UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------
FORM N-CSR
--------
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
INVESTMENT COMPANY ACT FILE NUMBERS 811-5690; 811-6618;
811-3169
FIRST INVESTORS SERIES FUND
FIRST INVESTORS SERIES FUND II, INC.
FIRST INVESTORS GLOBAL FUND, INC.
(Exact name of registrant as specified in charter)
95 Wall Street
New York, NY 10005
(Address of principal executive offices) (Zip code)
Joseph I. Benedek
First Investors Management Company, Inc.
581 Main Street
Woodbridge, NJ 07095
1-732-855-2712
(Name and address of agent for service)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:
1-212-858-8000
DATE OF FISCAL YEAR END: SEPTEMBER 30, 2004
DATE OF REPORTING PERIOD: SEPTEMBER 30, 2004
Item 1. Reports to Stockholders
The Annual Report to Stockholders follows
[First Investors Logo]
EQUITY FUNDS
TOTAL RETURN
VALUE
BLUE CHIP
GROWTH & INCOME
ALL-CAP GROWTH
MID-CAP OPPORTUNITY
SPECIAL SITUATIONS
FOCUSED EQUITY
GLOBAL
ANNUAL REPORT
September 30, 2004
Portfolio Managers' Letter
FIRST INVESTORS TOTAL RETURN FUND
Dear Investor:
This is the annual report for the First Investors Total Return Fund for the
fiscal year ended September 30, 2004. During the period, the Fund's return
on a net asset value basis was 9.7% for Class A shares and 8.9% for Class B
shares, including dividends of 20.0 cents per share on Class A shares and
11.8 cents per share on Class B shares.
The primary drivers of the Fund's performance were the improving economy,
the rise in energy prices and solid performance of the equity markets.
Given the solid rise in equity prices during the fiscal year, the Fund was
helped by its 64% average equity allocation.
More than three-quarters of the return of the equity portion of the
portfolio was attributable to four groups: the energy, financials, consumer
discretionary and industrials sectors. To a lesser extent, the Fund's focus
on firms with dividends benefited performance, as their shares outperformed
non-paying ones. An underweight position in the consumer staples sector
also aided returns. In addition, the Fund's multi-cap strategy aided
performance, as mid- and small-cap equities outperformed their larger
capitalization counterparts.
The Fund's average bond allocation of 31.5% made it slightly underweight in
bonds. The bond portion of the Fund had approximately two-thirds of its
assets in investment grade corporate bonds, and one-third in
mortgage-backed bonds. Both sectors outperformed the bond market in general
as yield spreads on corporate and mortgage-backed bonds narrowed versus
Treasury securities.
Thank you for placing your trust in First Investors. As always, we
appreciate the opportunity to serve your investment needs.
Sincerely,
/s/ EDWIN D. MISKA
Edwin D. Miska
Director of Equities
/s/ CLARK D. WAGNER
Clark D. Wagner
Director of Fixed Income
October 29, 2004
Understanding Your Fund's Expenses
FIRST INVESTORS EQUITY FUNDS
As a mutual fund shareholder, you incur two types of costs: (1) transaction
costs, including a sales charge (load) on purchase payments (on Class A
shares only), a contingent deferred sales charge on redemptions (on Class
B shares only); and (2) ongoing costs, including advisory fees;
distribution and service fees (12b-1); and other expenses. This example is
intended to help you understand your ongoing costs (in dollars) of
investing in the Funds and to compare these costs with the ongoing costs of
investing in other mutual funds.
The examples are based on an investment of $1,000 in each Fund at the
beginning of the period, April 1, 2004, and held for the entire six-month
period ended September 30, 2004. The calculations assume that no shares
were bought or sold during the period. Your actual costs may have been
higher or lower, depending on the amount of your investment and the timing
of any purchases or redemptions.
Actual Expenses Example:
These lines help you to estimate the actual expenses that you paid over the
period. The "Ending Account Value" shown is derived from the Fund's actual
return, and the "Expenses Paid During Period" shows the dollar amount that
would have been paid by an investor who started with $1,000 in each Fund.
You may use the information here, together with the amount you invested, to
estimate the expenses that you paid over the period.
To estimate the expense you paid on your account during this period, simply
divide your account value by $1,000 (for example, an $8,600 account value
divided by $1,000 = 8.60), then multiply the result by the number given for
your Fund under the heading "Expenses Paid During Period".
Hypothetical Expenses Example:
These lines of the table provide information about hypothetical account
values and hypothetical expenses based on the Fund's actual expense ratio
for Class A and Class B shares, and an assumed rate of return of 5% per
year before expenses, which is not the Fund's actual return. The
hypothetical account values and expenses may not be used to estimate the
actual ending account balance or expenses you paid for the period. You may
use this information to compare the ongoing costs of investing in the Fund
and other funds. To do so, compare this 5% hypothetical example with the 5%
hypothetical examples that appear in the shareholder reports of the other
funds.
Please note that the expenses shown in the table are meant to highlight and
help you compare your ongoing costs only and do not reflect any transaction
costs, such as front-end or contingent deferred sales charges (loads).
Therefore, the hypothetical expense example is useful in comparing ongoing
costs only and will not help you determine the relative total costs of
owning different funds. In addition, if these transaction costs were
included, your costs would have been higher.
Fund Expenses
FIRST INVESTORS TOTAL RETURN FUND
The examples below show the ongoing costs (in dollars) of investing in your
Fund and will help you in comparing those costs with those of other mutual
funds. Please refer to page 3 for a detailed explanation of the information
presented in these examples.
- ----------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- ----------------------------------------------------------------------------------------------
Actual $1,000.00 $989.43 $7.06
Hypothetical (5% return before expenses) $1,000.00 $1,017.90 $7.16
- ----------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- ----------------------------------------------------------------------------------------------
Actual $1,000.00 $986.04 $10.53
Hypothetical (5% return before expenses) $1,000.00 $1,014.40 $10.68
- ----------------------------------------------------------------------------------------------
* Expenses are equal to the annualized expense ratio of 1.42% for Class A
shares and 2.12% for Class B shares, multiplied by the average account
value over the period, multiplied by 183/366 (to reflect the one-half year
period). Expenses paid during the period are net of expenses waived.
Portfolio Composition
TOP TEN SECTORS
(BAR CHART: Top Ten Sectors)
Financials 19.7%
Consumer Discretionary 11.5%
Information Technology 10.7%
Health Care 9.8%
Mortgage-Backed Certificates 9.5%
Industrials 9.1%
Consumer Staples 8.1%
Energy 5.6%
Materials 5.5%
Utilities 3.1%
Portfolio's holdings and allocations are subject to change. Percentages are
as of September 30, 2004, and are based on total market value of
investments.
Cumulative Performance Information
FIRST INVESTORS TOTAL RETURN FUND
Comparison of change in value of $10,000 investment in the First Investors
Total Return Fund (Class A shares), the Lehman Brothers U.S. Government
Bond/Credit Index, the Merrill Lynch U.S. Corporate & Government Master
Index+ and the Standard & Poor's 500 Index.
FIRST INVESTORS TOTAL RETURN FUND
GRAPH PLOT POINTS
As of September 30, 2004
MERRILL LYNCH
LEHMAN U.S CORPORATE
TOTAL RETURN U.S. GOV/BOND S&P 500 AND GOVERNMENT
FUND CREDIT INDEX INDEX MASTER INDEX
Dec-94 $9,425 $10,000 $10,000 $10,000
Dec-95 11,957 11,924 13,758 11,906
Dec-96 13,226 12,270 16,917 12,252
Dec-97 15,618 13,468 22,561 13,451
Sep-98 16,104 14,725 23,915 14,699
Sep-99 18,205 14,486 30,565 14,481
Sep-00 21,589 15,462 34,625 15,452
Sep-01 17,888 17,498 25,408 17,524
Sep-02 15,855 19,099 20,203 19,120
Sep-03 18,326 20,342 25,132 20,308
Sep-04 20,019 21,019 28,617 20,984
(INSET BOX IN CHART READS:)
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 9.65% 3.38%
Five Years 1.95% 0.76%
Ten Years 7.62% 6.98%
Class B Shares
One Year 8.92% 4.92%
Five Years 1.23% 0.85%
Since Inception
(1/12/95) 7.27% 7.27%
The graph compares a $10,000 investment in the First Investors Total Return
Fund (Class A shares) beginning 12/31/94 with theoretical investments in
the Lehman Brothers U.S. Government Bond/Credit Index, the Merrill Lynch
Corporate & Government Master Index and the Standard & Poor's 500 Index
(the "Indices"). The Lehman Brothers U.S. Government Bond/Credit Index
combines the Lehman Brothers U.S. Government Bond Index with the Lehman
Brothers U.S. Credit Index. The U.S. Government Bond Index is made up of
the Treasury Bond Index (all public obligations of the U.S. Treasury) and
the Agency Bond Index (all publicly issued debt of U.S. Government agencies
and quasi-federal corporations, and corporate debt guaranteed by the U.S.
Government). The U.S. Credit Index includes all publicly issued,
fixed-rate, nonconvertible investment grade dollar-denominated,
S.E.C.-registered corporate debt. All issues in each Index have at least
one year to maturity and an outstanding par value of at least $150 million.
The Merrill Lynch U.S. Corporate & Government Master Index tracks the
performance of U.S. dollar-denominated investment grade U.S. Government and
corporate public debt issued in the U.S. domestic bond market, excluding
collateralized products such as Mortgage Pass-Through and Assets Backed
securities. Qualifying bonds have at least one year to maturity, a fixed
coupon schedule and minimum amount outstanding of $1 billion for U.S.
Treasuries and $150 million for all other securities. The Standard & Poor's
500 Index is an unmanaged capitalization-weighted index of 500 stocks
designed to measure the performance of the broad domestic economy through
changes in the aggregate market value of such stocks, which represent all
major industries. It is not possible to invest directly in these Indices.
In addition, the Indices do not take into account fees and expenses that an
investor would incur in purchasing securities in these Indices. For
purposes of the graph and the accompanying table, unless otherwise
indicated, it has been assumed that the maximum sales charge was deducted
from the initial $10,000 investment in the Fund and all dividends and
distributions were reinvested. Class B shares performance may be greater
than or less than that shown in the line graph above for Class A shares
based on differences in sales loads and fees paid by shareholders investing
in the different classes.
Cumulative Performance Information (continued)
FIRST INVESTORS TOTAL RETURN FUND
* Average Annual Total Return figures (for the periods ended 9/30/04)
include the reinvestment of all dividends and distributions. "N.A.V. Only"
returns are calculated without sales charges. The Class A "S.E.C.
Standardized" returns shown are based on the maximum sales charge of 5.75%
(prior to 6/17/02, the maximum sales charge was 6.25%). The Class B "S.E.C.
Standardized" returns are adjusted for the applicable deferred sales charge
(maximum of 4% in the first year). During the periods shown, some of the
expenses of the Fund were waived or assumed. If such expenses had been paid
by the Fund, the Class A "S.E.C. Standardized" Average Annual Total Returns
for One Year, Five Years and Ten Years would have been 3.17%, .52% and
6.72%, respectively. The Class B "S.E.C. Standardized" Average Annual Total
Returns for One Year, Five Years and Since Inception would have been 4.72%,
.61% and 7.01%, respectively. Results represent past performance and do not
indicate future results.The graph and the returns shown do not reflect the
deduction of taxes that a shareholder would pay on distributions or the
redemption of fund shares. Investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than the original cost. Lehman Brothers U.S.
Government Bond/Credit Index figures are from Lehman Brothers, Inc.,
Merrill Lynch U.S. Corporate & Government Master Index figures are from
Merrill Lynch & Co., Standard & Poor's 500 Index figures are from Standard
& Poor's and all other figures are from First Investors Management Company,
Inc.
+ We have added a comparison to the Merrill Lynch U.S. Corporate &
Government Master Index this year because that Index is more representative
of the Fund's current investment universe. After this year, we will not
show a comparison to the Lehman Brothers U.S. Government Bond/Credit Index.
This page intentionally left blank.
Portfolio of Investments
FIRST INVESTORS TOTAL RETURN FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS--62.3%
Consumer Discretionary--8.4%
55,400 * AnnTaylor Stores Corporation $1,296,360 $48
62,500 Blockbuster, Inc. - Class "A" 474,375 18
14,400 Clear Channel Communications, Inc. 448,848 17
39,800 * Cost Plus, Inc. 1,408,124 53
3,900 * Domino's Pizza, Inc. 57,330 2
38,200 * Fox Entertainment Group, Inc. - Class "A" 1,059,668 40
51,400 * GameStop Corporation - Class "A" 951,414 36
22,200 Gap, Inc. 415,140 15
14,400 Genuine Parts Company 552,672 21
20,400 Harley-Davidson, Inc. 1,212,576 45
32,200 Hasbro, Inc. 605,360 23
68,000 * Hollywood Entertainment Corporation 671,160 25
29,400 Home Depot, Inc. 1,152,480 43
44,100 J.C. Penney Company, Inc. (Holding Company) 1,555,848 58
17,700 Lear Corporation 963,765 36
43,500 Leggett & Platt, Inc. 1,222,350 46
48,700 Mattel, Inc. 882,930 33
73,500 McDonald's Corporation 2,060,205 77
90,000 * Office Depot, Inc. 1,352,700 51
28,100 Pier 1 Imports, Inc. 508,048 19
35,600 Polo Ralph Lauren Corporation - Class "A" 1,294,772 48
24,700 Ross Stores, Inc. 578,968 22
19,200 Sherwin-Williams Company 844,032 32
26,400 Viacom, Inc. - Class "B" 885,984 33
- ----------------------------------------------------------------------------------------------------------------------
22,455,109 841
- ----------------------------------------------------------------------------------------------------------------------
Consumer Staples--4.3%
29,400 Altria Group, Inc. 1,382,976 52
29,400 American Italian Pasta Company - Class "A" 768,810 29
17,500 Anheuser-Busch Companies, Inc. 874,125 33
17,000 Bunge, Ltd. 679,660 25
14,500 Coca-Cola Company 580,725 22
33,300 Hormel Foods Corporation 891,774 33
18,400 Kimberly-Clark Corporation 1,188,456 45
14,700 PepsiCo, Inc. 715,155 27
21,800 Procter & Gamble Company 1,179,816 44
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS TOTAL RETURN FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Consumer Staples (continued)
35,300 * Smithfield Foods, Inc. $882,500 $33
17,200 Tootsie Roll Industries, Inc. 502,584 19
22,100 Wal-Mart Stores, Inc. 1,175,720 44
22,500 WD-40 Company 643,500 24
- ----------------------------------------------------------------------------------------------------------------------
11,465,801 430
- ----------------------------------------------------------------------------------------------------------------------
Energy--5.0%
22,000 Anadarko Petroleum Corporation 1,459,920 55
75,000 Chesapeake Energy Corporation 1,187,250 44
14,400 ConocoPhillips 1,193,040 45
14,400 EOG Resources, Inc. 948,240 36
37,600 ExxonMobil Corporation 1,817,208 68
23,500 * Noble Corporation 1,056,325 40
44,100 Suncor Energy, Inc. 1,411,640 53
37,300 * Swift Energy Company 893,708 33
45,600 * Transocean, Inc. 1,631,568 61
53,000 XTO Energy, Inc. 1,721,440 64
- ----------------------------------------------------------------------------------------------------------------------
13,320,339 499
- ----------------------------------------------------------------------------------------------------------------------
Financials--12.7%
20,600 American Express Company 1,060,076 40
20,600 American International Group, Inc. 1,400,594 52
32,200 AmSouth Bancorporation 785,680 29
57,006 Bank of America Corporation 2,470,070 93
13,100 Bear Stearns Companies, Inc. 1,259,827 47
44,100 Citigroup, Inc. 1,945,692 73
36,800 Colonial BancGroup, Inc. 752,560 28
35,800 Endurance Specialty Holdings, Ltd. 1,150,970 43
14,600 Fannie Mae 925,640 35
14,700 GreenPoint Financial Corporation 682,227 26
45,600 JPMorgan Chase & Company 1,811,688 68
13,900 Lehman Brothers Holdings, Inc. 1,108,108 41
29,600 Marsh & McLennan Companies, Inc. 1,354,496 51
50,000 MBNA Corporation 1,260,000 47
10,200 Merrill Lynch & Company, Inc. 507,144 19
38,200 Montpelier Re Holdings, Ltd. 1,401,176 52
16,200 Morgan Stanley 798,660 30
18,600 National City Corporation 718,332 27
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Financials (continued)
61,300 New York Community Bancorp, Inc. $1,259,102 $47
66,300 NewAlliance Bancshares, Inc. 951,405 36
28,550 Old Republic International Corporation 714,607 27
22,000 Plum Creek Timber Company, Inc. (REIT) 770,660 29
28,300 Safeco Corporation 1,291,895 48
14,700 South Financial Group, Inc. 414,540 16
58,800 Sovereign Bancorp, Inc. 1,283,016 48
49,900 U.S. Bancorp 1,442,110 54
28,800 Wachovia Corporation 1,352,160 51
36,700 Washington Mutual, Inc. 1,434,236 54
20,500 Wells Fargo & Company 1,222,415 46
5,700 Willis Group Holdings, Ltd. 213,180 8
- ----------------------------------------------------------------------------------------------------------------------
33,742,266 1,265
- ----------------------------------------------------------------------------------------------------------------------
Health Care--8.4%
47,000 Abbott Laboratories 1,990,920 75
29,400 * Accredo Health, Inc. 692,958 26
11,800 Aetna, Inc. 1,179,174 44
13,500 * Amgen, Inc. 765,180 29
27,900 * Anthem, Inc. 2,434,275 91
78,100 * Boston Scientific Corporation 3,102,913 116
8,800 Eli Lilly & Company 528,440 20
18,900 * Forest Laboratories, Inc. 850,122 32
5,800 * Genentech, Inc. 304,036 11
25,800 Guidant Corporation 1,703,832 64
4,560 * Hospira, Inc. 139,536 5
29,400 Johnson & Johnson 1,656,102 62
15,400 * Laboratory Corporation of America Holdings 673,288 25
14,800 Medtronic, Inc. 768,120 29
23,500 Merck & Company, Inc. 775,500 29
88,080 Pfizer, Inc. 2,695,248 101
42,800 * Priority Healthcare Corporation 862,420 32
35,300 Wyeth 1,320,220 50
- ----------------------------------------------------------------------------------------------------------------------
22,442,284 841
- ----------------------------------------------------------------------------------------------------------------------
Industrials--7.2%
15,100 3M Company 1,207,547 45
60,300 * AGCO Corporation 1,363,985 51
14,900 Alexander & Baldwin, Inc. 505,706 19
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS TOTAL RETURN FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Industrials (continued)
74,100 American Power Conversion Corporation $1,288,599 $49
9,300 Caterpillar, Inc. 748,185 28
29,800 Cendant Corporation 643,680 24
29,500 Chicago Bridge & Iron
Company NV - NY Shares 884,705 33
10,600 Eaton Corporation 672,146 25
15,000 Engineered Support Systems, Inc. 684,600 26
14,800 Harsco Corporation 664,520 25
26,200 Honeywell International, Inc. 939,532 35
17,800 Lockheed Martin Corporation 992,884 37
57,900 Masco Corporation 1,999,287 75
32,500 Northrop Grumman Corporation 1,733,225 65
59,300 * Pinnacle Airlines Corporation 598,930 23
17,500 Pitney Bowes, Inc. 771,750 29
20,700 Rockwell Automation, Inc. 801,090 30
34,100 SPX Corporation 1,207,140 45
14,600 United Technologies Corporation 1,363,348 51
- ----------------------------------------------------------------------------------------------------------------------
19,070,859 715
- ----------------------------------------------------------------------------------------------------------------------
Information Technology--9.6%
4,400 Analog Devices, Inc. 170,632 6
59,500 * Cisco Systems, Inc. 1,076,950 40
29,400 Diebold, Inc. 1,372,980 51
42,900 * Electronics for Imaging, Inc. 696,696 26
103,000 * EMC Corporation 1,188,620 45
168,600 * Entrust, Inc. 426,558 16
41,376 First Data Corporation 1,799,856 68
58,800 Hewlett-Packard Company 1,102,500 41
51,700 Intel Corporation 1,037,102 39
23,600 Intersil Corporation - Class "A" 375,948 14
14,500 Intuit, Inc. 658,300 25
74,900 * Lexar Media, Inc. 628,410 24
72,200 * McAfee, Inc. 1,451,220 54
103,300 Microsoft Corporation 2,856,245 107
9,100 * NAVTEQ 324,324 12
87,800 Nokia Corporation - Class "A" (ADR) 1,204,616 45
57,300 * Paxar Corporation 1,299,564 49
46,000 QUALCOMM, Inc. 1,795,840 67
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Information Technology (continued)
41,800 * SanDisk Corporation $1,217,216 $46
19,100 StarTek, Inc. 598,976 22
36,800 * Storage Technology Corporation 929,568 35
54,385 * Taiwan Semiconductor Manufacturing Co., Ltd.
