-----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, MoTJ6X07aXcBL4rZDEC9pYtYTqkTPYyQ1RIZV8LzayZT+dKK4BmV/eslMO+IEDfs 9KiOh7Nmr+fw+fSrtvV0iA== 0001047469-04-022326.txt : 20040701 0001047469-04-022326.hdr.sgml : 20040701 20040701152530 ACCESSION NUMBER: 0001047469-04-022326 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20040430 FILED AS OF DATE: 20040701 EFFECTIVENESS DATE: 20040701 FILER: COMPANY DATA: COMPANY CONFORMED NAME: STATE STREET RESEARCH SECURITIES TRUST CENTRAL INDEX KEY: 0000918572 STATE OF INCORPORATION: MA FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-08322 FILM NUMBER: 04895074 BUSINESS ADDRESS: STREET 1: ONE FINANCIAL CENTER CITY: BOSTON STATE: MA ZIP: 02111 BUSINESS PHONE: 6173571340 MAIL ADDRESS: STREET 1: ONE FINANCIAL CENTER CITY: BOSTON STATE: MA ZIP: 02111 N-CSR 1 a2138663zn-csr.txt N-CSR 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 number 811-8322 ---------------------------------------------- State Street Research Securities Trust ------------------------------------------------------------------------ (Exact name of registrant as specified in charter) One Financial Center, Boston, MA 02111 ------------------------------------------------------------------------ (Address of principal executive offices) (Zip code) Terrence J. Cullen, Senior Vice President and Counsel State Street Research & Management Company One Financial Center, Boston, MA 02111 ------------------------------------------------------------------------ (Name and address of agent for service) Registrant's telephone number, including area code: 617-357-1200 ------------------ Date of fiscal year end: 4/30/04 ----------------- Date of reporting period: 5/1/03 - 4/30/04 ---------------------------- Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles. ITEM 1 (REPORT TO SHAREHOLDERS): The Annual Report is attached. [BACKGROUND GRAPHIC] [STATE STREET LOGO] [PHOTO] Large-Cap Analyst Fund April 30, 2004 Annual Report to Shareholders Table of Contents 3 Performance Discussion 6 Portfolio Holdings 8 Financial Statements 12 Financial Highlights 14 Report of Independent Registered Public Accounting Firm 15 Trustees and Officers FROM THE CHAIRMAN State Street Research From the uncertainties of war to a rebound in investor enthusiasm, from sluggish recovery to robust growth--the ground covered by both the financial markets and the U.S. economy over the past twelve months was nothing short of remarkable. When the 12-month reporting period began last May, economic growth was coming off a sluggish quarter, manufacturing activity was declining and unemployment was edging higher. However, once formal military action in Iraq came to a halt, the clouds of uncertainty lifted and better times followed. Economic growth picked up. Consumer confidence strengthened. A combination of accelerated tax cuts, tax rebates and the lowest mortgage rates in a generation fueled higher disposable income for most working Americans. The housing market was strong, and consumer spending continued to rise. Better yet, business spending began to recover after a long period of stagnation. Corporate profits staged a solid rebound, making it easier for companies to increase outlays, especially on information technology and electronic equipment. Late in the period, a surge in job growth put aside lingering fears about the economy. Yet, the period was not without its disappointments. Rising oil prices were creating an uptick in inflation. And with the economy on solid ground, there were widespread expectations that the Federal Reserve Board would raise short-term interest rates sooner rather than later this year. Stock and Bond Markets Moved Higher Stocks staged an impressive rally early in the period, with the riskiest sectors of the stock market leading the way--technology, small-caps and companies that had been beaten down in the bear market. However, index returns for the period as a whole masked the sideways movement that developed in the final months of the period as investors grew more cautious about interest rates and corporate profit comparisons going forward. Confidence in the economy also translated into gains for high-yield bonds that were in line with the stock market. However, high-yield bonds underperformed late in the period as investors came to view the sector as fully valued. Both investment-grade corporate and government bonds earned solid but modest returns for the year. The municipal market was a standout among investment-grade sectors, but mortgage bonds lagged as more homeowners took advantage of low rates and refinanced their mortgages. Looking Ahead The recent bear and bull cycles serve as a reminder that markets can be unpredictable, which underscores the importance of having an asset allocation plan in place. If you have a plan in place, stay with it, invest regularly and talk to your investment professional before you make a significant move outside your plan. As always, we look forward to helping you achieve your long-term financial goals with State Street Research Funds. Sincerely, /s/ Richard S. Davis Richard S. Davis Chairman April 30, 2004 2 - ---------------- PERFORMANCE - ---------------- Discussion as of April 30, 2004 How State Street Research Large-Cap Analyst Fund Performed For the 12 months ended April 30, 2004, State Street Research Large-Cap Analyst Fund returned 23.90%.(1) This performance was in line with the Russell 1000[RegTM] Index, which also returned 23.90%.(2) The fund outpaced the Lipper Large-Cap Core Funds Average, which returned 19.51% over the same one-year period.(2) Reasons for the Fund's Performance Strong stock selection, particularly in the health care, consumer discretionary and technology sectors, drove returns. Within health care, the fund benefited from our decision to downplay large-cap pharmaceutical stocks, which struggled as competition from generics increased and new product development activity was disappointing. Overseas drug companies, such as Altana and Elan, also helped performance, buoyed by their new product prospects. Because we continue to believe in health care's long-term prospects, we recently added to our position in Pfizer, which has a promising new lung-treatment drug awaiting approval. Among consumer-oriented stocks, top gainers included International Game Technology, the world's leading slot machine manufacturer; Cendant, a conglomerate that owns a mix of hotel, real estate, rental car and travel business; and Starbucks. Technology stocks also rallied nicely as the economy improved. Semiconductor stocks benefited from strong demand as sales increased for personal computers and also for consumer electronic devices that use semiconductor chips, such as cell phones and digital cameras. In the technology sector, the fund benefited from owning Intel and National Semiconductor. In the utilities sector, our investment in Comcast hurt performance. Worries about the company's bid for The Walt Disney Company caused the stock price to fall. Our relatively light exposure to AT&T Wireless also undermined returns as the stock price doubled following Cingular's acquisition announcement. The fund's investments in American Power Conversion and Applied Materials in the producer durables sector hindered performance. Both stocks sustained double-digit losses over the year. Looking Ahead We believe the market volatility that ensued late in the period could continue due to uncertainties surrounding the presidential election and the conflict in Iraq. However, we would view further market volatility as a buying opportunity. A Word about Risk The major risks of stock investing include sudden and unpredictable drops in value and period of lackluster performance. The fund invests in larger, more established companies, which may be unable to respond quickly to new competitive challenges, such as changes in technology and consumer trends. Many larger companies also cannot sustain the higher growth rates of successful smaller companies during periods of extended economic expansion. The fund may underperform other stock funds during periods when large-company stocks in general are out of favor. The fund's policy of remaining invested in all sectors of the Russell 1000 Index means that its performance may be affected by sector-wide downturns. Top 10 Holdings - --------------------------------------------------------------
Issuer/Security % of Fund Net Assets (1) Exxon Mobil 3.3% ---------------------------------------------- (2) Pfizer 3.1% ---------------------------------------------- (3) Citigroup 3.1% ---------------------------------------------- (4) General Electric 2.9% ---------------------------------------------- (5) Intel 2.4% ---------------------------------------------- (6) InterActiveCorp 2.2% ---------------------------------------------- (7) Novartis 2.1% ---------------------------------------------- (8) American International Group 2.1% ---------------------------------------------- (9) Microsoft 1.7% ---------------------------------------------- (10) Cisco Systems 1.7% ---------------------------------------------- Total 24.6%
Performance: Class A - ------------------------------------------------------------- Fund average annual total return as of 4/30/04(3,5) (does not reflect sales charge) Life of Fund 1 Year 5 Years (3/11/98) 23.90% -0.39% 3.08%
- ------------------------------------------------------------- Fund average annual total return as of 3/31/04(3,4,5) (at maximum applicable sales charge) Life of Fund 1 Year 5 Years (3/11/98) 29.61% -0.26% 2.47%
- ------------------------------------------------------------- Russell 1000 Index as of 4/30/04(2) Life of Fund 1 Year 5 Years (3/11/98) 23.90% -1.73% 2.36%
- ------------------------------------------------------------- See pages 4 and 5 for additional performance data for Class A shares and for performance data on other share classes. Because financial markets and mutual fund strategies are constantly evolving, it is possible that the fund's holdings, market stance, outlook for various industries or securities and other matters discussed in this report have changed since this information was prepared. Portfolio changes should not be considered recommendations for action by individual investors. (1) Class A shares; does not reflect sales charge. (2) The Russell 1000 Index measures the performance of the 1,000 largest securities in the Russell 3000[RegTM] Index (an unmanaged index of the 3,000 largest publicly traded U.S. companies). The index is unmanaged and does not take transaction charges into consideration. It is not possible to invest directly in an index. The Lipper Large-Cap Core Funds Average shows the performance of a category of mutual funds with similar goals. The Lipper average shows you how well the fund has done compared to competing funds. (3) Keep in mind that the performance data quoted represents past performance and is no guarantee of future results. Current performance may be lower or higher than the performance data quoted herein. For the most recent month-end performance results, visit our website at www.ssrfunds.com. The fund's share price, yield and return will fluctuate, and you may have a gain or loss when you sell your shares. All returns assume reinvestment of capital gains distributions and income dividends at net asset value. The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. (4) Performance reflects a maximum 5.75% Class A share front-end sales charge. (5) Performance results for the fund are increased by the voluntary reduction of fund fees and expenses; without subsidization, performance would have been lower. State Street Research Large-Cap Analyst Fund 3 - ---------------- PERFORMANCE - ---------------- Discussion as of April 30, 2004 These two pages focus on the fund's long-term track record. While a mutual fund's past performance is not a guarantee of future results, long-term returns can serve as an important context for evaluating recent performance. There are three ways of measuring long-term performance: cumulative total returns, average annual total returns and the change in dollar value over time of a given investment. Information about these measures follows, while the share class boxes contain the results of these measures for each share class. Cumulative Total Return Represents the total percentage you would have earned or lost if you had invested a lump sum in the fund and left it there until the end of the period indicated. Average Annual Total Return Represents the rate you would have had to earn during each year of a given time period in order to end up with the fund's actual cumulative return for those years. In reality, of course, fund performance varies from year to year. Because of this, a fund's actual performance for a given year may be higher or lower than an average annual performance figure. $10,000 Over Life of Fund Similar to cumulative total return, but uses dollars rather