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- 4118
Fidelity Securities Fund
(Exact name of registrant as specified in charter)
82 Devonshire St., Boston, Massachusetts 02109
(Address of principal executive offices) (Zip code)
Eric D. Roiter, Secretary
82 Devonshire St.
Boston, Massachusetts 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: 617-563-7000
Date of fiscal year end: | July 31 |
Date of reporting period: | January 31, 2004 |
Item 1. Reports to Stockholders
Fidelity®
Growth & Income
Portfolio
Semiannual Report
January 31, 2004
(2_fidelity_logos) (Registered_Trademark)
Contents
Chairman's Message | Ned Johnson's message to shareholders. | |
Investment Changes | A summary of major shifts in the fund's investments over the past six months. | |
Investments | A complete list of the fund's investments with their market values. | |
Financial Statements | Statements of assets and liabilities, operations, and changes in net assets, | |
Notes | Notes to the financial statements. | |
For a free copy of the fund's proxy voting guidelines visit www.fidelity.com/goto/proxyguidelines, call 1-800-544-8544, or visit the Securities and Exchange Commission (SEC)'s web site at www.sec.gov.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR Corp. or an affiliated company.
(Recycle graphic)
This report and the financial statements contained herein are submitted for the general information of the shareholders of the fund. This report is not authorized for distribution to prospective investors in the fund unless preceded or accompanied by an effective prospectus.
Mutual fund shares are not deposits or obligations of, or guaranteed by, any depository institution. Shares are not insured by the FDIC, Federal Reserve Board or any other agency, and are subject to investment risks, including possible loss of principal amount invested.
Neither the fund nor Fidelity Distributors Corporation is a bank.
For more information on any Fidelity fund, including charges and expenses, call 1-800-544-6666 for a free prospectus. Read it carefully before you invest or send money.
This report is printed on recycled paper using soy-based inks.Semiannual Report
Chairman's Message
(photo_of_Edward_C_Johnson_3d)
Dear Shareholder:
Many of you have read or heard news stories recently that were critical of mutual funds and made allegations that the mutual fund industry has been less than forthright. I find these reports unsettling and not necessarily an accurate picture of the overall industry, and I would like you to know where we at Fidelity stand.
With specific regard to allegations that certain mutual fund companies were violating the Securities and Exchange Commission's forward pricing rules or were involved in so-called "market timing" activities, I want to say two things:
First, Fidelity does not have agreements that permit customers who buy fund shares after 4 p.m. to obtain the 4 p.m. price. This is not to say that someone could not deceive the company through fraudulent acts. But I underscore that we have no so-called "agreements" which would permit this illegal practice.
Second, Fidelity has been on record for years opposing predatory short-term trading which adversely affects other shareholders in a mutual fund. In fact, in the 1980s, we began charging a fee - which is returned to the fund and, therefore, to investors - to discourage this activity. What's more, several years ago we took the industry lead in developing a Fair Value Pricing Policy to prevent market timing on foreign securities in our funds. It is reasonable to assume that another structure can be developed that would alter the system to make it much more difficult for predatory traders to operate. This, however, will only be achieved through close cooperation among regulators, legislators and the industry.
Certainly no industry is perfect, and there have been instances of unethical and illegal activity from time to time within the mutual fund industry. When this occurs, confessed or convicted offenders should be dealt with appropriately. Clearly, every system can be improved. We applaud well thought out improvements by regulators, legislators and industry representatives that achieve the common goal of building and protecting the value of investors' holdings. But we remain concerned about the risk of over-regulation and the quick application of simplistic solutions to intricate problems.
For more than 57 years, Fidelity Investments has worked very hard to improve its products and service to justify your trust. When our family founded this company in 1946, we had only a few hundred customers. Many of them were family and friends. Today, we serve more than 18 million customers including individual investors and participants in retirement plans across America.
Let me close by saying that we do not take your trust in us for granted, and we realize that we must always work to improve all aspects of our service to you. In turn, we urge you to continue your active participation with your financial matters, so that your interests can be well served.
