on April 30, 1994, which was $.58 (4.37%) per share lower than the closing net asset value per share on April 30, 1993. Income dividends of approximately $.67 per share were paid during this period, which translates into a distribution rate per share of 5.25%, based on the closing net asset value per share on April 30, 1994. We are pleased to report that all dividends paid from net investment income during this period are exempt from Federal and State of Georgia income taxes.* Soon after his inauguration, President Clinton quickly moved to outline his domestic economic agenda, which called for higher taxes and a substantial reduction in the Federal budget deficit. In return it was expected that the Federal Reserve Board would continue to maintain a stimulative policy. Congress approved a budget package in early August that tilted fiscal policy toward deficit reduction; in response, interest rates accelerated downward during the summer, before finally reaching their low point during the fourth quarter of last year. During the first half of its fiscal year, the Series' total return benefited from the strong performance of the municipal market. Declining interest rates, an accommodative Federal Reserve Board policy, low price volatility, and a lackluster economy drove the municipal market to higher price valuations. However, as the economy began to pick up steam during the fourth quarter of 1993 and into the new year, a change in Federal Reserve policy and rising interest rates had a negative impact on the municipal market. The recent market correction reflected increased volatility in both U.S. and international financial markets. In early February and again in late March, the Federal Reserve Board tightened short-term interest rates in advance of possibly higher levels of inflation. As a result, short-term interest rates rose approximately 75 basis points and long-term yields increased approximately 115 basis points overall. It is anticipated that further rate hikes may be forthcoming should the economy continue to signal an unacceptable rate of growth. This factor, coupled with political uncertainty in much of the world, could influence both the bond and equity markets and may leave them in a somewhat volatile position. The rise in bond yields has dramatically curtailed the supply of new issues in the municipal market and precluded any near-term prospect of refunding the last marginal candidates. At the same time, individual investor interest for tax exempt investments waned. However, with the maximum marginal Federal income tax rate alone at nearly 40%, and municipal bond yields substantially higher than just a few months ago, we think that investment opportunities should once again be present when concerns over inflation subside and interest rates stabilize. Last year, when rates were reaching their cyclical lows, we altered our security selection strategy. Specifically, we elected not to chase the market, and began to conduct our business somewhat more defensively. While these actions limited performance during that period in 1993 when rates were still declining, we believe they helped position the Fund more advantageously for the market decline which has occurred so far this year. Our current investment strategy is to maintain a defensive posture in an effort to offset near-term volatility in the market. To this end, we look for opportunities to sell lower coupon bonds and raise cash to position the Fund to capitalize on higher yields once interest rates stabilize. It is our stance at present to seek to purchase higher coupon securities to generate a higher yield while seeking to maintain credit quality. We reduced the Series' exposure to those bonds in the portfolio with the longest durations (price sensitivities) while maintaining the more defensive securities (i.e., pre-refunded bonds), and started building higher cash reserves. Some economists predict that rates may turn lower again as we approach year-end; this remains to be seen. We will attempt to capture higher yields through the second and third quarters assuming the market plays out as we anticipate. We will, however, monitor market changes very closely, and adjust our strategy to accommodate your investment goals. It is our intention to continue to focus on the potential for additional market volatility, and manage the portfolio with an eye toward navigating it through these difficult times. We will attempt to identify opportunities that we believe can favorably enhance the portfolio. We have included a current Statement of Investments and recent financial statements for your review. We appreciate your investment in the Fund and we look forward to serving your investment needs. Very truly yours, (Signature Logo) Richard J. Moynihan President May 16, 1994 New York, N.Y. *Some