than percentages, and assumes that the lump sum you invested was $10,000 (less the applicable maximum sales charge, if any) and compares fund performance to the performance of a market index. - ------------------------------------------------------------------------------------------------------------------------------ $10,000 Over Life of Fund (reflects maximum applicable sales charge) Class A [DATA BELOW IS REPRESENTED BY A LINE CHART IN THE ORIGINAL REPORT] Life of Fund 1 Year 5 Years (3/11/98) Russell 1000 - ------------------------------------------------------------------------------- Class A Index Cumulative Total Return 3/'98 9425 10000 (does not reflect sales charge) 23.90% -1.96% 20.46% 4/'98 9790 10464 - ------------------------------------------------------------------------------- '99 11580 12590 Cumulative Total Return '00 13730 14157 (at maximum applicable sales charge) 16.77% -7.59% 13.53% '01 12405 12223 - ------------------------------------------------------------------------------- '02 10622 10759 Average Annual Total Return '03 9163 9311 (at maximum applicable sales charge) 16.77% -1.57% 2.09% '04 11353 11536 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------ $10,000 Over Life of Fund (reflects maximum applicable sales charge) Class B(1) [DATA BELOW IS REPRESENTED BY A LINE CHART IN THE ORIGINAL REPORT] Life of Fund 1 Year 5 Years (3/11/98) Russell 1000 - ------------------------------------------------------------------------------- Class B(1) Index Cumulative Total Return 3/'98 10000 10000 (does not reflect sales charge) 23.10% -5.53% 15.09% 4/'98 10366 10464 - ------------------------------------------------------------------------------- '99 12182 12590 Cumulative Total Return '00 14317 14157 (at maximum applicable sales charge) 18.10% -7.25% 15.09% '01 12853 12223 - ------------------------------------------------------------------------------- '02 10935 10759 Average Annual Total Return '03 9350 9311 (at maximum applicable sales charge) 18.10% -1.49% 2.17% '04 11509 11536 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------
Keep in mind that the performance data quoted represents past performance and is no guarantee of future results. Current performance may be lower or higher than the performance data quoted herein. For the most recent month-end performance results, visit our website at www.ssrfunds.com. The fund's share price, yield and return will fluctuate, and you may have a gain or loss when you sell your shares. All returns assume reinvestment of capital gains distributions and income dividends at net asset value. The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions, or the redemption of fund shares. 4 - ------------------------------------------------------------------------------------------------------------------------------ $10,000 Over Life of Fund (reflects maximum applicable sales charge) Class B (only available through exchanges from another Class B account) [DATA BELOW IS REPRESENTED BY A LINE CHART IN THE ORIGINAL REPORT] Life of Fund 1 Year 5 Years (3/11/98) Russell 1000 - -------------------------------------------------------------------------------- Class B Index Cumulative Total Return 3/'98 10000 10000 (does not reflect sales charge) 26.01% -2.70% 18.51% 4/'98 10366 10464 - -------------------------------------------------------------------------------- '99 12180 12590 Cumulative Total Return '00 14325 14157 (at maximum applicable sales charge) 21.01% -4.48% 18.51% '01 12850 12223 - -------------------------------------------------------------------------------- '02 10933 10759 Average Annual Total Return '03 9405 9311 (at maximum applicable sales charge) 21.01% -0.91% 2.80% '04 11851 11536 - -------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------ $10,000 Over Life of Fund (reflects maximum applicable sales charge) Class C [DATA BELOW IS REPRESENTED BY A LINE CHART IN THE ORIGINAL REPORT] Life of Fund 1 Year 5 Years (3/11/98) Russell 1000 - -------------------------------------------------------------------------------- Class C Index Cumulative Total Return 3/'98 10000 10000 (does not reflect sales charge) 23.19% -5.34% 15.28% 4/'98 10377 10464 - -------------------------------------------------------------------------------- '99 12179 12590 Cumulative Total Return '00 14334 14157 (at maximum applicable sales charge) 22.19% -5.34% 15.28% '01 12860 12223 - -------------------------------------------------------------------------------- '02 10942 10759 Average Annual Total Return '03 9358 9311 (at maximum applicable sales charge) 22.19% -1.09% 2.34% '04 11528 11536 - -------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------ $10,000 Over Life of Fund (reflects maximum applicable sales charge) Class S [DATA BELOW IS REPRESENTED BY A LINE CHART IN THE ORIGINAL REPORT] Life of Fund 1 Year 5 Years (3/11/98) Russell 1000 - -------------------------------------------------------------------------------- Class S Index Cumulative Total Return 3/'98 10000 10000 (does not reflect sales charge) 24.36% -0.74% 22.27% 4/'98 10387 10464 - -------------------------------------------------------------------------------- '99 12318 12590 Cumulative Total Return '00 14643 14157 (at maximum applicable sales charge) 24.36% -0.74% 22.27% '01 13270 12223 - -------------------------------------------------------------------------------- '02 11402 10759 Average Annual Total Return '03 9832 9311 (at maximum applicable sales charge) 24.36% -0.15% 3.33% '04 12227 11536 - -------------------------------------------------------------------------------- - ------------------------------------------------------------------------------------------------------------------------------
Performance reflects a maximum 5.75% Class A share front-end sales charge, or 5% Class B(1) or Class B share or 1% Class C share contingent deferred sales charge, where applicable. Performance for Class B(1) shares reflects Class B share performance through December 31, 1998, and Class B(1) performance thereafter. If the returns for Class B(1) shares had reflected their current service/ distribution (Rule 12b-1) fees for the entire period, returns would have been lower. Class S shares, offered without sales charge, are available through certain retirement plans and special programs. Performance results for the fund are increased by the voluntary reduction of fund fees and expenses; without subsidization, performance would have been lower. The Russell 1000 Index measures the performance of the 1,000 largest securities in the Russell 3000 Index (an unmanaged index of the 3,000 largest publicly traded U.S. companies). The index is unmanaged and does not take transaction charges into consideration. It is not possible to invest directly in an index. State Street Research Large-Cap Analyst Fund 5 - ---------------- PORTFOLIO - ---------------- Holdings April 30, 2004
Issuer Shares Value - -------------------------------------------------------------------------------- Common Stocks 99.7% Automobiles & Transportation 0.5% Automotive Parts 0.5% Navistar International Corp.* ........................ 5,400 $ 243,810 ---------- Total Automobiles & Transportation ................................ 243,810 ---------- Consumer Discretionary 14.6% Casinos/Gambling, Hotel/Motel 0.9% International Game Technology Inc. ................... 11,700 441,558 ---------- Commercial Services 2.8% Cendant Corp. ........................................ 14,600 345,728 InterActiveCorp* ..................................... 35,000 1,115,450 ---------- 1,461,178 ---------- Communications, Media & Entertainment 1.7% Univision Communications Inc. Cl. A* ................. 6,800 230,180 Walt Disney Co. ...................................... 28,900 665,567 ---------- 895,747 ---------- Consumer Electronics 1.4% Yahoo! Inc.* ......................................... 14,600 736,716 ---------- Printing & Publishing 1.2% News Corp. Ltd. ADR .................................. 17,500 639,800 ---------- Restaurants 1.2% McDonald's Corp. ..................................... 12,000 326,760 Starbucks Corp.* ..................................... 8,000 310,880 ---------- 637,640 ---------- Retail 4.8% Bed Bath & Beyond Inc.* .............................. 12,600 467,712 Best Buy Company Inc. ................................ 8,400 455,700 Federated Department Stores Inc. ..................... 7,500 367,500 Gap Inc. ............................................. 13,300 292,733 Home Depot Inc. ...................................... 18,500 651,015 Nordstrom Inc. ....................................... 6,800 242,284 ---------- 2,476,944 ---------- Textile Apparel Manufacturers 0.6% Coach Inc.* .......................................... 7,100 302,460 ---------- Total Consumer Discretionary ...................................... 7,592,043 ---------- Consumer Staples 7.3% Beverages 3.2% Coca-Cola Co. ........................................ 15,800 799,006 PepsiCo Inc. ......................................... 15,710 856,038 ---------- 1,655,044 ---------- Drug & Grocery Store Chains 1.7% CVS Corp. ............................................ 22,000 849,860 ---------- Household Products 1.8% Clorox Co. ........................................... 5,500 284,790 Procter & Gamble Co. ................................. 6,300 666,225 ---------- 951,015 ---------- Issuer Shares Value - -------------------------------------------------------------------------------- Tobacco 0.6% Altria Group Inc. .................................... 5,900 $ 326,742 ---------- Total Consumer Staples ............................................ 3,782,661 ---------- Financial Services 22.0% Banks & Savings & Loan 6.1% Bank of America Corp. ................................ 9,900 796,851 Bank of New York Co. Inc. ............................ 17,100 498,294 Fifth Third Bancorp .................................. 7,000 375,620 J.P. Morgan Chase & Co. .............................. 19,470 732,072 Wells Fargo & Co. .................................... 13,000 733,980 ---------- 3,136,817 ---------- Financial Data Processing Services & Systems 1.1% First Data Corp. ..................................... 13,000 590,070 ---------- Insurance 4.6% AFLAC Inc. ........................................... 8,000 337,840 Allstate Corp. ....................................... 6,000 275,400 American International Group Inc. .................... 15,000 1,074,750 Hartford Financial Services Group Inc. ............... 11,800 720,744 ---------- 2,408,734 ---------- Miscellaneous Financial 8.8% Ambac Financial Group Inc. ........................... 7,100 489,900 American Express Co. ................................. 15,000 734,250 Citigroup Inc. ....................................... 33,200 1,596,588 Federal Home Loan Mortgage Corp. ..................... 6,900 402,960 Federal National Mortgage Association ................ 7,600 522,272 MBNA Corp. ........................................... 11,500 280,370 Willis Group Holdings Ltd. ........................... 14,700 533,757 ---------- 4,560,097 ---------- Securities Brokerage & Services 1.4% Lehman Brothers Holdings Inc. ........................ 3,500 256,900 Morgan Stanley Inc. .................................. 9,100 467,649 ---------- 724,549 ---------- Total Financial Services .......................................... 11,420,267 ---------- Health Care 14.0% Drugs & Biotechnology 9.8% Amgen Inc.* .......................................... 5,300 298,231 Biogen Idec Inc.* .................................... 6,050 356,950 Charles River Laboratories International Inc.* ................................ 9,400 432,400 Chiron Corp.* ........................................ 8,400 389,760 Elan Corp.* ADR ...................................... 23,500 507,600 Gilead Sciences Inc.* ................................ 7,000 425,810 Novartis AG ADR ...................................... 24,300 1,088,640 Pfizer Inc. .......................................... 44,885 1,605,087 ---------- 5,104,478 ---------- Health Care Services 2.5% Aetna Inc. ........................................... 3,100 256,525 Caremark Rx Inc.* .................................... 12,700 429,895 Medco Health Solutions Inc.* ......................... 9,300 329,220 WellPoint Health Networks Inc. Cl. A* ................ 2,700 301,563 ---------- 1,317,203 ---------- Hospital Supply 1.7% Guidant Corp. ........................................ 3,900 245,739 Medtronic Inc. ....................................... 12,100 610,566 ---------- 856,305 ---------- Total Health Care ................................................. 7,277,986 ---------- Integrated Oils 4.2% Integrated International 4.2% Exxon Mobil Corp. .................................... 40,400 1,719,020 Total Fina SA ADR .................................... 5,000 460,600 ---------- Total Integrated Oils ............................................. 2,179,620 ----------