(ADR) 388,309 15
23,800 * Tech Data Corporation 917,490 34
28,500 * Thermo Electron Corporation 770,070 29
65,100 * VERITAS Software Corporation 1,158,780 43
10,400 * Xilinx, Inc. 280,800 11
- ----------------------------------------------------------------------------------------------------------------------
25,727,570 964
- ----------------------------------------------------------------------------------------------------------------------
Materials--4.0%
19,200 Dow Chemical Company 867,456 33
23,700 Freeport-McMoRan Copper &
Gold, Inc. - Class "B" 959,850 36
42,700 Georgia-Pacific Corporation 1,535,065 58
35,500 Lubrizol Corporation 1,228,300 46
41,200 MeadWestvaco Corporation 1,314,280 49
13,200 PPG Industries, Inc. 808,896 30
17,500 Praxair, Inc. 747,950 28
60,900 RPM International, Inc. 1,074,885 40
16,400 United States Steel Corporation 616,968 23
23,700 Weyerhaeuser Company 1,575,576 59
- ----------------------------------------------------------------------------------------------------------------------
10,729,226 402
- ----------------------------------------------------------------------------------------------------------------------
Other--.8%
26,500 Nasdaq - 100 Index Tracking Stock 930,680 35
10,300 SPDR Trust Series "1" 1,151,334 43
- ----------------------------------------------------------------------------------------------------------------------
2,082,014 78
- ----------------------------------------------------------------------------------------------------------------------
Telecommunication Services--.7%
41,200 SBC Communications, Inc. 1,069,140 40
22,100 Verizon Communications, Inc. 870,298 33
- ----------------------------------------------------------------------------------------------------------------------
1,939,438 73
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS TOTAL RETURN FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
Shares or For Each
Principal $10,000 of
Amount Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Utilities--1.2%
34,600 Atmos Energy Corporation $871,574 $32
22,100 Consolidated Edison, Inc. 929,084 35
12,200 Dominion Resources, Inc. 796,050 30
26,500 ONEOK, Inc. 689,530 26
- ----------------------------------------------------------------------------------------------------------------------
3,286,238 123
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Common Stocks (cost $140,079,365) 166,261,144 6,231
- ----------------------------------------------------------------------------------------------------------------------
CORPORATE BONDS--18.9%
Aerospace/Defense--.6%
$500M Boeing Capital Corp., 4.75%, 2008 521,779 20
Precision Castparts Corp.:
500M 8.75%, 2005 513,060 19
500M 5.6%, 2013 512,775 19
- ----------------------------------------------------------------------------------------------------------------------
1,547,614 58
- ----------------------------------------------------------------------------------------------------------------------
Automotive--.3%
DaimlerChrysler NA Holdings Corp.:
350M 8%, 2010 407,402 16
350M 6.5%, 2013 380,412 14
- ----------------------------------------------------------------------------------------------------------------------
787,814 30
- ----------------------------------------------------------------------------------------------------------------------
Chemicals--.5%
1,075M Rohm & Haas Co., 7.4%, 2009 1,236,213 47
- ----------------------------------------------------------------------------------------------------------------------
Consumer Non-Durables--.4%
900M Clorox Co., 6.125%, 2011 995,477 37
- ----------------------------------------------------------------------------------------------------------------------
Energy--.2%
600M Texaco Capital, Inc., 8.25%, 2006 663,127 24
- ----------------------------------------------------------------------------------------------------------------------
Financial--2.5%
CIT Group, Inc.:
500M 4.75%, 2010 507,852 19
750M 7.75%, 2012 888,888 33
1,250M ERAC USA Finance Enterprise Co.,
7.35%, 2008 + 1,399,970 53
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
Principal $10,000 of
Amount Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Financial (continued)
$400M Ford Motor Credit Co., 7.75%, 2007 $435,459 $16
350M General Electric Capital Corp., 8.5%, 2008 409,562 15
General Motors Acceptance Corp.:
500M 4.5%, 2006 508,047 19
650M 7.75%, 2010 715,038 27
750M Household Finance Corp., 6.5%, 2008 826,017 31
885M SLM Corp., 5%, 2015 878,092 33
- ----------------------------------------------------------------------------------------------------------------------
6,568,925 246
- ----------------------------------------------------------------------------------------------------------------------
Financial Services--2.8%
500M Bank of America Corp., 6.5%, 2011 551,602 21
750M Bank One Corp., 7.6%, 2007 830,340 31
638M Bank United Corp., 8%, 2009 744,792 28
1,250M Fifth Third Bank, 3.375%, 2008 1,239,828 46
1,000M Lincoln National Corp., 6.5%, 2008 1,092,720 41
725M Manufacturers & Traders Trust Co., 8%, 2010 869,303 33
270M National City Bank of Indiana, 4.875%, 2007 280,761 10
853M National City Bank of Kentucky, 6.3%, 2011 949,729 36
737M Washington Mutual, Inc., 8.25%, 2010 873,237 33
- ----------------------------------------------------------------------------------------------------------------------
7,432,312 279
- ----------------------------------------------------------------------------------------------------------------------
Food/Beverage/Tobacco--.8%
1,000M Coca-Cola Co., 5.75%, 2011 1,090,429 41
1,030M Coca-Cola Enterprises, Inc., 7.125%, 2009 1,179,445 43
- ----------------------------------------------------------------------------------------------------------------------
2,269,874 84
- ----------------------------------------------------------------------------------------------------------------------
Food/Drug--1.1%
600M Delhaize America, Inc., 8.125%, 2011 688,214 26
1,000M Kroger Co., 7.8%, 2007 1,114,603 42
996M Safeway, Inc., 7%, 2007 1,084,680 41
- ----------------------------------------------------------------------------------------------------------------------
2,887,497 109
- ----------------------------------------------------------------------------------------------------------------------
Forest Products/Containers--.4%
1,100M International Paper Co., 6.75%, 2011 1,227,464 45
- ----------------------------------------------------------------------------------------------------------------------
Gaming/Leisure--.3%
750M MGM Mirage, Inc., 8.5%, 2010 855,938 32
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS TOTAL RETURN FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
Principal $10,000 of
Amount Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Health Care--.7%
$1,000M HCA, Inc., 5.25%, 2008 $1,024,856 $39
800M Wyeth, 6.95%, 2011 890,758 33
- ----------------------------------------------------------------------------------------------------------------------
1,915,614 72
- ----------------------------------------------------------------------------------------------------------------------
Information Technology--.4%
International Business Machines Corp.:
500M 4.875%, 2006 519,290 20
500M 5.4%, 2009 534,129 20
- ----------------------------------------------------------------------------------------------------------------------
1,053,419 40
- ----------------------------------------------------------------------------------------------------------------------
Manufacturing--.7%
700M Newell Rubbermaid, Inc., 6.75%, 2012 796,945 30
900M United Technologies Corp., 7.125%, 2010 1,041,792 39
- ----------------------------------------------------------------------------------------------------------------------
1,838,737 69
- ----------------------------------------------------------------------------------------------------------------------
Media-Broadcasting--.5%
705M Comcast Cable Communications, Inc.,
8.375%, 2007 787,999 29
500M Cox Communications, Inc., 5.5%, 2015 477,189 18
- ----------------------------------------------------------------------------------------------------------------------
1,265,188 47
- ----------------------------------------------------------------------------------------------------------------------
Media-Diversified--.8%
750M AOL Time Warner, Inc., 6.75%, 2011 833,156 31
500M Cox Enterprises, Inc., 8%, 2007 + 536,911 20
705M Viacom, Inc., 8.625%, 2012 872,004 33
- ----------------------------------------------------------------------------------------------------------------------
2,242,071 84
- ----------------------------------------------------------------------------------------------------------------------
Metals/Mining--.2%
500M Thiokol Corp., 6.625%, 2008 550,181 21
- ----------------------------------------------------------------------------------------------------------------------
Real Estate Investment Trusts--1.6%
910M AvalonBay Communities, Inc.,
6.875%, 2007 1,003,880 38
750M Boston Properties, Inc., 5%, 2015 728,935 27
700M EOP Operating LP, 8.1%, 2010 816,423 31
700M Mack-Cali Realty LP, 7.75%, 2011 812,382 30
800M Simon Property Group LP, 7.375%, 2018 925,348 35
- ----------------------------------------------------------------------------------------------------------------------
4,286,968 161
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
Principal $10,000 of
Amount Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Retail-General Merchandise--.5%
$500M Federated Department Stores, Inc., 7.45%, 2017 $588,334 $22
600M Target Corp., 7.5%, 2010 706,460 27
- ----------------------------------------------------------------------------------------------------------------------
1,294,794 49
- ----------------------------------------------------------------------------------------------------------------------
Telecommunications--.3%
600M New York Telephone Co., 6.125%, 2010 639,994 24
100M SBC Communications, Inc., 6.25%, 2011 109,845 4
- ----------------------------------------------------------------------------------------------------------------------
749,839 28
- ----------------------------------------------------------------------------------------------------------------------
Transportation--1.2%
Burlington Northern Santa Fe Corp.:
1,000M 7.875%, 2007 1,110,337 42
250M 6.75%, 2011 281,178 10
400M Canadian National Railway Co., 6.45%, 2006 422,553 16
Union Pacific Corp.:
200M 7.25%, 2008 223,857 8
1,100M 7.375%, 2009 1,258,329 47
- ----------------------------------------------------------------------------------------------------------------------
3,296,254 123
- ----------------------------------------------------------------------------------------------------------------------
Utilities--1.7%
750M Consumers Energy Co., 6.375%, 2008 812,252 30
800M DPL, Inc., 6.875%, 2011 852,000 32
750M Duke Capital Corp., 8%, 2019 898,991 34
750M Nisource Finance Corp., 7.875%, 2010 887,404 33
900M PP&L Capital Funding, Inc., 8.375%, 2007 1,000,738 38
- ----------------------------------------------------------------------------------------------------------------------
4,451,385 167
- ----------------------------------------------------------------------------------------------------------------------
Waste Management--.4%
1,000M Waste Management, Inc., 6.875%, 2009 1,117,906 42
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Corporate Bonds (cost $47,962,313) 50,534,611 1,894
- ----------------------------------------------------------------------------------------------------------------------
MORTGAGE-BACKED CERTIFICATES--8.9%
Fannie Mae--4.9%
7,209M 5.5%, 4/1/33-10/1/33 7,324,265 275
1,980M 6.5%, 11/1/33 2,091,374 78
3,473M 7%, 3/1/32-8/1/32 3,721,642 140
- ----------------------------------------------------------------------------------------------------------------------
13,137,281 493
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS TOTAL RETURN FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
Principal For Each
Amount or $10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Freddie Mac--2.1%
$2,800M 5.5%, 3/1/33-7/1/33 $2,845,817 $107
775M 6%, 9/1/32 801,673 30
1,739M 6.5%, 1/1/34 1,826,900 68
- ----------------------------------------------------------------------------------------------------------------------
5,474,390 205
- ----------------------------------------------------------------------------------------------------------------------
Government National Mortgage Association--1.9%
4,181M 5.5%, 4/15/33-6/15/34 4,274,637 160
474M 6.5%, 7/15/28 501,652 19
229M 7%, 8/15/32 244,545 9
- ----------------------------------------------------------------------------------------------------------------------
5,020,834 188
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Mortgage-Backed Certificates (cost $23,349,022) 23,632,505 886
- ----------------------------------------------------------------------------------------------------------------------
CONVERTIBLE PREFERRED STOCKS--1.5%
Financials--1.1%
Chubb Corporation:
26,800 7%, 2005 - Series "A" 763,264 29
14,800 7%, 2006 - Series "B" 416,250 16
28,600 Hartford Financial Services Group, Inc., 6%,
2006 - Class "A" 1,708,850 64
- ----------------------------------------------------------------------------------------------------------------------
2,888,364 109
- ----------------------------------------------------------------------------------------------------------------------
Telecommunication Services--.4%
23,500 ALLTEL Corporation, 7.75%, 2005 1,219,063 45
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Convertible Preferred Stocks (cost $3,579,873) 4,107,427 154
- ----------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS--.5%
$1,500M Tobacco Settlement Financing Corp., NJ Rev. Bonds,
6.75%, 2039 (cost $1,442,294) 1,440,000 54
- ----------------------------------------------------------------------------------------------------------------------
PASS THROUGH CERTIFICATES--.4%
Transportation
753M Continental Airlines, Inc., 8.388%, 2020 572,626 22
623M NWA Trust, 10.23%, 2012 544,923 20
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Pass Through Certificates (cost $1,421,688) 1,117,549 42
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS TOTAL RETURN FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
Principal $10,000 of
Amount Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
SHORT-TERM U.S. GOVERNMENT
AGENCY OBLIGATIONS--.5%
$1,200M Fannie Mae, 1.72%, 10/1/04 (cost $1,200,000) $1,200,000 $45
- ----------------------------------------------------------------------------------------------------------------------
SHORT-TERM CORPORATE NOTES--.4%
1,000M ChevronTexaco Corp., 1.73%, 10/8/04
(cost $999,664) 999,664 37
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Investments (cost $220,034,219) 93.4% 249,292,900 9,343
Other Assets, Less Liabilities 6.6 17,522,989 657
- ----------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $266,815,889 $10,000
======================================================================================================================
* Non-income producing
+ Security exempt from registration under Rule 144A of the Securities Act
of 1933 (see Note 6).
Summary of Abbreviations:
ADR American Depositary Receipts
REIT Real Estate Investment Trust
See notes to financial statements
Portfolio Manager's Letter
FIRST INVESTORS VALUE FUND
Dear Investor:
This is the annual report for the First Investors Value Fund for the
fiscal year ended September 30, 2004. During the period, the Fund's return
on a net asset value basis was 20.6% for Class A shares and 19.9% for
Class B shares, including dividends of 6.5 cents per share on Class A
shares and 2.9 cents per share on Class B shares.
The Fund's performance was primarily driven by the improving economy, good
performance in the equity markets, the general outperformance of value
stocks and rising energy and commodity prices. The Fund generated strong
returns across multiple sectors and market capitalization classes.
A key reason for the Fund's outperformance compared with the Standard &
Poor's 500 Index was its multi-cap approach. While the largest portion of
the Fund is invested in large-cap stocks, the Fund's multi-cap strategy
aided performance by providing the flexibility to seek compelling
opportunities in the mid- and small-cap areas. In particular, the Fund's
mid-cap allocation helped performance, as our holdings in the sector
outperformed the other capitalization classes. Brascan, a Canadian asset
management company with major investments in real estate and power
generation, was one of our top performing mid-cap stocks. Diamond Offshore
Drilling, an offshore driller of oil and gas wells, was also a significant
contributor.
Another factor in the Fund's outperformance was the strong performance of
its holdings in the financial sector. FleetBoston Financial, a large
regional bank that was acquired by Bank of America, and Allstate, a major
insurance provider, generated exceptional returns. The Fund was slightly
overweighted in the group as well.
The Fund's holdings in the technology, consumer discretionary, energy and
consumer staples sectors also aided performance. The energy sector's
strong performance for the fiscal year was driven by a sharp increase in
oil prices. ConocoPhillips was among the top-performing energy stocks for
the Fund. Among the Fund's consumer discretionary holdings, J.C. Penney
posted strong performance, in part due to the sale of its struggling
Eckerd drugstore business.
Thank you for placing your trust in First Investors. As always, we
appreciate the opportunity to serve your investment needs.
Sincerely,
/s/ MATTHEW S. WRIGHT
Matthew S. Wright
Portfolio Manager
October 29, 2004
Fund Expenses
FIRST INVESTORS VALUE FUND
The examples below show the ongoing costs (in dollars) of investing in
your Fund and will help you in comparing those costs with those of other
mutual funds. Please refer to page 3 for a detailed explanation of the
information presented in these examples.
- --------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- --------------------------------------------------------------------------------------------
Actual $1,000.00 $1,029.78 $7.31
Hypothetical (5% return before expenses) $1,000.00 $1,017.80 $7.26
- --------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- --------------------------------------------------------------------------------------------
Actual $1,000.00 $1,027.06 $10.84
Hypothetical (5% return before expenses) $1,000.00 $1,014.30 $10.78
- --------------------------------------------------------------------------------------------
* Expenses are equal to the annualized expense ratio of 1.44% for Class A
shares and 2.14% for Class B shares, multiplied by the average account
value over the period, multiplied by 183/366 (to reflect the one-half
year period).
Portfolio Composition
TOP TEN SECTORS
(BAR CHART: Top Ten Sectors)
Financials 24.7%
Consumer Discretionary 13.3%
Energy 9.7%
Industrials 9.1%
Consumer Staples 8.6%
Materials 7.5%
Health Care 6.4%
Utilities 6.2%
Telecommunication Services 4.5%
Information Technology 4.0%
Portfolio's holdings and allocations are subject to change. Percentages
are as of September 30, 2004, and are based on total market value of
investments.
Cumulative Performance Information
FIRST INVESTORS VALUE FUND
Comparison of change in value of $10,000 investment in the First Investors
Value Fund (Class A shares) and the Standard & Poor's 500 Index.
First Investors Value Fund
Graph Plot Points
for the periods Ended 9/30/04
Value S&P 500
Fund Index
Oct-94 $ 9,425 $10,000
Oct-95 11,298 12,644
Oct-96 12,704 15,691
Oct-97 14,338 20,730
Sep-98 16,639 23,386
Sep-99 18,633 29,888
Sep-00 21,909 33,858
Sep-01 16,435 24,845
Sep-02 12,106 19,755
Sep-03 14,412 24,575
Sep-04 17,327 27,982
(INSET BOX IN CHART READS:)
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 20.57% 13.74%
Five Years (1.39%) (2.55%)
Ten Years 6.58% 5.95%
Class B Shares
One Year 19.91% 15.91%
Five Years (2.05%) (2.44%)
Since Inception
(1/12/95) 5.95% 5.95%
The graph compares a $10,000 investment in the First Investors Value Fund
(Class A shares) beginning 10/31/94 with a theoretical investment in the
Standard & Poor's 500 Index (the "Index"). The Index is an unmanaged
capitalization-weighted index of 500 stocks designed to measure the
performance of the broad domestic economy through changes in the aggregate
market value of such stocks, which represent all major industries. It is
not possible to invest directly in this Index. In addition, the Index does
not take into account fees and expenses that an investor would incur in
purchasing securities in this Index. For purposes of the graph and the
accompanying table, unless otherwise indicated, it has been assumed that
the maximum sales charge was deducted from the initial $10,000 investment
in the Fund and all dividends and distributions were reinvested. Class B
shares performance may be greater than or less than that shown in the line
graph above for Class A shares based on differences in sales loads and
fees paid by shareholders investing in the different classes.
* Average Annual Total Return figures (for the periods ended 9/30/04)
include the reinvestment of all dividends and distributions. "N.A.V. Only"
returns are calculated without sales charges. The Class A "S.E.C.
Standardized" returns shown are based on the maximum sales charge of 5.75%
(prior to 6/17/02 the maximum sales charge was 6.25%). The Class B "S.E.C.
Standardized" returns are adjusted for the applicable deferred sales
charge (maximum of 4% in the first year). During certain of the periods
shown, some of the expenses of the Fund were waived or assumed. If such
expenses had been paid by the Fund, the Class A "S.E.C. Standardized"
Average Annual Total Return for Ten Years would have been 5.86% and the
Class B "S.E.C. Standardized" Average Annual Total Return Since Inception
would have been 5.85%. Results represent past performance and do not
indicate future results.The graph and the returns shown do not reflect the
deduction of taxes that a shareholder would pay on distributions or the
redemption of fund shares. Investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than the original cost. Standard & Poor's 500 Index
figures are from Standard & Poor's and all other figures are from First
Investors Management Company, Inc.
Portfolio of Investments
FIRST INVESTORS VALUE FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS--90.4%
Consumer Discretionary--13.2%
46,100 Clear Channel Communications, Inc. $1,436,937 $69
47,300 Genuine Parts Company 1,815,374 87
45,100 Hancock Fabrics, Inc. 540,298 26
39,600 Home Depot, Inc. 1,552,320 75
59,300 J.C. Penney Company, Inc. (Holding Company) 2,092,104 100
12,500 Jones Apparel Group, Inc. 447,500 21
59,574 Kimball International, Inc. - Class "B" 826,887 40
36,100 Lee Enterprises, Inc. 1,672,874 80
63,700 Leggett & Platt, Inc. 1,789,970 86
16,100 Liberty Corporation 639,814 31
96,600 Limited Brands 2,153,214 103
14,200 Magna International, Inc. - Class "A" 1,051,936 50
55,700 May Department Stores Company 1,427,591 69
104,600 McDonald's Corporation 2,931,938 141
95,700 Natuzzi SpA (ADR) 1,033,560 50
32,300 Newell Rubbermaid, Inc. 647,292 31
33,300 OshKosh B'Gosh, Inc. - Class "A" 672,660 32
162,900 Pearson PLC (ADR) 1,764,207 85
29,900 Tupperware Corporation 507,702 24
110,800 Walt Disney Company 2,498,540 120
- ----------------------------------------------------------------------------------------------------------------------
27,502,718 1,320
- ----------------------------------------------------------------------------------------------------------------------
Consumer Staples--8.6%
39,400 American Italian Pasta Company - Class "A" 1,030,310 49
37,200 Brown-Forman Corporation - Class "B" 1,703,760 82
50,000 Coca-Cola Company 2,002,500 96
71,800 ConAgra Foods, Inc. 1,845,978 89
15,541 * Del Monte Foods Company 163,025 8
40,700 Diageo PLC (ADR) 2,052,501 99
22,900 Fomento Economico Mexicano,
SA de CV (ADR) 1,011,722 49
44,200 H.J. Heinz Company 1,592,084 76
28,300 Kimberly-Clark Corporation 1,827,897 88
65,200 Ruddick Corporation 1,280,528 61
42,800 Sara Lee Corporation 978,408 47
58,200 Tasty Baking Company 465,600 22
46,600 UST, Inc. 1,876,116 90
- ----------------------------------------------------------------------------------------------------------------------
17,830,429 856
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS VALUE FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Energy--9.6%
27,600 Anadarko Petroleum Corporation $1,831,536 $88
36,000 BP PLC (ADR) 2,071,080 99
36,400 ChevronTexaco Corporation 1,952,496 94
30,600 ConocoPhillips 2,535,210 122
47,900 Diamond Offshore Drilling, Inc. 1,580,221 76
38,200 Kerr-McGee Corporation 2,186,950 105
51,700 Marathon Oil Corporation 2,134,176 102
40,200 Royal Dutch Petroleum Company - NY Shares
(ADR) 2,074,320 100
52,600 Tidewater, Inc. 1,712,130 82
46,900 Unocal Corporation 2,016,700 97
- ----------------------------------------------------------------------------------------------------------------------
20,094,819 965
- ----------------------------------------------------------------------------------------------------------------------
Financials--23.1%
43,900 A.G. Edwards, Inc. 1,519,818 73
11,100 ACE, Ltd. 444,666 21
52,600 Allstate Corporation 2,524,274 121
62,400 AmSouth Bancorporation 1,522,560 73
74,500 Aon Corporation 2,141,130 103
50,864 Bank of America Corporation 2,203,937 106
70,200 Bank of New York Company, Inc. 2,047,734 98
47,100 Banknorth Group, Inc. 1,648,500 79
76,900 Brascan Corporation - Class "A" 2,322,380 111
43,855 Cincinnati Financial Corporation 1,807,703 87
25,200 Comerica, Inc. 1,495,620 72
38,500 CRT Properties, Inc. (REIT) 825,825 40
34,200 Erie Indemnity Company - Class "A" 1,744,884 84
30,300 FBL Financial Group, Inc. - Class "A" 793,557 38
30,600 Jefferson-Pilot Corporation 1,519,596 73
56,400 KeyCorp 1,782,240 85
30,700 Lincoln National Corporation 1,442,900 69
43,400 Merrill Lynch & Company, Inc. 2,157,848 104
37,700 Montpelier Re Holdings, Ltd. 1,382,836 66
40,300 Morgan Stanley 1,986,790 95
20,500 New York Community Bancorp, Inc. 421,070 20
73,500 NewAlliance Bancshares, Inc. 1,054,725 51
18,200 One Liberty Properties, Inc. (REIT) 328,510 16
50,900 Plum Creek Timber Company, Inc. (REIT) 1,783,027 86
29,200 PNC Financial Services Group 1,579,720 76
46,300 Protective Life Corporation 1,820,053 87
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Financials (continued)
72,300 Sky Financial Group, Inc. $1,807,500 $87
25,500 SunTrust Banks, Inc. 1,795,455 86
42,900 T. Rowe Price Group, Inc. 2,185,326 105
34,000 Wells Fargo & Company 2,027,420 97
- ----------------------------------------------------------------------------------------------------------------------
48,117,604 2,309
- ----------------------------------------------------------------------------------------------------------------------
Health Care--5.9%
47,200 Abbott Laboratories 1,999,392 96
37,100 GlaxoSmithKline PLC (ADR) 1,622,383 78
4,520 * Hospira, Inc. 138,312 7
35,700 Johnson & Johnson 2,010,981 96
56,100 Merck & Company, Inc. 1,851,300 89
33,200 Novartis AG 1,549,444 74
56,500 Pfizer, Inc. 1,728,900 83
77,100 Schering-Plough Corporation 1,469,526 71
- ----------------------------------------------------------------------------------------------------------------------
12,370,238 594
- ----------------------------------------------------------------------------------------------------------------------
Industrials--9.1%
23,000 A.O. Smith Corporation 560,050 27
29,800 * Adesa, Inc. 489,614 24
2,600 Alexander & Baldwin, Inc. 88,244 4
34,800 Baldor Electric Company 823,368 40
24,000 CNF, Inc. 983,760 47
33,500 Dover Corporation 1,302,145 63
43,600 Federal Signal Corporation 810,088 39
20,300 General Dynamics Corporation 2,072,630 99
58,400 Honeywell International, Inc. 2,094,224 101
63,200 Masco Corporation 2,182,296 105
63,300 Norfolk Southern Corporation 1,882,542 90
69,800 Pall Corporation 1,708,704 82
43,700 Pitney Bowes, Inc. 1,927,170 92
15,300 SPX Corporation 541,620 26
28,600 Stewart & Stevenson Services, Inc. 505,362 24
20,300 Teleflex, Inc. 862,750 41
- ----------------------------------------------------------------------------------------------------------------------
18,834,567 904
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS VALUE FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Information Technology--4.0%
48,100 Automatic Data Processing, Inc. $1,987,492 $96
63,900 AVX Corporation 757,215 36
87,000 Hewlett-Packard Company 1,631,250 78
60,900 Methode Electronics, Inc. - Class "A" 778,911 37
64,700 Motorola, Inc. 1,167,188 56
84,000 Nokia Corporation - Class "A" (ADR) 1,152,480 55
26,700 Paychex, Inc. 805,005 39
- ----------------------------------------------------------------------------------------------------------------------
8,279,541 397
- ----------------------------------------------------------------------------------------------------------------------
Materials--7.4%
31,500 Air Products & Chemicals, Inc. 1,712,970 82
58,800 Alcoa, Inc. 1,975,092 95
37,300 Compass Minerals International, Inc. 828,060 40
47,300 Du Pont (E.I.) de Nemours & Company 2,024,440 97
75,900 Glatfelter 940,401 45
39,700 Great Lakes Chemical Corporation 1,016,320 49
59,300 Lubrizol Corporation 2,051,780 98
42,130 Myers Industries, Inc. 461,324 22
75,900 Sonoco Products Company 2,006,796 96
18,200 Vulcan Materials Company 927,290 45
23,400 Weyerhaeuser Company 1,555,632 75
- ----------------------------------------------------------------------------------------------------------------------
15,500,105 744
- ----------------------------------------------------------------------------------------------------------------------
Telecommunication Services--3.9%
57,500 BellSouth Corporation 1,559,400 75
31,500 CT Communications, Inc. 434,385 21
22,000 D&E Communications, Inc. 253,000 12
39,000 Nippon Telegraph and Telephone Corporation
(ADR) 779,220 37
55,400 SBC Communications, Inc. 1,437,630 69
21,100 Telephone & Data Systems, Inc. 1,775,987 85
48,528 Verizon Communications, Inc. 1,911,033 92
- ----------------------------------------------------------------------------------------------------------------------
8,150,655 391
- ----------------------------------------------------------------------------------------------------------------------
Utilities--5.6%
9,933 ALLETE, Inc. 322,833 15
34,550 American States Water Company 860,295 41
39,200 KeySpan Corporation 1,536,640 74
41,200 MDU Resources Group, Inc. 1,084,796 52
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Utilities (continued)
86,900 NiSource, Inc. $1,825,769 $88
37,700 Northwest Natural Gas Company 1,196,221 57
43,100 ONEOK, Inc. 1,121,462 54
12,100 South Jersey Industries, Inc. 577,775 28
51,200 Southwest Gas Corporation 1,226,240 59
48,700 United Utilities PLC (ADR) 991,532 48
39,700 Vectren Corporation 999,646 48
- ----------------------------------------------------------------------------------------------------------------------
11,743,209 564
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Common Stocks (cost $150,765,734) 188,423,885 9,044
- ----------------------------------------------------------------------------------------------------------------------
CONVERTIBLE PREFERRED STOCKS--2.1%
Financials--1.4%
49,200 Chubb Corporation, 7%, 2005 - Series "A" 1,401,216 67
7,700 State Street Corporation, 6.75%, 2006 1,535,765 74
- ----------------------------------------------------------------------------------------------------------------------
2,936,981 141
- ----------------------------------------------------------------------------------------------------------------------
Health Care--.4%
8,100 Anthem, Inc., 6%, 2004 813,038 39
- ----------------------------------------------------------------------------------------------------------------------
Telecommunication Services--.3%
12,400 ALLTEL Corporation, 7.75%, 2005 643,250 31
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Convertible Preferred Stocks (cost $2,413,193) 4,393,269 211
- ----------------------------------------------------------------------------------------------------------------------
PREFERRED STOCKS--.5%
Telecommunication Services--.3%
20,300 Verizon South, Inc., 7%, 2041 - Series "F" 530,439 25
- ----------------------------------------------------------------------------------------------------------------------
Utilities--.2%
18,300 Entergy Louisiana, Inc., 7.6%, 2032 488,976 24
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Preferred Stocks (cost $2,507,862) 1,019,415 49
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS VALUE FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
Principal $10,000 of
Amount Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
CORPORATE BONDS--.3%
Utilities
$500M Union Electric Co., 6.75%, 2008 (cost $499,294) $551,806 $26
- ----------------------------------------------------------------------------------------------------------------------
SHORT-TERM U.S. GOVERNMENT AGENCY
OBLIGATIONS--5.3%
11,000M Fannie Mae, 1.72%, 10/1/04 (cost $11,000,000) 11,000,000 528
- ----------------------------------------------------------------------------------------------------------------------
SHORT-TERM CORPORATE NOTES--.6%
1,300M Coca-Cola Co., 1.74%, 10/19/04
(cost $1,298,869) 1,298,869 62
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Investments (cost $168,484,952) 99.2% 206,687,244 9,920
Other Assets, Less Liabilities .8 1,665,496 80
- ----------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $208,352,740 $10,000
======================================================================================================================
* Non-income producing
Summary of Abbreviations
ADR American Depositary Reciepts
REIT Real Estate Investment Trust
See notes to financial statements
Portfolio Manager's Letter
FIRST INVESTORS BLUE CHIP FUND
Dear Investor:
This is the annual report for the First Investors Blue Chip Fund for the
fiscal year ended September 30, 2004. During the period, the Fund's return
on a net asset value basis was 9.0% for Class A shares and 8.3% for Class
B shares.