income may be subject to the Federal Alternative Minimum Tax for certain investors. PERFORMANCE COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN Premier STATE Municipal Bond Fund, GEORGIA SERIES Class A Shares AND THE lehman brothers municipal bond index Exhibit A In Dollars $10,968 Lehman Brothers Municipal Bond Index* $10,650 Premier State Municipal Bond Fund Georgia Series (Class A Shares) *Source: Lehman Brothers AVERAGE ANNUAL TOTAL RETURN CLASS A CLASS B - ---------------------------------------------------------- ----------------------------------------------------- % Return Reflecting % Return Applicable Contingent Reflecting % Return Deferred Sales % Return Without Maximum Initial Assuming No Charge Upon PERIODS ENDED 4/30/94 SALES CHARGE SALES CHARGE (4.5%) PERIODS ENDED 4/30/94 REDEMPTION REDEMPTION* - -------------------- ----------- ------------------ -------------------- --------- ---------------- 1 Year 0.97% (3.61)% 1 Year 0.46% (2.41)% From Inception (9/3/92) 6.80 3.87 From Inception (1/15/93) 4.99 2.69
Past performance is not predictive of future performance. Share price and investment return fluctuate and share price may be more or less than original cost upon redemption. The above graph compares a $10,000 investment made in Class A shares of Premier State Municipal Bond Fund, Georgia Series on 9/3/92 (Inception Date) to a $10,000 investment made in the Lehman Brothers Municipal Bond Index on that date. For comparative purposes the value of the Index on 8/31/92 is used as the beginning value on 9/3/92. All dividends and capital gain distributions are reinvested. Performance for Class B shares will differ from the results shown above due to difference in charges and expenses charged to that class. The Series invests primarily in Georgia municipal securities and its performance shown in the graph takes into account the maximum initial sales charge on Class A shares and all other applicable fees and expenses. Unlike the Series, the Lehman Brothers Municipal Bond Index is an unmanaged total return performance benchmark for the long-term, investment grade tax exempt bond market, calculated by using municipal bonds selected to be representative of the market. The Index does not take into account charges, fees and other expenses. Further information relating to Series performance, including expense reimbursements, if applicable, is contained in the Condensed Financial Information section of the Prospectus and elsewhere in this report. *Maximum contingent deferred sales charge for Class B shares is 3% and is reduced to 0% after five years.
PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES STATEMENT OF INVESTMENTS APRIL 30, 1994 PRINCIPAL MUNICIPAL BONDS--96.2% AMOUNT VALUE ---------- ---------- GEORGIA--90.9% Albany, Sewer System Revenue 6.50%, 7/1/2009 (Insured; MBIA)................ $ 100,000 $ 104,064 Albany-Dougherty Inner City Authority, Revenue, Refunding 6%, 2/1/2011...... 200,000 196,662 Athens-Clarke County Unified Government, Water and Sewer Revenue, Refunding 5.875%, 1/1/2008 (Insured; FGIC)........................................ 265,000 266,818 Atlanta: Airport Facilities Revenue 6.50%, 1/1/2013.............................. 150,000 151,216 COP (Atlanta Pretrial Detention Center Project) 6.25%, 12/1/2011 (Insured; MBIA) 300,000 303,918 School Improvement: 5.60%, 12/1/2012...................................................... 1,000,000 953,330 5.60%, 12/1/2018...................................................... 1,000,000 916,490 Atlanta Downtown Development Authority, Revenue, Refunding (Underground Atlanta Project) 6.25%, 10/1/2016.......................... 200,000 198,556 Bartow County, Water and Sewer Revenue, Refunding 6%, 9/1/2015 (Insured; AMBAC) 450,000 440,946 Buford, GO School Boards 5.90%, 2/1/2013.................................... 300,000 286,233 Cherokee County School Systems 5.375%, 2/1/2014 (Insured; AMBAC)............ 1,000,000 916,230 Clarke County Hospital Authority, Revenue Certificates (Athens Regional Medical Center Project) 5.75%, 1/1/2010 (Insured; MBIA) 265,000 260,413 Cobb County Housing Authority, MFMR, Refunding (Garrison Plantation Development) 5.75%, 7/1/2014 (Insured; FHA).......................................... 1,070,000 989,429 Cobb County Kennestone Hospital Authority, Revenue Certificates 5.50%, 4/1/2017 (Insured; MBIA)......................................... 300,000 271,413 Columbia County, Water and Sewerage Revenue, Refunding 5.55%, 12/1/2008 (Insured; AMBAC)....................................... 650,000 635,986 Columbus, Water and Sewer Revenue, Refunding: 6.25%, 5/1/2011 (Insured; FGIC)......................................... 155,000 158,350 5.70%, 5/1/2020......................................................... 