Semiannual Report
Best regards,
/s/Edward C. Johnson 3d
Edward C. Johnson 3d
Semiannual Report
Investment Changes
Top Ten Stocks as of January 31, 2004 | ||
% of fund's | % of fund's net assets | |
SLM Corp. | 3.7 | 4.5 |
Microsoft Corp. | 3.7 | 3.5 |
Pfizer, Inc. | 3.4 | 3.3 |
Citigroup, Inc. | 3.3 | 3.3 |
General Electric Co. | 3.3 | 3.5 |
Exxon Mobil Corp. | 3.1 | 2.9 |
Verizon Communications, Inc. | 2.4 | 2.5 |
Fannie Mae | 2.3 | 2.0 |
SBC Communications, Inc. | 2.2 | 1.9 |
Wal-Mart Stores, Inc. | 2.1 | 2.8 |
29.5 | ||
Top Five Market Sectors as of January 31, 2004 | ||
% of fund's | % of fund's net assets | |
Financials | 22.2 | 22.4 |
Health Care | 15.2 | 17.1 |
Consumer Staples | 12.4 | 12.2 |
Industrials | 11.0 | 10.2 |
Information Technology | 10.6 | 9.0 |
Asset Allocation (% of fund's net assets) | |||||||
As of January 31, 2004* | As of July 31, 2003** | ||||||
![]() | Stocks 95.7% | ![]() | Stocks and | ||||
![]() | Convertible | ![]() | Convertible | ||||
![]() | Short-Term | ![]() | Short-Term | ||||
* Foreign investments | 4.8% | ** Foreign investments | 1.9% |
Semiannual Report
Investments January 31, 2004 (Unaudited)
Showing Percentage of Net Assets
Common Stocks - 95.7% | |||
Shares | Value (Note 1) (000s) | ||
CONSUMER DISCRETIONARY - 9.9% | |||
Hotels, Restaurants & Leisure - 2.5% | |||
Carnival Corp. unit | 2,658,400 | $ 118,086 | |
Harrah's Entertainment, Inc. | 1,000,600 | 53,032 | |
Marriott International, Inc. Class A | 3,769,800 | 167,341 | |
McDonald's Corp. | 7,900,100 | 203,349 | |
MGM MIRAGE (a) | 2,664,528 | 107,674 | |
Starbucks Corp. (a) | 2,971,379 | 109,228 | |
758,710 | |||
Household Durables - 0.0% | |||
Garmin Ltd. | 194,955 | 10,360 | |
Internet & Catalog Retail - 0.2% | |||
InterActiveCorp (a) | 1,821,200 | 59,007 | |
Media - 5.6% | |||
Clear Channel Communications, Inc. | 1,931,700 | 86,907 | |
Comcast Corp. Class A (special) (a) | 4,194,800 | 138,219 | |
Cox Communications, Inc. Class A (a) | 898,200 | 30,772 | |
E.W. Scripps Co. Class A | 515,800 | 49,058 | |
EchoStar Communications Corp. Class A (a) | 3,309,563 | 120,799 | |
Gannett Co., Inc. | 1,154,100 | 98,918 | |
Hughes Electronics Corp. (a) | 810,374 | 13,566 | |
Knight-Ridder, Inc. | 516,900 | 39,760 | |
News Corp. Ltd.: | |||
ADR | 3,150,300 | 115,994 | |
sponsored ADR | 90,637 | 2,906 | |
Omnicom Group, Inc. | 4,491,000 | 370,058 | |
Time Warner, Inc. (a) | 8,715,546 | 153,132 | |
Tribune Co. | 950,000 | 48,631 | |
Univision Communications, Inc. Class A (a) | 2,658,600 | 94,035 | |
Viacom, Inc. Class B (non-vtg.) | 5,690,797 | 229,339 | |
Walt Disney Co. | 5,779,900 | 138,718 | |
1,730,812 | |||
Multiline Retail - 0.2% | |||
Family Dollar Stores, Inc. | 1,070,700 | 37,089 | |
Kohl's Corp. (a) | 754,000 | 33,402 | |
70,491 | |||
Specialty Retail - 1.2% | |||
Best Buy Co., Inc. | 709,500 | 35,752 | |
Home Depot, Inc. | 6,450,350 | 228,794 | |
Common Stocks - continued | |||
Shares | Value (Note 1) (000s) | ||
CONSUMER DISCRETIONARY - continued | |||
Specialty Retail - continued | |||
Lowe's Companies, Inc. | 731,200 | $ 39,156 | |
Staples, Inc. (a) | 1,919,600 | 51,081 | |
354,783 | |||
Textiles Apparel & Luxury Goods - 0.2% | |||
NIKE, Inc. Class B | 885,900 | 61,712 | |
TOTAL CONSUMER DISCRETIONARY | 3,045,875 | ||
CONSUMER STAPLES - 12.4% | |||
Beverages - 2.3% | |||
Anheuser-Busch Companies, Inc. | 2,776,600 | 140,829 | |
PepsiCo, Inc. | 4,839,107 | 228,696 | |
The Coca-Cola Co. | 7,075,100 | 348,378 | |
717,903 | |||
Food & Staples Retailing - 4.0% | |||
Safeway, Inc. (a) | 2,460,930 | 55,592 | |
Sysco Corp. | 7,148,800 | 271,154 | |
Wal-Mart Stores, Inc. | 11,982,600 | 645,263 | |
Walgreen Co. | 6,848,300 | 236,609 | |
Whole Foods Market, Inc. | 369,000 | 24,896 | |
1,233,514 | |||
Food Products - 0.3% | |||
Kellogg Co. | 861,400 | 32,570 | |
McCormick & Co., Inc. (non-vtg.) | 2,362,800 | 70,128 | |
102,698 | |||
Household Products - 2.6% | |||
Colgate-Palmolive Co. | 3,106,700 | 159,281 | |
Kimberly-Clark Corp. | 2,664,200 | 157,348 | |
Procter & Gamble Co. | 4,890,200 | 494,301 | |
810,930 | |||
Personal Products - 1.3% | |||