An improved economic environment and a better outlook for corporate
earnings drove the Fund's positive absolute return for the year. However,
the Fund underperformed the Standard & Poor's 500 Index. This relative
underperformance was mostly due to the Fund's focus on the "mega cap"
sector (those companies with market capitalizations in excess of $25
billion) and an overweight position in the large-cap technology sector,
both of which proved to be poor relative performers during the period.
The Fund held large positions in a number of companies whose stocks turned
in disappointing performances during the reporting period. Among our
consumer discretionary holdings, International Gaming Technology, a large
gaming company, posted poor results. In the health care area, Fund
performance was hurt by our position in Cardinal Health, which was plagued
by allegations of improper accounting practices. In addition, the Fund's
overweight position in the semiconductor sector hurt performance, as
manufacturers posted disappointing results.
Many of the Fund's holdings in the energy sector aided performance, as the
sector was boosted by higher oil and natural gas prices. In addition, many
of the Fund's holdings in the basic materials sector did well, thanks to
high overseas demand, particularly from China.
Thank you for placing your trust in First Investors. As always, we
appreciate the opportunity to serve your investment needs.
Sincerely,
/s/ DENNIS T. FITZPATRICK
Dennis T. Fitzpatrick
Vice President
and Portfolio Manager
October 29, 2004
Fund Expenses
FIRST INVESTORS BLUE CHIP FUND
The examples below show the ongoing costs (in dollars) of investing in
your Fund and will help you in comparing those costs with those of other
mutual funds. Please refer to page 3 for a detailed explanation of the
information presented in these examples.
- --------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- --------------------------------------------------------------------------------------------
Actual $1,000.00 $967.90 $7.18
Hypothetical (5% return before expenses) $1,000.00 $1,017.70 $7.36
- --------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- --------------------------------------------------------------------------------------------
Actual $1,000.00 $964.41 $10.61
Hypothetical (5% return before expenses) $1,000.00 $1,014.20 $10.88
- --------------------------------------------------------------------------------------------
* Expenses are equal to the annualized expense ratio of 1.46% for Class A
shares and 2.16% for Class B shares, multiplied by the average account
value over the period, multiplied by 183/366 (to reflect the one-half
year period). Expenses paid during the period are net of expenses waived.
Portfolio Composition
TOP TEN SECTORS
(BAR CHART: Top Ten Sectors)
Financials 19.1%
Information Technology 17.7%
Health Care 12.6%
Consumer Discretionary 11.8%
Industrials 11.2%
Consumer Staples 9.0%
Energy 8.4%
Materials 4.8%
Telecommunication Services 2.6%
Utilities 1.9%
Portfolio's holdings and allocations are subject to change. Percentages
are as of September 30, 2004, and are based on total market value of
investments.
Cumulative Performance Information
FIRST INVESTORS BLUE CHIP FUND
Comparison of change in value of $10,000 investment in the First Investors
Blue Chip Fund (Class A shares) and the Standard & Poor's 500 Index.
First Investors Blue Chip Fund
Graph Plot Points
for the periods Ended 9/30/04
Blue Chip S&P 500
Fund Index
Dec-94 $ 9,425 $10,000
Dec-95 12,632 13,758
Dec-96 15,228 16,917
Dec-97 19,195 22,561
Sep-98 18,284 23,915
Sep-99 23,600 30,565
Sep-00 28,672 34,625
Sep-01 19,817 25,408
Sep-02 15,075 20,203
Sep-03 17,747 25,132
Sep-04 19,352 28,617
(INSET BOX IN CHART READS:)
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 9.04% 2.75%
Five Years (3.89%) (5.03%)
Ten Years 7.30% 6.67%
Class B Shares
One Year 8.30% 4.30%
Five Years (4.56%) (4.95%)
Since Inception
(1/12/95) 6.69% 6.69%
The graph compares a $10,000 investment in the First Investors Blue Chip
Fund (Class A shares) beginning 12/31/94 with a theoretical investment in
the Standard & Poor's 500 Index (the "Index"). The Index is an unmanaged
capitalization-weighted index of 500 stocks designed to measure the
performance of the broad domestic economy through changes in the aggregate
market value of such stocks, which represent all major industries. It is
not possible to invest directly in this Index. In addition, the Index does
not take into account fees and expenses that an investor would incur in
purchasing securities in the Index. For purposes of the graph and the
accompanying table, unless otherwise indicated, it has been assumed that
the maximum sales charge was deducted from the initial $10,000 investment
in the Fund and all dividends and distributions were reinvested. Class B
shares performance may be greater than or less than that shown in the line
graph above for Class A shares based on differences in sales loads and
fees paid by shareholders investing in the different classes.
* Average Annual Total Return figures (for the periods ended 9/30/04)
include the reinvestment of all dividends and distributions. "N.A.V. Only"
returns are calculated without sales charges. The Class A "S.E.C.
Standardized" returns shown are based on the maximum sales charge of 5.75%
(prior to 6/17/02, the maximum sales charge was 6.25%). The Class B
"S.E.C. Standardized" returns are adjusted for the applicable deferred
sales charge (maximum of 4% in the first year). During the periods shown,
some of the expenses of the Fund were waived or assumed. If such expenses
had been paid by the Fund, the Class A "S.E.C. Standardized" Average
Annual Total Returns for One Year, Five Years and Ten Years would have
been 2.65%, (5.13%) and 6.52%, respectively. The Class B "S.E.C.
Standardized" Average Annual Total Returns for One Year, Five Years and
Since Inception would have been 4.20%, (5.04%) and 6.54%, respectively.
Results represent past performance and do not indicate future results.The
graph and the returns shown do not reflect the deduction of taxes that a
shareholder would pay on distributions or the redemption of fund shares.
Investment return and principal value of an investment will fluctuate so
that an investor's shares, when redeemed, may be worth more or less than
the original cost. Standard & Poor's 500 Index figures are from Standard &
Poor's and all other figures are from First Investors Management Company,
Inc.
Portfolio of Investments
FIRST INVESTORS BLUE CHIP FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS--98.4%
Consumer Discretionary--11.7%
14,800 Brunswick Corporation $677,248 $14
40,600 Carnival Corporation 1,919,974 40
71,996 * Comcast Corporation - Class "A" 2,033,167 43
48,900 * Comcast Corporation - Special Class "A" 1,365,288 29
14,700 Eastman Kodak Company 473,634 10
18,500 * eBay, Inc. 1,700,890 36
19,900 Gannett Company, Inc. 1,666,824 35
66,300 Gap, Inc. 1,239,810 26
92,400 Hilton Hotels Corporation 1,740,816 37
160,500 Home Depot, Inc. 6,291,600 132
129,000 International Game Technology 4,637,550 97
92,200 * Kohl's Corporation 4,443,118 93
48,700 Lowe's Companies, Inc. 2,646,845 56
131,700 McDonald's Corporation 3,691,551 78
58,900 NIKE, Inc. 4,641,320 98
147,000 * Office Depot, Inc. 2,209,410 46
86,400 Target Corporation 3,909,600 82
228,700 * Time Warner, Inc. 3,691,218 78
110,700 Viacom, Inc. - Class "B" 3,715,092 78
125,900 Walt Disney Company 2,839,045 60
- ----------------------------------------------------------------------------------------------------------------------
55,534,000 1,168
- ----------------------------------------------------------------------------------------------------------------------
Consumer Staples--8.9%
69,800 Altria Group, Inc. 3,283,392 69
36,100 Anheuser-Busch Companies, Inc. 1,803,195 38
91,200 Coca-Cola Company 3,652,560 77
47,900 Costco Wholesale Corporation 1,990,724 42
66,300 CVS Corporation 2,793,219 59
81,200 General Mills, Inc. 3,645,880 77
53,700 Kimberly-Clark Corporation 3,468,483 73
104,100 PepsiCo, Inc. 5,064,465 106
129,000 Procter & Gamble Company 6,981,480 147
62,800 Walgreen Company 2,250,124 47
139,400 Wal-Mart Stores, Inc. 7,416,080 156
- ----------------------------------------------------------------------------------------------------------------------
42,349,602 891
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Energy--8.4%
184,200 Chesapeake Energy Corporation $2,915,886 $61
183,600 ChevronTexaco Corporation 9,848,304 207
106,900 EnCana Corporation 4,949,470 104
189,500 ExxonMobil Corporation 9,158,535 193
217,700 * Grant Prideco, Inc. 4,460,673 94
49,300 Schlumberger, Ltd. 3,318,383 70
11,100 Sunoco, Inc. 821,178 17
92,300 * Transocean, Inc. 3,302,494 70
11,100 Valero Energy Corporation 890,331 19
- ----------------------------------------------------------------------------------------------------------------------
39,665,254 835
- ----------------------------------------------------------------------------------------------------------------------
Financials--18.9%
36,800 Allstate Corporation 1,766,032 37
118,100 American Express Company 6,077,426 128
121,900 American International Group, Inc. 8,287,981 174
215,766 Bank of America Corporation 9,349,141 197
145,400 Bank of New York Company, Inc. 4,241,318 89
750 * Berkshire Hathaway, Inc. - Class "B" 2,153,250 45
114,300 Chubb Corporation 8,033,004 169
217,400 Citigroup, Inc. 9,591,688 202
33,000 Compass Bancshares, Inc. 1,446,060 30
26,500 Fannie Mae 1,680,100 35
41,800 Freddie Mac 2,727,032 57
167,268 JPMorgan Chase & Company 6,645,558 140
34,900 Marsh & McLennan Companies, Inc. 1,597,024 34
155,100 Merrill Lynch & Company, Inc. 7,711,572 162
48,900 Morgan Stanley 2,410,770 51
158,600 New York Community Bancorp, Inc. 3,257,644 69
37,000 * Primus Guaranty, Ltd. 499,500 11
180,800 UnumProvident Corporation 2,836,752 60
63,400 Washington Mutual, Inc. 2,477,672 52
121,100 Wells Fargo & Company 7,221,193 152
- ----------------------------------------------------------------------------------------------------------------------
90,010,717 1,894
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS BLUE CHIP FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Health Care--12.5%
64,200 Abbott Laboratories $2,719,512 $57
57,500 * Amgen, Inc. 3,259,100 69
29,500 * Boston Scientific Corporation 1,172,035 25
124,300 Bristol-Myers Squibb Company 2,942,181 62
37,000 Cooper Companies, Inc. 2,536,350 53
44,200 Eli Lilly & Company 2,654,210 56
156,300 Johnson & Johnson 8,804,379 185
116,200 Medtronic, Inc. 6,030,780 127
228,000 Novartis AG 10,640,760 224
305,160 Pfizer, Inc. 9,337,896 196
129,200 UnitedHealth Group, Inc. 9,527,208 200
- ----------------------------------------------------------------------------------------------------------------------
59,624,411 1,254
- ----------------------------------------------------------------------------------------------------------------------
Industrials--11.1%
35,000 3M Company 2,798,950 59
22,100 Boeing Company 1,140,802 24
74,100 Cendant Corporation 1,600,560 34
22,100 Cummins, Inc. 1,632,969 34
95,800 Deere & Company 6,183,890 130
30,400 Emerson Electric Company 1,881,456 40
423,700 General Electric Company 14,227,846 299
55,100 Honeywell International, Inc. 1,975,886 42
66,900 Lockheed Martin Corporation 3,731,682 78
153,200 Masco Corporation 5,289,996 111
35,400 Northrop Grumman Corporation 1,887,882 40
125,500 Tyco International, Ltd. 3,847,830 81
30,000 United Parcel Service, Inc. - Class "B" 2,277,600 48
47,400 United Technologies Corporation 4,426,212 93
- ----------------------------------------------------------------------------------------------------------------------
52,903,561 1,113
- ----------------------------------------------------------------------------------------------------------------------
Information Technology--17.6%
313,600 * Alvarion, Ltd. 4,057,984 85
235,100 * Amdocs, Ltd. 5,132,233 108
44,200 * ASML Holding NV - NY Shares 568,854 12
364,100 * Cisco Systems, Inc. 6,590,210 139
295,000 * Corning, Inc. 3,268,600 69
133,700 * Dell, Inc. 4,759,720 100
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Information Technology (continued)
544,600 * EMC Corporation $6,284,684 $132
99,600 First Data Corporation 4,332,600 91
312,600 Intel Corporation 6,270,756 132
62,800 International Business Machines Corporation 5,384,472 113
700 * JAMDAT Mobile, Inc. 16,149 1
18,400 * Marvell Technology Group, Ltd. 480,792 10
514,400 Microsoft Corporation 14,223,160 299
258,200 Motorola, Inc. 4,657,928 98
47,900 * National Semiconductor Corporation 741,971 16
368,700 Nokia Corporation - Class "A" (ADR) 5,058,564 106
99,800 * SanDisk Corporation 2,906,176 61
516,300 * Sonus Networks, Inc. 2,906,769 61
104,400 Texas Instruments, Inc. 2,221,632 47
201,100 * Veritas Software Corporation 3,579,580 75
- ----------------------------------------------------------------------------------------------------------------------
83,442,834 1,755
- ----------------------------------------------------------------------------------------------------------------------
Materials--4.8%
276,800 * AK Steel Holding Corporation 2,258,688 48
51,600 Alcoa, Inc. 1,733,244 36
25,800 Cameco Corporation 2,044,392 43
92,800 Dow Chemical Company 4,192,704 88
59,000 Georgia-Pacific Corporation 2,121,050 45
228,700 Newmont Mining Corporation 10,412,711 219
- ----------------------------------------------------------------------------------------------------------------------
22,762,789 479
- ----------------------------------------------------------------------------------------------------------------------
Telecommunication Services--2.6%
202,200 * Nextel Communications, Inc. - Class "A" 4,820,448 102
124,800 SBC Communications, Inc. 3,238,560 68
104,000 Verizon Communications, Inc. 4,095,520 86
- ----------------------------------------------------------------------------------------------------------------------
12,154,528 256
- ----------------------------------------------------------------------------------------------------------------------
Utilities--1.9%
172,700 Duke Energy Corporation 3,953,103 83
202,000 ONEOK, Inc. 5,256,040 111
- ----------------------------------------------------------------------------------------------------------------------
9,209,143 194
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Common Stocks (cost $379,481,826) 467,656,839 9,839
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS BLUE CHIP FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
Principal $10,000 of
Amount Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
SHORT-TERM U.S. GOVERNMENT AGENCY
OBLIGATIONS--.5%
$2,300M Fannie Mae, 1.72%, 10/8/04 (cost $2,299,230) $2,299,230 $48
- ----------------------------------------------------------------------------------------------------------------------
SHORT-TERM CORPORATE NOTES--.4%
2,100M General Electric Co., 1.75%, 10/6/04
(cost $2,099,490) 2,099,490 44
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Investments (cost $383,880,546) 99.3% 472,055,559 9,931
Other Assets, Less Liabilities .7 3,270,959 69
- ----------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $475,326,518 $10,000
======================================================================================================================
* Non-income producing
Summary of Abbreviations:
ADR American Depositary Receipts
See notes to financial statements
Portfolio Manager's Letter
FIRST INVESTORS GROWTH & INCOME FUND
Dear Investor:
This is the annual report for the First Investors Growth & Income Fund for
the fiscal year ended September 30, 2004. During the period, the Fund's
return on a net asset value basis was 14.0% for Class A shares and 13.3%
for Class B shares, including dividends of 3.0 cents per share on Class A
shares.
The Fund's positive performance was driven largely by the improving
economy, the rise in energy prices and the solid performance of the
equity markets. Fund performance was largely the result of investments in
the energy, financials, consumer discretionary and industrials sectors.
More than three-quarters of the Fund's performance came from these groups.
In addition, the Fund's multi-cap strategy aided performance, as it
enabled the Fund to invest in mid- and small-cap equities, which
outperformed their larger-capitalization counterparts. The Fund's focus on
firms with dividends also helped performance during the period, as
dividend-paying companies outperformed non-paying ones. An underweight
allocation in the consumer staples sector also aided returns.
The Fund's best overall contributing sector was energy, which benefited
from strong commodity pricing and increased demand from the world's
economies. Both oil and gas companies, as well as equipment and services
firms, did well. Holdings in the financials sector also performed well,
driven by merger and acquisition activity and favorable economic factors.
Commercial banks were the best performing group. Within the consumer
discretionary sector, shares of retailers, restaurants and household
durables performed best. Industrial company holdings benefited from
increased revenues and aggressive cost cutting programs. Shares of defense
firms, machinery and building products also posted strong results.
Thank you for placing your trust in First Investors. As always, we
appreciate the opportunity to serve your investment needs.
Sincerely,
/s/ EDWIN D. MISKA
Edwin D. Miska
Director of Equities
and Portfolio Manager
October 29, 2004
Fund Expenses
FIRST INVESTORS GROWTH & INCOME FUND.
The examples below show the ongoing costs (in dollars) of investing in
your Fund and will help you in comparing those costs with those of other
mutual funds. Please refer to page 3 for a detailed explanation of the
information presented in these examples.
- --------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- --------------------------------------------------------------------------------------------
Actual $1,000.00 $985.00 $6.95
Hypothetical (5% return before expenses) $1,000.00 $1,018.00 $7.06
- --------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- --------------------------------------------------------------------------------------------
Actual $1,000.00 $982.25 $10.41
Hypothetical (5% return before expenses) $1,000.00 $1,014.50 $10.58
- --------------------------------------------------------------------------------------------
* Expenses are equal to the annualized expense ratio of 1.40% for Class A
shares and 2.10% for Class B shares, multiplied by the average account
value over the period, multiplied by 183/366 (to reflect the one-half
year period).
Portfolio Composition
TOP TEN SECTORS
(BAR CHART: Top Ten Sectors)
Financials 21.5%
Information Technology 15.1%
Health Care 13.3%
Consumer Discretionary 13.2%
Industrials 11.2%
Energy 7.8%
Consumer Staples 6.7%
Materials 6.3%
Utilities 1.9%
Telecommunication Services 1.8%
Portfolio's holdings and allocations are subject to change. Percentages
are as of September 30, 2004, and are based on total market value of
investments.
Cumulative Performance Information
FIRST INVESTORS GROWTH & INCOME FUND
Comparison of change in value of $10,000 investment in the First Investors
Growth & Income Fund (Class A shares) and the Standard & Poor's 500 Index.
First Investors Growth & Income Fund
Graph Plot Points
for the periods Ended 9/30/04
Growth & Income S&P 500
Fund Index
Oct-94 $ 9,425 $10,000
Oct-95 11,192 12,644
Oct-96 13,617 15,691
Oct-97 17,185 20,730
Sep-98 18,704 23,386
Sep-99 23,145 29,888
Sep-00 28,078 33,858
Sep-01 20,804 24,845
Sep-02 16,532 19,755
Sep-03 20,086 24,575
Sep-04 22,869 27,982
(INSET BOX IN CHART READS:)
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 13.95% 7.41%
Five Years (0.22%) (1.40%)
Ten Years 9.47% 8.81%
Class B Shares
One Year 13.26% 9.26%
Five Years (0.91%) (1.31%)
Since Inception
(1/12/95) 9.04% 9.04%
The graph compares a $10,000 investment in the First Investors Growth &
Income Fund (Class A shares) beginning 10/31/94 with a theoretical
investment in the Standard & Poor's 500 Index (the "Index"). The Index is
an unmanaged capitalization-weighted index of 500 stocks designed to
measure the performance of the broad domestic economy through changes in
the aggregate market value of such stocks, which represent all major
industries. It is not possible to invest directly in this Index. In
addition, the Index does not take into account fees and expenses that an
investor would incur in purchasing securities in the Index. For purposes
of the graph and the accompanying table, unless otherwise indicated, it
has been assumed that the maximum sales charge was deducted from the
initial $10,000 investment in the Fund and all dividends and distributions
were reinvested. Class B shares performance may be greater than or less
than that shown in the line graph above for Class A shares based on
differences in sales loads and fees paid by shareholders investing in the
different classes.
* Average Annual Total Return figures (for the periods ended 9/30/04)
include the reinvestment of all dividends and distributions. "N.A.V. Only"
returns are calculated without sales charges. The Class A "S.E.C.
Standardized" returns shown are based on the maximum sales charge of 5.75%
(prior to 6/17/02 the maximum sales charge was 6.25%). The Class B "S.E.C.
Standardized" returns are adjusted for the applicable deferred sales
charge (maximum of 4% in the first year). During certain of the periods
shown, some of the expenses of the Fund were waived or assumed. If such
expenses had been paid by the Fund, the Class A "S.E.C. Standardized"
Average Annual Total Return for ten years would have been 8.72% and the
Class B "S.E.C. Standardized" Average Annual Total Return Since Inception
would have been 8.94%. Results represent past performance and do not
indicate future results.The graph and the returns shown do not reflect the
deduction of taxes that a shareholder would pay on distributions or the
redemption of fund shares. Investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than the original cost. Standard & Poor's 500 Index
figures are from Standard & Poor's and all other figures are from First
Investors Management Company, Inc.