6 The notes are an integral part of the financial statements.
Issuer Shares Value - -------------------------------------------------------------------------------- Materials & Processing 3.5% Chemicals 2.3% Air Products & Chemicals Inc. ...................... 4,800 $ 239,088 Dow Chemical Co. ................................... 15,800 627,102 Sherwin Williams Co. ............................... 8,000 304,400 ---------- 1,170,590 ---------- Containers & Packaging 0.5% Sealed Air Corp.* .................................. 5,500 269,940 ---------- Paper & Forest Products 0.7% International Paper Co. ............................ 9,400 379,008 ---------- Total Materials & Processing ..................................... 1,819,538 ---------- Diversified Manufacturing 5.6% Multi-Sector 5.6% General Electric Co. ............................... 50,900 1,524,455 Honeywell International Inc. ....................... 23,200 802,256 ITT Industries Inc. ................................ 7,300 578,817 ---------- Total Other ...................................................... 2,905,528 ---------- Other Energy 3.5% Gas Pipelines 1.7% EOG Resources Inc. ................................. 17,300 852,025 ---------- Miscellaneous Energy 0.7% Consol Energy Inc. ................................. 6,800 194,684 Peabody Energy Corp. ............................... 3,700 173,493 ---------- 368,177 ---------- Oil Well Equipment & Services 1.1% BJ Services Co.* ................................... 6,600 293,700 Patterson-UTI Energy Inc.* ......................... 7,500 271,425 ---------- 565,125 ---------- Total Other Energy ............................................... 1,785,327 ---------- Producer Durables 5.3% Industrial Products 1.2% American Power Conversion Corp. .................... 32,500 606,450 ---------- Machinery 1.6% AGCO Corp.* ........................................ 28,600 550,550 Illinois Tool Works Inc. ........................... 3,300 284,493 ---------- 835,043 ---------- Miscellaneous Equipment 0.5% Pentair Inc. ....................................... 4,400 262,196 ---------- Production Technology Equipment 2.0% Applied Materials Inc.* ............................ 28,000 510,440 Lam Research Corp.* ................................ 25,000 553,500 ---------- 1,063,940 ---------- Total Producer Durables .......................................... 2,767,629 ---------- Technology 12.7% Communications Technology 2.3% Cisco Systems Inc.* ................................ 41,800 872,366 QUALCOMM Inc. ...................................... 5,300 331,038 ---------- 1,203,404 ---------- Computer Software 2.9% Microsoft Corp. .................................... 33,600 872,592 Oracle Corp.* ...................................... 56,800 637,296 ---------- 1,509,888 ---------- Computer Technology 1.7% EMC Corp.* ......................................... 48,400 540,144 Hewlett-Packard Co. ................................ 16,100 317,170 ---------- 857,314 ---------- Issuer Shares Value - -------------------------------------------------------------------------------- Electronics 0.7% Flextronics International Ltd.* .................... 22,100 $ 355,810 ---------- Electronics: Semiconductors/Components 5.1% Cypress Semiconductor Corp.* ....................... 19,700 275,209 Intel Corp. ........................................ 48,700 1,253,051 Linear Technology Corp. ............................ 15,900 566,517 Maxim Integrated Products Inc. ..................... 7,000 321,930 PerkinElmer Inc. ................................... 13,000 250,250 ---------- 2,666,957 ---------- Total Technology ................................................. 6,593,373 ---------- Utilities 6.5% Cable Television & Radio 2.2% Comcast Corp.* ..................................... 22,500 677,250 Cox Communications Inc. Cl. A* ..................... 14,700 480,543 ---------- 1,157,793 ---------- Electrical 0.9% Exelon Corp.* ...................................... 6,500 435,110 ---------- Telecommunications 3.4% Nextel Communications Inc. Cl. A* .................. 10,800 257,688 Qwest Communications International Inc.* .............................. 58,800 236,376 SBC Communications Inc. ............................ 18,500 460,650 Verizon Communications Inc. ........................ 21,500 811,410 ---------- 1,766,124 ---------- Total Utilities .................................................. 3,359,027 ---------- Total Common Stocks (Cost $47,764,802) ........................... 51,726,809 ---------- Short-Term Investments 2.8% State Street Navigator Securities Lending Prime Portfolio .......................... 1,480,975 1,480,975 ---------- Total Short-Term Investments (Cost $1,480,975) ................... 1,480,975 ----------
Principal Amount - -------------------------------------------------------------------------------- Commercial Paper 0.9% American Express Credit Corp., 1.00% 5/04/2004 $450,000 449,962 ------- Total Commercial Paper (Cost $449,962) ........................... 449,962 -------
% of Net Assets - -------------------------------------------------------------------------------- Summary of Portfolio Assets Investments (Cost $49,695,739) ..................... 103.4% 53,657,746 Cash and Other Assets, Less Liabilities ............ (3.4%) (1,789,011) --------- ------------ Net Assets ......................................... 100.0% $ 51,868,735 ========= ============
KEY TO SYMBOLS * Denotes a security which has not paid a dividend during the last year. ADR Stands for American Depositary Receipt. Federal Income Tax Information At April 30, 2004, the net unrealized appreciation of investments based on cost for federal income tax purposes of $49,921,043 was as follows: Aggregate gross unrealized appreciation for all investments in which there is an excess of value over tax cost $ 5,587,680 Aggregate gross unrealized depreciation for all investments in which there is an excess of tax cost over value (1,850,977) ------------ $ 3,736,703 ============
The notes are an integral part of the financial statements. State Street Research Large-Cap Analyst Fund 7 - ----------- FINANCIAL - ----------- Statements Statement of Assets and Liabilities - -------------------------------------------------------------------------------- April 30, 2004
Assets Investments, at value (cost $49,695,739) .................... $53,657,746 Cash ........................................................ 27,904 Receivable for securities sold .............................. 880,235 Dividends receivable ........................................ 47,802 Receivable from distributor ................................. 37,709 Receivable for fund shares sold ............................. 31,584 Other assets ................................................ 19,773 ----------- 54,702,753 ----------- Liabilities Payable for collateral received on securities loaned ........ 1,480,975 Payable for securities purchased ............................ 1,118,633 Accrued transfer agent and shareholder services ............. 77,489 Accrued management fee ...................................... 27,880 Payable for fund shares redeemed ............................ 19,536 Accrued distribution and service fees ....................... 15,816 Accrued trustees' fees ...................................... 10,225 Accrued administration fee .................................. 3,884 Other accrued expenses ...................................... 79,580 ----------- 2,834,018 ----------- Net Assets .................................................. $51,868,735 =========== Net Assets consist of: Undistributed net investment income ....................... $ 154,918 Unrealized appreciation of investments .................... 3,962,007 Accumulated net realized loss ............................. (7,742,123) Paid-in capital ........................................... 55,493,933 ----------- $51,868,735 ===========
Net Asset Value (NAV) of Each Share Class Except where noted, the NAV is the offering and the redemption price for each class.