Avon Products, Inc. | 863,800 | 54,696 | |
Gillette Co. | 9,061,400 | 328,476 | |
383,172 | |||
Tobacco - 1.9% | |||
Altria Group, Inc. | 8,905,900 | 495,079 | |
Common Stocks - continued | |||
Shares | Value (Note 1) (000s) | ||
CONSUMER STAPLES - continued | |||
Tobacco - continued | |||
Loews Corp. - Carolina Group | 483,600 | $ 12,641 | |
UST, Inc. | 2,050,000 | 73,206 | |
580,926 | |||
TOTAL CONSUMER STAPLES | 3,829,143 | ||
ENERGY - 5.6% | |||
Energy Equipment & Services - 0.2% | |||
Schlumberger Ltd. (NY Shares) | 836,900 | 51,202 | |
Oil & Gas - 5.4% | |||
Apache Corp. | 3,505,920 | 134,908 | |
BP PLC sponsored ADR | 5,438,300 | 258,863 | |
ChevronTexaco Corp. | 3,108,410 | 268,411 | |
ConocoPhillips | 492,200 | 32,426 | |
Exxon Mobil Corp. | 23,483,394 | 957,888 | |
Royal Dutch Petroleum Co. (NY Shares) | 207,200 | 9,821 | |
1,662,317 | |||
TOTAL ENERGY | 1,713,519 | ||
FINANCIALS - 22.2% | |||
Capital Markets - 3.6% | |||
Bank of New York Co., Inc. | 1,476,800 | 46,888 | |
Goldman Sachs Group, Inc. | 2,367,200 | 235,655 | |
Merrill Lynch & Co., Inc. | 6,513,300 | 382,917 | |
Morgan Stanley | 7,462,200 | 434,375 | |
1,099,835 | |||
Commercial Banks - 4.0% | |||
Bank of America Corp. | 4,775,346 | 389,000 | |
Bank One Corp. | 4,203,200 | 212,724 | |
Fifth Third Bancorp | 874,071 | 50,513 | |
FleetBoston Financial Corp. | 1,037,498 | 46,252 | |
Wachovia Corp. | 3,124,213 | 144,464 | |
Wells Fargo & Co. | 6,857,800 | 393,706 | |
1,236,659 | |||
Consumer Finance - 4.6% | |||
American Express Co. | 5,006,490 | 259,536 | |
SLM Corp. (c) | 30,010,730 | 1,152,409 | |
1,411,945 | |||
Common Stocks - continued | |||
Shares | Value (Note 1) (000s) | ||
FINANCIALS - continued | |||
Diversified Financial Services - 3.4% | |||
CIT Group, Inc. | 738,380 | $ 27,999 | |
Citigroup, Inc. | 20,801,938 | 1,029,280 | |
1,057,279 | |||
Insurance - 2.9% | |||
AFLAC, Inc. | 1,575,100 | 58,090 | |
American International Group, Inc. | 8,979,800 | 623,647 | |
MBIA, Inc. | 2,610,700 | 164,474 | |
The Chubb Corp. | 861,400 | 61,581 | |
907,792 | |||
Real Estate - 1.1% | |||
Apartment Investment & Management Co. Class A | 639,900 | 22,512 | |
Equity Office Properties Trust | 3,194,290 | 94,711 | |
Equity Residential (SBI) | 4,443,650 | 129,310 | |
Manufactured Home Communities, Inc. (c) | 1,331,400 | 44,735 | |
Simon Property Group, Inc. | 1,034,900 | 53,867 | |
345,135 | |||
Thrifts & Mortgage Finance - 2.6% | |||
Fannie Mae | 8,997,520 | 693,709 | |
Golden West Financial Corp., Delaware | 894,100 | 92,745 | |
786,454 | |||
TOTAL FINANCIALS | 6,845,099 | ||
HEALTH CARE - 15.2% | |||
Biotechnology - 1.1% | |||
Amgen, Inc. (a) | 4,155,800 | 268,008 | |
Genzyme Corp. - General Division (a) | 935,200 | 51,296 | |
Protein Design Labs, Inc. (a) | 1,000,000 | 20,200 | |
339,504 | |||
Health Care Equipment & Supplies - 3.2% | |||
Alcon, Inc. | 4,011,720 | 256,790 | |
Baxter International, Inc. | 2,178,600 | 63,506 | |
Becton, Dickinson & Co. | 2,699,320 | 121,631 | |
Boston Scientific Corp. (a) | 1,199,780 | 48,939 | |
C.R. Bard, Inc. | 306,060 | 28,831 | |
Guidant Corp. | 650,400 | 41,548 | |
Medtronic, Inc. | 3,156,390 | 155,358 | |
St. Jude Medical, Inc. (a) | 1,094,320 | 78,627 | |
Common Stocks - continued | |||
Shares | Value (Note 1) (000s) | ||
HEALTH CARE - continued | |||
Health Care Equipment & Supplies - continued | |||
Stryker Corp. | 871,700 | $ 77,355 | |
Zimmer Holdings, Inc. (a) | 1,641,493 | 125,574 | |
998,159 | |||
Health Care Providers & Services - 1.9% | |||
HCA, Inc. | 194,000 | 8,711 | |
IMS Health, Inc. | 3,145,819 | 80,942 | |
UnitedHealth Group, Inc. | 7,987,880 | 486,302 | |
575,955 | |||
Pharmaceuticals - 9.0% | |||
Abbott Laboratories | 4,664,900 | 200,964 | |
Allergan, Inc. | 1,300,400 | 107,738 | |
AstraZeneca PLC sponsored ADR | 3,414,400 | 164,813 | |
Bristol-Myers Squibb Co. | 1,876,500 | 52,636 | |
Eli Lilly & Co. | 3,358,852 | 228,536 | |
Forest Laboratories, Inc. (a) | 1,128,800 | 84,084 | |
Johnson & Johnson | 6,122,900 | 327,085 | |
Merck & Co., Inc. | 3,700,200 | 176,130 | |
Novartis AG sponsored ADR | 4,454,000 | 201,098 | |