Portfolio of Investments
FIRST INVESTORS GROWTH & INCOME FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS--97.2%
Consumer Discretionary--13.2%
190,000 * AnnTaylor Stores Corporation $4,446,000 $76
212,500 Blockbuster, Inc. - Class "A" 1,612,875 28
50,000 Clear Channel Communications, Inc. 1,558,500 27
135,000 * Cost Plus, Inc. 4,776,300 82
13,300 * Domino's Pizza, Inc. 195,510 3
130,000 * Fox Entertainment Group, Inc. - Class "A" 3,606,200 62
174,600 * GameStop Corporation - Class "A" 3,231,846 56
77,500 Gap, Inc. 1,449,250 25
50,000 Genuine Parts Company 1,919,000 33
70,000 Harley-Davidson, Inc. 4,160,800 72
109,400 Hasbro, Inc. 2,056,720 35
230,100 * Hollywood Entertainment Corporation 2,271,087 39
100,000 Home Depot, Inc. 3,920,000 67
150,000 J.C. Penney Company, Inc. (Holding Company) 5,292,000 91
60,000 Lear Corporation 3,267,000 56
150,000 Leggett & Platt, Inc. 4,215,000 73
165,000 Mattel, Inc. 2,991,450 51
250,000 McDonald's Corporation 7,007,500 121
305,300 * Office Depot, Inc. 4,588,659 79
100,000 Pier 1 Imports, Inc. 1,808,000 31
120,000 Polo Ralph Lauren Corporation - Class "A" 4,364,400 75
80,000 Ross Stores, Inc. 1,875,200 32
65,000 Sherwin-Williams Company 2,857,400 49
90,000 Viacom, Inc. - Class "B" 3,020,400 52
- ----------------------------------------------------------------------------------------------------------------------
76,491,097 1,315
- ----------------------------------------------------------------------------------------------------------------------
Consumer Staples--6.7%
100,000 Altria Group, Inc. 4,704,000 81
100,000 American Italian Pasta Company - Class "A" 2,615,000 45
60,000 Anheuser-Busch Companies, Inc. 2,997,000 50
57,900 Bunge, Ltd. 2,314,842 40
50,000 Coca-Cola Company 2,002,500 34
113,300 Hormel Foods Corporation 3,034,174 52
62,500 Kimberly-Clark Corporation 4,036,875 69
50,000 PepsiCo, Inc. 2,432,500 42
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Consumer Staples (continued)
75,000 Procter & Gamble Company $4,059,000 $70
120,000 * Smithfield Foods, Inc. 3,000,000 52
57,300 Tootsie Roll Industries, Inc. 1,674,306 29
75,000 Wal-Mart Stores, Inc. 3,990,000 69
75,700 WD-40 Company 2,165,020 37
- ----------------------------------------------------------------------------------------------------------------------
39,025,217 670
- ----------------------------------------------------------------------------------------------------------------------
Energy--7.8%
75,000 Anadarko Petroleum Corporation 4,977,000 86
255,000 Chesapeake Energy Corporation 4,036,650 69
50,000 ConocoPhillips 4,142,500 71
49,300 EOG Resources, Inc. 3,246,405 56
130,000 ExxonMobil Corporation 6,282,900 108
80,000 * Noble Corporation 3,596,000 62
150,000 Suncor Energy, Inc. 4,801,500 82
125,000 * Swift Energy Company 2,995,000 51
155,000 * Transocean, Inc. 5,545,900 95
180,175 XTO Energy, Inc. 5,852,084 101
- ----------------------------------------------------------------------------------------------------------------------
45,475,939 781
- ----------------------------------------------------------------------------------------------------------------------
Financials--19.8%
70,000 American Express Company 3,602,200 62
70,000 American International Group, Inc. 4,759,300 82
110,000 AmSouth Bancorporation 2,684,000 46
197,718 Bank of America Corporation 8,567,121 147
45,000 Bear Stearns Companies, Inc. 4,327,650 74
150,000 Citigroup, Inc. 6,618,000 114
125,000 Colonial BancGroup, Inc. 2,556,250 44
120,000 Endurance Specialty Holdings, Ltd. 3,858,000 66
50,000 Fannie Mae 3,170,000 54
50,000 GreenPoint Financial Corporation 2,320,500 40
155,000 JPMorgan Chase & Company 6,158,150 106
47,500 Lehman Brothers Holdings, Inc. 3,786,700 65
100,000 Marsh & McLennan Companies, Inc. 4,576,000 79
170,000 MBNA Corporation 4,284,000 74
35,000 Merrill Lynch & Company, Inc. 1,740,200 30
130,000 Montpelier Re Holdings, Ltd. 4,768,400 82
55,000 Morgan Stanley 2,711,500 46
65,000 National City Corporation 2,510,300 43
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS GROWTH & INCOME FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Financials (continued)
208,333 New York Community Bancorp, Inc. $4,279,160 $73
225,000 NewAlliance Bancshares, Inc. 3,228,750 55
100,000 Old Republic International Corporation 2,503,000 43
75,000 Plum Creek Timber Company, Inc. (REIT) 2,627,250 45
96,105 Safeco Corporation 4,387,193 75
50,000 South Financial Group, Inc. 1,410,000 24
200,000 Sovereign Bancorp, Inc. 4,364,000 75
170,000 U.S. Bancorp 4,913,000 84
100,000 Wachovia Corporation 4,695,000 81
125,000 Washington Mutual, Inc. 4,885,000 84
70,000 Wells Fargo & Company 4,174,100 72
18,300 Willis Group Holdings, Ltd. 684,420 12
- ----------------------------------------------------------------------------------------------------------------------
115,149,144 1,977
- ----------------------------------------------------------------------------------------------------------------------
Health Care--13.1%
160,000 Abbott Laboratories 6,777,600 116
100,000 * Accredo Health, Inc. 2,357,000 41
40,000 Aetna, Inc. 3,997,200 69
46,700 * Amgen, Inc. 2,646,956 45
95,000 * Anthem, Inc. 8,288,750 142
260,000 * Boston Scientific Corporation 10,329,800 177
30,000 Eli Lilly & Company 1,801,500 31
65,000 * Forest Laboratories, Inc. 2,923,700 50
20,000 * Genentech, Inc. 1,048,400 18
87,500 Guidant Corporation 5,778,500 99
16,000 * Hospira, Inc. 489,600 8
100,000 Johnson & Johnson 5,633,000 97
52,800 * Laboratory Corporation of America Holdings 2,308,416 40
50,000 Medtronic, Inc. 2,595,000 45
80,000 Merck & Company, Inc. 2,640,000 45
300,000 Pfizer, Inc. 9,180,000 158
145,000 * Priority Healthcare Corporation 2,921,750 50
120,000 Wyeth 4,488,000 77
- ----------------------------------------------------------------------------------------------------------------------
76,205,172 1,308
- ----------------------------------------------------------------------------------------------------------------------
Industrials--11.1%
52,000 3M Company 4,158,440 71
205,000 * AGCO Corporation 4,637,100 80
50,400 Alexander & Baldwin, Inc. 1,710,576 29
250,000 American Power Conversion Corporation 4,347,500 75
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Industrials (continued)
30,000 Caterpillar, Inc. $2,413,500 $41
100,000 Cendant Corporation 2,160,000 37
100,200 Chicago Bridge & Iron Company
NV - NY Shares 3,004,998 52
36,000 Eaton Corporation 2,282,760 39
50,000 Engineered Support Systems, Inc. 2,282,000 39
50,000 Harsco Corporation 2,245,000 39
90,000 Honeywell International, Inc. 3,227,400 55
60,000 Lockheed Martin Corporation 3,346,800 57
200,000 Masco Corporation 6,906,000 119
110,000 Northrop Grumman Corporation 5,866,300 101
200,000 * Pinnacle Airlines Corporation 2,020,000 35
60,000 Pitney Bowes, Inc. 2,646,000 45
70,000 Rockwell Automation, Inc. 2,709,000 47
115,800 SPX Corporation 4,099,320 70
50,000 United Technologies Corporation 4,669,000 80
- ----------------------------------------------------------------------------------------------------------------------
64,731,694 1,111
- ----------------------------------------------------------------------------------------------------------------------
Information Technology--15.0%
15,000 Analog Devices, Inc. 581,700 10
200,000 * Cisco Systems, Inc. 3,620,000 62
100,000 Diebold, Inc. 4,670,000 80
135,000 * Electronics for Imaging, Inc. 2,192,400 38
350,000 * EMC Corporation 4,039,000 70
665,000 * Entrust, Inc. 1,682,450 29
140,000 First Data Corporation 6,090,000 105
200,000 Hewlett-Packard Company 3,750,000 64
175,000 Intel Corporation 3,510,500 60
80,000 Intersil Corporation - Class "A" 1,274,400 22
50,000 * Intuit, Inc. 2,270,000 39
252,100 * Lexar Media, Inc. 2,115,119 36
245,000 * McAfee, Inc. 4,924,500 85
350,000 Microsoft Corporation 9,677,500 166
31,000 NAVTEQ 1,104,840 19
300,000 Nokia Corporation - Class "A" (ADR) 4,116,000 71
195,000 * Paxar Corporation 4,422,600 76
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS GROWTH & INCOME FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Information Technology (continued)
160,000 QUALCOMM, Inc. $6,246,400 $107
140,000 * SanDisk Corporation 4,076,800 70
65,000 StarTek, Inc. 2,038,400 35
125,000 * Storage Technology Corporation 3,157,500 54
184,820 * Taiwan Semiconductor Manufacturing Co., Ltd.
(ADR) 1,319,615 23
80,000 * Tech Data Corporation 3,084,000 53
96,900 * Thermo Electron Corporation 2,618,238 45
220,000 * VERITAS Software Corporation 3,916,000 67
35,000 * Xilinx, Inc. 945,000 16
- ----------------------------------------------------------------------------------------------------------------------
87,442,962 1,502
- ----------------------------------------------------------------------------------------------------------------------
Materials--6.3%
65,000 Dow Chemical Company 2,936,700 50
80,000 Freeport-McMoRan Copper &
Gold, Inc. - Class "B" 3,240,000 56
145,000 Georgia-Pacific Corporation 5,212,750 89
121,500 Lubrizol Corporation 4,203,900 72
140,000 MeadWestvaco Corporation 4,466,000 77
45,000 PPG Industries, Inc. 2,757,600 47
60,000 Praxair, Inc. 2,564,400 44
207,000 RPM International, Inc. 3,653,550 63
55,300 United States Steel Corporation 2,080,386 36
80,400 Weyerhaeuser Company 5,344,992 92
- ----------------------------------------------------------------------------------------------------------------------
36,460,278 626
- ----------------------------------------------------------------------------------------------------------------------
Other--1.2%
90,000 Nasdaq - 100 Index Tracking Stock 3,160,800 54
35,000 SPDR Trust - Series "1" 3,912,300 67
- ----------------------------------------------------------------------------------------------------------------------
7,073,100 121
- ----------------------------------------------------------------------------------------------------------------------
Telecommunication Services--1.1%
140,000 SBC Communications, Inc. 3,633,000 62
75,000 Verizon Communications, Inc. 2,953,500 51
- ----------------------------------------------------------------------------------------------------------------------
6,586,500 113
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Utilities--1.9%
115,400 Atmos Energy Corporation $2,906,926 $50
75,000 Consolidated Edison, Inc. 3,153,000 54
42,000 Dominion Resources, Inc. 2,740,500 47
90,000 ONEOK, Inc. 2,341,800 40
- ----------------------------------------------------------------------------------------------------------------------
11,142,226 191
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Common Stocks (cost $469,679,356) 565,783,329 9,715
- ----------------------------------------------------------------------------------------------------------------------
CONVERTIBLE PREFERRED STOCKS--2.5%
Financials--1.7%
Chubb Corporation:
90,800 7%, 2005 - Series "A" 2,585,984 45
50,000 7%, 2006 - Series "B" 1,406,250 24
97,000 Hartford Financial Services Group, Inc.,
6%, 2006 - Class "A" 5,795,750 100
- ----------------------------------------------------------------------------------------------------------------------
9,787,984 169
- ----------------------------------------------------------------------------------------------------------------------
Health Care--.1%
16,000 Baxter International, Inc., 7%, 2006 860,000 14
- ----------------------------------------------------------------------------------------------------------------------
Telecommunication Services--.7%
80,000 ALLTEL Corporation, 7.75%, 2005 4,150,000 71
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Convertible Preferred Stocks (cost $12,653,193) 14,797,984 254
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Investments (cost $482,332,549) 99.7% 580,581,313 9,969
Other Assets, Less Liabilities .3 1,778,361 31
- ----------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $582,359,674 $10,000
======================================================================================================================
* Non-income producing
Summary of Abbreviations:
ADR American Depositary Receipts
REIT Real Estate Investment Trust
See notes to financial statements
Portfolio Manager's Letter
FIRST INVESTORS ALL-CAP GROWTH FUND
Dear Investor:
This is the annual report for the First Investors All-Cap Growth Fund for
the fiscal year ended September 30, 2004. During the period, the Fund's
return on a net asset value basis was 15.6% for Class A shares and 14.8%
for Class B shares.
The Fund's positive overall performance during the reporting period was
driven by the improving economy and solid performance of the equity
markets. In addition, the Fund's multi-cap strategy aided performance, as
it enabled the Fund to invest in mid- and small-cap equities, which
outperformed their larger-capitalization counterparts.
The Fund's relative outperformance of the Russell 3000 Growth Index was
largely due to strong security selection, primarily within the information
technology and financials sectors. Top contributors included Yahoo!, which
benefited from double-digit growth in the online advertising business, and
Countrywide Financial, a diversified financial firm that experienced growth
in banking and mortgage origination.
During the reporting period, sector allocation overall detracted from
performance. Although individual holdings in information technology were
strong, our overweight in the sector detracted from performance as this
sector underperformed the Index.
Thank you for placing your trust in First Investors. As always, we
appreciate the opportunity to serve your investment needs.
Sincerely,
/s/ ANDREW J. SHILLING
Andrew J. Shilling
Portfolio Manager
October 29, 2004
Fund Expenses
FIRST INVESTORS ALL-CAP GROWTH FUND
The examples below show the ongoing costs (in dollars) of investing in your
Fund and will help you in comparing those costs with those of other mutual
funds. Please refer to page 3 for a detailed explanation of the information
presented in these examples.
- ----------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- ----------------------------------------------------------------------------------------------
Actual $1,000.00 $986.09 $7.89
Hypothetical (5% return before expenses) $1,000.00 $1,017.05 $8.02
- ----------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- ----------------------------------------------------------------------------------------------
Actual $1,000.00 $983.16 $11.35
Hypothetical (5% return before expenses) $1,000.00 $1,013.55 $11.53
- ----------------------------------------------------------------------------------------------
* Expenses are equal to the annualized expense ratio of 1.59% for Class A
shares and 2.29% for Class B shares, multiplied by the average account
value over the period, multiplied by 183/366 (to reflect the one-half year
period).
Portfolio Composition
BY SECTOR
(BAR CHART DATA:)
Information Technology 39.0%
Health Care 17.7%
Industrials 10.7%
Financials 10.5%
Consumer Discretionary 10.0%
Energy 2.6%
Telecommunication Services 2.4%
Consumer Staples 0.9%
Materials 0.8%
Portfolio's holdings and allocations are subject to change. Percentages are
as of September 30, 2004, and are based on total market value of
investments.
FIRST INVESTORS ALL-CAP GROWTH FUND
Cumulative Performance Information
Comparison of change in value of $10,000 investment in the First Investors
All-Cap Growth Fund (Class A shares) and the Russell 3000 Growth Index.
First Investors All-Cap Growth Fund
Graph Plot Points
for the periods Ended 9/30/04
All-Cap Russell
Growth 3000 Growth
Fund Index
Oct-00 $ 9,425 $10,000
Sep-01 6,155 6,001
Sep-02 5,024 4,667
Sep-03 6,362 5,925
Sep-04 7,352 6,388
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 15.56% 8.94%
Since Inception (10/25/00) (6.12%) (7.52%)
Class B Shares
One Year 14.83% 10.83%
Since Inception (10/25/00) (6.77%) (7.49%)
The graph compares a $10,000 investment in the First Investors All-Cap
Growth Fund (Class A shares) beginning 10/25/00 (inception date) with a
theoretical investment in the Russell 3000 Growth Index (the "Index"). The
Index is an unmanaged index composed of the 3000 largest U.S. companies, as
determined by market capitalization, and represents approximately 98% of
the investable U.S. equity market. It is not possible to invest directly in
this Index. In addition, the Index does not take into account fees and
expenses that an investor would incur in purchasing securities in the
Index. For purposes of the graph and the accompanying table, unless
otherwise indicated, it has been assumed that the maximum sales charge was
deducted from the initial $10,000 investment in the Fund. Class B shares
performance may be greater than or less than that shown in the line graph
above for Class A shares based on differences in the sales loads and fees
paid by shareholders investing in the different classes.
* Average Annual Total Return figures are for the periods ended 9/30/04.
"N.A.V. Only" returns are calculated without sales charges. The Class A
"S.E.C. Standardized" returns shown are based on the maximum sales charge
of 5.75% (prior to 6/17/02, the maximum sales charge was 6.25%). The Class
B "S.E.C. Standardized" returns are adjusted for the applicable deferred
sales charge (maximum of 4% in the first year). During the periods shown,
some of the expenses of the Fund were waived or assumed. If such expenses
had been paid by the Fund, the Class A "S.E.C. Standardized" Total Return
Since Inception would have been (7.69%) and the Class B "S.E.C.
Standardized" Total Return Since Inception would have been (7.63%). Results
represent past performance and do not indicate future results.The graph and
the returns shown do not reflect the deduction of taxes that a shareholder
would pay on distributions or the redemption of fund shares. Investment
return and principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the
original cost. Russell 3000 Growth Index figures are from Frank Russell and
Company and all other figures are from First Investors Management Company,
Inc.
Portfolio of Investments
FIRST INVESTORS ALL-CAP GROWTH FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS--95.3%
Consumer Discretionary--10.1%
14,050 * A.C. Moore Arts & Crafts, Inc. $347,457 $23
52,030 * eBay, Inc. 4,783,638 317
36,720 * Fleetwood Enterprises, Inc. 557,410 37
10,100 * Helen of Troy, Ltd. 274,922 18
14,730 Landry's Restaurants, Inc. 401,982 27
16,400 Lennar Corporation 780,640 52
72,140 * Lions Gate Entertainment Corporation 627,618 42
22,800 Michaels Stores, Inc. 1,349,988 89
53,750 Omnicom Group, Inc. 3,926,975 261
9,800 * Pixar 773,220 51
170,490 * Sirius Satellite Radio, Inc. 545,568 36
46,870 * TiVo, Inc. 310,279 21
14,400 * Williams-Sonoma, Inc. 540,720 36
- ----------------------------------------------------------------------------------------------------------------------
15,220,417 1,010
- ----------------------------------------------------------------------------------------------------------------------
Consumer Staples--1.0%
34,370 Gillette Company 1,434,604 95
- ----------------------------------------------------------------------------------------------------------------------
Energy--2.6%
10,680 Cabot Oil & Gas Corporation 479,532 32
15,100 EOG Resources, Inc. 994,335 66
20,100 Petro-Canada 1,044,195 69
17,770 * Whiting Petroleum Corporation 540,208 36
27,275 XTO Energy, Inc. 885,892 59
- ----------------------------------------------------------------------------------------------------------------------
3,944,162 262
- ----------------------------------------------------------------------------------------------------------------------
Financials--10.5%
6,485 * Affiliated Managers Group, Inc. 347,207 23
6,460 * Arch Capital Group, Ltd. 251,552 17
59,460 Citigroup, Inc. 2,623,375 174
207,670 Countrywide Financial Corporation 8,180,121 543
12,850 Fannie Mae 814,690 54
31,030 Freddie Mac 2,024,397 134
16,640 IndyMac Bancorp, Inc. 602,368 40
12,900 Legg Mason, Inc. 687,183 46
25,290 * U.S.I. Holdings Corporation 345,209 23
- ----------------------------------------------------------------------------------------------------------------------
15,876,102 1,054
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS ALL-CAP GROWTH FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Health Care--17.8%
25,640 Abbott Laboratories $1,086,110 $72
20,930 * Abgenix, Inc. 206,370 14
107,770 AstraZeneca PLC (ADR) 4,432,580 294
23,970 Cardinal Health, Inc. 1,049,167 70
12,600 * Cephalon, Inc. 603,540 40
70,510 Eli Lilly & Company 4,234,126 281
26,910 * Forest Laboratories, Inc. 1,210,412 80
100,360 Guidant Corporation 6,627,774 440
27,700 * Medco Health Solutions, Inc. 855,930 57
18,310 * Medicines Company 442,003 29
64,490 Medtronic, Inc. 3,347,031 222
89,600 * Millennium Pharmaceuticals, Inc. 1,228,416 81
15,290 * NPS Pharmaceuticals, Inc. 333,016 22
107,160 * Service Corporation International 665,464 44
7,730 * Symbion, Inc. 124,492 8
14,100 * Watson Pharmaceuticals, Inc. 415,386 28
- ----------------------------------------------------------------------------------------------------------------------
26,861,817 1,782
- ----------------------------------------------------------------------------------------------------------------------
Industrials--10.8%
92,140 * Apollo Group, Inc. - Class "A" 6,760,312 449
11,700 Arkansas Best Corporation 428,454 28
18,000 * DiamondCluster International, Inc. 219,600 14
17,700 * Education Management Corporation 471,528 31
10,570 General Dynamics Corporation 1,079,197 72
71,570 General Electric Company 2,403,321 159
27,270 Jackson Hewitt Tax Service, Inc. 551,672 37
20,330 * Navigant Consulting, Inc. 446,447 30
16,400 PACCAR, Inc. 1,133,568 75
10,400 Parker-Hannifin Corporation 612,144 41
27,700 Rockwell Collins, Inc. 1,028,778 68
33,070 * Sirva, Inc. 757,303 50
7,330 * Yellow Roadway Corporation 343,704 23
- ----------------------------------------------------------------------------------------------------------------------
16,236,028 1,077
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Information Technology--39.3%
27,300 * Accenture, Ltd. - Class "A" $738,465 $49
21,700 Acxiom Corporation 515,158 34
74,300 * Aeroflex, Inc. 785,351 52
38,300 * Amdocs, Ltd. 836,089 56
92,810 Analog Devices, Inc. 3,599,172 239
14,600 CDW Corporation 847,238 56
149,070 * Cisco Systems, Inc. 2,698,167 179
27,000 * Cognizant Technology Solutions
Corporation - Class "A" 823,770 55
237,240 * Corning, Inc. 2,628,619 174
153,740 * Dell, Inc. 5,473,144 363
95,360 * Electronic Arts, Inc. 4,385,606 291
138,210 * EMC Corporation 1,594,943 106
122,170 First Data Corporation 5,314,395 353
7,500 * Intuit, Inc. 340,500 23
101,740 * MEMC Electronic Materials, Inc. 862,755 57
119,080 Microsoft Corporation 3,292,562 219
37,950 * MPS Group, Inc. 319,160 21
21,580 * NAVTEQ 769,111 51
52,200 * Network Appliance, Inc. 1,200,600 80
8,180 Plantronics, Inc. 353,703 23
28,370 * Polycom, Inc. 562,293 37
20,600 * Red Hat, Inc. 252,144 17
114,740 * Research in Motion, Ltd. 8,759,252 581
46,510 * Sapient Corporation 354,871 24
19,160 * SERENA Software, Inc. 320,547 21
15,200 * Symantec Corporation 834,176 55
63,400 * Tellabs, Inc. 582,646 39
19,490 * THQ, Inc. 379,275 25
17,500 * VeriSign, Inc. 347,900 23
86,390 Xilinx, Inc. 2,332,530 155
208,090 * Yahoo!, Inc. 7,056,332 468
- ----------------------------------------------------------------------------------------------------------------------
59,160,474 3,926
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS ALL-CAP GROWTH FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Materials--.8%
18,740 Arch Coal, Inc. $665,083 $44
36,290 * GrafTech International, Ltd. 506,246 34
- ----------------------------------------------------------------------------------------------------------------------
1,171,329 78
- ----------------------------------------------------------------------------------------------------------------------
Telecommunication Services--2.4%
81,080 * American Tower Corporation - Class "A" 1,244,578 83
96,620 * Crown Castle International Corporation 1,437,706 95
39,800 * Nextel Communications, Inc. - Class "A" 948,830 63
- ----------------------------------------------------------------------------------------------------------------------
3,631,114 241
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Common Stocks (cost $120,494,286) 143,536,047 9,525
- ----------------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--5.4%
$8,150M BNP Paribas, 1.72%, dated 9/30/04, to be
repurchased at $8,150,389 on 10/1/04
(collateralized by U.S. Treasury Bonds,
10.75%, 8/15/05, valued at $8,310,246)
(cost $8,150,000) 8,150,000 540
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Investments (cost $128,644,286) 100.7% 151,686,047 10,065
Excess of Liabilities Over Other Assets (.7) (985,442) (65)
- ----------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $150,700,605 $10,000
======================================================================================================================
* Non-income producing
Summary of Abbreviations:
ADR American Depositary Receipts
See notes to financial statements
Portfolio Managers' Letter
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
Dear Investor:
This is the annual report for the First Investors Mid-Cap Opportunity Fund
for the fiscal year ended September 30, 2004. During the period, the
Fund's return on a net asset value basis was 18.4% for Class A shares and
17.6% for Class B shares.