500,000 460,670 5.70%, 5/1/2020 (Insured; FGIC)......................................... 500,000 468,525 Columbus Hospital Authority, Revenue Certificates (St. Francis Hospital) 6.20%, 1/1/2010 (Insured; MBIA)......................................... 200,000 203,464 Coweta County School System: 6.35%, 8/1/2012......................................................... 100,000 101,644 Refunding 5.75%, 2/1/2010 (Insured; FGIC)............................... 200,000 196,726 Dade County Water and Sewer Authority, Revenue, Refunding and Improvement 5.375%, 7/1/2018 (Insured; FGIC)........................................ 1,135,000 1,019,684 Dekalb County Development Authority, Revenue (Wesley Homes, Inc-Budd Terrace Project) 6.75%, 10/1/2013 (LOC; Wachovia Bank of Georgia, N.A.) (a)............................... 200,000 201,470 Dekalb County Health Facilities, GO 5.50%, 1/1/2020......................... 1,000,000 896,420 Dekalb County School District, Refunding 5.60%, 7/1/2010.................... 500,000 484,455 Dekalb County Water and Sewer Authority, Revenue 5.125%, 10/1/2014.......... 1,000,000 874,290 Downtown Savannah Authority, Revenue, Refunding (Chatham County Projects) 5%, 1/1/2011.................................. 1,000,000 880,080 Downtown Smyrna Development Authority, Revenue, Refunding 5.50%, 2/1/2012... 500,000 460,565 Fayette County School District 6.125%, 3/1/2015............................. 500,000 500,000 PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994 PRINCIPAL MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE ---------- ---------- GEORGIA (CONTINUED) Fulco Hospital Authority, Revenue Anticipation Certificates (Georgia Baptist Healthcare) 6.25%, 9/1/2013............................ $ 250,000 $ 243,682 Fulton County, Water and Sewer Revenue, Refunding 6.375%, 1/1/2014 (Insured; FGIC) 290,000 300,724 Fulton County Building Authority, Revenue, Refunding (County Government and Health Facilities Project) 6.125%, 1/1/2011 (Prerefunded 1/1/2005) (b)......... 300,000 302,658 Fulton County Development Authority, Special Facilities Revenue, Refunding (Delta Air Lines Inc., Project) 6.95%, 11/1/2012........................ 245,000 241,242 Fulton County Hospital Authority, Revenue Anticipation Certificates (Northside Hospital Project) 6.625%, 10/1/2016 (Insured; MBIA).......... 200,000 219,662 Fulton Dekalb Hospital Authority, HR, Refunding Certificates 5.50%, 1/1/2012 (Insured; MBIA)......................................... 1,000,000 929,430 Gainesville, Water and Sewer Revenue, Refunding 6%, 11/15/2012 (Insured; FGIC) 300,000 300,990 Georgia, GO 6.30%, 3/1/2008................................................. 100,000 106,421 Georgia Environmental Facilities Authority, Revenue (Guaranteed-Water and Sewer Loan Program) 6.125%, 7/1/1996.............. 470,000 489,552 Georgia Housing and Finance Authority, Revenue: (Home Ownership Opportunity Program) 6.50%, 12/1/2011................... 180,000 182,459 Single Family Mortgage 5.20%, 12/1/2013 (Insured; FHA).................. 1,000,000 875,100 Georgia Municipal Electric Authority, Power Revenue, Refunding 6.125%, 1/1/2014 (Insured; FGIC)........................................ 300,000 297,093 Gwinnett County School District 6.25%, 2/1/2011............................. 500,000 509,020 Habersham County Hospital Authority, Revenue Anticipation Certificates 5.60%, 12/1/2013 (Insured; MBIA)........................................ 500,000 469,440 Hall County and the City of Gainesville Development Authority, Revenue Anticipation Certificates (Northeast Georgia Healthcare Project) 6.25%, 10/1/2012 (Insured; MBIA)........................................ 100,000 101,061 Henry County and Henry County Water and Sewer Authority, Revenue, Refunding 6.50%, 2/1/2011 (Insured; MBIA)......................................... 100,000 104,315 Metropolitan Atlanta Rapid Transportation Authority, Sales Tax Revenue, Refunding 6.25%, 7/1/2020 (Insured; AMBAC)........................................ 300,000 302,673 Monroe County Development Authority, PCR (Oglethorpe Power Corp. Scherer Project) 6.80%, 1/1/2011......................................................... 100,000 104,155 Municipal Electric Authority of Georgia, Special Obligation (First Crossover-General Resolution) 6.50%, 1/1/2020.................... 100,000 103,294 Private Colleges and Universities Authority, Revenue (Agnes Scott College Projects) 5.50%, 6/1/2013.......................... 1,000,000 914,920 Putnam County Development Authority, PCR (Georgia Power Co. Plant Branch) 6.20%, 8/1/2022......................................................... 300,000 289,890 Savannah Economic Development Authority, PCR, Refunding (Union Camp Corp. Project) 6.80%, 2/1/2012.............................. 200,000 206,884 Savannah Hospital Authority, Revenue, Refunding: Improvement (Candler Hospital) 7%, 1/1/2011............................. 