Class Net Assets [divided by] Number of Shares = NAV A $32,726,344 3,119,811 $10.49* B(1) $7,600,574 758,856 $10.02** B $8,502,245 823,516 $10.32** C $1,161,394 115,707 $10.04** S $1,878,178 176,714 $10.63
* Maximum offering price per share = $11.13 ($10.49 [divided by] 0.9425) ** When you sell Class B(1), Class B or Class C shares, you receive the net asset value minus deferred sales charge, if any. Statement of Operations - -------------------------------------------------------------------------------- For the year ended April 30, 2004
Investment Income Interest (Note 1) ............................................ $ 34,815 Dividends, net of foreign taxes of $5,623 (Note 1) ........... 621,210 ---------- 656,025 ---------- Expenses Management fee (Note 2) ...................................... 295,776 Transfer agent and shareholder services ...................... 230,045 Administration fee (Note 2) .................................. 96,131 Custodian fee ................................................ 89,208 Distribution and service fees - Class A (Note 5) ............. 83,021 Distribution and service fees - Class B(1) (Note 5) .......... 65,002 Distribution and service fees - Class C (Note 5) ............. 9,940 Registration fees ............................................ 56,925 Reports to shareholders ...................................... 47,334 Audit fee .................................................... 25,117 Trustees' fees (Note 2) ...................................... 16,445 Legal fees ................................................... 4,301 Miscellaneous ................................................ 18,011 ---------- 1,037,256 Expenses borne by the distributor (Note 3) ................... (421,574) Fees paid indirectly (Note 2) ................................ (2,685) ---------- 612,997 ---------- 43,028 Reimbursement of distribution fees (Note 5) .................. 121,362 ---------- Net investment income ........................................ 164,390 ---------- Realized and Unrealized Gain on Investments Net realized gain on investments and options (Notes 1 and 4) ............................................ 7,053,307 Change in unrealized appreciation of investments ............. 2,029,732 ---------- Net gain on investments ...................................... 9,083,039 ---------- Net increase in net assets resulting from operations ......... $9,247,429 ==========
8 The notes are an integral part of the financial statements. Statement of Changes in Net Assets - --------------------------------------------------------------------------------
Years ended April 30 -------------------------------- 2004 2003 ------------ ------------ Increase (Decrease) In Net Assets Operations: Net investment income .................... $ 164,390 $ 38,187 Net realized gain (loss) on investments ......................... 7,053,307 (9,130,490) Change in unrealized appreciation (depreciation) on investments ......................... 2,029,732 (462,346) ------------ ------------ Net increase (decrease) in net assets resulting from operations ............................. 9,247,429 (9,554,649) ------------ ------------ Dividend from net investment income: Class A ................................ (50,020) -- Class S ................................ (6,414) -- ------------ ------------ (56,434) -- ------------ ------------ Net increase (decrease) from fund share transactions (Note 6) ............ 6,699,133 (13,457,435) ------------ ------------ Total increase (decrease) in net assets ............................. 15,890,128 (23,012,084) Net Assets Beginning of year ........................ 35,978,607 58,990,691 ------------ ------------ End of year (includes undistributed net investment income of $154,918 and $50,679, respectively) ................. $ 51,868,735 $ 35,978,607 ============ ============
Notes to Financial Statements - -------------------------------------------------------------------------------- April 30, 2004 Note 1 State Street Research Large-Cap Analyst Fund is a series of State Street Research Securities Trust (the "Trust"), which is organized as a Massachusetts business trust, and is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. The fund seeks to provide long-term growth of capital. In seeking to achieve its investment objective, the fund invests at least 80% of net asset in large-cap stocks and convertible securities of U.S. and foreign companies. The fund considers large-cap companies to be those with market capitalizations within the range of the Russell 1000 Index (an index of the 1,000 largest publicly traded U.S. companies) and of other U.S. and foreign companies of comparable size. The fund offers five classes of shares. Class A shares are subject to an initial sales charge of up to 5.75% and pay annual service and distribution fees equal to 0.30% of average daily net assets. Class B(1) shares pay annual service and distribution fees of 1.00% and automatically convert into Class A shares (which pay lower ongoing expenses) at the end of eight years. Class B(1) shares are subject to a contingent deferred sales charge on certain redemptions made within six years of purchase. Class B shares are offered only to current shareholders through reinvestment of dividends and distributions or through exchanges from existing Class B accounts of State Street Research funds. Currently, the annual service and distribution fees paid by Class B shares have been voluntarily reduced to 0.00%. Class B shares automatically convert into Class A shares at the end of eight years. Class B shares are subject to a contingent deferred sales charge on certain redemptions made within five years of purchase. Class C shares are subject to a contingent deferred sales charge of 1.00% on any shares redeemed within one year of their purchase, and also pay annual service and distribution fees of 1.00%. Class S shares are only offered through certain retirement accounts, advisory accounts of State Street Research & Management Company (the "Adviser"), an investment management subsidiary of MetLife, Inc. ("MetLife"), and special programs. No sales charge is imposed at the time of purchase or redemption of Class S shares. Class S shares do not pay any service or distribution fees. The fund's expenses are borne prorata by each class, except that each class bears expenses, and has exclusive voting rights with respect to provisions of the plans of distribution, related specifically to that class. The Trustees declare separate dividends on each class of shares. The following significant accounting policies are consistently followed by the fund in preparing its financial statements, and such policies are in conformity with accounting principles generally accepted in the United States of America. A. Investment Valuation Values for listed equity securities reflect final sales on national securities exchanges quoted prior to the close of the New York Stock Exchange. Over-the-counter securities quoted on the National Association of Securities Dealers Automated Quotation ("Nasdaq") system are valued at closing prices supplied through such system. If not quoted on the Nasdaq system, such securities are valued at prices obtained from independent brokers. In the absence of recorded sales, valuations are at the mean of the closing bid and asked quotations. Short-term securities maturing within sixty days are valued at amortized cost. Other securities, if any, are valued at their fair value as determined in good faith under consistently applied procedures established by and under the supervision of the Trustees. If trading or events occurring in other markets after the close of the principal market in which foreign securities are traded, and before the close of business of the fund, are expected to materially affect the value of these securities, then they are valued at their fair value taking this trading or these events into account. The notes are an integral part of the financial statements. State Street Research Large-Cap Analyst Fund 9 Notes (continued) - -------------------------------------------------------------------------------- B. Security Transactions Security transactions are accounted for on the trade date (date the order to buy or sell is executed). Realized gains or losses are reported on the basis of identified cost of securities delivered. C. Net Investment Income Net investment income is determined daily and consists of interest and dividends accrued and discount earned, less the estimated daily expenses of the fund. Interest income is accrued daily as earned. Dividend income is accrued on the ex-dividend date. D. Dividends Dividends from net investment income are declared and paid or reinvested annually. Net realized capital gains, if any, are distributed annually, unless additional distributions are required for compliance with applicable tax regulations. The fund has designated $56,434 as ordinary income dividends and $0 as long-term capital gains distributions. Income dividends and capital gains distributions are determined in accordance with federal income tax regulations which may differ from accounting principles generally accepted in the United States of America. The difference is primarily due to differing treatments for wash sale deferrals. The fund hereby designates the maximum amount allowable of its net taxable income as qualified dividend income as provided in the Jobs and Growth Tax Relief Reconciliation Act of 2003. This amount has been reflected on Form 1099 for the calendar year 2003. E. Federal Income Taxes No provision for federal income taxes is necessary because the fund has elected to qualify under Subchapter M of the Internal Revenue Code and its policy is to distribute all of its taxable income, including net realized capital gains, within the prescribed time periods. At April 30, 2004, the fund had a capital loss carryforward of $7,516,820 available, to the extent provided in regulations, to offset future capital gains, if any, all of which expires on April 30, 2011. In order to meet certain excise tax distribution requirements under Section 4982 of the Internal Revenue Code, the fund is required to measure and distribute annually, if necessary, net capital gains realized during a twelve-month period ending October 31. In this connection, the fund is permitted to defer into its next fiscal year any net capital losses incurred between each November 1 and the end of its fiscal year. From November 1, 2002, through April 30, 2003, the fund incurred net capital losses of $2,627,722 and has deferred and treated such losses as arising in the fiscal year ended April 30, 2004. To the extent book/tax differences are permanent in nature, such amounts are reclassified within the capital accounts based on federal tax basis treatment. The fund reclassified for book purposes amounts arising from permanent book/tax differences primarily relating to non-deductible excise taxes. At April 30, 2004, the components of distributable earnings on a tax basis differ from the amounts reflected in the Statement of Assets and Liabilities by temporary book/tax differences largely arising from wash sales and capital loss carryforwards. At April 30, 2004, the tax basis distributable earnings were $154,918 in undistributed ordinary income and $0 in undistributed long-term gains. F. Estimates The preparation of 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 and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from these estimates. G. Securities Lending The fund may seek additional income by lending portfolio securities to qualified institutions. The fund will receive cash or securities as collateral in an amount equal to at least 100% of the current market value of any loaned securities plus accrued interest. By reinvesting any cash collateral it receives in these transactions, the fund could realize additional gains and losses. If the borrower fails to return the securities and the value of the collateral has declined during the term of the loan, the fund will bear the loss. At April 30, 2004, the value of the securities loaned and the value of collateral were $1,426,116 and $1,480,975 (consisting