The Fund's performance was largely driven by rising oil and natural gas
prices, consolidation in commercial banking, solid performance of the
mid-cap stock sector and asset allocation decisions. Performance on an
absolute basis was attributable to investments in two key sectors: energy
and financials. Shares of commercial banks and thrift institutions were
key contributors in the financials sector, aided by merger and acquisition
activity. Meaningful contributions also came from the consumer
discretionary, health care and industrials sectors.
On a relative basis, the Fund outperformed the Standard & Poor's 400
Midcap Index due to its overweight positions within the energy and health
care sectors. Within the energy sector, strength came from the oil and gas
exploration and equipment companies. Among health care sector holdings,
shares of HMOs, pharmacy benefit managers and medical supply firms rose
sharply.
Thank you for placing your trust in First Investors. As always, we
appreciate the opportunity to serve your investment needs.
Sincerely,
/s/ EDWIN D. MISKA
Edwin D. Miska
Director of Equities
and Co-Portfolio Manager
/s/ STEVEN S. HILL
Steven S. Hill
Co-Portfolio Manager
October 29, 2004
Fund Expenses
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
The examples below show the ongoing costs (in dollars) of investing in
your Fund and will help you in comparing those costs with those of other
mutual funds. Please refer to page 3 for a detailed explanation of the
information presented in these examples.
- --------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- --------------------------------------------------------------------------------------------
Actual $1,000.00 $994.74 $7.63
Hypothetical (5% return before expenses) $1,000.00 $1,017.35 $7.72
- --------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- --------------------------------------------------------------------------------------------
Actual $1,000.00 $991.07 $11.10
Hypothetical (5% return before expenses) $1,000.00 $1,013.85 $11.23
- --------------------------------------------------------------------------------------------
* Expenses are equal to the annualized expense ratio of 1.53% for Class A
shares and 2.23% for Class B shares, multiplied by the average account
value over the period, multiplied by 183/366 (to reflect the one-half
year period). Expenses paid during the period are net of expenses waived.
Portfolio Composition
TOP TEN SECTORS
(BAR CHART: Top Ten Sectors)
Financials 20.2%
Consumer Discretionary 16.1%
Information Technology 15.2%
Health Care 14.1%
Industrials 10.6%
Energy 9.0%
Materials 4.9%
Consumer Staples 3.9%
Utilities 2.1%
Other 0.8%
Portfolio's holdings and allocations are subject to change. Percentages
are as of September 30, 2004, and are based on total market value of
investments.
Cumulative Performance Information
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
Comparison of change in value of $10,000 investment in the First Investors
Mid-Cap Opportunity Fund (Class A shares) and the Standard & Poor's 400
Midcap Index.
First Investors Mid-Cap Opportunity Fund
Graph Plot Points
for the periods Ended 9/30/04
S&P 400
Mid-Cap MIDCAP
Fund Index
Oct-94 $ 9,425 $10,000
Oct-95 11,664 12,123
Oct-96 13,022 14,228
Oct-97 16,550 18,873
Sep-98 13,833 18,483
Sep-99 20,011 23,190
Sep-00 29,298 33,213
Sep-01 19,712 26,903
Sep-02 17,633 25,640
Sep-03 21,432 32,513
Sep-04 25,377 38,221
(INSET BOX IN CHART READS:)
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 18.41% 11.60%
Five Years 4.87% 3.63%
Ten Years 10.70% 10.05%
Class B Shares
One Year 17.55% 13.55%
Five Years 4.13% 3.79%
Since Inception
(1/12/95) 9.55% 9.55%
The graph compares a $10,000 investment in the First Investors Mid-Cap
Opportunity Fund (Class A shares) beginning 10/31/94 with a theoretical
investment in the Standard & Poor's 400 Midcap Index (the "Index"). The
Index is an unmanaged capitalization-weighted index of 400 stocks
designed to measure the performance of the mid-range sector of the U.S.
stock market where the median market capitalization is approximately
$700 million. It is not possible to invest directly in this Index. In
addition, the Index does not take into account fees and expenses that
an investor would incur in purchasing securities in the Index. For
purposes of the graph and the accompanying table, unless otherwise
indicated, it has been assumed that the maximum sales charge was
deducted from the initial $10,000 investment in the Fund and all
dividends and distributions were reinvested. Class B shares performance
may be greater than or less than that shown in the line graph above for
Class A shares based on differences in sales loads and fees paid by
shareholders investing in the different classes.
* Average Annual Total Return figures (for the periods ended 9/30/04)
include the reinvestment of all dividends and distributions. "N.A.V. Only"
returns are calculated without sales charges. The Class A "S.E.C.
Standardized" returns shown are based on the maximum sales charge of 5.75%
(prior to 6/17/02, the maximum sales charge was 6.25%). The Class B
"S.E.C. Standardized" returns are adjusted for the applicable deferred
sales charge (maximum of 4% in the first year). During the periods shown,
some of the expenses of the Fund were waived or assumed. If such expenses
had been paid by the Fund, the Class A "S.E.C. Standardized" Average
Annual Total Returns for One Year, Five Years and Ten Years would have
been 11.42%, 3.41% and 9.62%, respectively. The Class B "S.E.C.
Standardized" Average Annual Total Returns for One Year, Five Years and
Since Inception would have been 13.38%, 3.55% and 9.10%, respectively.
Results represent past performance and do not indicate future results.The
graph and the returns shown do not reflect the deduction of taxes that a
shareholder would pay on distributions or the redemption of fund shares.
Investment return and principal value of an investment will fluctuate so
that an investor's shares, when redeemed, may be worth more or less than
the original cost. Standard & Poor's 400 Midcap Index figures are from
Standard & Poor's and all other figures are from First Investors
Management Company, Inc.
Portfolio of Investments
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS--97.0%
Consumer Discretionary--16.1%
55,000 American Axle & Manufacturing Holdings, Inc. $1,609,300 $50
27,200 American Eagle Outfitters, Inc. 1,002,320 31
120,000 * AnnTaylor Stores Corporation 2,808,000 87
56,250 Applebee's International, Inc. 1,422,000 44
27,500 * Barnes & Noble, Inc. 1,017,500 31
105,000 Blockbuster, Inc. - Class "A" 796,950 25
49,000 BorgWarner, Inc. 2,121,210 66
35,000 * Chico's FAS, Inc. 1,197,000 37
45,000 * Coach, Inc. 1,908,900 59
75,000 * Cost Plus, Inc. 2,653,500 82
220,000 * GameStop Corporation - Class "A" 4,072,200 126
52,100 Hasbro, Inc. 979,480 30
115,000 * Hollywood Entertainment Corporation 1,135,050 35
82,500 K-Swiss, Inc. - Class "A" 1,588,125 49
40,000 Landry's Restaurants, Inc. 1,091,600 34
30,000 Lear Corporation 1,633,500 50
80,000 Leggett & Platt, Inc. 2,248,000 69
45,000 Mattel, Inc. 815,850 25
75,000 Movie Gallery, Inc. 1,314,750 41
167,000 * Office Depot, Inc. 2,510,010 78
125,000 * Pacific Sunwear of California, Inc. 2,631,250 81
65,000 Pier 1 Imports, Inc. 1,175,200 36
56,100 Polo Ralph Lauren Corporation - Class "A" 2,040,357 63
140,000 * Quiksilver, Inc. 3,558,800 110
60,000 Regis Corporation 2,413,200 75
50,000 Ross Stores, Inc. 1,172,000 36
27,500 Tiffany & Company 845,350 26
62,800 TJX Companies, Inc. 1,384,112 43
20,000 * Tuesday Morning Corporation 618,400 19
50,000 Tupperware Corporation 849,000 26
13,500 * Warnaco Group, Inc. 300,105 9
30,000 * Williams-Sonoma, Inc. 1,126,500 35
- ----------------------------------------------------------------------------------------------------------------------
52,039,519 1,608
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Consumer Staples--3.9%
30,000 Altria Group, Inc. $1,411,200 $43
200,000 * Chiquita Brands International, Inc. 3,482,000 108
30,000 Coca-Cola Enterprises, Inc. 567,000 17
58,900 Hormel Foods Corporation 1,577,342 49
60,000 * Performance Food Group Company 1,422,000 44
120,000 * Smithfield Foods, Inc. 3,000,000 93
39,800 Tootsie Roll Industries, Inc. 1,162,956 36
- ----------------------------------------------------------------------------------------------------------------------
12,622,498 390
- ----------------------------------------------------------------------------------------------------------------------
Energy--9.0%
40,000 Anadarko Petroleum Corporation 2,654,400 82
155,000 Chesapeake Energy Corporation 2,453,650 76
46,900 EOG Resources, Inc. 3,088,365 95
75,000 * Grant Prideco, Inc. 1,536,750 47
40,000 Patterson-UTI Energy, Inc. 762,800 24
80,000 Suncor Energy, Inc. 2,560,800 79
120,000 * Swift Energy Company 2,875,200 89
142,500 Talisman Energy, Inc. 3,690,750 114
77,500 * Transocean, Inc. 2,772,950 86
50,000 * Weatherford International, Ltd. 2,551,000 79
126,366 XTO Energy, Inc. 4,104,368 127
- ----------------------------------------------------------------------------------------------------------------------
29,051,033 898
- ----------------------------------------------------------------------------------------------------------------------
Financials--20.3%
40,000 Ambac Financial Group, Inc. 3,198,000 99
35,000 Astoria Financial Corporation 1,242,150 38
80,000 Banknorth Group, Inc. 2,800,000 87
30,000 Bear Stearns Companies, Inc. 2,885,100 89
37,488 Citigroup, Inc. 1,653,971 51
30,000 City National Corporation 1,948,500 60
50,000 Colonial BancGroup, Inc. 1,022,500 32
100,000 * Conseco, Inc. 1,766,000 55
56,250 Doral Financial Corporation 2,332,688 72
73,000 Endurance Specialty Holdings, Ltd. 2,346,950 73
35,000 Greater Bay Bancorp 1,006,250 31
57,500 GreenPoint Financial Corporation 2,668,575 83
95,000 Hub International, Ltd. 1,717,600 53
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Financials (continued)
60,000 Independence Community Bank Corporation $2,343,000 $72
175,000 Janus Capital Group, Inc. 2,381,750 74
55,000 KeyCorp 1,738,000 54
60,000 Montpelier Re Holdings, Ltd. 2,200,800 68
80,000 National Commerce Financial Corporation 2,736,800 85
111,666 New York Community Bancorp, Inc. 2,293,620 71
135,000 NewAlliance Bancshares, Inc. 1,937,250 60
42,500 North Fork Bancorporation, Inc. 1,889,125 58
60,000 Old Republic International Corporation 1,501,800 47
44,400 PartnerRe, Ltd. 2,428,236 75
60,900 Protective Life Corporation 2,393,979 74
40,000 Provident Financial Services, Inc. 690,000 21
40,000 SAFECO Corporation 1,826,000 56
110,000 South Financial Group, Inc. 3,102,000 96
200,640 Sovereign Bancorp, Inc. 4,377,965 135
81,500 Willis Group Holdings, Ltd. 3,048,100 94
33,000 Zions Bancorporation 2,014,320 62
- ----------------------------------------------------------------------------------------------------------------------
65,491,029 2,025
- ----------------------------------------------------------------------------------------------------------------------
Health Care--14.1%
84,150 * Accredo Health, Inc. 1,983,415 61
33,000 Aetna, Inc. 3,297,690 102
14,000 AmerisourceBergen Corporation 751,940 23
52,500 * Anthem, Inc. 4,580,625 142
40,000 * Barrier Therapeutics, Inc. 486,400 15
42,500 Beckman Coulter, Inc. 2,385,100 74
40,000 Biomet, Inc. 1,875,200 58
130,000 * Caremark Rx, Inc. 4,169,100 129
113,000 * Centene Corporation 4,811,540 149
54,000 * Charles River Laboratories International, Inc. 2,473,200 76
95,000 * Community Health Systems, Inc. 2,534,600 78
40,000 DENTSPLY International, Inc. 2,077,600 64
10,000 * Express Scripts, Inc. 653,400 20
32,500 * Forest Laboratories, Inc. 1,461,850 45
50,000 * Gilead Sciences, Inc. 1,869,000 58
35,000 * Henry Schein, Inc. 2,180,850 68
75,000 * Idenix Pharmaceuticals, Inc. 1,200,000 37
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Health Care (continued)
35,000 * IDX Systems Corporation $1,135,750 $35
35,000 * Laboratory Corporation of America Holdings 1,530,200 47
25,600 * Neurocrine Biosciences, Inc. 1,207,296 37
85,000 * Priority Healthcare Corporation - Class "B" 1,712,750 53
40,000 * Triad Hospitals, Inc. 1,377,600 43
- ----------------------------------------------------------------------------------------------------------------------
45,755,106 1,414
- ----------------------------------------------------------------------------------------------------------------------
Industrials--10.6%
123,100 * AGCO Corporation 2,784,522 86
135,000 American Power Conversion Corporation 2,347,650 73
29,300 Avery Dennison Corporation 1,927,354 60
93,500 Chicago Bridge & Iron Company
NV - NY Shares 2,804,065 87
23,333 * ChoicePoint, Inc. 995,152 31
41,000 FedEx Corporation 3,513,290 109
20,000 L-3 Communications Holdings, Inc. 1,340,000 41
35,000 Manpower, Inc. 1,557,150 48
91,400 Masco Corporation 3,156,042 97
50,000 * Mobile Mini, Inc. 1,240,000 38
75,000 Northrop Grumman Corporation 3,999,750 124
225,000 * Pinnacle Airlines Corporation 2,272,500 70
30,900 Rockwell Automation, Inc. 1,195,830 37
62,500 * Shaw Group, Inc. 750,000 23
59,300 SPX Corporation 2,099,220 65
57,600 * United Defense Industries, Inc. 2,303,424 71
- ----------------------------------------------------------------------------------------------------------------------
34,285,949 1,060
- ----------------------------------------------------------------------------------------------------------------------
Information Technology--15.2%
75,200 * Amphenol Corporation - Class "A" 2,576,352 80
175,000 * Catalyst Semiconductor, Inc. 1,041,250 32
37,500 * CheckFree Corporation 1,037,625 32
125,000 * Comverse Technology, Inc. 2,353,750 73
65,000 * DigitalNet Holdings, Inc. 1,963,975 61
35,000 * DST Systems, Inc. 1,556,450 48
100,000 * Electronics for Imaging, Inc. 1,624,000 50
71,250 Fair Isaac Corporation 2,080,500 64
135,000 * Ingram Micro, Inc. - Class "A" 2,173,500 67
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS MID-CAP OPPORTUNITY FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Information Technology (continued)
27,900 * International Rectifier Corporation $956,970 $30
100,000 Intersil Corporation - Class "A" 1,593,000 49
62,500 * Intuit, Inc. 2,837,500 88
220,000 * Lexar Media, Inc. 1,845,800 57
59,700 * Manhattan Associates, Inc. 1,457,874 45
105,000 * McAfee, Inc. 2,110,500 65
17,700 * NAVTEQ Corporation 630,828 19
41,300 * Novellus Systems, Inc. 1,098,167 34
125,000 * Paxar Corporation 2,835,000 88
75,000 * SanDisk Corporation 2,184,000 68
35,000 * Semtech Corporation 670,950 21
80,000 * Storage Technology Corporation 2,020,800 62
75,600 * SunGard Data Systems, Inc. 1,797,012 56
85,000 * Sybase, Inc. 1,172,150 36
100,000 * Tellabs, Inc. 919,000 28
70,000 * Thermo Electron Corporation 1,891,400 58
160,000 * VERITAS Software Corporation 2,848,000 88
125,000 * Vishay Intertechnology, Inc. 1,612,500 50
50,000 * Waters Corporation 2,205,000 68
- ----------------------------------------------------------------------------------------------------------------------
49,093,853 1,517
- ----------------------------------------------------------------------------------------------------------------------
Materials--4.9%
50,000 Freeport-McMoRan Copper &
Gold, Inc. - Class "B" 2,025,000 62
60,000 Georgia-Pacific Corporation 2,157,000 67
50,000 * Headwaters, Inc. 1,543,000 48
65,000 Louisiana-Pacific Corporation 1,686,750 52
50,000 Lubrizol Corporation 1,730,000 53
80,000 MeadWestvaco Corporation 2,552,000 79
50,000 Praxair, Inc. 2,137,000 66
90,000 Sappi, Ltd. (ADR) 1,288,800 40
21,300 United States Steel Corporation 801,305 25
- ----------------------------------------------------------------------------------------------------------------------
15,920,855 492
- ----------------------------------------------------------------------------------------------------------------------
Other--.8%
25,000 MidCap SPDR Trust - Series "1" 2,713,250 84
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
Shares or For Each
Principal $10,000 of
Amount Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Utilities--2.1%
59,500 AGL Resources, Inc. $1,830,815 $57
30,000 Equitable Resources, Inc. 1,629,300 50
47,000 SCANA Corporation 1,754,980 54
51,000 Wisconsin Energy Corporation 1,626,900 50
- ----------------------------------------------------------------------------------------------------------------------
6,841,995 211
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Common Stocks (cost $261,264,505) 313,815,087 9,699
- ----------------------------------------------------------------------------------------------------------------------
SHORT-TERM CORPORATE NOTES--2.2%
$1,400M Coca-Cola Co., 1.74%, 10/19/04 1,398,782 43
3,000M General Electric Co., 1.75%, 10/6/04 2,999,270 93
2,700M Toyota Motor Credit Co., 1.73%, 10/21/04 2,697,405 83
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Short-Term Corporate Notes (cost $7,095,457) 7,095,457 219
- ----------------------------------------------------------------------------------------------------------------------
SHORT-TERM U.S. GOVERNMENT AGENCY
OBLIGATIONS--.9%
3,000M Fannie Mae, 1.72%, 10/1/04 (cost $3,000,000) 3,000,000 93
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Investments (cost $271,359,962) 100.1% 323,910,544 10,011
Excess of Liabilities Over Other Assets (.1) (358,876) (11)
- ----------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $323,551,668 $10,000
======================================================================================================================
* Non-income producing
Summary of Abbreviations:
ADR American Depositary Receipts
See notes to financial statements
Portfolio Manager's Letter
FIRST INVESTORS SPECIAL SITUATIONS FUND
Dear Investor:
This is the annual report for the First Investors Special Situations Fund
for the fiscal year ended September 30, 2004. During the period, the
Fund's return on a net asset value basis was 7.7% for Class A shares and
7.0% for Class B shares.
The Fund's positive performance was driven largely by the improving
economy, the rise in energy prices and the solid performance of the
small-cap sector. Its performance was largely the result of investments in
the consumer discretionary, industrials, energy and financials sectors, as
almost all of the Fund's return during the reporting period can be
attributed to these groups.
On a relative basis, the Fund underperformed the Russell 2000 Index for
the reporting period. The Fund's growth-orientation hurt performance, as
shares of growth-oriented, small-cap investments underperformed their
value counterparts during the fiscal year, reversing the trend from fiscal
2003. As evidenced by the comparative style benchmarks, the Russell 2000
Growth Index returned 11.42% versus the Russell 2000 Value Index, which
gained 23.53%.
Specifically, the Fund's underweight positions in the financials,
materials and industrials sectors hurt relative performance. An overweight
position in the technology sector also hurt performance, as shares of
those companies underperformed. Notably, shares within the software and
services industry were the most disappointing. Shares of eCollege.com fell
on lowered growth expectations. Internet-based yellow pages service
provider YP Corp. fell on management upheaval. Shares of Internet service
provider United Online underperformed due to increased competition and
large insider sales.
Thank you for placing your trust in First Investors. As always, we
appreciate the opportunity to serve your investment needs.
Sincerely,
/s/ EDWIN D. MISKA
Edwin D. Miska
Director of Equities
and Portfolio Manager*
October 29, 2004
* Mr. Miska became the Fund's Portfolio Manager on September 1, 2004.
Fund Expenses
FIRST INVESTORS SPECIAL SITUATIONS FUND
The examples below show the ongoing costs (in dollars) of investing in
your Fund and will help you in comparing those costs with those of other
mutual funds. Please refer to page 3 for a detailed explanation of the
information presented in these examples.
- --------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- --------------------------------------------------------------------------------------------
Actual $1,000.00 $924.26 $7.79
Hypothetical (5% return before expenses) $1,000.00 $1,016.90 $8.17
- --------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- --------------------------------------------------------------------------------------------
Actual $1,000.00 $921.71 $11.16
Hypothetical (5% return before expenses) $1,000.00 $1,013.40 $11.68
- --------------------------------------------------------------------------------------------
* Expenses are equal to the annualized expense ratio of 1.62% for Class A
shares and 2.32% for Class B shares, multiplied by the average account
value over the period, multiplied by 183/366 (to reflect the one-half
year period). Expenses paid during the period are net of expenses waived.
Portfolio Composition
TOP TEN SECTORS
(BAR CHART: Top Ten Sectors)
Information Technology 23.2%
Health Care 20.7%
Consumer Discretionary 14.4%
Industrials 13.9%
Financials 9.4%
Energy 7.8%
Materials 3.0%
Telecommunication Services 2.7%
Other 1.6%
Consumer Staples 0.8%
Portfolio's holdings and allocations are subject to change. Percentages
are as of September 30, 2004, and are based on total market value of
investments.
Cumulative Performance Information
FIRST INVESTORS SPECIAL SITUATIONS FUND
Comparison of change in value of $10,000 investment in the First Investors
Special Situations Fund (Class A shares) and the Russell 2000 Index.
First Investors Special Situations Fund
Graph Plot Points
for the periods Ended 9/30/04
Special Russell
Situations 2000
Fund Index
Dec-94 $ 9,425 $10,000
Dec-95 11,682 12,621
Dec-96 13,032 14,709
Dec-97 15,136 17,981
Sep-98 12,167 15,094
Sep-99 15,968 17,986
Sep-00 22,846 22,233
Sep-01 13,053 17,543
Sep-02 10,901 15,917
Sep-03 13,458 21,732
Sep-04 14,500 25,823
(INSET BOX IN CHART READS:)
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 7.74% 1.57%
Five Years (1.91%) (3.07%)
Ten Years 4.09% 3.48%
Class B Shares
One Year 7.03% 3.03%
Five Years (2.60%) (3.00%)
Since Inception
(1/12/95) 3.75% 3.75%
The graph compares a $10,000 investment in the First Investors Special
Situations Fund (Class A shares) beginning 12/31/94 with a theoretical
investment in the Russell 2000 Index (the "Index"). The Index consists of
the smallest 2,000 companies in the Russell 3000 Index (which represents
approximately 98% of the investable U.S. equity market). The Index is an
unmanaged index generally considered as the premier of small
capitalization stocks. It is not possible to invest directly in this
Index. In addition, the Index does not take into account fees and
expenses. For purposes of the graph and the accompanying table, unless
otherwise indicated, it has been assumed that the maximum sales charge was
deducted from the initial $10,000 investment in the Fund and all dividends
and distributions were reinvested. Class B shares performance may be
greater than or less than that shown in the line graph above for Class A
shares based on differences in the sales loads and fees paid by
shareholders investing in the different classes.
* Average Annual Total Return figures (for the periods ended 9/30/04)
include the reinvestment of all dividends and distributions. "N.A.V. Only"
returns are calculated without sales charges. The Class A "S.E.C.
Standardized" returns shown are based on the maximum sales charge of 5.75%
(prior to 6/17/02, the maximum sales charge was 6.25%). The Class B "S.E.C.
Standardized" returns are adjusted for the applicable deferred sales charge
(maximum of 4% in the first year). During the periods shown, some of the
expenses of the Fund were waived or assumed. If such expenses had been paid
by the Fund, the Class A "S.E.C. Standardized" Average Annual Total Returns
for One Year, Five Years and Ten Years would have been 1.34%, (3.30%) and
3.24%, respectively. The Class B "S.E.C. Standardized" Average Annual Total
Returns for One Year, Five Years and Since Inception would have been 2.80%,
(3.21%) and 3.50%, respectively. Results represent past performance and do
not indicate future results.The graph and the returns shown do not reflect
the deduction of taxes that a shareholder would pay on distributions or the
redemption of fund shares. Investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than the original cost. Russell 2000 Index figures are
from Frank Russell and Company and all other figures are from First
Investors Management Company, Inc.