200,000 200,818 (Saint Joseph's Hospital Project) 6.20%, 7/1/2023....................... 500,000 470,515 PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES STATEMENT OF INVESTMENTS (CONTINUED) APRIL 30, 1994 PRINCIPAL MUNICIPAL BONDS (CONTINUED) AMOUNT VALUE ---------- ---------- GEORGIA (CONTINUED) Sugar Hill Public Utility, Revenue, Refunding 5.90%, 1/1/2014 (Insured; FSA) $ 500,000 $ 485,240 Upson County Hospital Authority, Revenue Certificates 5.75%, 1/1/2012 (Insured; MBIA)......................................... 350,000 337,193 Wayne County Development Authority, PCR (ITT Rayonier, Inc. Project) 6.10%, 11/1/2007........................................................ 750,000 728,528 U.S. RELATED--5.3% Guam Power Authority, Revenue 6.30%, 10/1/2022.............................. 500,000 487,820 Puerto Rico, GO, Refunding 6%, 7/1/2014..................................... 600,000 576,360 Puerto Rico Highway and Transportation Authority, Highway Revenue 6.50%, 7/1/2022 (Prerefunded 7/1/2002) (b).............................. 300,000 327,192 ---------- TOTAL MUNICIPAL BONDS (cost $26,114,346).................................... $25,006,378 =========== SHORT-TERM MUNICIPAL INVESTMENT--3.8% GEORGIA; Marietta Housing Authority, MFHR, VRDN (Franklin Walk Apartments) 3.325% (LOC; Bankers Trust) (a,c) (cost $1,000,000)..................... $ 1,000,000 $ 1,000,000 =========== TOTAL INVESTMENTS--100.0% (cost $27,114,346)................................ $ 26,006,378 ===========
SUMMARY OF ABBREVIATIONS AMBAC American Municipal Bond Assurance Corporation LOC Letter of Credit COP Certificate of Participation MBIA Municipal Bond Insurance Association FGIC Financial Guaranty Insurance Corporation MFHR Multi-Family Housing Revenue FHA Federal Housing Administration MFMR Multi-Family Mortgage Revenue FSA Financial Security Assurance PCR Pollution Control Revenue GO General Obligation VRDN Variable Rate Demand Notes HR Hospital Revenue
SUMMARY OF COMBINED RATINGS (UNAUDITED) FITCH (D) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE - --------- --------- -------------------- ----------------------- AAA Aaa AAA 42.3% AA Aa AA 34.2 A A A 13.2 BBB Baa BBB 5.5 BB Ba BB .9 F1 MIG1 SP1 3.9 ------ 100.0% ======
NOTES TO STATEMENT OF INVESTMENTS: (a) Secured by letters of credit. (b) Bonds which are prerefunded are collateralized by U.S. Government securities which are held in escrow and are used to pay principal and interest on the tax-exempt issue and to retire the bonds in full at the earliest refunding date. (c) Securities payable on demand. The interest rate, which is subject to change, is based upon bank prime rates or an index of market interest rates. (d) Fitch currently provides creditworthiness information for a limited amount of investments. See notes to financial statements. PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES STATEMENT OF ASSETS AND LIABILITIES APRIL 30, 1994 ASSETS: Investments in securities, at value (cost $27,114,346)-see statement...................................... $26,006,378 Cash.................................................................... 142,049 Interest receivable..................................................... 497,540 Receivable for shares of Beneficial Interest subscribed................. 199,996 Prepaid expenses........................................................ 16,434 Due from The Dreyfus Corporation........................................ 9,416 ---------- 26,871,813 LIABILITIES: Payable for investment securities purchased............................. $503,998 Payable for shares of Beneficial Interest redeemed...................... 30,140 Accrued expenses........................................................ 36,913 571,051 -------- ---------- NET ASSETS ................................................................ $26,300,762 =========== REPRESENTED BY: Paid-in capital......................................................... $27,429,375 Accumulated net realized (loss) on investments.......................... (20,645) Accumulated net unrealized (depreciation) on investments-Note 3......... (1,107,968) ------------- NET ASSETS at value......................................................... $26,300,762 =========== Shares of Beneficial Interest outstanding: Class A Shares (unlimited number of $.001 par value shares authorized)............... 792,541 =========== Class B Shares (unlimited number of $.001 par value shares authorized)............... 1,279,595 =========== NET ASSET VALUE per share: Class A Shares ($10,057,607 / 792,541 shares)........................................ $12.69 ======= Class B Shares ($16,243,155 / 1,279,595 shares)...................................... $12.69 ======= See notes to financial statements.
PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES STATEMENT OF OPERATIONS YEAR ENDED APRIL 30, 1994 INVESTMENT INCOME: INTEREST INCOME......................................................... $1,191,802 EXPENSES: Management fee--Note 2(a)............................................. $ 120,183 Shareholder servicing costs-Note 2(c)................................. 79,126 Distribution fees (Class B shares)-Note 2(b).......................... 62,714 Prospectus and shareholders' reports.................................. 14,693 Registration fees..................................................... 5,162 Organization expenses................................................. 4,500 Professional fees..................................................... 3,250 Custodian fees........................................................ 2,565 Trustees' fees and expenses-Note 2(d)................................. 198 Miscellaneous......................................................... 10,399 ------------ 302,790 Less-expense reimbursement from Manager due to undertaking-Note 2(a)............................................. 223,583 ------------ TOTAL EXPENSES.................................................. 79,207 ---------- INVESTMENT INCOME--NET.......................................... 1,112,595 ---------- REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS: Net realized (loss) on investments--Note 3.............................. $ (5,970) Net unrealized (depreciation) on investments............................ (1,498,005) ------------ NET REALIZED AND UNREALIZED (LOSS) ON INVESTMENTS............... (1,503,975) ------------ NET (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS...................... $ (391,380) ============ See notes to financial statements.
PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES STATEMENT OF CHANGES IN NET ASSETS YEAR ENDED APRIL 30, --------------------------------- 1993(1) 1994 --------------- --------------- OPERATIONS: Investment income--net.................................................. $ 192,429 $ 1,112,595 Net realized (loss) on investments...................................... (14,675) (5,970) Net unrealized appreciation (depreciation) on investments for the year.. 390,037 (1,498,005) ---------- ----------- NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS... 567,791 (391,380) ---------- ----------- DIVIDENDS TO SHAREHOLDERS FROM; Investment income--net: Class A shares........................................................ (143,166) (503,813) Class B shares........................................................ (49,263) (608,782) ---------- ----------- TOTAL DIVIDENDS................................................... (192,429) (1,112,595) ---------- ----------- BENEFICIAL INTEREST TRANSACTIONS: Net proceeds from shares sold: Class A shares........................................................ 9,210,060 4,256,182 Class B shares........................................................ 6,237,874 11,270,678 Dividends reinvested: Class A shares........................................................ 103,827 363,383 Class B shares........................................................ 22,493 335,961 Cost of shares redeemed: Class A shares........................................................ (2,301,609) (1,324,053) Class B shares........................................................ (24,753) (720,668) ---------- ----------- INCREASE IN NET ASSETS FROM BENEFICIAL INTEREST TRANSACTIONS...... 13,247,892 14,181,483 ---------- ----------- TOTAL INCREASE IN NET ASSETS.................................... 13,623,254 12,677,508 NET ASSETS: Beginning of year....................................................... -- 13,623,254 ---------- ----------- End of year............................................................. $13,623,254 $26,300,762 ============ ==========
SHARES ------------------------------------------------------------------- CLASS A CLASS B --------------------------------- ----------------------------- YEAR ENDED APRIL 30, YEAR ENDED APRIL 30, --------------------------------- ----------------------------- 1993(1) 1994 1993(2) 1994 -------- -------- -------- --------- CAPITAL SHARE TRANSACTIONS: Shares sold............................ 722,509 314,626 476,432 832,134 Shares issued for dividends reinvested. 7,993 26,952 1,698 24,944 Shares redeemed........................ (179,901) (99,638) (1,866) (53,747) -------- -------- -------- --------- NET INCREASE IN SHARES OUTSTANDING 550,601 241,940 476,264 803,331 ========= ========== ========= =========