entirely of cash collateral invested in State Street Navigator Securities Lending Prime Portfolio), respectively. During the year ended April 30, 2004, income from securities lending amounted to $1,827 and is included in interest income. Note 2 The Trust and the Adviser have entered into an agreement under which the Adviser earns monthly fees at an annual rate of 0.65% of fund net assets. In consideration of these fees, the Adviser furnishes the fund with management, investment advisory, statistical and research facilities and services. The Adviser also pays all salaries, rent and certain other expenses of management. During the year ended April 30, 2004, the fees pursuant to such agreement amounted to $295,776. State Street Research Service Center, a division of State Street Research Investment Services, Inc., the Trust's principal underwriter (the "Distributor"), provides certain shareholder services to the fund such as responding to inquiries and instructions from investors with respect to the purchase and redemption of shares of the fund. In addition, MetLife receives a fee for maintenance of the accounts of certain shareholders who are participants in sponsored arrangements, such as employee benefit plans, through or under which shares of the fund may be purchased. Total shareholder service costs are allocated to each fund in the same ratios as the transfer agent costs. During the year ended April 30, 2004, the amount of such expenses allocated to the fund was $66,736. The fund has entered into an arrangement with its transfer agent whereby credits realized as a result of uninvested cash balances and directed brokerage commissions, respectively, were used to reduce a portion of the fund's expenses. During the year ended April 30, 2004, the fund's transfer agent fees were reduced by $2,685 under these arrangements. The fees of the Trustees not currently affiliated with the Adviser amounted to $16,445 during the year ended April 30, 2004. The fund has agreed to pay the Adviser for certain administrative costs incurred in providing other assistance and services to the fund. The fee was based on a fixed amount that has been allocated equally among the State Street Research funds. During the year ended April 30, 2004, the amount of such expenses was $96,131. Note 3 The Distributor and its affiliates may from time to time and in varying amounts voluntarily assume some portion of fees and expenses relating to the fund. For the year ended April 30, 2004, the amount of such expenses assumed by the Distributor and its affiliates was $421,574. Note 4 For the year ended April 30, 2004, purchases and sales of securities, exclusive of short-term obligations, aggregated $56,144,406, and $48,470,978, respectively. Note 5 The Trust has adopted plans of distribution pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the plans, the fund pays annual service fees to the Distributor at a rate of 0.25% of average daily net assets for Class A, Class B(1), Class B and Class C shares. In addition, the fund pays annual distribution fees of 0.05% of average daily net assets for Class A shares and 0.75% of average daily net assets for Class B(1), Class B and Class C shares. Currently, the annual service and distribution fees paid by Class B shares have been voluntarily waived to 0.00%. The fund expects this waiver to continue, although there is no guarantee that it will. The Distributor uses such payments for personal services and/or the maintenance of shareholder accounts, to reimburse securities dealers for distribution and marketing services, to furnish ongoing assistance to investors and to defray a portion of its distribution and marketing expenses. For Class A, Class B and Class C shares, the payments are intended to reimburse the distributor for expenditures incurred under the plan, and any unused payments are returnable to the fund. For Class B(1), the payments compensate the distributor for services and expenditures incurred under the plan, and none of the payments are returnable to the fund. During the year ended 10 April 30, 2004, the Distributor reimbursed a total of $121,362 to Class B shares of the fund reflecting the estimated excess of payments received over costs incurred under the plan. This amount is shown as "Reimbursement of distribution fees" in the Statement of Operations. For the year ended April 30, 2004, fees pursuant to such plans amounted to $83,021, $65,002, and $9,940 for Class A, Class B(1) and Class C shares, respectively. As of April 30, 2004, there were $571,363, $390,898, and $419,478 for Class A, Class B(1) and Class C shares, respectively, of unreimbursed distribution and shareholder servicing related expenses to be carried forward to future plan years. The fund has been informed that the Distributor and MetLife Securities, Inc., a wholly owned subsidiary of MetLife, earned initial sales charges aggregating $61,508 and $336,679, respectively, on sales of Class A shares of the fund during the year ended April 30, 2004, and that MetLife Securities, Inc. earned commissions aggregating $202,645 and $3,926 on sales of Class B(1) and Class C shares, respectively, and the Distributor collected contingent deferred sales charges aggregating $16,256, $2,612 and $55 on redemptions of Class B(1), Class B and Class C shares, respectively, during the same period. Note 6 The Trustees have the authority to issue an unlimited number of shares of beneficial interest at $0.001 par value per share. These transactions break down by share class as follows:
Years ended April 30 ------------------------------------------------------------ 2004 2003 ------------------------------------------------------------ Class A Shares Amount Shares Amount - ------------------------------------------------------------------------------------------------------------------------------- Shares sold 1,460,047 $ 14,326,166 942,130 $ 7,966,395 Issued upon reinvestment of dividends from net investment income 4,820 49,361 -- -- Shares redeemed (788,343) (7,783,284) (1,591,554) (13,018,192) ------------ ------------ ------------ ------------ Net increase (decrease) 676,524 $ 6,592,243 (649,424) $ (5,051,797) ============ ============ ============ ============ Class B(1) Shares Amount Shares Amount - ------------------------------------------------------------------------------------------------------------------------------- Shares sold 243,721 $ 2,331,099 194,805 $ 1,557,170 Shares redeemed (144,904) (1,102,824) (349,924) (2,709,281) ------------ ------------ ------------ ------------ Net increase (decrease) 98,817 $ 1,228,275 (155,119) $ (1,152,111) ============ ============ ============ ============ Class B Shares Amount Shares Amount - ------------------------------------------------------------------------------------------------------------------------------- Shares sold 35,528 $ 331,885 65,423 $ 518,080 Shares redeemed (199,372) (1,922,441) (399,002) (3,127,283) ------------ ------------ ------------ ------------ Net decrease (163,844) $ (1,590,556) (333,579) $ (2,609,203) ============ ============ ============ ============ Class C Shares Amount Shares Amount - ------------------------------------------------------------------------------------------------------------------------------- Shares sold 31,883 $ 310,024 61,660 $ 485,458 Shares redeemed (21,414) (200,459) (173,362) (1,317,372) ------------ ------------ ------------ ------------ Net increase (decrease) 10,469 $ 109,565 (111,702) $ (831,914) ============ ============ ============ ============ Class S Shares Amount Shares Amount - ------------------------------------------------------------------------------------------------------------------------------- Shares sold 129,850 $ 1,254,196 134,514 $ 1,117,726 Issued upon reinvestment of dividends from net investment income 619 6,414 -- -- Shares redeemed (92,976) (901,004) (646,384) (4,930,136) ------------ ------------ ------------ ------------ Net increase (decrease) 37,493 $ 359,606 (511,870) $ (3,812,410) ============ ============ ============ ============
State Street Research Large-Cap Analyst Fund 11 - ----------- FINANCIAL - ----------- Highlights For a share outstanding throughout each year:
Class A ------------------------------------------------------------- Years ended April 30 ------------------------------------------------------------- 2004(a) 2003(a) 2002(a)(c) 2001(a)(c) 2000(a)(c) - -------------------------------------------------------------------------------------------------------------------------------- Net asset value, beginning of year ($) 8.48 9.83 11.48 13.70 11.73 --------- --------- --------- --------- --------- Net investment income (loss) ($)* 0.01 0.02 (0.01) (0.04) (0.04) Net realized and unrealized gain (loss) on investments ($) 2.02 (1.37) (1.64) (1.22) 2.20 --------- --------- --------- --------- --------- Total from investment operations ($) 2.03 (1.35) (1.65) (1.26) 2.16 --------- --------- --------- --------- --------- Dividend from net investment income ($) (0.02) -- -- -- -- Distributions from capital gains ($) -- -- -- (0.96) (0.19) --------- --------- --------- --------- --------- Total distributions ($) (0.02) -- -- (0.96) (0.19) --------- --------- --------- --------- --------- Net asset value, end of year ($) 10.49 8.48 9.83 11.48 13.70 ========= ========= ========= ========= ========= Total return (%)(b) 23.90 (13.73) (14.37) (9.65) 18.57 Ratios/Supplemental Data: - -------------------------------------------------------------------------------------------------------------------------------- Net assets at end of year ($ thousands) 32,726 20,711 30,401 24,452 26,704 Expense ratio (%)* 1.31 1.30 1.32 1.34 1.27 Expense ratio after expense reductions (%)* 1.30 1.30 1.30 1.30 1.25 Ratio of net investment income (loss) to average net assets (%)* 0.14 0.18 (0.11) (0.29) (0.29) Portfolio turnover rate (%) 109.07 101.21 87.28 84.75 106.12 *Reflects voluntary reduction of expenses of these amounts (%) 0.92 1.02 (0.84) 0.67 0.61
Class B(1) ----------------------------------------------------------- Years ended April 30 ----------------------------------------------------------- 2004(a) 2003(a) 2002(a)(c) 2001(a)(c) 2000(a)(c) - ------------------------------------------------------------------------------------------------------------------------------ Net asset value, beginning of year ($) 8.14 9.52 11.19 13.46 11.63 -------- -------- -------- -------- -------- Net investment loss ($)* (0.05) (0.04) (0.08) (0.12) (0.13) Net realized and unrealized gain (loss) on investments ($) 1.93 (1.34) (1.59) (1.19) 2.15 -------- -------- -------- -------- -------- Total from investment operations ($) 1.88 (1.38) (1.67) (1.31) 2.02 -------- -------- -------- -------- -------- Distributions from capital gains ($) -- -- -- (0.96) (0.19) -------- -------- -------- -------- -------- Total distributions ($) -- -- -- (0.96) (0.19) -------- -------- -------- -------- -------- Net asset value, end of year ($) 10.02 8.14 9.52 11.19 13.46 ======== ======== ======== ======== ======== Total return (%)(b) 23.10 (14.50) (14.92) (10.23) 17.52 Ratios/Supplemental Data: - ------------------------------------------------------------------------------------------------------------------------------ Net assets at end of year ($ thousands) 7,601 5,126 7,471 8,113 6,847 Expense ratio (%)* 2.01 2.00 2.02 2.04 2.02 Expense ratio after expense reductions (%)* 2.00 2.00 2.00 2.00 2.00 Ratio of net investment loss to average net assets (%)* (0.56) (0.52) (0.80) (0.99) (1.05) Portfolio turnover rate (%) 109.07 101.21 87.28 84.75 106.12 *Reflects voluntary reduction of expenses of these amounts (%) 0.93 1.03 0.87 0.67 0.61