Pfizer, Inc. | 28,530,769 | 1,045,082 | |
Shire Pharmaceuticals Group PLC sponsored ADR (a) | 418,400 | 12,238 | |
Teva Pharmaceutical Industries Ltd. sponsored ADR | 216,000 | 13,519 | |
Watson Pharmaceuticals, Inc. (a) | 639,900 | 29,762 | |
Wyeth | 3,140,200 | 128,591 | |
2,772,276 | |||
TOTAL HEALTH CARE | 4,685,894 | ||
INDUSTRIALS - 10.5% | |||
Aerospace & Defense - 2.2% | |||
Boeing Co. | 2,483,500 | 103,686 | |
Honeywell International, Inc. | 2,165,600 | 78,221 | |
Lockheed Martin Corp. | 4,083,500 | 198,540 | |
Northrop Grumman Corp. | 625,100 | 60,453 | |
Raytheon Co. | 2,035,400 | 62,100 | |
United Technologies Corp. | 1,817,800 | 173,673 | |
676,673 | |||
Air Freight & Logistics - 0.6% | |||
United Parcel Service, Inc. Class B | 2,608,700 | 185,922 | |
Common Stocks - continued | |||
Shares | Value (Note 1) (000s) | ||
INDUSTRIALS - continued | |||
Airlines - 0.4% | |||
Southwest Airlines Co. | 9,502,243 | $ 142,059 | |
Commercial Services & Supplies - 0.6% | |||
Arbitron, Inc. (a) | 598,300 | 26,044 | |
Avery Dennison Corp. | 183,180 | 11,386 | |
Pitney Bowes, Inc. | 647,020 | 26,256 | |
Viad Corp. | 646,400 | 16,205 | |
Waste Management, Inc. | 3,538,500 | 98,229 | |
178,120 | |||
Electrical Equipment - 0.3% | |||
Emerson Electric Co. | 1,331,300 | 85,070 | |
Industrial Conglomerates - 5.1% | |||
3M Co. | 3,151,980 | 249,290 | |
General Electric Co. | 29,766,200 | 1,001,037 | |
Tyco International Ltd. | 11,602,570 | 310,369 | |
1,560,696 | |||
Machinery - 1.0% | |||
Caterpillar, Inc. | 592,900 | 46,323 | |
Dover Corp. | 2,066,200 | 85,375 | |
Eaton Corp. | 83,100 | 9,652 | |
Illinois Tool Works, Inc. | 746,800 | 58,325 | |
Ingersoll-Rand Co. Ltd. Class A | 511,700 | 34,043 | |
Pall Corp. | 3,150,500 | 81,913 | |
315,631 | |||
Road & Rail - 0.3% | |||
Burlington Northern Santa Fe Corp. | 1,509,600 | 48,503 | |
Union Pacific Corp. | 787,500 | 50,715 | |
99,218 | |||
TOTAL INDUSTRIALS | 3,243,389 | ||
INFORMATION TECHNOLOGY - 10.6% | |||
Communications Equipment - 1.8% | |||
Cisco Systems, Inc. (a) | 19,314,500 | 495,224 | |
Motorola, Inc. | 3,117,000 | 51,680 | |
546,904 | |||
Computers & Peripherals - 2.7% | |||
Dell, Inc. (a) | 6,700,300 | 224,259 | |
Hewlett-Packard Co. | 3,923,100 | 93,331 | |
Common Stocks - continued | |||
Shares | Value (Note 1) (000s) | ||
INFORMATION TECHNOLOGY - continued | |||
Computers & Peripherals - continued | |||
International Business Machines Corp. | 4,482,700 | $ 444,818 | |
Lexmark International, Inc. Class A (a) | 812,200 | 67,323 | |
829,731 | |||
Electronic Equipment & Instruments - 0.2% | |||
Flextronics International Ltd. (a) | 3,247,900 | 61,710 | |
Internet Software & Services - 0.3% | |||
Yahoo!, Inc. (a) | 1,783,900 | 83,576 | |
IT Services - 0.6% | |||
Accenture Ltd. Class A (a) | 1,407,600 | 33,318 | |
Automatic Data Processing, Inc. | 968,600 | 41,408 | |
First Data Corp. | 1,169,765 | 45,808 | |
Paychex, Inc. | 1,457,000 | 54,608 | |
175,142 | |||
Office Electronics - 0.1% | |||
Xerox Corp. (a) | 3,396,200 | 49,720 | |
Semiconductors & Semiconductor Equipment - 0.8% | |||
Analog Devices, Inc. | 914,700 | 43,768 | |
Intel Corp. | 1,979,900 | 60,585 | |
NVIDIA Corp. (a) | 984,331 | 21,901 | |
Samsung Electronics Co. Ltd. | 100,000 | 44,729 | |
Teradyne, Inc. (a) | 2,165,700 | 58,257 | |
Texas Instruments, Inc. | 345,300 | 10,825 | |
240,065 | |||
Software - 4.1% | |||
Adobe Systems, Inc. | 519,300 | 19,972 | |
Microsoft Corp. | 40,942,200 | 1,132,052 | |
Network Associates, Inc. (a) | 689,000 | 11,954 | |
Oracle Corp. (a) | 8,432,718 | 116,456 | |
1,280,434 | |||
TOTAL INFORMATION TECHNOLOGY | 3,267,282 | ||
MATERIALS - 1.7% | |||
Chemicals - 1.4% | |||
BASF AG sponsored ADR | 664,400 | 36,941 | |
Dow Chemical Co. | 3,944,970 | 165,491 | |
Common Stocks - continued | |||
Shares | Value (Note 1) (000s) | ||
MATERIALS - continued | |||
Chemicals - continued | |||
E.I. du Pont de Nemours & Co. | 1,233,600 | $ 54,155 | |
Praxair, Inc. | 5,115,100 | 181,126 | |
437,713 | |||
Metals & Mining - 0.1% | |||
Alcoa, Inc. | 1,277,300 | 43,658 | |
Paper & Forest Products - 0.2% | |||