Portfolio of Investments
FIRST INVESTORS SPECIAL SITUATIONS FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS--97.3%
Consumer Discretionary--14.4%
124,950 * Aeropostale, Inc. $3,273,690 $156
41,700 * Arbitron, Inc. 1,526,637 73
209,800 * Champion Enterprises, Inc. 2,158,842 103
80,100 Claire's Stores, Inc. 2,005,704 95
96,500 Foot Locker, Inc. 2,287,050 109
27,400 * Getty Images, Inc. 1,515,220 72
24,600 * Guitar Center, Inc. 1,065,180 51
77,900 * Jarden Corporation 2,842,571 135
55,687 * Jos. A. Bank Clothiers, Inc. 1,541,416 73
97,900 * Keystone Automotive Industries, Inc. 2,153,800 102
111,400 * Navigant International, Inc. 1,819,162 87
60,300 * Quiksilver, Inc. 1,532,826 73
78,200 * Scientific Games Corporation - Class "A" 1,493,620 71
102,300 * Source Interlink Companies, Inc. 994,356 47
48,200 * Urban Outfitters, Inc. 1,658,080 79
109,200 * Warnaco Group, Inc. 2,427,516 116
- ----------------------------------------------------------------------------------------------------------------------
30,295,670 1,442
- ----------------------------------------------------------------------------------------------------------------------
Consumer Staples--.8%
273,800 * Star Scientific, Inc. 1,620,896 77
- ----------------------------------------------------------------------------------------------------------------------
Energy--7.8%
47,200 Ashland, Inc. 2,646,976 126
87,900 Chesapeake Energy Corporation 1,391,457 66
105,800 * Energy Partners, Ltd. 1,722,424 82
45,700 Overseas Shipholding Group, Inc. 2,268,548 108
86,000 Patterson-UTI Energy, Inc. 1,640,020 78
61,000 Stelmar Shipping, Ltd. 2,306,410 110
71,700 * Swift Energy Company 1,717,932 82
56,450 * TETRA Technologies, Inc. 1,752,773 83
27,000 World Fuel Services Corporation 966,600 46
- ----------------------------------------------------------------------------------------------------------------------
16,413,140 781
- ----------------------------------------------------------------------------------------------------------------------
Financials--9.3%
35,500 * Affiliated Managers Group, Inc. 1,900,670 91
41,100 * First Marblehead Corporation 1,907,040 91
51,800 HCC Insurance Holdings, Inc. 1,561,770 74
103,700 MoneyGram International, Inc. 1,771,196 84
30,600 Montpelier Re Holdings, Ltd. 1,122,408 54
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS SPECIAL SITUATIONS FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Financials (continued)
53,200 Odyssey Re Holdings Corporation $1,179,976 $56
182,800 Origen Financial, Inc. 1,345,408 64
62,300 RAIT Investment Trust 1,703,905 81
80,500 * Saxon Capital, Inc. (REIT) 1,730,750 82
52,800 Thornburg Mortgage, Inc. 1,531,728 73
78,000 Ventas, Inc. 2,021,760 96
43,300 Westcorp, Inc. 1,841,116 88
- ----------------------------------------------------------------------------------------------------------------------
19,617,727 934
- ----------------------------------------------------------------------------------------------------------------------
Health Care--20.7%
69,100 * AmSurg Corporation 1,463,538 70
154,700 * Aspect Medical Systems, Inc. 2,798,523 133
71,000 * Centene Corporation 3,023,180 144
58,300 * CV Therapeutics, Inc. 728,750 35
70,100 * DaVita, Inc. 2,183,615 104
153,100 * Discovery Laboratories, Inc. 1,025,770 49
642,800 * Endocare, Inc. 1,780,556 85
21,600 * Fisher Scientific International, Inc. 1,259,928 60
23,700 * Gen-Probe, Inc. 944,919 45
75,900 * LabOne, Inc. 2,218,557 106
72,800 Matthews International Corporation - Class "A" 2,466,464 117
39,900 Medicis Pharmaceutical Corporation - Class "A" 1,557,696 74
62,500 * MGI Pharma, Inc. 1,668,125 79
289,500 * MIM Corporation 1,673,310 80
86,600 * Nabi Biopharmaceuticals 1,158,708 55
22,900 * Neurocrine Biosciences, Inc. 1,079,964 51
29,900 * Onyx Pharmaceuticals, Inc. 1,285,999 61
93,900 PolyMedica Corporation 2,892,120 138
79,700 * Psychiatric Solutions, Inc. 2,020,395 96
84,630 * SFBC International, Inc. 2,226,615 106
201,600 * SuperGen, Inc. 1,245,888 59
208,300 * TriPath Imaging, Inc. 1,703,894 81
93,000 * VCA Antech, Inc. 1,918,590 91
151,600 West Pharmaceutical Services, Inc. 3,160,860 150
- ----------------------------------------------------------------------------------------------------------------------
43,485,964 2,069
- ----------------------------------------------------------------------------------------------------------------------
Industrials--13.8%
93,400 Angelica Corporation 2,323,792 111
110,600 * Commercial Vehicle Group, Inc. 1,751,904 83
42,400 * Education Management Corporation 1,129,536 54
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Industrials (continued)
30,500 * ESCO Technologies, Inc. $2,066,680 $98
261,700 * EVCI Career Colleges, Inc. 1,848,910 88
136,900 Healthcare Services Group, Inc. 2,458,724 117
45,500 * II-VI, Inc. 1,592,955 76
197,800 * Kansas City Southern 3,000,626 143
57,600 * MTC Technologies, Inc. 1,591,488 76
30,500 Oshkosh Truck Corporation 1,740,330 83
83,900 Ritchie Brothers Auctioneers, Inc. 2,571,535 122
109,700 * SI International, Inc. 2,824,199 134
82,200 United Industrial Corporation 2,703,558 129
70,300 Wabtec Corporation 1,313,907 62
- ----------------------------------------------------------------------------------------------------------------------
28,918,144 1,376
- ----------------------------------------------------------------------------------------------------------------------
Information Technology--23.2%
100,300 * ATMI, Inc. 2,054,144 98
88,200 BEI Technologies, Inc. 2,416,680 115
63,000 * Catapult Communications Corporation 1,186,920 56
72,600 * Cognizant Technology Solutions
Corporation - Class "A" 2,215,026 105
434,200 * CyberSource Corporation 2,097,186 100
56,900 * Digital River, Inc. 1,694,482 81
100,000 * Epicor Software Corporation 1,203,000 57
125,600 * FindWhat.com 2,352,488 112
88,100 * Global Imaging Systems, Inc. 2,738,148 130
35,800 * Hyperion Solutions Corporation 1,216,842 58
55,500 * Integrated Circuit Systems, Inc. 1,193,250 57
72,200 * Intergraph Corporation 1,961,674 93
30,800 * International Rectifier Corporation 1,056,440 50
141,500 * Intervoice, Inc. 1,523,955 72
123,300 * Measurement Specialties, Inc. 3,064,005 146
269,600 * MEMC Electronic Materials, Inc. 2,286,208 109
51,200 * MICROS Systems, Inc. 2,563,584 122
379,200 * Optimal Group, Inc. 3,481,056 166
130,500 * Overland Storage, Inc. 1,825,695 87
205,500 QAD, Inc. 1,432,335 68
73,300 * Sigmatel, Inc. 1,554,693 74
61,400 StarTek, Inc. 1,925,504 92
180,900 * TIBCO Software, Inc. 1,539,459 73
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS SPECIAL SITUATIONS FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
Shares or For Each
Principal $10,000 of
Amount Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Information Technology (continued)
242,200 * Tyler Technologies, Inc. $2,141,048 $102
38,200 * Varian Semiconductor Equipment
Associates, Inc. 1,180,380 56
129,600 * ZiLOG, Inc. 747,792 36
- ----------------------------------------------------------------------------------------------------------------------
48,651,994 2,315
- ----------------------------------------------------------------------------------------------------------------------
Materials--3.0%
139,300 AMCOL International Corporation 2,663,416 127
97,200 * Headwaters, Inc. 2,999,592 143
39,300 Penford Corporation 684,213 32
- ----------------------------------------------------------------------------------------------------------------------
6,347,221 302
- ----------------------------------------------------------------------------------------------------------------------
Other--1.6%
35,000 iShares S&P Midcap 400 Index 2,049,950 98
98,800 Technology Investment Capital Corporation 1,383,200 66
- ----------------------------------------------------------------------------------------------------------------------
3,433,150 164
- ----------------------------------------------------------------------------------------------------------------------
Telecommunication Services--2.7%
46,200 * NII Holdings, Inc. - Class "B" 1,903,902 91
168,100 * PTEK Holdings, Inc. 1,440,617 68
87,200 * Western Wireless Corporation - Class "A" 2,241,912 107
- ----------------------------------------------------------------------------------------------------------------------
5,586,431 266
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Common Stocks (cost $169,768,012) 204,370,337 9,726
- ----------------------------------------------------------------------------------------------------------------------
SHORT-TERM U.S. GOVERNMENT AGENCY
OBLIGATIONS--2.5%
$5,300M Fannie Mae, 1.72% 10/1/04 (cost $5,300,000) 5,300,000 252
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Investments (cost $175,068,012) 99.8% 209,670,337 9,978
Other Assets, Less Liabilities .2 470,405 22
- ----------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $210,140,742 $10,000
======================================================================================================================
* Non-income producing
Summary of Abbreviations:
REIT Real Estate Investment Trust
See notes to financial statements
Portfolio Manager's Letter
FIRST INVESTORS FOCUSED EQUITY FUND
Dear Investor:
This is the annual report for the First Investors Focused Equity Fund for
the fiscal year ended September 30, 2004. During the period, the Fund's
return on a net asset value basis was 8.3% for Class A shares and 7.6% for
Class B shares.
The Fund's performance during the reporting period was driven by a
combination of the solid performance of the equity markets and the
concentrated nature of the Fund. The Fund's performance was helped by top
absolute contributors Chevron and Schlumberger, which benefited from higher
oil prices and refining margins.
Several broad issues were factors in the Fund's underperformance relative
to the Standard & Poor's 500 (S&P 500) Index. In general, the Fund was
positioned for an economic recovery that did not play out as strongly as
expected. The Fund's focus on high quality, large-cap stocks was a drag on
performance, as they underperformed smaller capitalization classes.
Specifically, stock selection was the primary contributor to the Fund's
underperformance relative to the S&P 500 Index. The impact of stock
selection has a greater effect on performance because the Fund is
concentrated in less than 50 securities. In particular, stock selection
within the financials, information technology and consumer discretionary
sectors had a negative impact on performance. Inventory issues and slowing
demand plagued Intel and other semiconductor stocks in the portfolio.
Litigation issues hurt Fund holdings in Merrill Lynch and Citigroup. Sector
allocation was also a moderate negative for Fund performance relative to
the S&P 500 Index.
Thank you for placing your trust in First Investors. As always, we
appreciate the opportunity to serve your investment needs.
Sincerely,
/s/ MATTHEW E. MEGARGEL
Matthew E. Megargel
Portfolio Manager
October 29, 2004
Fund Expenses
FIRST INVESTORS FOCUSED EQUITY FUND
The examples below show the ongoing costs (in dollars) of investing in your
Fund and will help you in comparing those costs with those of other mutual
funds. Please refer to page 3 for a detailed explanation of the information
presented in these examples.
- ----------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- ----------------------------------------------------------------------------------------------
Actual $1,000.00 $979.97 $8.91
Hypothetical (5% return before expenses) $1,000.00 $1,016.00 $9.07
- ----------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- ----------------------------------------------------------------------------------------------
Actual $1,000.00 $976.66 $12.35
Hypothetical (5% return before expenses) $1,000.00 $1,012.50 $12.58
- ----------------------------------------------------------------------------------------------
* Expenses are equal to the annualized expense ratio of 1.80% for Class A
shares and 2.50% for Class B shares, multiplied by the average account
value over the period, multiplied by 183/366 (to reflect the one-half year
period).
Portfolio Composition
BY SECTOR
(BAR CHART DATA:)
Information Technology 19.7%
Financials 18.0%
Health Care 14.9%
Industrials 14.7%
Energy 8.6%
Consumer Discretionary 8.2%
Consumer Staples 8.0%
Materials 6.2%
Telecommunication Services 1.4%
Portfolio's holdings and allocations are subject to change. Percentages are
as of September 30, 2004, and are based on total market value of
investments.
Cumulative Performance Information
FIRST INVESTORS FOCUSED EQUITY FUND
Comparison of change in value of $10,000 investment in the First Investors
Focused Equity Fund (Class A shares) and the Standard & Poor's 500 Index.
First Investors Focused Equity Fund
Graph Plot Points
for the periods Ended 9/30/04
Focused
Equity S&P 500
Fund Index
Mar-99 $ 9,425 $10,000
Sep-99 10,254 9,957
Sep-00 9,783 11,279
Sep-01 7,276 8,277
Sep-02 5,401 6,581
Sep-03 6,814 8,187
Sep-04 7,380 9,322
(INSET BOX IN CHART READS:)
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 8.30% 2.09%
Five Years (6.37%) (7.46%)
Since Inception (3/22/99) (4.33%) (5.35%)
Class B Shares
One Year 7.57% 3.57%
Five Years (7.03%) (7.40%)
Since Inception (3/22/99) (5.00%) (5.18%)
The graph compares a $10,000 investment in the First Investors Focused
Equity Fund (Class A shares) beginning 3/22/99 (inception date) with a
theoretical investment in the Standard & Poor's 500 Index (the "Index").
The Index is an unmanaged capitalization-weighted index of 500 stocks
designed to measure the performance of the broad domestic economy through
changes in the aggregate market value of such stocks, which represent all
major industries. It is not possible to invest directly in this Index. In
addition, the Index does not take into account fees and expenses that an
investor would incur in purchasing securities in the Index. For purposes
of the graph and the accompanying table, unless otherwise indicated, it has
been assumed that the maximum sales charge was deducted from the initial
$10,000 investment in the Fund. Class B shares performance may be greater
than or less than that shown in the line graph above for Class A shares
based on differences in sales loads and fees paid by shareholders investing
in the different lasses.
* Average Annual Total Return figures are for the periods ended 9/30/04.
"N.A.V. Only" returns are calculated without sales charges. The Class A
"S.E.C. Standardized" returns shown are based on the maximum sales charge
of 5.75% (prior to 6/17/02 the maximum sales charge was 6.25%). The Class B
"S.E.C. Standardized" returns are adjusted for the applicable deferred
sales charge (maximum of 4% in the first year). During certain of the
periods shown, some of the expenses of the Fund were waived or assumed. If
such expenses had been paid by the Fund, the Class A "S.E.C. Standardized"
Average Annual Total Returns for Five Years and Since Inception would have
been (7.44%) and (5.36%), respectively. The Class B "S.E.C. Standardized"
Average Annual Total Returns for Five Years and Since Inception would have
been (7.38%) and (5.19%), respectively. Results represent past performance
and do not indicate future results.The graph and the returns shown do not
reflect the deduction of taxes that a shareholder would pay on
distributions or the redemption of fund shares. Investment return and
principal value of an investment will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
Standard & Poor's 500 Index figures are from Standard & Poor's and all
other figures are from First Investors Management Company, Inc.
Portfolio of Investments
FIRST INVESTORS FOCUSED EQUITY FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS--99.9%
Consumer Discretionary--8.2%
30,400 Lowe's Companies, Inc. $1,652,240 $275
12,600 NIKE, Inc. - Class "B" 992,880 165
141,700 * Time Warner, Inc. 2,287,038 381
- ----------------------------------------------------------------------------------------------------------------------
4,932,158 821
- ----------------------------------------------------------------------------------------------------------------------
Consumer Staples--8.0%
22,600 Altria Group, Inc. 1,063,104 177
31,200 Gillette Company 1,302,288 217
28,600 PepsiCo, Inc. 1,391,390 231
19,200 Procter & Gamble Company 1,039,104 173
- ----------------------------------------------------------------------------------------------------------------------
4,795,886 798
- ----------------------------------------------------------------------------------------------------------------------
Energy--8.6%
48,200 ChevronTexaco Corporation 2,585,448 430
19,500 GlobalSantaFe Corporation 597,675 99
29,700 Schlumberger, Ltd. 1,999,107 333
- ----------------------------------------------------------------------------------------------------------------------
5,182,230 862
- ----------------------------------------------------------------------------------------------------------------------
Financials--18.1%
16,800 American Express Company 864,528 144
31,220 American International Group, Inc. 2,122,648 353
67,000 Bank of America Corporation 2,903,110 483
58,800 Citigroup, Inc. 2,594,256 432
28,700 Merrill Lynch & Company, Inc. 1,426,964 238
28,884 St. Paul Travelers Companies, Inc. 954,905 159
- ----------------------------------------------------------------------------------------------------------------------
10,866,411 1,809
- ----------------------------------------------------------------------------------------------------------------------
Health Care--14.9%
36,100 Abbott Laboratories 1,529,196 254
17,900 Eli Lilly & Company 1,074,895 179
12,900 * Genzyme Corporation 701,889 117
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Health Care (continued)
28,000 Medtronic, Inc. $1,453,200 $242
77,200 Pfizer, Inc. 2,362,320 393
29,600 Schering-Plough Corporation 564,176 94
33,900 Wyeth 1,267,860 211
- ----------------------------------------------------------------------------------------------------------------------
8,953,536 1,490
- ----------------------------------------------------------------------------------------------------------------------
Industrials--14.8%
4,200 Caterpillar, Inc. 337,890 56
29,600 CSX Corporation 982,720 164
11,700 FedEx Corporation 1,002,573 167
9,300 General Dynamics Corporation 949,530 158
79,900 General Electric Company 2,683,042 446
49,500 Tyco International, Ltd. 1,517,670 253
15,000 United Technologies Corporation 1,400,700 233
- ----------------------------------------------------------------------------------------------------------------------
8,874,125 1,477
- ----------------------------------------------------------------------------------------------------------------------
Information Technology--19.7%
42,800 * Applied Materials, Inc. 705,772 117
64,500 * Cisco Systems, Inc. 1,167,450 194
55,800 * Corning, Inc. 618,264 103
30,300 * Dell, Inc. 1,078,680 179
33,800 First Data Corporation 1,470,300 245
50,700 Intel Corporation 1,017,042 169
128,600 Microsoft Corporation 3,555,790 592
43,300 Motorola, Inc. 781,132 130
31,800 Texas Instruments, Inc. 676,704 113
23,000 * Yahoo!, Inc. 779,930 130
- ----------------------------------------------------------------------------------------------------------------------
11,851,064 1,972
- ----------------------------------------------------------------------------------------------------------------------
Materials--6.2%
31,100 Alcoa, Inc. 1,044,649 174
25,800 Du Pont (E.I.) de Nemours & Company 1,104,240 184
39,400 International Paper Company 1,592,154 265
- ----------------------------------------------------------------------------------------------------------------------
3,741,043 623
- ----------------------------------------------------------------------------------------------------------------------
Telecommunication Services--1.4%
41,200 Sprint Corporation 829,356 138
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Common Stocks (cost $57,271,571) 60,025,809 9,990
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS FOCUSED EQUITY FUND
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
Principal $10,000 of
Amount Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--.4%
$213M BNP Paribas, 1.72%, dated 9/30/04, to be
repurchased at $213,010 on 10/1/04
(collateralized by U.S. Treasury Bonds,
11.25%, 2/15/15, valued at $218,323)
(cost $213,000) $213,000 $36
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Investments (cost $57,484,571) 100.3% 60,238,809 10,026
Excess of Liabilities Over Other Assets (.3) (154,938) (26)
- ----------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $60,083,871 $10,000
======================================================================================================================
* Non-income producing
See notes to financial statements
Portfolio Manager's Letter
FIRST INVESTORS GLOBAL FUND, INC.
Dear Investor:
This is the annual report for the First Investors Global Fund for the
fiscal year ended September 30, 2004. During the period, the Fund's return
on a net asset value basis was 14.9% for Class A shares and 14.1% for Class
B shares.
The Fund's positive overall performance during the reporting period was
driven by improving global economies and solid performance of equity
markets. Foreign markets outperformed U.S. domestic markets during the
period, illustrating the benefit of the Fund's global investment approach.
The Pacific Basin (excluding Japan) led the way with 29.8%, and Europe was
not far behind with 26.1% for the period. Emerging markets stocks also did
well, climbing 23.6%.
Stock selection was strong in the industrials and materials sectors. In
industrials, British Airways benefited from increasing business traffic in
the important trans-Atlantic market and a helpful exchange rate against the
U.S. dollar. Corus Group, a steel company, also did well following internal
restructuring and strong demand from China.
Stock selection in the financials, consumer discretionary and consumer
staples sectors detracted from performance. In financials, European
reinsurance company Converium fell dramatically in value after it announced
that it had under-reserved its U.S. business exposure. Consumer staples
holding Ahold suffered from lingering concerns over its U.S. food service
business due to a competitive pricing environment and rising inflation in
the U.S. retail food market.
Thank you for placing your trust in First Investors. As always, we
appreciate the opportunity to serve your investment needs.
Sincerely,
/s/ TROND SKRAMSTAD
Trond Skramstad
Portfolio Manager
October 29, 2004
Fund Expenses
FIRST INVESTORS GLOBAL FUND, INC.
The examples below show the ongoing costs (in dollars) of investing in your
Fund and will help you in comparing those costs with those of other mutual
funds. Please refer to page 3 for a detailed explanation of the information
presented in these examples.
- ----------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class A Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- ----------------------------------------------------------------------------------------------
Actual $1,000.00 $983.41 $9.17
Hypothetical (5% return before expenses) $1,000.00 $1,015.75 $9.32
- ----------------------------------------------------------------------------------------------
Beginning Ending
Account Account Expenses Paid
Value Value During Period
Expense Example - Class B Shares (4/1/04) (9/30/04) (4/1/04-9/30/04)*
- ----------------------------------------------------------------------------------------------
Actual $1,000.00 $980.46 $12.63
Hypothetical (5% return before expenses) $1,000.00 $1,012.25 $12.83
- ----------------------------------------------------------------------------------------------
* Expenses are equal to the annualized expense ratio of 1.85% for Class A
shares and 2.55% for Class B shares, multiplied by the average account
value over the period, multiplied by 183/366 (to reflect the one-half year
period).
Portfolio Composition
TOP TEN COUNTRIES
(BAR CHART: Top Ten Countries)
United States 46.3%
France 10.8%
United Kingdom 10.0%
Japan 7.8%
Germany 3.8%
Netherlands 3.6%
Switzerland 3.1%
Canada 2.6%
South Korea 2.2%
Belgium 1.5%
Portfolio's holdings and allocations are subject to change. Percentages are
as of September 30, 2004, and are based on total market value of
investments.
Cumulative Performance Information
FIRST INVESTORS GLOBAL FUND, INC.
Comparison of change in value of $10,000 investment in the First Investors
Global Fund, Inc. (Class A shares) and the Morgan Stanley Capital
International ("MSCI") All Country World Free Index.
First Investors Global Fund
Graph Plot Points
for the periods Ended 9/30/04
MSCI
Global All Country
Fund Index
Dec-94 $ 9,425 $10,000
Dec-95 11,098 11,946
Dec-96 12,700 13,523
Dec-97 13,713 15,551
Sep-98 13,542 15,657
Sep-99 17,555 20,496
Sep-00 19,613 22,138
Sep-01 13,951 15,908
Sep-02 11,327 13,078
Sep-03 13,817 16,580
Sep-04 15,879 19,570
(INSET BOX IN CHART READS:)
Average Annual Total Return*
Class A Shares N.A.V. Only S.E.C. Standardized
One Year 14.92% 8.41%
Five Years (1.99%) (3.13%)
Ten Years 5.02% 4.40%
Class B Shares
One Year 14.05% 10.05%
Five Years (2.67%) (3.06%)
Since Inception
(1/12/95) 4.81% 4.81%
The graph compares a $10,000 investment in the First Investors Global Fund,
Inc. (Class A shares) beginning 12/31/94 with a theoretical investment in
the MSCI All Country World Free Index (the "Index"). The Index represents
both the developed and the emerging markets. The Index includes 50 markets
of which emerging markets represent approximately 5.0%. It is not possible
to invest directly in this Index. In addition, the Index does not take into
account fees and expenses that an investor would incur in purchasing
securities in the Index. For purposes of the graph and the accompanying
table, unless otherwise indicated, it has been assumed that the maximum
sales charge was deducted from the initial $10,000 investment in the Fund
and all dividends and distributions were reinvested. Class B shares
performance may be greater than or less than that shown in the line graph
above for Class A shares based on differences in sales loads and fees paid
by shareholders investing in the different classes.
* Average Annual Total Return figures (for the periods ended 9/30/04)
include the reinvestment of all dividends and distributions. "N.A.V. Only"
returns are calculated without sales charges. The Class A "S.E.C.
Standardized" returns shown are based on the maximum sales charge of 5.75%
(prior to 6/17/02, the maximum sales charge was 6.25%). The Class B "S.E.C.
Standardized" returns are adjusted for the applicable deferred sales charge
(maximum of 4% in the first year). Results represent past performance and
do not indicate future results.The graph and the returns shown do not
reflect the deduction of taxes that a shareholder would pay on
distributions or the redemption of fund shares. Investment return and
principal value of an investment will fluctuate so that an investor's
shares, when redeemed, may be worth more or less than the original cost.
MSCI All Country World Free Index figures are from Morgan Stanley & Co.,
Inc. and all other figures are from First Investors Management Company,
Inc.