Class B --------------------------------------------------------------- Years ended April 30 --------------------------------------------------------------- 2004(a)(d) 2003(a) 2002(a)(c) 2001(a)(c) 2000(a)(c) - ---------------------------------------------------------------------------------------------------------------------------------- Net asset value, beginning of year ($) 8.19 9.52 11.19 13.47 11.63 --------- --------- --------- --------- --------- Net investment income (loss) ($)* 0.18 0.01 (0.08) (0.12) (0.13) Net realized and unrealized gain (loss) on investments ($) 1.95 (1.34) (1.59) (1.20) 2.16 --------- --------- --------- --------- --------- Total from investment operations ($) 2.13 (1.33) (1.67) (1.32) 2.03 --------- --------- --------- --------- --------- Distributions from capital gains ($) -- -- -- (0.96) (0.19) --------- --------- --------- --------- --------- Total distributions ($) -- -- -- (0.96) (0.19) --------- --------- --------- --------- --------- Net asset value, end of year ($) 10.32 8.19 9.52 11.19 13.47 ========= ========= ========= ========= ========= Total return (%)(b) 26.01 (13.97) (14.92) (10.30) 17.61 Ratios/Supplemental Data: - ---------------------------------------------------------------------------------------------------------------------------------- Net assets at end of year ($ thousands) 8,502 8,089 12,576 17,054 21,267 Expense ratio (%)* 1.01 1.33 2.02 2.04 2.02 Expense ratio after expense reductions (%)* 1.00 1.33 2.00 2.00 2.00 Ratio of net investment income (loss) to average net assets (%)* 1.85 0.08 (0.79) (1.00) (1.04) Portfolio turnover rate (%) 109.07 101.21 87.28 84.75 106.12 *Reflects voluntary reduction of expenses of these amounts (%) 0.94 1.02 0.89 0.67 0.61
12
Class C -------------------------------------------------------------- Years ended April 30 -------------------------------------------------------------- 2004(a) 2003(a) 2002(a)(c) 2001(a)(c) 2000(a)(c) - --------------------------------------------------------------------------------------------------------------------------------- Net asset value, beginning of year ($) 8.15 9.53 11.20 13.48 11.63 -------- -------- -------- -------- -------- Net investment loss ($)* (0.05) (0.04) (0.08) (0.12) (0.13) Net realized and unrealized gain (loss) on investments ($) 1.94 (1.34) (1.59) (1.20) 2.17 -------- -------- -------- -------- -------- Total from investment operations ($) 1.89 (1.38) (1.67) (1.32) 2.04 -------- -------- -------- -------- -------- Distributions from capital gains ($) -- -- -- (0.96) (0.19) -------- -------- -------- -------- -------- Total distributions ($) -- -- -- (0.96) (0.19) -------- -------- -------- -------- -------- Net asset value, end of year ($) 10.04 8.15 9.53 11.20 13.48 ======== ======== ======== ======== ======== Total return (%)(b) 23.19 (14.48) (14.91) (10.28) 17.70 Ratios/Supplemental Data: - --------------------------------------------------------------------------------------------------------------------------------- Net assets at end of year ($ thousands) 1,161 858 2,068 2,576 5,393 Expense ratio (%)* 2.01 2.00 2.02 2.04 2.02 Expense ratio after expense reductions (%)* 2.00 2.00 2.00 2.00 2.00 Ratio of net investment loss to average net assets (%)* (0.56) (0.51) (0.79) (1.00) (1.08) Portfolio turnover rate (%) 109.07 101.21 87.28 84.75 106.12 *Reflects voluntary reduction of expenses of these amounts (%) 0.93 1.00 0.88 0.67 0.61
Class S ------------------------------------------------------------------ Years ended April 30 ------------------------------------------------------------------ 2004(a) 2003(a) 2002(a)(c) 2001(a)(c) 2000(a)(c) - ----------------------------------------------------------------------------------------------------------------------------------- Net asset value, beginning of year ($) 8.58 9.95 11.58 13.77 11.76 -------- -------- -------- -------- -------- Net investment income (loss) ($)* 0.04 0.04 0.02 0.00 (0.00) Net realized and unrealized gain (loss) on investments ($) 2.05 (1.41) (1.65) (1.23) 2.20 -------- -------- -------- -------- -------- Total from investment operations ($) 2.09 (1.37) (1.63) (1.23) 2.20 -------- -------- -------- -------- -------- Dividend from net investment income ($) (0.04) -- -- -- -- Distributions from capital gains ($) -- -- -- (0.96) (0.19) -------- -------- -------- -------- -------- Total distributions ($) (0.04) -- -- (0.96) (0.19) -------- -------- -------- -------- -------- Net asset value, end of year ($) 10.63 8.58 9.95 11.58 13.77 ======== ======== ======== ======== ======== Total return (%)(b) 24.36 (13.77) (14.08) (9.38) 18.87 Ratios/Supplemental Data: - ----------------------------------------------------------------------------------------------------------------------------------- Net assets at end of year ($ thousands) 1,878 1,195 6,476 6,980 6,895 Expense ratio (%)* 1.01 1.00 1.02 1.04 1.02 Expense ratio after expense reductions (%)* 1.00 1.00 1.00 1.00 1.00 Ratio of net investment income (loss) to average net assets (%)* 0.44 0.52 0.20 0.01 (0.04) Portfolio turnover rate (%) 109.07 101.21 87.28 84.75 106.12 *Reflects voluntary reduction of expenses of these amounts (%) 0.93 0.99 0.87 0.67 0.61
(a) Per-share figures have been calculated using the average shares method. (b) Does not reflect any front-end or contingent deferred sales charges. Total return would be lower if the distributor and its affiliates had not voluntarily assumed a portion of the fund's expenses. (c) Audited by other auditors (d) During the year ended April 30, 2004, the Distributor reimbursed Class B shares of the fund the estimated excess of payments received over costs incurred under the 12B-1 plan. The effect of this reimbursement was to increase net investment income per share $0.14, increase the total return 1.40% and increase the ratio of net investment income to average net assets 1.40%. State Street Research Large-Cap Analyst Fund 13 - ----------- REPORT OF - ----------- Independent Registered Public Accounting Firm To the Board of Trustees and Shareholders of State Street Research Large-Cap Analyst Fund We have audited the accompanying statement of assets and liabilities, including the portfolio holdings, of State Street Research Large-Cap Analyst Fund (the "Fund"), a series of State Street Research Securities Trust, as of April 30, 2004, and the related statement of operations for the year then ended, the statement of changes in net assets, and the financial highlights for each of the two years in the period then ended. 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. The financial highlights for each of the years in the three-year period ended April 30, 2002, were audited by other auditors whose report dated June 14, 2002, expressed an unqualified opinion on such statement and financial highlights. We conducted our audits in accordance with 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 April 30, 2004, by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other 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 Fund as of April 30, 2004, the results of its operations for the year then ended, the changes in its net assets, and the financial highlights for each of the two years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. DELOITTE & TOUCHE LLP Boston, Massachusetts June 11, 2004 14 - -------------------------- TRUSTEES AND OFFICERS - -------------------------- State Street Research Securities Trust
Number of Funds Name, Position(s) Term of Office in Fund Complex Other Address Held with and Length of Principal Occupations Overseen by Directorships Held and Age(a) Fund Time Served(b) During Past 5 Years Trustee/Officer(c) by Trustee/Officer - ------------------------------------------------------------------------------------------------------------------------------------ Independent Trustees Bruce R. Bond Trustee Since Retired; formerly Chairman of 19 Avaya Corp. (58) 1999 the Board, Chief Executive Officer and President, PictureTel Corporation (video conferencing systems) - ------------------------------------------------------------------------------------------------------------------------------------ Peter S. Drotch Trustee Since Retired; formerly Partner, 19 The First (62) 2004 PricewaterhouseCoopers LLP Marblehead Corp. - ------------------------------------------------------------------------------------------------------------------------------------ Steve A. Garban Trustee Since Retired; formerly Senior 53 Metropolitan (66) 1997 Vice President for Finance and Series Fund, Inc. Operations and Treasurer, and Metropolitan The Pennsylvania State University Series Fund II - ------------------------------------------------------------------------------------------------------------------------------------ Susan M. Phillips Trustee Since Dean, School of Business and Public 19 The Kroger Co. (59) 1999 Management, George Washington University; formerly a member of the Board of Governors of the Federal Reserve System; and Chairman and Commissioner of the Commodity Futures Trading Commission - ------------------------------------------------------------------------------------------------------------------------------------ Toby Rosenblatt Trustee Since President, Founders Investments Ltd. 53 A.P. Pharma, Inc.; (65) 1994 (investments); President, Pacific Four Metropolitan Investments (investments); formerly Series Fund, Inc. President, The Glen Ellen Company and Metropolitan (private investment firm) Series Fund II - ------------------------------------------------------------------------------------------------------------------------------------ Michael S. Trustee Since Jay W. Forrester Professor of 53 Metropolitan Scott Morton (66) 1994 Management, Sloan School of Management, Series Fund, Inc. Massachusetts Institute of Technology and Metropolitan Series Fund II ==================================================================================================================================== Interested Trustees Richard S. Davis(+) Trustee Since Chairman of the Board, President 19 None (58) 2000 and Chief Executive Officer of State Street Research & Management Company; formerly Senior Vice President, Fixed Income Investments, Metropolitan Life Insurance Company ==================================================================================================================================== Officers Edward Dowd Vice Since Vice President of State Street Research 7 None (37) President 2003 & Management Company, formerly Vice President, Independence Investment LLC and equity research associate, Donaldson, Lufkin and Jenrette - ------------------------------------------------------------------------------------------------------------------------------------ C. Kim Goodwin Vice Since Managing Director and Chief Investment 18 None (45) President 2002 Officer - Equities of State Street Research & Management Company; formerly Chief Investment Officer - U.S. Growth Equities, American Century - ------------------------------------------------------------------------------------------------------------------------------------ Jeffrey Lindsey Vice Since Managing Director of State Street 7 None (41) President 2003 Research & Management Company, formerly Managing Director and Senior Vice President, Putnam Investments - ------------------------------------------------------------------------------------------------------------------------------------ John S. Lombardo Vice Since Managing Director, Chief Financial 19 None (49) President 2001 Officer and Director of State Street Research & Management Company; formerly Executive Vice President, State Street Research & Management Company; and Senior Vice President, Product and Financial Management, MetLife Auto & Home - ------------------------------------------------------------------------------------------------------------------------------------ Ajay Mehra Vice Since Managing Director of State Street 4 None (39) President 2003 Research & Management Company; formerly Senior Vice President and Portfolio Manager, Columbia Management Group - ------------------------------------------------------------------------------------------------------------------------------------ Denis J. Walsh III Vice Since Managing Director of State Street 2 None (43) President 2003 Research & Management Company; formerly Senior Research Analyst, Fleet Investment Advisors - ------------------------------------------------------------------------------------------------------------------------------------ Douglas A. Romich Treasurer Since Senior Vice President and Treasurer 19 None (47) 2001 of State Street Research & Management Company; formerly Vice President and Assistant Treasurer, State Street Research & Management Company - ------------------------------------------------------------------------------------------------------------------------------------