International Paper Co. | 1,306,000 | 55,205 | |
TOTAL MATERIALS | 536,576 | ||
TELECOMMUNICATION SERVICES - 6.8% | |||
Diversified Telecommunication Services - 6.5% | |||
ALLTEL Corp. | 1,899,350 | 92,460 | |
BellSouth Corp. | 16,869,000 | 493,081 | |
SBC Communications, Inc. | 26,387,000 | 672,869 | |
Verizon Communications, Inc. | 20,436,840 | 753,302 | |
2,011,712 | |||
Wireless Telecommunication Services - 0.3% | |||
Vodafone Group PLC sponsored ADR | 3,020,700 | 77,330 | |
TOTAL TELECOMMUNICATION SERVICES | 2,089,042 | ||
UTILITIES - 0.8% | |||
Electric Utilities - 0.8% | |||
Entergy Corp. | 2,905,800 | 169,931 | |
Southern Co. | 2,457,300 | 73,228 | |
243,159 | |||
TOTAL COMMON STOCKS (Cost $18,936,362) | 29,498,978 | ||
Convertible Preferred Stocks - 1.1% | |||
INDUSTRIALS - 0.5% | |||
Aerospace & Defense - 0.5% | |||
Northrop Grumman Corp. 7.25% | 738,900 | 76,956 | |
Raytheon Co. 8.25% | 1,318,700 | 71,103 | |
148,059 | |||
Convertible Preferred Stocks - continued | |||
Shares | Value (Note 1) (000s) | ||
UTILITIES - 0.6% | |||
Electric Utilities - 0.5% | |||
FPL Group, Inc.: | |||
8.00% | 221,600 | $ 12,687 | |
8.50% | 2,242,600 | 129,353 | |
142,040 | |||
Gas Utilities - 0.1% | |||
KeySpan Corp. 8.75% MEDS | 615,600 | 32,824 | |
TOTAL UTILITIES | 174,864 | ||
TOTAL CONVERTIBLE PREFERRED STOCKS (Cost $302,746) | 322,923 |
U.S. Treasury Obligations - 0.0% | ||||
Principal Amount (000s) | ||||
U.S. Treasury Bonds 8.125% 8/15/19 | $ 10,000 | 13,670 |
Money Market Funds - 2.6% | |||
Shares | |||
Fidelity Cash Central Fund, 1.08% (b) | 808,365,331 | 808,365 | |
TOTAL INVESTMENT PORTFOLIO - 99.4% (Cost $20,057,681) | 30,643,936 | ||
NET OTHER ASSETS - 0.6% | 183,058 | ||
NET ASSETS - 100% | $ 30,826,994 |
Security Type Abbreviations | ||
MEDS | - | Mandatorily Exchangeable Debt Securities |
Legend |
(a) Non-income producing |
(b) Affiliated fund that is available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete listing of the fund's holdings as of its most recent fiscal year end is available upon request. |
(c) Affiliated company |
Other Information |
Purchases and sales of securities, other than short-term securities, aggregated $4,707,977,000 and $4,251,889,000, respectively. |
The fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms were $187,000 for the period. |
Income Tax Information |
At July 31, 2003, the fund had a capital loss carryforward of approximately $902,579,000 of which $266,818,000 and $635,761,000 will expire on July 31, 2010 and 2011, respectively. |
Semiannual Report
See accompanying notes which are an integral part of the financial statements.
Semiannual Report
Financial Statements
Statement of Assets and Liabilities
Amounts in thousands (except per-share amount) J | January 31, 2004 (Unaudited) | |
Assets | ||
Investment in securities, at value (cost $20,057,681) - See accompanying schedule | $ 30,643,936 | |
Receivable for investments sold | 171,719 | |
Receivable for fund shares sold | 33,115 | |
Dividends receivable | 42,835 | |
Interest receivable | 1,157 | |
Prepaid expenses | 153 | |
Other receivables | 1,248 | |
Total assets | 30,894,163 | |
Liabilities | ||
Payable for investments purchased | $ 14,863 | |
Payable for fund shares redeemed | 33,944 | |
Accrued management fee | 12,264 | |
Transfer agent fee payable | 5,121 | |
Other affiliated payables | 162 | |
Other payables and accrued expenses | 815 | |
Total liabilities | 67,169 | |
Net Assets | $ 30,826,994 | |
Net Assets consist of: | ||
Paid in capital | $ 20,734,188 | |
Undistributed net investment income | 21,737 | |
Accumulated undistributed net realized gain (loss) on investments and foreign currency transactions | (515,194) | |
Net unrealized appreciation (depreciation) on investments and assets and liabilities in foreign currencies | 10,586,263 | |
Net Assets, for 853,488 shares outstanding | $ 30,826,994 | |
Net Asset Value, offering price and redemption price per share ($30,826,994 ÷ 853,488 shares) | $ 36.12 |
Semiannual Report
See accompanying notes which are an integral part of the financial statements.