Portfolio of Investments
FIRST INVESTORS GLOBAL FUND, INC.
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
COMMON STOCKS--97.6%
United States--43.6%
46,100 Abbott Laboratories $1,952,796 $87
10,900 Air Products & Chemicals, Inc. 592,742 26
39,900 Alcoa, Inc. 1,340,241 60
29,100 Altria Group, Inc. 1,368,864 61
23,000 American Express Company 1,183,580 53
39,753 American International Group, Inc. 2,702,806 120
23,500 Analog Devices, Inc. 911,330 41
32,400 Apache Corporation 1,623,564 72
54,900 * Applied Materials, Inc. 905,301 40
32,600 Aramark Corporation - Class "B" 786,964 35
84,800 Bank of America Corporation 3,674,384 164
5,300 Caterpillar, Inc. 426,385 19
64,600 ChevronTexaco Corporation 3,465,144 154
83,000 * Cisco Systems, Inc. 1,502,300 67
75,649 Citigroup, Inc. 3,337,634 149
71,600 * Corning, Inc. 793,328 35
12,200 Countrywide Financial Corporation 480,558 21
55,900 CSX Corporation 1,855,880 83
38,900 * Dell, Inc. 1,384,840 62
32,800 DuPont (E.I.) de Nemours & Company 1,403,840 63
8,600 * Electronic Arts, Inc. 395,514 18
23,800 Eli Lilly & Company 1,429,190 64
15,100 FedEx Corporation 1,293,919 58
42,900 First Data Corporation 1,866,150 83
17,300 General Dynamics Corporation 1,766,330 79
101,600 General Electric Company 3,411,728 152
26,200 * Genzyme Corporation 1,425,542 63
9,000 * Gilead Sciences, Inc. 336,420 15
37,800 Gillette Company 1,577,772 70
24,800 GlobalSantaFe Corporation 760,120 34
4,800 Ingersoll-Rand Company - Class "A" 326,256 15
65,160 Intel Corporation 1,307,110 58
50,100 International Paper Company 2,024,541 90
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
United States (continued)
11,400 * KLA-Tencor Corporation $472,872 $21
18,600 * Lamar Advertising Company - Class "A" 773,946 34
37,600 Lowe's Companies, Inc. 2,043,560 91
18,800 Market 2000+ HOLDRs Trust 978,916 44
21,000 * Medco Health Solutions, Inc. 648,900 29
35,700 Medtronic, Inc. 1,852,830 82
37,900 Merrill Lynch & Company, Inc. 1,884,388 84
10,600 Michaels Stores, Inc. 627,626 28
162,700 Microsoft Corporation 4,498,655 200
55,800 Motorola, Inc. 1,006,632 45
49,500 * Nextel Communications, Inc. - Class "A" 1,180,080 53
16,200 NIKE, Inc. - Class "B" 1,276,560 57
15,200 Norfolk Southern Corporation 452,048 20
28,700 * Pactiv Corporation 667,275 30
36,800 PepsiCo, Inc. 1,790,320 80
11,400 PETsMART, Inc. 323,646 14
98,525 Pfizer, Inc. 3,014,865 134
51,800 * Polycom, Inc. 1,026,676 46
12,900 Precision Castparts Corporation 774,645 34
28,000 Principal Financial Group, Inc. 1,007,160 45
24,400 Procter & Gamble Company 1,320,528 59
22,800 Rockwell Collins, Inc. 846,792 38
87,400 Schering-Plough Corporation 1,665,844 74
38,100 Schlumberger, Ltd. 2,564,511 114
35,800 Southern Company 1,073,284 48
44,900 Sprint Corporation 903,837 40
36,925 St. Paul Travelers Companies, Inc. 1,220,741 54
29,200 Staples, Inc. 870,744 39
40,600 Texas Instruments, Inc. 863,968 38
181,500 * Time Warner, Inc. 2,929,410 130
63,000 Tyco International, Ltd. 1,931,580 86
19,000 United Technologies Corporation 1,774,220 79
40,900 * VeriSign, Inc. 813,092 36
41,800 Wyeth 1,563,320 70
29,600 * Yahoo!, Inc. 1,003,736 45
11,700 Zions Bancorporation 714,168 32
- ----------------------------------------------------------------------------------------------------------------------
97,974,448 4,364
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS GLOBAL FUND, INC.
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
France--10.9%
56,200 AXA $1,137,048 $51
24,853 Essilor International SA 1,597,389 71
74,008 European Aeronautic Defence and
Space Company 1,960,610 87
92,483 France Telecom SA 2,304,170 103
14,500 Groupe Danone 1,139,970 51
46,875 Lafarge SA 4,101,511 183
16,600 Pinault-Printemps-Redoute SA 1,524,642 68
25,700 PSA Peugeot Citroen 1,583,202 70
59,681 Societe Television Francaise 1 1,692,988 75
20,244 Total SA 4,123,460 184
39,100 Veolia Environment 1,125,186 50
83,100 * Vivendi Universal SA 2,129,226 95
- ----------------------------------------------------------------------------------------------------------------------
24,419,402 1,088
- ----------------------------------------------------------------------------------------------------------------------
United Kingdom--10.0%
53,700 AstraZeneca PLC 2,200,963 98
80,000 GlaxoSmithKline PLC 1,724,138 77
98,800 Imperial Tobacco Group PLC 2,152,552 96
294,000 Kingfisher PLC 1,639,912 73
138,823 Reckitt Benckiser PLC 3,401,342 151
772,763 Rolls-Royce Group PLC 3,541,327 158
155,652 Royal Bank of Scotland Group PLC 4,495,291 200
1,419,612 Vodafone Group PLC 3,397,313 151
- ----------------------------------------------------------------------------------------------------------------------
22,552,838 1,004
- ----------------------------------------------------------------------------------------------------------------------
Japan--7.8%
46,000 Canon, Inc. 2,161,956 96
65,000 Eisai Company, Ltd. 1,769,269 79
12,300 Electric Power Development Company, Ltd.** 301,320 13
262 Japan Tobacco, Inc. 2,191,752 98
38,000 Kao Corporation 839,541 37
13,300 Nintendo Company, Ltd. 1,626,675 72
739 NTT DoCoMo, Inc. 1,253,849 56
58,000 Olympus Corporation 1,118,269 50
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Japan (continued)
58,000 Sankyo Company, Ltd. $1,226,149 $55
29,600 Shin-Etsu Chemical Company, Ltd. 1,063,521 47
206,000 Sumitomo Metal Mining Company, Ltd. 1,427,973 64
254,000 Sumitomo Trust and Banking Company, Ltd. 1,502,590 67
16,270 Takefuji Corporation 1,040,725 46
- ----------------------------------------------------------------------------------------------------------------------
17,523,589 780
- ----------------------------------------------------------------------------------------------------------------------
Germany--3.8%
42,500 Bayerische Motoren Werke (BMW) AG 1,749,823 78
30,900 DaimlerChrysler AG 1,272,224 57
76,100 * Deutsche Lufthansa AG - Registered 890,343 40
42,800 E.ON AG 3,149,588 140
15,800 Muenchener Rueckversicherungs -
Gesellschaft AG - Registered 1,516,904 67
- ----------------------------------------------------------------------------------------------------------------------
8,578,882 382
- ----------------------------------------------------------------------------------------------------------------------
Netherlands--3.6%
89,455 ABN AMRO Holding NV 2,032,076 91
131,500 * ASML Holding NV 1,692,026 75
89,442 ING Groep NV 2,257,287 101
321,300 * Koninklijke Ahold NV 2,051,141 91
- ----------------------------------------------------------------------------------------------------------------------
8,032,530 358
- ----------------------------------------------------------------------------------------------------------------------
Switzerland--3.1%
8,172 Converium Holding AG 109,619 5
5,000 Converium Holding AG (ADR) 34,750 1
85,680 Novartis AG - Registered 3,993,414 178
40,870 UBS AG - Registered 2,876,970 128
- ----------------------------------------------------------------------------------------------------------------------
7,014,753 312
- ----------------------------------------------------------------------------------------------------------------------
Canada--2.6%
25,800 Canadian National Railway Company 1,259,040 56
42,400 EnCana Corporation 1,954,913 87
15,900 * Research in Motion, Ltd. 1,213,806 54
57,000 Talisman Energy, Inc. 1,472,798 66
- ----------------------------------------------------------------------------------------------------------------------
5,900,557 263
- ----------------------------------------------------------------------------------------------------------------------
Portfolio of Investments (continued)
FIRST INVESTORS GLOBAL FUND, INC.
September 30, 2004
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
For Each
$10,000 of
Shares Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
South Korea--2.3%
131,620 Kia Motors Corporation $1,211,613 $54
29,560 LG Electronics, Inc. 1,699,410 76
24,740 SK Corporation 1,140,855 51
52,290 SK Telecom Company, Ltd. (ADR) 1,017,041 45
- ----------------------------------------------------------------------------------------------------------------------
5,068,919 226
- ----------------------------------------------------------------------------------------------------------------------
Belgium--1.5%
49,377 * Belgacom SA 1,768,649 79
64,500 Fortis 1,533,286 68
- ----------------------------------------------------------------------------------------------------------------------
3,301,935 147
- ----------------------------------------------------------------------------------------------------------------------
Italy--1.4%
140,048 ENI SpA 3,137,871 140
- ----------------------------------------------------------------------------------------------------------------------
Sweden--1.2%
145,700 Nordea Bank AB 1,190,785 53
483,070 * Telefonaktiebolaget LM Ericsson AB -
Class "B" 1,499,599 67
- ----------------------------------------------------------------------------------------------------------------------
2,690,384 120
- ----------------------------------------------------------------------------------------------------------------------
Taiwan--1.1%
340,419 Taiwan Semiconductor Manufacturing
Company, Ltd. (ADR) 2,430,592 108
- ----------------------------------------------------------------------------------------------------------------------
Ireland--.9%
45,100 * Elan Corporation PLC (ADR) 1,055,340 47
37,800 * Ryanair Holdings PLC (ADR) 1,103,760 48
- ----------------------------------------------------------------------------------------------------------------------
2,159,100 95
- ----------------------------------------------------------------------------------------------------------------------
India--.8%
30,500 Infosys Technologies, Ltd. (ADR) 1,726,300 77
- ----------------------------------------------------------------------------------------------------------------------
Spain--.7%
73,800 Iberdrola SA 1,530,715 68
- ----------------------------------------------------------------------------------------------------------------------
China--.7%
3,756,000 China Petroleum & Chemical Corporation 1,529,267 68
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Amount
Invested
Shares or For Each
Principal $10,000 of
Amount Security Value Net Assets
- ----------------------------------------------------------------------------------------------------------------------
Hong Kong--.5%
233,000 Esprit Holdings, Ltd. $1,183,219 $53
- ----------------------------------------------------------------------------------------------------------------------
Indonesia--.5%
59,200 PT Telekomunikasi Indonesia (ADR) 1,047,248 47
- ----------------------------------------------------------------------------------------------------------------------
Russia--.4%
7,000 LUKOIL (ADR) 868,000 39
- ----------------------------------------------------------------------------------------------------------------------
Australia--.2%
136,206 WMC Resources, Ltd. 528,822 23
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Common Stocks (cost $192,028,099) 219,199,371 9,762
- ----------------------------------------------------------------------------------------------------------------------
PREFERRED STOCKS--.0%
Brazil
23,000 * Vale Do Rio Doce - Class "B" (cost $0)** 165 --
- ----------------------------------------------------------------------------------------------------------------------
REPURCHASE AGREEMENT--2.9%
$6,387M BNP Paribas, 1.72%, dated 9/30/04, to be
repurchased at $6,387,305 on 10/1/04
(collateralized by U.S. Treasury Notes,
10.75%, 8/15/05, valued at $6,512,555)
(cost $6,387,000) 6,387,000 285
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Investments (cost $198,415,099) 100.5% 225,586,536 10,047
Excess of Liabilities Over Other Assets (.5) (1,065,752) (47)
- ----------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $224,520,784 $10,000
======================================================================================================================
* Non-income producing
** Security valued at fair value (see Note 1A)
Summary of Abbreviations:
ADR American Depositary Receipts
See notes to financial statements
Portfolio of Investments (continued)
FIRST INVESTORS GLOBAL FUND, INC.
September 30, 2004
Sector diversification of the portfolio was as follows:
- ----------------------------------------------------------------------------------------------------------------------
Percentage
Sector of Net Assets Value
- ----------------------------------------------------------------------------------------------------------------------
Pharmaceuticals & Biotechnology 10.4% $23,357,250
Energy 10.1 22,640,503
Capital Goods 7.6 17,061,193
Diversified Financials 6.7 15,121,030
Banks 6.3 14,089,852
Materials 5.9 13,150,631
Telecommunication Services 5.7 12,872,186
Software & Services 5.3 11,930,122
Technology Hardware & Equipment 4.7 10,589,137
Food, Beverage & Tobacco 3.8 8,643,458
Semiconductors & Semiconductor Equipment 3.8 8,583,199
Retailing 3.7 8,213,349
Media 3.4 7,525,570
Household & Personal Products 3.2 7,139,183
Utilities 3.1 6,878,773
Transportation 3.1 6,854,990
Insurance 3.0 6,721,868
Automobiles & Components 2.6 5,816,862
Health Care Equipment & Services 2.3 5,217,388
Consumer Durables & Apparel 1.3 2,975,971
Food & Staples Retailing .9 2,051,141
Pooled Vehicle .4 978,916
Commercial Services & Supplies .3 786,964
Repurchase Agreement 2.9 6,387,000
- ----------------------------------------------------------------------------------------------------------------------
Total Value of Investments 100.5 225,586,536
Excess of Liabilities Over Other Assets (.5) (1,065,752)
- ----------------------------------------------------------------------------------------------------------------------
Net Assets 100.0% $224,520,784
======================================================================================================================
See notes to financial statements
This page intentionally left blank.
Statements of Assets and Liabilities
FIRST INVESTORS
September 30, 2004
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL GROWTH & ALL-CAP
RETURN VALUE BLUE CHIP INCOME GROWTH
- ---------------------------------------------------------------------------------------------------------------------------------
Assets
Investments in securities:
At identified cost $220,034,219 $168,484,952 $383,880,546 $482,332,549 $128,644,286
============ ============ ============ ============ ============
At value (Note 1A) $249,292,900 $206,687,244 $472,055,559 $580,581,313 $151,686,047
Cash 1,155,940 1,011,543 2,754,490 892,920 50,468
Receivables:
Investment securities sold 15,575,922 597,982 8,556,906 1,330,427 523,265
Dividends and interest 1,085,739 434,059 442,966 452,332 40,215
Shares sold 393,644 592,367 286,750 972,050 436,090
Forward currency contracts (Note 4) -- -- -- -- --
Other assets 11,494 7,646 24,040 25,159 5,088
------------ ------------ ------------ ------------ ------------
Total Assets 267,515,639 209,330,841 484,120,711 584,254,201 152,741,173
------------ ------------ ------------ ------------ ------------
Liabilities
Payables:
Investment securities purchased 162,668 557,180 7,567,126 560,926 1,723,725
Shares redeemed 267,509 203,455 783,501 790,149 154,540
Dividends payable 15,237 13,941 -- 4,451 --
Accrued advisory fees 163,034 126,416 292,520 346,871 90,325
Accrued shareholder servicing costs 66,892 56,870 137,109 155,570 57,763
Accrued expenses 24,410 20,239 13,937 36,560 14,215
------------ ------------ ------------ ------------ ------------
Total Liabilities 699,750 978,101 8,794,193 1,894,527 2,040,568
------------ ------------ ------------ ------------ ------------
Net Assets $266,815,889 $208,352,740 $475,326,518 $582,359,674 $150,700,605
============ ============ ============ ============ ============
Net Assets Consist of:
Capital paid in $262,398,226 $229,809,489 $527,116,812 $566,568,642 $145,441,609
Undistributed net investment income (deficit) (264,926) 156,825 -- 1,142,907 --
Accumulated net realized loss on investments
and foreign currency transactions (24,576,092) (59,815,866) (139,965,307) (83,600,639) (17,782,765)
Net unrealized appreciation in value
of investments and foreign
currency transactions 29,258,681 38,202,292 88,175,013 98,248,764 23,041,761
------------ ------------ ------------ ------------ ------------
Total $266,815,889 $208,352,740 $475,326,518 $582,359,674 $150,700,605
============ ============ ============ ============ ============
Net Assets:
Class A $231,196,720 $185,009,479 $414,363,548 $498,968,775 $130,323,261
Class B $35,619,169 $23,343,261 $60,962,970 $83,390,899 $20,377,344
Shares outstanding (Note 5):
Class A 17,815,094 31,079,026 22,169,985 41,104,256 16,702,354
Class B 2,782,931 3,979,433 3,462,449 7,177,657 2,683,652
Net asset value and redemption price
per share - Class A $12.98 $5.95 $18.69 $12.14 $7.80
============ ============ ============ ============ ============
Maximum offering price per share - Class A
(Net asset value/.9425)* $13.77 $6.31 $19.83 $12.88 $8.28
============ ============ ============ ============ ============
Net asset value and offering price per share -
Class B (Note 5) $12.80 $5.87 $17.61 $11.62 $7.59
============ ============ ============ ============ ============
Statements of Assets and Liabilities (continued)
FIRST INVESTORS
September 30, 2004
- -------------------------------------------------------------------------------------------------------------
MID-CAP SPECIAL FOCUSED
OPPORTUNITY SITUATIONS EQUITY GLOBAL
- -------------------------------------------------------------------------------------------------------------
Assets
Investments in securities:
At identified cost $271,359,962 $175,068,012 $57,484,571 $198,415,099
============ ============ ============ ============
At value (Note 1A) $323,910,544 $209,670,337 $60,238,809 $225,586,536
Cash 196,859 1,114,907 52,253 50,243
Receivables:
Investment securities sold 758,160 83,698 676,899 2,659,759
Dividends and interest 155,949 70,676 45,617 314,417
Shares sold 819,736 182,522 29,455 91,021
Forward currency contracts (Note 4) -- -- -- 10,089
Other assets 11,994 10,176 3,114 31,939
------------ ------------ ------------ ------------
Total Assets 325,853,242 211,132,316 61,046,147 228,744,004
------------ ------------ ------------ ------------
Liabilities
Payables:
Investment securities purchased 1,562,836 419,520 661,423 3,659,620
Shares redeemed 407,352 329,009 213,110 276,878
Dividends payable -- -- -- --
Accrued advisory fees 194,599 126,749 37,335 183,559
Accrued shareholder servicing costs 108,902 82,940 31,505 68,520
Accrued expenses 27,885 33,356 18,903 34,643
------------ ------------ ------------ ------------
Total Liabilities 2,301,574 991,574 962,276 4,223,220
------------ ------------ ------------ ------------
Net Assets $323,551,668 $210,140,742 $60,083,871 $224,520,784
============ ============ ============ ============
Net Assets Consist of:
Capital paid in $283,335,277 $236,728,424 $84,252,209 $228,663,459
Undistributed net investment income (deficit) -- -- -- --
Accumulated net realized loss on investments
and foreign currency transactions (12,334,191) (61,190,007) (26,922,576) (31,322,315)
Net unrealized appreciation in value
of investments and foreign
currency transactions 52,550,582 34,602,325 2,754,238 27,179,640
------------ ------------ ------------ ------------
Total $323,551,668 $210,140,742 $60,083,871 $224,520,784
============ ============ ============ ============
Net Assets:
Class A $277,416,113 $189,569,661 $49,475,440 $209,334,832
Class B $46,135,555 $20,571,081 $10,608,431 $15,185,952
Shares outstanding (Note 5):
Class A 12,215,875 11,254,142 6,316,638 35,318,259
Class B 2,186,113 1,324,101 1,408,007 2,752,991
Net asset value and redemption price
per share - Class A $22.71 $16.84 $7.83 $5.93
============ ============ ============ ============
Maximum offering price per share - Class A
(Net asset value/.9425)* $24.10 $17.87 $8.31 $6.29
============ ============ ============ ============
Net asset value and offering price per share -
Class B (Note 5) $21.10 $15.54 $7.53 $5.52
============ ============ ============ ============
* On purchases of $100,000 or more, the sales charge is reduced.