(1)From September 3, 1992 (commencement of operations) to April 30, 1993. (2)From January 15, 1993 (commencement of initial offering) to April 30, 1993. See notes to financial statements. PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES FINANCIAL HIGHLIGHTS Contained below is per share operating performance data for a share of Beneficial Interest outstanding, total investment return, ratios to average net assets and other supplemental data for each year indicated. This information has been derived from information provided in the Series' financial statements. CLASS A SHARES CLASS B SHARES ---------------------- ---------------------- YEAR ENDED APRIL 30, YEAR ENDED APRIL 30, ---------------------- ---------------------- PER SHARE DATA: 1993(1) 1994 1993(2) 1994 --------- -------- -------- -------- Net asset value, beginning of year...................... $12.50 $13.27 $12.71 $13.27 --------- -------- -------- -------- INVESTMENT OPERATIONS: Investment income--net.................................. .51 .73 .20 .67 Net realized and unrealized gain (loss) on investments.. .77 (.58) .56 (.58) --------- -------- -------- -------- TOTAL FROM INVESTMENT OPERATIONS...................... 1.28 .15 .76 .09 --------- -------- -------- -------- DISTRIBUTIONS; Dividends from investment income--net................... (.51) (.73) (.20) (.67) --------- -------- -------- -------- Net asset value, end of year............................ $13.27 $12.69 $13.27 $12.69 ===== ====== ===== ======== TOTAL INVESTMENT RETURN (3)................................. 15.91%(4) .97% 20.66%(4) .46% RATIOS/SUPPLEMENTAL DATA: Ratio of expenses to average net assets................. - .07% .50%(4) .58% Ratio of net investment income to average net assets.... 5.55%(4) 5.41% 4.60%(4) 4.85% Decrease reflected in above expense ratios due to undertakings by the Manager........................................ 1.46%(4) 1.02% 1.37%(4) 1.02% Portfolio Turnover Rate................................. 37.79%(5) 6.76% 37.79%(5) 6.76% Net Assets, end of year (000's Omitted)................. $7,304 $10,058 $6,319 $16,243
(1)From September 3, 1992 (commencement of operations) to April 30, 1993. (2)From January 15, 1993 (commencement of initial offering) to April 30, 1993. (3)Exclusive of sales load. (4)Annualized. (5)Not annualized. See notes to financial statements. PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES NOTES TO FINANCIAL STATEMENTS NOTE 1--SIGNIFICANT ACCOUNTING POLICIES: Premier State Municipal Bond Fund (the "Fund") is registered under the Investment Company Act of 1940 ("Act") as a non-diversified open-end management investment company and operates as a series company currently offering fifteen series including the Georgia Series (the "Series"). Dreyfus Service Corporation ("Distributor") acts as the distributor of the Fund's shares. The Distributor is a wholly-owned subsidiary of The Dreyfus Corporation ("Manager"). The Fund accounts separately for the assets, liabilities and operations of each series. Expenses directly attributable to each series are charged to that series' operations; expenses which are applicable to all series are allocated among them. The Series offers both Class A and Class B shares. Class A shares are subject to a sales charge imposed at the time of purchase and Class B shares are subject to a contingent deferred sales charge imposed at the time of redemption on redemptions made within five years of purchase. Other differences between the two Classes include the services offered to and the expenses borne by each Class and certain voting rights. (A) PORTFOLIO VALUATION: The Series' investments (excluding options and financial futures on municipal and U.S. treasury securities) are valued each business day by an independent pricing service ("Service") approved by the Board of Trustees. Investments for which quoted bid prices in the judgment of the Service are readily available and are representative of the bid side of the market are valued at the mean between the quoted bid prices (as obtained by the Service from dealers in such securities) and asked prices (as calculate d by the Service based upon its evaluation of the market for such securities). Other investments (which constitute a majority of the portfolio securities) are carried at fair value as determined by the Service, based on methods which include consideration of: yields or prices of municipal securities of comparable quality, coupon, maturity and type; indications as to values from dealers; and general market conditions. Options and financial futures on municipal and U.S. treasury securities are valued at the last sales price on securities exchange on which such securities are primarily traded or at the last sales price on the national securities market on each business day. Investments not listed on an exchange or the national securities market, or securities for which there were no transactions, are valued at the average of the most recent bid and asked prices. Bid price is used when no asked price is available. (B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are recorded on a trade date basis. Realized gain and loss from securities transactions are recorded on the identified cost basis. Interest income, adjusted for amortization of premiums and, when appropriate, discounts on investments, is earned from settlement date and recognized on the accrual basis. Securities purchased or sold on a when-issued or delayed-delivery basis may be settled a month or more after the trade date. The Series follows an investment policy of