Financial Statements - continued
Statement of Operations
Amounts in thousands | Six months ended January 31, 2004 (Unaudited) | |
Investment Income | ||
Dividends (including $20,584 received from affiliated issuers) | $ 262,485 | |
Interest | 7,768 | |
Security lending | 1 | |
Total income | 270,254 | |
Expenses | ||
Management fee | $ 69,971 | |
Transfer agent fees | 30,666 | |
Accounting and security lending fees | 799 | |
Non-interested trustees' compensation | 88 | |
Appreciation in deferred trustee compensation account | 60 | |
Custodian fees and expenses | 194 | |
Registration fees | 66 | |
Audit | 91 | |
Legal | 57 | |
Miscellaneous | 118 | |
Total expenses before reductions | 102,110 | |
Expense reductions | (1,334) | 100,776 |
Net investment income (loss) | 169,478 | |
Realized and Unrealized Gain (Loss) Net realized gain (loss) on: | ||
Investment securities (including realized gain (loss) of $18,929 on sales of investments in affiliated issuers) | 439,442 | |
Foreign currency transactions | 60 | |
Futures contracts | (3,342) | |
Total net realized gain (loss) | 436,160 | |
Change in net unrealized appreciation (depreciation) on: Investment securities | 2,401,978 | |
Assets and liabilities in foreign currencies | 8 | |
Futures contracts | 4,919 | |
Total change in net unrealized appreciation (depreciation) | 2,406,905 | |
Net gain (loss) | 2,843,065 | |
Net increase (decrease) in net assets resulting from operations | $ 3,012,543 |
Semiannual Report
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Amounts in thousands | Six months ended January 31, 2004 (Unaudited) | Year ended July 31, 2003 |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $ 169,478 | $ 344,856 |
Net realized gain (loss) | 436,160 | (93,749) |
Change in net unrealized appreciation (depreciation) | 2,406,905 | 1,057,363 |
Net increase (decrease) in net assets resulting | 3,012,543 | 1,308,470 |
Distributions to shareholders from net investment income | (197,201) | (319,655) |
Share transactions | 2,137,237 | 3,679,661 |
Reinvestment of distributions | 190,995 | 309,163 |
Cost of shares redeemed | (2,579,993) | (4,563,028) |
Net increase (decrease) in net assets resulting from share transactions | (251,761) | (574,204) |
Total increase (decrease) in net assets | 2,563,581 | 414,611 |
Net Assets | ||
Beginning of period | 28,263,413 | 27,848,802 |
End of period (including undistributed net investment income of $21,737 and undistributed net investment income of $49,460, respectively) | $ 30,826,994 | $ 28,263,413 |
Other Information Shares | ||
Sold | 62,290 | 118,325 |
Issued in reinvestment of distributions | 5,576 | 10,093 |
Redeemed | (75,078) | (148,741) |
Net increase (decrease) | (7,212) | (20,323) |
Semiannual Report
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Six months ended | Years ended July 31, | |||||
(Unaudited) | 2003 | 2002 | 2001 | 2000 | 1999 | |
Selected Per-Share Data | ||||||
Net asset value, beginning of period | $ 32.84 | $ 31.61 | $ 39.10 | $ 46.83 | $ 47.27 | $ 43.73 |
Income from Investment Operations | ||||||
Net investment income (loss) D | .20 | .40 | .34 | .39 | .38 | .39 |
Net realized and unrealized gain (loss) | 3.31 | 1.20 | (7.12) | (3.83) | 2.47 | 5.69 |
Total from investment operations | 3.51 | 1.60 | (6.78) | (3.44) | 2.85 | 6.08 |
Distributions from net investment income | (.23) | (.37) | (.33) | (.38) | (.39) | (.38) |
Distributions from net realized gain | - | - | (.38) | (3.91) | (2.90) | (2.16) |
Total distributions | (.23) | (.37) | (.71) | (4.29) | (3.29) | (2.54) |
Net asset value, end of period | $ 36.12 | $ 32.84 | $ 31.61 | $ 39.10 | $ 46.83 | $ 47.27 |
Total Return B,C | 10.73% | 5.15% | (17.56)% | (8.25)% | 6.34% | 15.20% |
Ratios to Average Net Assets E | ||||||
Expenses before expense reductions | .70% A | .73% | .69% | .68% | .67% | .68% |
Expenses net of voluntary waivers, if any | .70% A | .73% | .69% | .68% | .67% | .68% |
Expenses net of all reductions | .69% A | .71% | .68% | .66% | .66% | .66% |
Net investment income (loss) | 1.16% A | 1.29% | .94% | .94% | .82% | .88% |
Supplemental Data | ||||||
Net assets, end of period (in millions) | $ 30,827 | $ 28,263 | $ 27,849 | $ 36,099 | $ 41,440 | $ 48,595 |
Portfolio turnover rate | 30% A | 33% | 36% | 46% | 41% | 35% |
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower had certain expenses not been reduced during the periods shown.
D Calculated based on average shares outstanding during the period.
E Expense ratios reflect operating expenses of the fund. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from brokerage service arrangements or other expense offset arrangements and do not represent the amount paid by the fund during periods when reimbursements or reductions occur. Expenses net of any voluntary waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from brokerage service arrangements or other expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the fund.
Semiannual Report
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements
For the period ended January 31, 2004 (Unaudited)
(Amounts in thousands except ratios)
1. Significant Accounting Policies.
Fidelity Growth & Income Portfolio (the fund) is a fund of Fidelity Securities Fund (the trust) and is authorized to issue an unlimited number of shares. The trust is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Massachusetts business trust. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which require management to make certain estimates and assumptions at the date of the financial statements. The following summarizes the significant accounting policies of the fund:
Security Valuation. Net asset value per share (NAV calculation) is calculated as of the close of business of the New York Stock Exchange, normally 4:00 p.m. Eastern time. Equity securities for which market quotations are available are valued at the last sale price or official closing price (closing bid price or last evaluated quote if no sale has occurred) on the primary market or exchange on which they trade. Debt securities for which quotations are readily available are valued at their most recent bid prices (sales prices if the principal market is an exchange) in the principal market in which such securities are normally traded, as determined by recognized dealers in such securities, or securities are valued on the basis of information provided by a pricing service. Pricing services use valuation matrices that incorporate both dealer-supplied valuations and valuation models. If an event that is expected to materially affect the value of a security occurs after the close of an exchange or market on which that security trades, but prior to the NAV calculation, then that security will be fair valued taking the event into account. Securities (including restricted securities) for which market quotations are not readily available are valued at their fair value as determined in good faith under consistently applied procedures under the general supervision of the Board of Trustees. Price movements in futures contracts and ADRs, market and trading trends, the bid/ask quotes of brokers and off-exchange institutional trading may be reviewed in the course of making a good faith determination of a security's fair value. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued on the basis of amortized cost. Investments in open-end investment companies are valued at their net asset value each business day.