The fund's Statement of Additional Information includes additional information about the fund's trustees, and is available without charge by contacting State Street Research, One Financial Center, Boston, Massachusetts 02111-2690, or by calling toll-free 1-87-SSR-FUNDS (1-877-773-8637). (a) The address of each person is c/o State Street Research & Management Company, One Financial Center, Boston, MA 02111-2690. (b) A Trustee serves until he or she retires, resigns or is removed as provided in the master trust agreement of the respective Trust. Each Trust has adopted a mandatory retirement age of 72. Each officer holds office until he or she resigns, is removed or a successor is elected. (c) Includes all series of 9 investment companies for which State Street Research & Management Company serves as sole investment adviser and all series of Metropolitan Series Fund, Inc. and Metropolitan Series Fund II. The primary adviser to Metropolitan Series Fund, Inc. and Metropolitan Series Fund II is MetLife Advisers, LLC, which has retained State Street Research & Management Company as sub-adviser to certain series of Metropolitan Series Fund, Inc. (+) Mr. Davis is an "interested person" of the Trust under the Investment Company Act of 1940 by reason of his affiliation with the Trust's Investment Manager, State Street Research & Management Company, as noted. State Street Research Large-Cap Analyst Fund 15 ---------------- [LOGO STATE STREET RESEARCH] | PRSRT STD | One Financial Center | U.S. POSTAGE | Boston, MA 02111-2690 | PAID | | PERMIT #6 | | HUDSON, MA | ---------------- ==================================================================================================================================== New accounts, mutual fund purchases, exchanges and account information Internet www.ssrfunds.com Did You Know? E-mail info@ssrfunds.com State Street Research offers electronic delivery of quarterly statements, shareholder reports and Phone 1-87-SSR-FUNDS (1-877-773-8637), fund prospectuses. If you elect this option, we toll-free, 7 days a week, 24 hours a day will send these materials to you via e-mail. To Hearing-impaired: 1-800-676-7876 learn more, visit us on the Web at Chinese- and Spanish-speaking: 1-888-638-3193 www.ssrfunds.com and click on "Go to Your Account" or call us at 1-87-SSR-FUNDS (1-877-773-8637). Fax 1-617-737-9722 (request confirmation number first from the Service Center by calling 1-877-773-8637) Did you know that you can give a State Street Research mutual fund as a gift? Mail State Street Research Service Center Call a service center representative at P.O. Box 8408, Boston, MA 02266-8408 1-87-SSR-FUNDS (1-877-773-8637), Monday through Friday, 8am-6pm eastern time, to learn more. ==================================================================================================================================== Investors should carefully consider the fund's investment objective, risks, charges and expenses before investing. The fund's prospectus contains more complete information on these and other matters. A prospectus for any State Street Research fund is available through your financial professional, by calling toll-free 1-87-SSR-FUNDS (1-877-773-8637) or by visiting our website at www.ssrfunds.com. Please read the prospectus carefully before investing. OverView For more information on the products and services we offer, refer to OverView, our quarterly shareholder newsletter. Webcasts For a professional perspective on the markets, the economy and timely investment [GRAPHIC] topics, tune in to a State Street Research webcast by visiting our website at for Excellence in www.ssrfunds.com. Shareholder Communications Complete Fund Listing [GRAPHIC] For a list of our funds, visit our website at www.ssrfunds.com under Research for Excellence in Service Our Funds. This report must be accompanied or preceded by a current prospectus. When used as sales material after June 30, 2004, this report must be accompanied by a current Quarterly Performance Update. "State Street Research Proxy Voting Policies and Procedures"--which describes how we vote proxies relating to portfolio securities--is available upon request, free of charge, by calling the State Street Research Service Center toll-free at 1-87-SSR-FUNDS (1-877-773-8637) or by accessing the U.S. Securities and Exchange Commission website at www.sec.gov. The DALBAR awards recognize quality shareholder service and quality shareholder communications, and should not be considered a rating of fund performance. The survey included mutual fund complexes that volunteered or were otherwise selected to participate and was not industrywide. Member NASD, SIPC (c)2004 State Street Research Investment Services, Inc. One Financial Center Boston, MA 02111-2690 www.ssrfunds.com CONTROL NUMBER:(exp0605)SSR-LD LCA-1891-0604
FORM N-CSR(2 OF 3) ITEM 2: CODE OF ETHICS (a) The Registrant has, as of the end of the period covered by this report, adopted a code of ethics pursuant to Section 406 of the Sarbanes-Oxley Act and as defined in the instructions to Form N-CSR 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 individuals are employed by the Registrant or a third party. (b) Omitted (c) During the period covered by this report, there were not any amendments to the provisions of the code of ethics adopted in 2(a) above. (d) During the period covered by this report, there were not any waivers or implicit waivers to a provision of the code of ethics adopted in 2(a) above. (e) Not applicable. (f) Not applicable. ITEM 3: AUDIT COMMITTEE FINANCIAL EXPERT The Registrant's Board of Trustees has determined that Steve A. Garban, a member of the Registrant's Board of Trustees and Audit Committee, qualifies as an "audit committee financial expert" as such term is defined in the instructions to Form N-CSR. Mr. Garban is "independent", as defined in the instructions to Form N-CSR. ITEM 4: PRINCIPAL ACCOUNTANT FEES AND SERVICES
(a) Audit Fee Fiscal year ended April 30, 2003 $22,000 Fiscal year ended April 30, 2004 $24,000 (b) Audit-Related Fees - Represents fees for assurance and related services related to the audit of the registrant's financial statements. Fiscal year ended April 30, 2003 $0 Fiscal year ended April 30, 2004 $0 (c) Tax Fees - Represents fees for professional services rendered by the principal accountant for tax compliance, tax provision review, and the tax return preparation. Fiscal year ended April 30, 2003 $3,500 Fiscal year ended April 30, 2004 $3,750 (d) All other fees - Represents fees paid to Deloitte & Touche LLP to provide a special review of late trading, market timing and related issues concerning the Registrant. Fiscal year ended April 30, 2003 $0 Fiscal year ended April 30, 2004 $14,000
The Registrant's independent accountants, Deloitte & Touche LLP, and their predecessor, PricewaterhouseCoopers LLP, did not bill fees for audit-related, tax, or other non-audit services that required pre-approval by the Audit Committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X during the Registrant's last two fiscal years. (e)(1) The Audit Committee has determined that all work performed for the Registrant by Deloitte & Touche LLP will be pre-approved by the full Audit Committee and, therefore, has not adopted pre-approval procedures. (2) None. (f) Not applicable. (g) Non-Audit Fees - Represents fees for audit-related, tax and other non-audit services rendered by the principal accountant to the Registrant, the Registrant's investment adviser and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the Registrant. Fiscal Year Ended April 30, 2003 $3,500 Fiscal Year Ended April 30, 2004 $63,500 (h) The Audit Committee of the Registrant has considered whether the non-audit services that were rendered by the Registrant's principal accountant to the Registrant's investment adviser (not including any subadviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the Registrant and that were not pre-approved by the Audit Committee are compatible with maintaining the principal accountant's independence. ITEM 5: AUDIT COMMITTEE OF LISTED REGISTRANTS Not applicable. ITEM 6: SCHEDULE OF INVESTMENTS Not applicable. ITEM 7: DISCLOSURE OF PROXY VOTING POLICIES & PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES Not applicable. ITEM 8: PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS Not applicable. ITEM 9: SUBMISSION OF MATTERS TO A VOTE OF SECURITIY HOLDERS The Governance Committee will consider nominees recommended by shareholders. Shareholders may submit recommendations to the attention of the Secretary of the Trust, State Street Research & Management Company, One Financial Center, 30th Floor, Boston MA 02111. ITEM 10: CONTROLS AND PROCEDURES (a) The Registrant's principal executive and principal financial officers have concluded, based on their evaluation of the Registrant's disclosure controls and procedures as of a date within 90 days of the filing date of this report, that the Registrant's disclosure controls and procedures are reasonably designed to ensure that information required to be disclosed by the Registrant on Form N-CSR is recorded, processed, summarized and reported within the required time periods and that information required to be disclosed by the Registrant in the reports that it files or submits on Form N-CSR is accumulated and communicated to the Registrant's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. (b) There were no changes in the Registrant's internal control over financial reporting during the Registrant's second fiscal half-year that have materially affected, or are reasonably likely to materially affect, the internal control over financial reporting. ITEM 11: EXHIBITS (a)(1) Code of Ethics required to be disclosed under Item 2 of Form N-CSR attached hereto as Exhibit 99.CODE ETH (a)(2) Certification for each principal executive and principal financial officer of the Registrant required by Rule 30a-2(a) under the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(a)) attached hereto as Exhibit 99.302CERT (b) Certification required by Rule 30a-2(b) under the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(b)) attached hereto as Exhibit 99.906CERT Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. State Street Research Securities Trust By: /s/ Richard S. Davis ------------------------------------------------------ Richard S. Davis, President, Chairman and Chief Executive Officer Principal Executive Officer Date June 30, 2004 ------------------------------------------------------ FORM N-CSR(3 OF 3) 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. By: /s/ Richard S. Davis ------------------------------------------------------ Richard S. Davis, President, Chairman and Chief Executive Officer Principal Executive Officer Date June 30, 2004 ------------------------ By: /s/ Douglas A. Romich ------------------------------------------------------ Douglas A. Romich, Treasurer Principal Financial Officer Date June 30, 2004 ------------------------ EX-99.CODEETH 2 a2138663zex-99_codeeth.txt EXHIBIT 99.CODE ETH Exhibit 99.CODE ETH STATE STREET RESEARCH FUNDS FINANCIAL OFFICER CODE OF PROFESSIONAL CONDUCT INTRODUCTION The reputation and integrity of the State Street Research Funds (the "Funds") are valuable assets that are vital to the Funds' success. Each Fund's senior financial officers ("SFOs") are responsible for conducting the Fund's business in a manner that demonstrates a commitment to the highest standards of integrity. A Fund's SFOs include the principal executive officer, the principal financial officer, comptroller or principal accounting officer, and any person who performs a similar function. The Sarbanes-Oxley Act of 2002 (the "Act") effected sweeping corporate disclosure and financial reporting reform on public companies, including mutual funds, to address corporate malfeasance and assure investors that the companies in which they invest are accurately and completely disclosing financial