investing primarily in municipal obligations of one state. Economic changes affecting the state and certain of its public bodies and municipalities may affect the ability of issuers within the state to pay interest on, or repay principal of, municipal obligations held by the Series. (C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Series to declare dividends daily from investment income-net. Such dividends are paid monthly. Dividends from net realized capital gain are normally declared and paid annually, but the Series may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code. To the extent that net realized capital gain can be offset by capital loss carryovers, if any, it is the policy of the Series not to distribute such gain. PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES NOTES TO FINANCIAL STATEMENTS (CONTINUED) (D) FEDERAL INCOME TAXES: It is the policy of the Series to continue to qualify as a regulated investment company, which can distribute tax exempt dividends, by complying with the provisions available to certain investment companies, as defined in applicable sections of the Internal Revenue Code, and to make distributions of income and net realized capital gain sufficient to relieve it from all, or substantially all, Federal income taxes. The Fund has an unused capital loss carryover of $14,625 available for Federal income tax purposes to be applied against future net securirites profits, if any, realized susequent to April 30, 1994. If not applied, the carryover expires in fiscal 2002. NOTE 2--MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES: (A) Pursuant to a management agreement ("Agreement") with the Manager, the management fee is computed at the annual rate of .55 of 1% of the average daily value of the Series' net assets and is payable monthly. The Agreement provides for an expense reimbursement from the Manager should the Series' aggregate expenses, exclusive of taxes, brokerage, interest on borrowings and extraordinary expenses, exceed the expense limitation of any state having jurisdiction over the Series for any full fiscal year. However, the Manager had undertaken from May 1, 1993 through January 11, 1994 to reimburse all fees and expenses of the Series (excluding 12b-1 distribution plan fees and certain expenses as described above) and thereafter had undertaken through February 14, 1994 to reduce the management fee paid by the Series, to the extent that the Series aggregate expenses (excluding 12b-1 distribution plan fees and certain expenses as described above) exceeded specified annual percentages of the Series' average daily net assets. The Manager has currently undertaken from February 15, 1994 through July 1, 1994 or until such time as the net assets of the Series exceed $50 million, regardless of whether they remain at that level, to reimburse all fees and expenses of the Series (excluding Shareholder Services Plan fees, 12b-1 distribution plan fees, and certain expenses as described above). The expense reimbursement, pursuant to the undertakings, amounted to $223,583 for the year ended April 30, 1994. The undertaking may be modified by the Manager from time to time, provided that the resulting expense reimbursement would not be less than the amount required pursuant to the Agreement. The Distributor retained $9,022 during the year ended April 30, 1994 from commissions earned on sales of the Series' Class A shares. The Distributor retained $11,423 during the year ended April 30, 1994 from contingent deferred sales charges imposed upon redemptions of the Series' Class B shares. (B) Under the Distribution Plan ("Class B Distribution Plan") adopted pursuant to Rule 12b-1 under the Act, the Series pays the Distributor at an annual rate of .50 of 1% of the value of the Series' Class B shares average daily net assets, for the costs and expenses in connection with advertising, marketing and distributing the Series' Class B shares. The Distributor may make payments to one or more Service Agents (a securities dealer, financial institution, or other industry professional) based on the value of the Series' Class B shares owned by clients of the Service Agent. During the year ended April 30, 1994, $62,714 was charged to the Series pursuant to the Class B Distribution Plan. (C) Under the Shareholder Services Plan, the Series pays the Distributor, at an annual rate of .25 of 1% of the value of the average daily net assets of Class A and Class B shares for servicing shareholder accounts. The services provided may include personal services relating to shareholder accounts, such as PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES NOTES TO FINANCIAL STATEMENTS (CONTINUED) answering shareholder inquiries regarding the Series and providing reports and other information, and services related to the maintenance of shareholder accounts. The Distributor may make payments to Service Agents in respect of these services. The Distributor determines the amounts to be paid to Service Agents. For the year ended April 30, 1994, $23,272 and $31,357 were charged to the