Foreign Currency. The fund uses foreign currency contracts to facilitate transactions in foreign-denominated securities. Losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rate at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
(Amounts in thousands except ratios)
1. Significant Accounting Policies - continued
Foreign Currency - continued
currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. Security transactions are accounted for as of trade date. Gains and losses on securities sold are determined on the basis of identified cost. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. The fund estimates the components of distributions received from Real Estate Investment Trusts (REITs). Distributions received in excess of income are recorded as a reduction of cost of investments and/or as a realized gain. Interest income is accrued as earned. Interest income includes coupon interest and amortization of premium and accretion of discount on debt securities, which is accrued using the interest method. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain.
Expenses. Most expenses of the trust can be directly attributed to a fund. Expenses which cannot be directly attributed are apportioned among the funds in the trust.
Deferred Trustee Compensation. Under a Deferred Compensation Plan (the Plan), non-interested Trustees must defer receipt of a portion of, and may elect to defer receipt of an additional portion of, their annual compensation. Deferred amounts are treated as though equivalent dollar amounts had been invested in shares of the fund or are invested in a cross-section of other Fidelity funds, and are marked-to-market. Deferred amounts remain in the fund until distributed in accordance with the Plan.
Income Tax Information and Distributions to Shareholders. Each year, the fund intends to qualify as a regulated investment company by distributing all of its taxable income and realized gains under Subchapter M of the Internal Revenue Code. As a result, no provision for income taxes is required in the accompanying financial statements. Foreign taxes are provided for based on the fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests. Distributions are recorded on the ex-dividend date.
Semiannual Report
1. Significant Accounting Policies - continued
Income Tax Information and Distributions to Shareholders - continued
Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from generally accepted accounting principles. Capital accounts within the financial statements are adjusted for permanent and temporary book and tax differences. These adjustments have no impact on net assets or the results of operations. Temporary differences will reverse in a subsequent period. These differences are primarily due to futures transactions, foreign currency transactions, non-taxable dividends, capital loss carryforwards and losses deferred due to wash sales.
The federal tax cost of investments including unrealized appreciation (depreciation) as of period end was as follows:
Unrealized appreciation | $ 10,897,172 | | |
Unrealized depreciation | (358,997) | |
Net unrealized appreciation (depreciation) | $ 10,538,175 | |
Cost for federal income tax purposes | $ 20,105,761 |
2. Operating Policies.
Repurchase Agreements. Fidelity Management & Research Company (FMR) has received an Exemptive Order from the Securities and Exchange Commission (the SEC) which permits the fund and other affiliated entities of FMR to transfer uninvested cash balances into joint trading accounts. These accounts are then invested in repurchase agreements that are collateralized by U.S. Treasury or Government obligations. The fund may also invest directly with institutions, in repurchase agreements that are collateralized by commercial paper obligations and corporate obligations. Collateral is held in segregated accounts with custodian banks and may be obtained in the event of a default of the counterparty. Collateral is marked-to-market daily and maintained at a value at least equal to the principal amount of the repurchase agreement (including accrued interest).
Futures Contracts. The fund may use futures contracts to manage its exposure to the stock market. Buying futures tends to increase the fund's exposure to the underlying instrument, while selling futures tends to decrease the fund's exposure to the underlying instrument or hedge other fund investments. Losses may arise from changes in the value of the underlying instruments or if the counterparties do not perform under the contracts' terms. Gains (losses) are realized upon the expiration or closing of the futures contracts. Futures contracts are valued at the settlement price established each day by the board of trade or exchange on which they are traded.
Semiannual Report
Notes to Financial Statements (Unaudited) - continued
(Amounts in thousands except ratios)
3. Purchases and Sales of Investments.
Information regarding purchases and sales of securities is included under the caption "Other Information" at the end of the fund's Schedule of Investments.
4. Fees and Other Transactions with Affiliates.
Management Fee. FMR and its affiliates provide the fund with investment management related services for which the fund pays a monthly management fee. The management fee is the sum of an individual fund fee rate that is based on an annual rate of .20% of the fund's average net assets and a group fee rate that averaged .28% during the period. The group fee rate is based upon the average net assets of all the mutual funds advised by FMR. The group fee rate decreases as assets under management increase and increases as assets under management decrease. For the period, the total annualized management fee rate was .48% of the fund's average net assets.
Transfer Agent Fees. Fidelity Service Company, Inc. (FSC), an affiliate of FMR, is the fund's transfer, dividend disbursing and shareholder servicing agent. FSC receives account fees and asset-based fees that vary according to account size and type of account. FSC pays for typesetting, printing and mailing of shareholder reports, except proxy statements. For the period, the transfer agent fees were equivalent to an annualized rate of .21% of average net assets.
Accounting and Security Lending Fees. FSC maintains the fund's accounting records. The accounting fee is based on the level of average net assets for the month. Under a separate contract, FSC administers the security lending program. The security lending fee is based on the number and duration of lending transactions.
Central Funds. The fund may invest in affiliated Central Funds managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of FMR. The Central Funds are open-end investment companies available only to investment companies and other accounts managed by FMR and its affiliates. The Central Funds seek preservation of capital and current income and do not pay a management fee. Income distributions earned by the fund are recorded as income in the accompanying financial statements and totaled $6,592 for the period.