information. Under the Act, all public companies (including the Funds) must either have a code of ethics for their SFOs, or disclose why they do not. The Act was intended to foster corporate environments that encourage employees to question unethical and potentially illegal business practices. Each Fund has chosen to adopt a financial officer code of ethics to encourage its SFOs to act ethically and to question potentially unethical or illegal practices, and to strive to ensure that the Fund's financial disclosures are complete, accurate, and understandable. This Code of Ethics should be read in conjunction with the Fund's other policy statements, including the Code of Ethics adopted pursuant to Rule 17j-1 under the Investment Company Act of 1940. PURPOSES OF THE CODE The purposes of this Code are: - To promote honest and ethical conduct among the Fund's SFOs, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships; - To assist SFOs to recognize and avoid conflicts of interest, including disclosure to an appropriate person of any material transaction or relationship that reasonably could be expected to give rise to such a conflict; - To promote full, fair, accurate, timely, and understandable disclosure in reports and documents that the Fund files with, or submits to, the SEC and in other public communications the Fund makes; - To promote compliance with applicable laws, rules and regulations; - To encourage the prompt internal reporting to an appropriate person of violations of the Code; and - To establish accountability for adherence to the Code. QUESTIONS ABOUT THIS CODE The Board of Trustees of each Fund has designated the Secretary of the Fund to be the Compliance Officer for the implementation and administration of the Code. You should direct your questions about this Code to the Compliance Officer. CONDUCT GUIDELINES Each Fund has adopted the following guidelines under which its SFOs must perform their duties and conduct the business affairs of the Funds. Persons subject to this requirement include the principal executive officer, the principal financial officer, comptroller or principal accounting officer, and any person who performs a similar function. However, the Fund expects that ALL persons who participate in the preparation of any part of the Fund's financial statements follow these guidelines: - ETHICAL AND HONEST CONDUCT IS OF PARAMOUNT IMPORTANCE. The Fund's SFOs must act with honesty and integrity and avoid violations of this Code, including actual or apparent conflicts of interest with the Fund in personal and professional relationships. - SFOS MUST DISCLOSE MATERIAL TRANSACTIONS OR RELATIONSHIPS. The Fund's SFOs must disclose to the Fund's Compliance Officer any material transaction or relationship that reasonably could be expected to give rise to any violations of the Code, including actual or apparent conflicts of interest with the Fund. You should disclose these transactions or relationships whether you are involved or have only observed the transaction or relationship. If it is not possible to disclose the matter to the Compliance Officer, it should be disclosed to the Fund's Chief Financial Officer or Chief Executive Officer. - STANDARDS FOR QUALITY OF INFORMATION SHARED WITH FUND SERVICE PROVIDERS. The Fund's SFOs must at all times seek to provide information to the Fund's other employees and service providers (adviser, administrator, outside auditor, outside counsel, custodian, ETC.) that is accurate, complete, objective, relevant, timely, and understandable. - STANDARDS FOR QUALITY OF INFORMATION INCLUDED IN PERIODIC REPORTS. The Fund's SFOs must at all times endeavor to ensure full, fair, timely, accurate, and understandable disclosure in the Fund's periodic reports. 2 - COMPLIANCE WITH LAWS. The Fund's SFOs must comply with the federal securities laws and other applicable laws and rules, such as the Internal Revenue Code. - STANDARD OF CARE. The Fund's SFOs must at all times act in good faith, responsibly, and with due care, competence and diligence, without misrepresenting material facts or allowing your independent judgment to be subordinated. - CONFIDENTIALITY OF INFORMATION. The Fund's SFOs must at all times respect the confidentiality of information acquired in the course of their professional duties, except when authorized by the Fund to disclose it or where disclosure is otherwise legally mandated. You may not use confidential information acquired in the course of your work for personal advantage. - SHARING OF INFORMATION AND ETHICAL STANDARDS. The Fund's SFOs should share information with relevant parties to keep them informed of the business affairs of the Fund, as appropriate, and maintain skills important and relevant to the Fund's needs. - PROMOTE ETHICAL CONDUCT. The Fund's SFOs should at all times proactively promote ethical behavior among peers in the work environment. - STANDARDS FOR RECORDKEEPING. The Fund's SFOs must at all times endeavor to ensure that the Fund's books and records are thoroughly and accurately maintained to the best of their knowledge in a manner consistent with applicable laws and this Code. WAIVERS OF THIS CODE You may request a waiver of a provision of this Code by submitting your request in writing to the Compliance Officer for appropriate review. For example, if a family member works for a service provider that prepares the Fund's financial statements, you may have a potential conflict of interest in reviewing those statements and should seek a waiver of this Code to review the work. An executive officer of the Fund or the Audit Committee will decide whether to grant a waiver. All waivers of this Code must be disclosed to the Fund's shareholders to the extent required by SEC rules. ANNUAL CERTIFICATION To the extent necessary, the Fund's Compliance Officer will provide guidance on the conduct required by this Code and the manner in which violations must be reported and waivers must be requested. Each SFO will be asked to certify on an annual basis that he/she is in full compliance with this Code. 3 REPORTING SUSPECTED VIOLATIONS SFOs who observe, learn of, or, in good faith, suspect a violation of the Code MUST immediately report the violation to the Compliance Officer, another member of the Fund's senior management, or to the Audit Committee of the Board. An example of a possible Code violation is the preparation and filing of financial disclosure that omits material facts, or that is accurate but is written in a way that obscures its meaning. Because service providers such as the adviser, outside accounting firm, and custodian provide much of the work relating to the Fund's financial statements, the Fund's SFOs should be alert for actions by service providers that may be illegal, or that could be viewed as dishonest or unethical conduct. A SFO should report these actions to the Compliance Officer even if you know, or think, that the service provider has its own code of ethics for its SFOs or employees. SFOs who report violations or suspected violations in good faith will not be subject to retaliation of any kind. Reported violations will be investigated and addressed promptly and will be treated confidentially to the extent possible. VIOLATIONS OF THE CODE Dishonest or unethical conduct or conduct that is illegal will constitute a violation of this Code, regardless of whether this Code refers to that particular conduct. A violation of this Code may result in disciplinary action, up to and including termination of employment. A variety of laws apply to the Fund and its operations, including the Securities Act of 1933, the Investment Company Act of 1940, state laws relating to duties owed by Fund directors/trustees and officers, and criminal laws. The federal securities laws generally prohibit the Fund from making material misstatements in its prospectus and other documents filed with the SEC, or from omitting to state a material fact. These material misstatements and omissions include financial statements that are misleading or omit material facts. The Fund must and will report all suspected criminal violations to the appropriate authorities for possible prosecution, and will investigate, address and report, as appropriate, non-criminal violations. ADOPTED MAY 7, 2003 4 EX-99.302CERT 3 a2138663zex-99_302cert.txt EXHIBIT 99.302 CERT Exhibit 99.302 CERT State Street Research Securities Trust Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 I, Douglas A. Romich, certify that: 1. I have reviewed this report on Form N-CSR of State State Street Research Securities Trust; 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, and changes in net assets of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in rule 30a-2 (c) under the Investment Company Act) for the registrant and have: a) designed such disclosure controls and procedures 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) evaluated the effectiveness of the registrant's disclosure controls and procedures as of the date within 90 days prior to the filing date of this report (the "Evaluation Date"); and c) presented in this report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize, and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: June 30, 2004 /s/ Douglas A. Romich Douglas A. Romich Treasurer State Street Research Securities Trust Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 I, Richard S. Davis, certify that: 1. I have reviewed this report on Form N-CSR of State Street Research Securities Trust; 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, and changes in net assets of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in rule 30a-2 (c) under the Investment Company Act) for the registrant and have: a) designed such disclosure controls and procedures 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) evaluated the effectiveness of the registrant's disclosure controls and procedures as of the date within 90 days prior to the filing date of this report (the "Evaluation Date"); and c) presented in this report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize, and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: June 30, 2004 /s/ Richard S. Davis Richard S. Davis President, Chairman and Chief Executive Officer EX-99.906CERT 4 a2138663zex-99_906cert.txt EXHIBIT 99.906 CERT Exhibit 99.906 CERT State Street Research Securities Trust Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code) Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of the State Street Research Securities Trust, a Massachusetts business trust, (the "Trust"), does hereby certify that the Trust's report on Form N-CSR for the period ended April 30, 2004 (the "N-CSR") fully complies with the requirements of Section 13 (a) or 15 (d), as applicable, of the Securities Exchange Act of 1934, as amended, and information contained in the N-CSR fairly presents, in all material respects, the financial condition and the results of operations of the Trust. This certification is provided solely pursuant to 18 U.S.C. 1350 and shall not be deemed a part of the N-CSR, the financial statements filed with the N-CSR or otherwise "filed" for any purpose. Date: June 30, 2004 /s/ Douglas A. Romich Douglas A. Romich Treasurer State Street Research Securities Trust Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code) Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officer of the State Street Research Securities Trust, a Massachusetts business trust, (the "Trust"), does hereby certify that the Trust's report on Form N-CSR for the period ended April 30, 2004 (the "N-CSR") fully complies with the requirements of Section 13 (a) or 15 (d), as applicable, of the Securities Exchange Act of 1934, as amended, and information contained in the N-CSR fairly presents, in all material respects, the financial condition and the results of operations of the Trust. This certification is provided solely pursuant to 18 U.S.C. 1350 and shall not be deemed a part of the N-CSR, the financial statements filed with the N-CSR or otherwise "filed" for any purpose. Date: June 30, 2004 /s/ Richard S. Davis Richard S. Davis President, Chairman and Chief Executive Officer -----END PRIVACY-ENHANCED MESSAGE-----