Class A and Class B shares, respectively, pursuant to the Shareholder Services Plan. (D) Certain officers and trustees of the Fund are "affiliated persons," as defined in the Act, of the Manager and/or the Distributor. Each trustee who is not an "affiliated person" receives from the Fund an annual fee of $2,500 and an attendance fee of $250 per meeting. (E) On December 5, 1993, the Manager entered into an Agreement and Plan of Merger (the "Merger Agreement") providing for the merger of the Manager with a subsidiary of Mellon Bank Corporation ("Mellon"). Following the merger, it is planned that the Manager will be a direct subsidiary of Mellon Bank, N.A. Closing of this merger is subject to a number of contingencies, including receipt of certain regulatory approvals and approvals of the stockholders of the Manager and of Mellon. The merger is expected to occur in mid-1994, but could occur later. As a result of regulatory requirements and the terms of the Merger Agreement, the Manager will seek various approvals from the Fund's board and shareholders before completion of the merger. Shareholder approval will be solicited by a proxy statement. NOTE 3--SECURITIES TRANSACTIONS: Purchases and sales of securities amounted to $14,988,477 and $1,469,980, respectively, for the year ended April 30, 1994, and consisted entirely of municipal bonds and short-term municipal investments. At April 30, 1994, accumulated net unrealized depreciation on investments was $1,107,968, consisting of $119,174 gross unrealized appreciation and $1,227,142 gross unrealized depreciation. At April 30, 1994, the cost of investments for Federal income tax purposes was substantially the same as the cost for financial reporting purposes (see the Statement of Investments). PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES REPORT OF ERNST & YOUNG, INDEPENDENT AUDITORS SHAREHOLDERS AND BOARD OF TRUSTEES PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES We have audited the accompanying statement of assets and liabilities of Premier State Municipal Bond Fund, Georgia Series (one of the Series constituting the Premier State Municipal Bond Fund), including the statement of investments, as of April 30, 1994, and the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and financial highlights for each of the years indicated therein. These financial statements and financial highlights are the responsibility of the Fund's 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 generally accepted auditing standards. 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 April 30, 1994 by correspondence with the custodian and brokers. 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 Premier State Municipal Bond Fund, Georgia Series at April 30, 1994, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the indicated years, in conformity with generally accepted accounting principles. (Ernest and Young Logo Signature) New York, New York June 7, 1994 PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES IMPORTANT TAX INFORMATION (UNAUDITED) In accordance with Federal tax law, the Series hereby designates all the dividends paid from investment income-net during the fiscal year ended April 30, 1994 as "exempt-interest dividends" (not subject to regular Federal and, for individuals who are Georgia residents, Georgia personal income taxes). As required by Federal tax law rules, shareholders will receive notification of their portion of the Series' taxable ordinary dividends (if any) and capital gain distributions (if any) paid for the 1994 calendar year on Form 1099-DIV which will be mailed by January 31, 1995. PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES 144 Glenn Curtiss Boulevard Uniondale, NY 11556 MANAGER The Dreyfus Corporation 200 Park Avenue New York, NY 10166 DISTRIBUTOR Dreyfus Service Corporation 200 Park Avenue New York, NY 10166 CUSTODIAN The Bank of New York 110 Washington Street New York, NY 10286 TRANSFER AGENT & DIVIDEND DISBURSING AGENT The Shareholder Services Group, Inc. P.O. Box 9671 Providence, RI 02940 Further information is contained in the Prospectus, which must precede or accompany this report. Printed in U.S.A. 068/AR944 Annual Report Premier State Municipal Bond Fund Georgia Series April 30, 1994 (Dreyfus Lion Logo) EX-99.A 2 GRAPH IN THE PRESIDENT'S LETTER COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN PREMIER STATE MUNICIPAL BOND FUND, GEORGIA SERIES CLASS A SHARES AND THE LEHMAN BROTHERS MUNICIPAL BOND INDEX EXHIBIT A: ____________________________________________________ | | | | | | | PREMIER STATE | | PERIOD | LEHMAN BROTHERS |MUNICIPAL BOND FUND, | | | MUNICIPAL | GEORGIA SERIES | | | BOND INDEX * | CLASS A | |-----------|-----------------|---------------------| | 9/3/92 | 10,000 | 9,549 | | 10/31/92 | 9,966 | 9,401 | | 1/31/93 | 10,368 | 10,075 | | 4/30/93 | 10,736 | 10,548 | | 7/31/93 | 10,991 | 10,807 | | 10/31/93 | 11,370 | 11,327 | | 1/31/94 | 11,639 | 11,574 | | 4/30/94 | 10,968 | 10,650 | |---------------------------------------------------| -----END PRIVACY-ENHANCED MESSAGE-----