Brokerage Commissions. The fund placed a portion of its portfolio transactions with brokerage firms which are affiliates of the investment adviser. The commissions paid to these affiliated firms are shown under the caption "Other Information" at the end of the fund's Schedule of Investments.
Semiannual Report
5. Committed Line of Credit.
The fund participates with other funds managed by FMR in a $3.5 billion credit facility (the "line of credit") to be utilized for temporary or emergency purposes to fund shareholder redemptions or for other short-term liquidity purposes. The fund has agreed to pay commitment fees on its pro rata portion of the line of credit. During the period, there were no borrowings on this line of credit.
6. Security Lending.
The fund lends portfolio securities from time to time in order to earn additional income. The fund receives collateral (in the form of U.S. Treasury obligations, letters of credit and/or cash) against the loaned securities and maintains collateral in an amount not less than 100% of the market value of the loaned securities during the period of the loan. The market value of the loaned securities is determined at the close of business of the fund and any additional required collateral is delivered to the fund on the next business day. If the borrower defaults on its obligation to return the securities loaned because of insolvency or other reasons, a fund could experience delays and costs in recovering the securities loaned or in gaining access to the collateral. Cash collateral is invested in cash equivalents. At period end there were no security loans outstanding.
7. Expense Reductions.
Many of the brokers with whom FMR places trades on behalf of the fund provided services to the fund in addition to trade execution. These services included payments of certain expenses on behalf of the fund totaling $1,333 for the period. In addition, through arrangements with the fund's custodian, credits realized as a result of uninvested cash balances were used to reduce the fund's expenses. During the period, these credits reduced the fund's custody expenses by $1.
8. Transactions with Affiliated Companies.
An affiliated company is a company in which the fund has ownership of at least 5% of the voting securities. Companies which are affiliates of the fund at period-end are noted in the fund's Schedule of Investments. Transactions during the period with companies which are or were affiliates are as follows:
Affiliate | Value, beginning of period | Purchases | Sales | Dividend | Value, end |
Manufactured Home Communities, Inc. | $ 33,855 | $ 14,635 | $ - | $ 10,291 | $ 44,735 |
SLM Corp. | 1,269,938 | 3,583 | 28,473 | 10,293 | 1,152,409 |
TOTALS | $ 1,303,793 | $ 18,218 | $ 28,473 | $ 20,584 | $ 1,197,144 |
Semiannual Report
Investment Adviser
Fidelity Management & Research Company
Boston, MA
Investment Sub-Advisers
FMR Co., Inc.
Fidelity Management & Research
(Far East) Inc.
Fidelity Management & Research
(U.K.) Inc.
Fidelity Investments Japan Limited
Fidelity International Investment
Advisors
Fidelity International Investment
Advisors (U.K.) Limited
General Distributor
Fidelity Distributors Corporation
Boston, MA
Transfer and Shareholder
Servicing Agent
Fidelity Service Company, Inc.
Boston, MA
Custodian
JPMorgan Chase Bank
New York, NY
Fidelity's Growth and Income Funds
Balanced Fund
Convertible Securities Fund
Equity-Income Fund
Equity-Income II Fund
Fidelity ® Fund
Global Balanced Fund
Growth & Income Portfolio
Growth & Income II Portfolio
Puritan ® Fund
Real Estate Income Fund
Real Estate Investment Portfolio
Utilities Fund
The Fidelity Telephone Connection
Mutual Fund 24-Hour Service
Exchanges/Redemptions
and Account Assistance 1-800-544-6666
Product Information 1-800-544-6666
Retirement Accounts 1-800-544-4774
(8 a.m. - 9 p.m.)
TDD Service 1-800-544-0118
for the deaf and hearing impaired
(9 a.m. - 9 p.m. Eastern time)
Fidelity Automated Service
Telephone (FAST®) (automated graphic) 1-800-544-5555
(automated graphic) Automated line for quickest service
(Fidelity Investment logo)(registered trademark)
Corporate Headquarters
82 Devonshire St., Boston, MA 02109
www.fidelity.com
GAI-USAN-0304
1.789285.100
Item 2. Code of Ethics
Not applicable.
Item 3. Audit Committee Financial Expert
Not applicable.
Item 4. Principal Accountant Fees and Services
Not applicable.
Item 5. Audit Committee of Listed Registrants
Not applicable.
Item 6. Reserved
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies
Not applicable.
Item 8. Reserved
Item 9. Submission of Matters to a Vote of Security Holders
There were no material changes to the procedures by which shareholders may recommend nominees to Fidelity Securities Fund: Fidelity Growth & Income Portfolio's Board of Trustees.
Item 10. Controls and Procedures
(a)(i) The President and Treasurer and the Chief Financial Officer have concluded that the Fidelity Securities Fund: Fidelity Growth & Income Portfolio's (the "Fund") disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act) provide reasonable assurances that material information relating to the Fund is made known to them by the appropriate persons, based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this report.
(a)(ii) There was no change in the Fund's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act) that occurred during the Fund's last fiscal half-year that has materially affected, or is reasonably likely to materially affect, the Fund's internal control over financial reporting.
Item 11. Exhibits
(a) | (1) | Not applicable. |
(a) | (2) | Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT. |
(b) | Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) is furnished and attached hereto as Exhibit 99.906CERT. |
SIGNATURES
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.
Fidelity Securities Fund
By: | /s/Christine Reynolds |
Christine Reynolds | |
President and Treasurer | |
Date: | March 26, 2004 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By: | /s/Christine Reynolds |
Christine Reynolds | |
President and Treasurer | |
Date: | March 26, 2004 |
By: | /s/Timothy F. Hayes |
Timothy F. Hayes | |
Chief Financial Officer | |
Date: | March 26, 2004 |