See notes to financial statements
Statements of Operations
FIRST INVESTORS
Year Ended September 30, 2004
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL GROWTH & ALL-CAP
RETURN VALUE BLUE CHIP INCOME GROWTH
- -----------------------------------------------------------------------------------------------------------------------------------
Investment Income
Dividends $3,023,045 $4,709,074 $7,374,247 $10,809,021 $655,500
Interest 4,259,537 174,492 -- 19,175 53,653
------------ ------------ ------------ ------------ ------------
Total income 7,282,582 4,883,566 7,374,247 10,828,196 709,153
------------ ------------ ------------ ------------ ------------
Expenses (Notes 1 and 3):
Advisory fees 2,331,936 1,358,970 4,164,190 4,079,182 951,351
Distribution plan expenses - Class A 631,706 478,739 1,268,209 1,415,337 326,332
Distribution plan expenses - Class B 336,896 216,163 659,409 846,374 180,693
Shareholder servicing costs 745,746 625,249 1,735,973 1,805,154 668,091
Professional fees 37,620 39,916 68,038 66,579 28,795
Custodian fees 42,751 24,465 64,660 57,160 16,405
Registration fees 32,538 33,338 32,816 34,492 34,148
Reports to shareholders 28,800 23,760 67,364 70,282 26,432
Directors/trustees' fees 9,014 7,265 16,554 18,949 5,767
Other expenses 56,948 31,410 91,681 99,280 21,320
------------ ------------ ------------ ------------ ------------
Total expenses 4,253,955 2,839,275 8,168,894 8,492,789 2,259,334
Less: Expenses waived (500,000) -- (500,000) -- --
Expenses paid indirectly (9,269) (6,476) (10,862) (6,284) (928)
------------ ------------ ------------ ------------ ------------
Net expenses 3,744,686 2,832,799 7,658,032 8,486,505 2,258,406
------------ ------------ ------------ ------------ ------------
Net investment income (loss) 3,537,896 2,050,767 (283,785) 2,341,691 (1,549,253)
------------ ------------ ------------ ------------ ------------
Realized and Unrealized Gain (Loss) on Investments
and Foreign Currency Transactions (Note 2):
Net realized gain on investments
and foreign currency transactions 8,318,115 4,056,548 25,571,788 36,796,326 3,952,080
Net unrealized appreciation (depreciation)
of investments and foreign
currency transactions 8,527,394 25,404,854 14,361,975 27,753,508 12,347,189
------------ ------------ ------------ ------------ ------------
Net gain on investments and foreign
currency transactions 16,845,509 29,461,402 39,933,763 64,549,834 16,299,269
------------ ------------ ------------ ------------ ------------
Net Increase in Net Assets
Resulting from Operations $20,383,405 $31,512,169 $39,649,978 $66,891,525 $14,750,016
============ ============ ============ ============ ============
Statements of Operations (continued)
FIRST INVESTORS
Year Ended September 30, 2004
- --------------------------------------------------------------------------------------------------------------
MID-CAP SPECIAL FOCUSED
OPPORTUNITY SITUATIONS EQUITY GLOBAL
- --------------------------------------------------------------------------------------------------------------
Investment Income
Dividends $3,116,815 $1,083,700 $979,979 $3,883,851+
Interest 53,790 87,262 6,162 73,209
------------ ------------ ------------ ------------
Total income 3,170,605 1,170,962 986,141 3,957,060
------------ ------------ ------------ ------------
Expenses (Notes 1 and 3):
Advisory fees 2,671,873 2,107,110 475,507 2,281,707
Distribution plan expenses - Class A 738,998 576,140 156,290 636,175
Distribution plan expenses - Class B 432,503 223,692 113,042 161,125
Shareholder servicing costs 1,245,203 1,036,238 388,545 859,913
Professional fees 43,013 44,986 24,704 55,909
Custodian fees 35,779 39,842 10,466 261,883
Registration fees 32,492 31,992 33,288 36,444
Reports to shareholders 49,739 41,379 34,020 36,409
Directors/trustees' fees 10,562 8,239 3,259 8,585
Other expenses 56,038 41,556 15,505 20,417
------------ ------------ ------------ ------------
Total expenses 5,316,200 4,151,174 1,254,626 4,358,567
Less: Expenses waived (500,000) (498,992) -- --
Expenses paid indirectly (5,791) (7,979) (396) (1,424)
------------ ------------ ------------ ------------
Net expenses 4,810,409 3,644,203 1,254,230 4,357,143
------------ ------------ ------------ ------------
Net investment income (loss) (1,639,804) (2,473,241) (268,089) (400,083)
------------ ------------ ------------ ------------
Realized and Unrealized Gain (Loss) on Investments
and Foreign Currency Transactions (Note 2):
Net realized gain on investments
and foreign currency transactions 20,378,683 26,478,497 1,822,147 30,025,702
Net unrealized appreciation (depreciation)
of investments and foreign
currency transactions 24,729,598 (9,729,555) 3,279,568 690,941
------------ ------------ ------------ ------------
Net gain on investments and foreign
currency transactions 45,108,281 16,748,942 5,101,715 30,716,643
------------ ------------ ------------ ------------
Net Increase in Net Assets
Resulting from Operations $43,468,477 $14,275,701 $4,833,626 $30,316,560
============ ============ ============ ============
+ Net of $338,353 foreign taxes withheld
See notes to financial statements
Statements of Changes in Net Assets
FIRST INVESTORS
- --------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN VALUE
---------------------------- ----------------------------
Year Ended September 30 2004 2003 2004 2003
- --------------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets From Operations
Net investment income (loss) $3,537,896 $2,595,772 $2,050,767 $1,994,571
Net realized gain (loss) on investments 8,318,115 (4,976,396) 4,056,548 (7,805,613)
Net unrealized appreciation of investments 8,527,394 27,102,984 25,404,854 27,059,981
------------ ------------ ------------ ------------
Net increase in net assets resulting from operations 20,383,405 24,722,360 31,512,169 21,248,939
------------ ------------ ------------ ------------
Dividends to Shareholders
Net investment income - Class A (3,344,902) (2,745,536) (1,866,906) (1,748,084)
Net investment income - Class B (318,565) (285,333) (112,863) (160,660)
------------ ------------ ------------ ------------
Total dividends (3,663,467) (3,030,869) (1,979,769) (1,908,744)
------------ ------------ ------------ ------------
Share Transactions*
Class A:
Proceeds from shares sold 67,816,731 49,222,767 51,007,936 26,361,060
Reinvestment of dividends 3,288,426 2,709,146 1,814,820 1,695,885
Cost of shares redeemed (31,026,815) (23,367,193) (19,645,255) (18,006,487)
------------ ------------ ------------ ------------
40,078,342 28,564,720 33,177,501 10,050,458
------------ ------------ ------------ ------------
Class B:
Proceeds from shares sold 9,344,252 7,886,210 5,777,938 3,447,342
Reinvestment of dividends 316,238 283,519 111,791 159,358
Cost of shares redeemed (4,776,454) (4,531,666) (4,941,142) (4,191,112)
------------ ------------ ------------ ------------
4,884,036 3,638,063 948,587 (584,412)
------------ ------------ ------------ ------------
Net increase (decrease) from share transactions 44,962,378 32,202,783 34,126,088 9,466,046
------------ ------------ ------------ ------------
Net increase in net assets 61,682,316 53,894,274 63,658,488 28,806,241
Net Assets
Beginning of year 205,133,573 151,239,299 144,694,252 115,888,011
------------ ------------ ------------ ------------
End of year + $266,815,889 $205,133,573 $208,352,740 $144,694,252
============ ============ ============ ============
+Includes undistributed net investment income (deficit) of $(264,926) $( 312,490) $156,825 $85,827
============ ============ ============ ============
*Shares Issued and Redeemed
Class A:
Sold 5,268,212 4,332,265 8,950,654 5,561,598
Issued for dividends reinvested 252,536 239,990 310,958 364,982
Redeemed (2,410,468) (2,092,115) (3,441,839) (3,944,699)
------------ ------------ ------------ ------------
Net increase (decrease) in Class A shares outstanding 3,110,280 2,480,140 5,819,773 1,981,881
============ ============ ============ ============
Class B:
Sold 737,727 705,304 1,032,020 736,536
Issued for dividends reinvested 24,614 25,554 19,427 35,022
Redeemed (375,421) (414,061) (882,554) (931,856)
------------ ------------ ------------ ------------
Net increase (decrease) in Class B shares outstanding 386,920 316,797 168,893 (160,298)
============ ============ ============ ============
Statements of Changes in Net Assets
FIRST INVESTORS
- -------------------------------------------------------------------------------------------------------------------------------
BLUE CHIP GROWTH & INCOME
---------------------------- ----------------------------
Year Ended September 30 2004 2003 2004 2003
- -------------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets From Operations
Net investment income (loss) $(283,785) $(425,904) $2,341,691 $1,371,212
Net realized gain (loss) on investments 25,571,788 (27,055,645) 36,796,326 (17,943,080)
Net unrealized appreciation of investments 14,361,975 94,207,242 27,753,508 97,389,824
------------ ------------ ------------ ------------
Net increase in net assets resulting from operations 39,649,978 66,725,693 66,891,525 80,817,956
------------ ------------ ------------ ------------
Dividends to Shareholders
Net investment income - Class A -- -- (1,198,784) (1,561,227)
Net investment income - Class B -- -- -- --
------------ ------------ ------------ ------------
Total dividends -- -- (1,198,784) (1,561,227)
------------ ------------ ------------ ------------
Share Transactions*
Class A:
Proceeds from shares sold 59,861,560 53,450,998 105,331,802 69,467,305
Reinvestment of dividends -- -- 1,186,897 1,545,811
Cost of shares redeemed (62,755,398) (60,801,572) (63,168,639) (55,627,119)
------------ ------------ ------------ ------------
(2,893,838) (7,350,574) 43,350,060 15,385,997
------------ ------------ ------------ ------------
Class B:
Proceeds from shares sold 8,311,100 8,941,786 14,981,290 11,899,634
Reinvestment of dividends -- -- -- --
Cost of shares redeemed (15,084,253) (12,841,105) (17,923,509) (14,006,947)
------------ ------------ ------------ ------------
(6,773,153) (3,899,319) (2,942,219) (2,107,313)
------------ ------------ ------------ ------------
Net increase (decrease) from share transactions (9,666,991) (11,249,893) 40,407,841 13,278,684
------------ ------------ ------------ ------------
Net increase in net assets 29,982,987 55,475,800 106,100,582 92,535,413
Net Assets
Beginning of year 445,343,531 389,867,731 476,259,092 383,723,679
------------ ------------ ------------ ------------
End of year + $475,326,518 $445,343,531 $582,359,674 $476,259,092
============ ============ ============ ============
+Includes undistributed net investment income (deficit) of $-- $-- $1,142,907 $--
============ ============ ============ ============
*Shares Issued and Redeemed
Class A:
Sold 3,172,176 3,344,515 8,833,243 7,092,953
Issued for dividends reinvested -- -- 97,777 160,200
Redeemed (3,335,866) (3,864,778) (5,290,872) (5,818,365)
------------ ------------ ------------ ------------
Net increase (decrease) in Class A shares outstanding (163,690) (520,263) 3,640,148 1,434,788
============ ============ ============ ============
Class B:
Sold 466,882 588,924 1,312,512 1,263,648
Issued for dividends reinvested -- -- -- --
Redeemed (846,873) (860,901) (1,568,845) (1,523,474)
------------ ------------ ------------ ------------
Net increase (decrease) in Class B shares outstanding (379,991) (271,977) (256,333) (259,826)
============ ============ ============ ============
See notes to financial statements
Statements of Changes in Net Assets
FIRST INVESTORS
- ----------------------------------------------------------------------------------------------------------------------------------
ALL-CAP GROWTH MID-CAP OPPORTUNTITY
---------------------------- ----------------------------
Year Ended September 30 2004 2003 2004 2003
- ----------------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets From Operations
Net investment loss $(1,549,253) $(857,716) $(1,639,804) $(1,684,478)
Net realized gain (loss) on investments 3,952,080 (1,931,995) 20,378,683 (9,144,785)
Net unrealized appreciation (depreciation) of investments 12,347,189 18,163,770 24,729,598 47,400,847
------------ ------------ ------------ ------------
Net increase in net assets resulting from operations 14,750,016 15,374,059 43,468,477 36,571,584
------------ ------------ ------------ ------------
Share Transactions *
Class A:
Proceeds from shares sold 52,765,310 27,790,360 79,643,493 51,795,794
Cost of shares redeemed (11,769,360) (7,697,061) (31,414,210) (21,887,533)
------------ ------------ ------------ ------------
40,995,950 20,093,299 48,229,283 29,908,261
------------ ------------ ------------ ------------
Class B:
Proceeds from shares sold 6,200,445 4,175,360 11,173,893 7,921,873
Cost of shares redeemed (1,739,011) (1,410,633) (5,939,582) (4,116,563)
------------ ------------ ------------ ------------
4,461,434 2,764,727 5,234,311 3,805,310
------------ ------------ ------------ ------------
Net increase (decrease) from share transactions 45,457,384 22,858,026 53,463,594 33,713,571
------------ ------------ ------------ ------------
Net increase in net assets 60,207,400 38,232,085 96,932,071 70,285,155
Net Assets
Beginning of year 90,493,205 52,261,120 226,619,597 156,334,442
------------ ------------ ------------ ------------
End of year $150,700,605 $90,493,205 $323,551,668 $226,619,597
============ ============ ============ ============
*Shares Issued and Redeemed
Class A:
Sold 6,871,429 4,464,318 3,631,663 3,001,097
Redeemed (1,531,123) (1,288,511) (1,427,534) (1,294,434)
------------ ------------ ------------ ------------
Net increase (decrease) in Class A shares outstanding 5,340,306 3,175,807 2,204,129 1,706,663
============ ============ ============ ============
Class B:
Sold 827,213 685,202 548,606 487,764
Redeemed (231,955) (241,915) (289,487) (261,744)
------------ ------------ ------------ ------------
Net increase (decrease) in Class B shares outstanding 595,258 443,287 259,119 226,020
============ ============ ============ ============
Statements of Changes in Net Assets (continued)
FIRST INVESTORS
- ----------------------------------------------------------------------------------------------------------------------------------
SPECIAL SITUATIONS FOCUSED EQUITY
---------------------------- ----------------------------
Year Ended September 30 2004 2003 2004 2003
- ----------------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets From Operations
Net investment loss $(2,473,241) $(2,174,743) $(268,089) $(255,382)
Net realized gain (loss) on investments 26,478,497 (8,547,634) 1,822,147 (3,672,111)
Net unrealized appreciation (depreciation) of investments (9,729,555) 46,021,471 3,279,568 15,896,024
------------ ------------ ------------ ------------
Net increase in net assets resulting from operations 14,275,701 35,299,094 4,833,626 11,968,531
------------ ------------ ------------ ------------
Share Transactions *
Class A:
Proceeds from shares sold 32,272,999 21,524,779 7,719,981 7,578,453
Cost of shares redeemed (24,508,853) (21,840,556) (10,216,270) (7,332,359)
------------ ------------ ------------ ------------
7,764,146 (315,777) (2,496,289) 246,094
------------ ------------ ------------ ------------
Class B:
Proceeds from shares sold 4,172,232 2,582,621 1,199,744 1,101,769
Cost of shares redeemed (5,431,921) (3,464,531) (2,128,058) (1,629,642)
------------ ------------ ------------ ------------
(1,259,689) (881,910) (928,314) (527,873)
------------ ------------ ------------ ------------
Net increase (decrease) from share transactions 6,504,457 (1,197,687) (3,424,603) (281,779)
------------ ------------ ------------ ------------
Net increase in net assets 20,780,158 34,101,407 1,409,023 11,686,752
Net Assets
Beginning of year 189,360,584 155,259,177 58,674,848 46,988,096
------------ ------------ ------------ ------------
End of year $210,140,742 $189,360,584 $60,083,871 $58,674,848
============ ============ ============ ============
*Shares Issued and Redeemed
Class A:
Sold 1,863,325 1,599,285 977,797 1,128,365
Redeemed (1,421,872) (1,660,681) (1,296,757) (1,112,790)
------------ ------------ ------------ ------------
Net increase (decrease) in Class A shares outstanding 441,453 (61,396) (318,960) 15,575
============ ============ ============ ============
Class B:
Sold 259,292 204,411 157,973 168,390
Redeemed (338,579) (282,940) (280,246) (262,445)
------------ ------------ ------------ ------------
Net increase (decrease) in Class B shares outstanding (79,287) (78,529) (122,273) (94,055)
============ ============ ============ ============
See notes to financial statements
Statements of Changes in Net Assets
FIRST INVESTORS
- --------------------------------------------------------------------------------------------------
GLOBAL
----------------------------
Year Ended September 30 2004 2003
- --------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets From Operations
Net investment loss $(400,083) $(471,515)
Net realized gain (loss) on investments and
foreign currency transactions 30,025,702 (3,393,379)
Net unrealized appreciation of investments and
foreign currency transactions 690,941 42,419,475
------------ ------------
Net increase in net assets resulting from operations 30,316,560 38,554,581
------------ ------------
Share Transactions*
Class A:
Proceeds from shares sold 16,930,869 13,212,580
Cost of shares redeemed (28,122,035) (30,106,459)
------------ ------------
(11,191,166) (16,893,879)
------------ ------------
Class B:
Proceeds from shares sold 1,931,105 1,392,241
Cost of shares redeemed (3,892,357) (3,012,650)
------------ ------------
(1,961,252) (1,620,409)
------------ ------------
Net decrease from share transactions (13,152,418) (18,514,288)
------------ ------------
Net increase in net assets 17,164,142 20,040,293
Net Assets
Beginning of year 207,356,642 187,316,349
------------ ------------
End of year $224,520,784 $207,356,642
============ ============
*Shares Issued and Redeemed
Class A:
Sold 2,881,046 2,823,401
Redeemed (4,801,535) (6,467,613)
------------ ------------
Net decrease in Class A shares outstanding (1,920,489) (3,644,212)
============ ============
Class B:
Sold 353,684 315,712
Redeemed (706,156) (690,288)
------------ ------------
Net decrease in Class B shares outstanding (352,472) (374,576)
============ ============
See notes to financial statements
Notes to Financial Statements
September 30, 2004
1. Significant Accounting Policies--First Investors Total Return Fund,
First Investors Blue Chip Fund and First Investors Special Situations Fund,
each a series of First Investors Series Fund ("Series Fund"), a
Massachusetts business trust; First Investors Value Fund (formerly
Utilities Income), First Investors Growth & Income Fund, First Investors
All-Cap Growth Fund, First Investors Mid-Cap Opportunity Fund and First
Investors Focused Equity Fund, each a series of First Investors Series Fund
II, Inc. ("Series Fund II"), a Maryland corporation; and First Investors
Global Fund, Inc. ("Global Fund"), a Maryland corporation, are registered
under the Investment Company Act of 1940 (the "1940 Act") as diversified,
open-end management investment companies, with the exception of First
Investors Focused Equity Fund, which is registered as a non-diversified
series of the investment company. Each Fund accounts separately for the
assets, liabilities, and operations of the Fund. Series Fund offers two
additional series which are not included in this report. The objective of
each Fund is as follows:
Total Return Fund seeks high, long-term total investment return consistent
with moderate investment risk.
Value Fund seeks total return.
Blue Chip Fund seeks high total investment return consistent with the
preservation of capital.
Growth & Income Fund seeks long-term growth of capital and current income.
All-Cap Growth Fund seeks long-term growth of capital.
Mid-Cap Opportunity Fund seeks long-term capital growth.
Special Situations Fund seeks long-term growth of capital.
Focused Equity Fund seeks capital appreciation.
Global Fund primarily seeks long-term capital growth and, secondarily, a
reasonable level of current income.
A. Security Valuation--Except as provided below, a security listed or
traded on an exchange or the Nasdaq Stock Market is valued at its last sale
price on the exchange or market where the security is principally traded,
and lacking any sales, the security is valued at the mean between the
closing bid and asked prices. Securities traded in the over-the-counter
("OTC") market (including securities listed on exchanges whose primary
market is believed to be OTC) are valued at the mean between the last bid
and asked prices based upon quotes furnished by a market maker for such
securities. Securities may also be priced by a pricing service approved by
the applicable Fund's
Notes to Financial Statements (continued)
September 30, 2004
Board of Directors/Trustees (the "Board"). The pricing service considers
security type, rating, market condition and yield data as well as market
quotations, prices provided by market makers and other available
information in determining value. Short-term debt securities that mature in
60 days or less are valued at amortized cost. The Funds monitor for
significant events occurring after the close of foreign markets but prior
to the close of trading on the New York Stock Exchange that could have a
material impact on the value of any foreign securities that are held by the
Funds. Examples of such events include natural disasters, political events,
issuer-specific developments such as bankruptcies and significant
fluctuations in securities markets. If the Valuation Committee decides that
such events warrant using fair value estimates for foreign securities, it
will take such events into consideration in determining the fair values of
such securities. If market quotations or prices are not readily available
or determined to be unreliable, the securities will be valued at fair value
as determined in good faith pursuant to procedures adopted by the Board. At
September 30, 2004, the Global Fund held two securities that were fair
valued by its Valuation Committee with an aggregate value of $301,485
representing .1% of the Fund's net assets. For valuation purposes, where
applicable, quotations of foreign securities in foreign currency are
translated to U.S. dollar equivalents using the foreign exchange quotation
in effect.
B. Federal Income Taxes--No provision has been made for federal income
taxes on net income or capital gains since it is the policy of each Fund to
continue to comply with the special provisions of the Internal Revenue Code
applicable to investment companies and to make sufficient distributions of
income and capital gains (in excess of any available capital loss
carryovers) to relieve it from all, or substantially all, such taxes.
At September 30, 2004, capital loss carryovers were as follows:
Year Capital Loss Carryovers Expire
--------------------------------------------------------------------------------
Fund Total 2008 2009 2010 2011 2012
- ---- ----- ---- ---- ---- ---- ----
Total Return $22,473,294 $ -- $ -- $ 3,370,272 $19,103,022 $ --
Value 59,796,762 -- 5,133,146 18,257,137 36,406,479 --
Blue Chip 129,277,387 -- -- 60,089,848 69,187,539 --
Growth & Income 78,057,817 -- -- 13,237,225 64,820,592 --
All-Cap Growth 17,185,776 -- -- 6,375,516 10,810,260 --
Mid-Cap Opportunity 12,290,944 -- -- 5,604,079 6,686,865 --
Special Situations 60,973,556 -- -- 34,927,376 26,046,180 --
Focused Equity 26,520,358 553,800 12,951,888 1,712,582 9,856,986 1,445,102
Global 30,872,163 -- -- -- 30,872,163 --
C. Distributions to Shareholders--Dividends from net investment income, if
any, of Total Return Fund, Value Fund, Blue Chip Fund and Growth & Income
Fund are declared and paid quarterly. Dividends from net investment income,
if any, of All-Cap Growth Fund, Mid-Cap Opportunity Fund, Special
Situations Fund, Focused Equity Fund and Global Fund are declared and paid
annually. Distributions from net realized capital gains, if any, are
normally declared and paid annually. Income dividends and capital gain
distributions are determined in accordance with income tax regulations
which may differ from accounting principles generally accepted in the
United States of America. These differences are primarily due to differing
treatments for capital loss carryforwards, deferral of wash sales losses,
post-October capital losses, net operating losses and foreign currency
transactions.
D. Expense Allocation--Expenses directly charged or attributable to a Fund
are paid from the assets of that Fund. General expenses of Series Fund and
Series Fund II are allocated among and charged to the assets of each Fund
in the Series on a fair and equitable basis, which may be based on the
relative assets of each Fund or the nature of the services performed and
relative applicability to each Fund.
E. Repurchase Agreements--Securities pledged as collateral for repurchase
agreements entered into by the All-Cap Growth Fund, Focused Equity Fund,
and Global Fund are held by each Fund's custodian until maturity of the
repurchase agreement. The agreements provide that the Funds will receive,
as collateral, securities with a market value which will at all times be at
least equal to 100% of the amount invested by the Funds.
F. Use of Estimates--The preparation of the financial statements in
conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expense
during the reporting period. Actual results could differ from those
estimates.
G. Foreign Currency Translations--The accounting records of Global Fund are
maintained in U.S. dollars. Portfolio securities and other assets and
liabilities denominated in foreign currencies are translated to U.S.
dollars at the date of valuation. Purchases and sales of investment
securities, dividend income and certain expenses are translated to U.S.
dollars at the rates of exchange prevailing on the respective dates of such
transactions.
Global Fund does not isolate that portion of gains and losses on
investments which is due to changes in foreign exchange rates from that
which is due to changes in market
Notes to Financial Statements (continued)
September 30, 2004
prices of the investments. Such fluctuations are included with the net
realized and unrealized gains and losses from investments.
Net realized and unrealized gains and losses on foreign currency
transactions include gains and losses from the sales of foreign currency
and gains and losses on accrued foreign dividends and related withholding
taxes.
H. Other--Security transactions are accounted for on the date the
securities are purchased or sold. Cost is determined, and gains and losses
are based, on the identified cost basis for both financial statement and
federal income tax purposes. Dividend income is recorded on the ex-dividend
date. Interest income and estimated expenses are accrued daily. Bond
discounts and premiums are accreted or amortized using the interest method.
For the year ended September 30, 2004, the Bank of New York, custodian for
the Series Fund and Series Fund II, has provided total credits in the
amount of $34,476 against custodian charges based on the uninvested cash
balances of these Funds. The Funds also reduced expenses through brokerage
service arrangements. For the year ended September 30, 2004, the Funds'
expenses were reduced by $14,933 under these arrangements.
2. Security Transactions--For the year ended September 30, 2004, purchases
and sales of securities and long-term U.S. Government obligations
(excluding U.S. Treasury bills, repurchase agreements, short-term
securities and foreign currencies) were as follows:
Long-Term U.S.
Securities Government Obligations
--------------------------- ---------------------------
Cost of Proceeds Cost of Proceeds
Fund Purchases from Sales Purchases from Sales
- ---- ------------ ------------ ------------ ------------
Total Return $105,000,090 $ 71,844,070 $22,871,756 $22,562,644
Value 48,800,890 17,965,141 -- --
Blue Chip 446,911,205 455,594,176 -- --
Growth & Income 220,982,166 178,505,586 -- --
All-Cap Growth 133,813,051 91,820,378 -- --
Mid-Cap Opportunity 158,232,375 113,067,035 -- --
Special Situations 251,691,015 246,272,461 -- --
Focused Equity 24,487,618 27,442,586 -- --
Global 230,606,554 242,428,575 -- --
At September 30, 2004 aggregate cost and net unrealized appreciation of
securities for federal income tax purposes were as follows:
Gross Gross Net
Aggregate Unrealized Unrealized Unrealized
Fund Cost Appreciation Depreciation Appreciation
- ---- ------------ ------------ ------------ ------------
Total Return $222,811,590 $ 32,549,313 $ 6,068,003 $26,481,310
Value 168,504,056 40,253,651 2,070,463 38,183,188
Blue Chip 394,568,466 85,184,080 7,696,987 77,487,093
Growth & Income 487,875,371 112,888,251 20,182,309 92,705,942
All-Cap Growth 129,241,275 27,162,469 4,717,697 22,444,772
Mid-Cap Opportunity 271,403,209 64,692,183 12,184,848 52,507,335
Special Situations 175,284,463 42,723,628 8,337,754 34,385,874
Focused Equity 57,886,789 5,906,553 3,554,533 2,352,020
Global 198,881,046 32,127,158 5,421,668 26,705,490
3. Advisory Fee and Other Transactions With Affiliates--Certain officers
and directors/trustees of the Funds are officers and directors of the
Funds' investment adviser, First Investors Management Company, Inc.
("FIMCO"), their underwriter, First Investors Corporation ("FIC"), their
transfer agent, Administrative Data Management Corp. ("ADM") and/or First
Investors Federal Savings Bank, ("FIFSB"), custodian of the Funds'
retirement accounts. Directors/trustees of the Funds who are not
"interested persons" of the Funds as defined in the 1940 Act are
remunerated by the Funds. For the year ended September 30, 2004, total
directors/trustees fees accrued by the Funds amounted to $88,194.
The Investment Advisory Agreements provide as compensation to FIMCO, an
annual fee, payable monthly, at the following rates:
Total Return, Blue Chip, Mid-Cap Opportunity and Special Situations Funds--
1% on the first $200 million of each Fund's average daily net assets, .75%
on the next $300 million, declining by .03% on each $250 million
thereafter, down to .66% on average daily net assets over $1 billion. FIMCO
has waived 25% of the 1% annual fee on the first $200 million of each
Fund's average daily net assets for the year ended September 30, 2004.
Value, Growth & Income, All-Cap Growth and Focused Equity Funds-- .75% on
the first $300 million of each Fund's average daily net assets, .72% on the
next $200 million, .69% on the next $250 million and .66% on average daily
net assets over $750 million.
Notes to Financial Statements (continued)
September 30, 2004
Global Fund--1% on the first $250 million of the Fund's average daily net
assets, declining by .03% on each $250 million thereafter, down to .91% on
average daily net assets over $750 million.
For the year ended September 30, 2004, total advisory fees accrued to FIMCO
by the Funds were $20,421,826 of which $1,998,992 was waived.
For the year ended September 30, 2004, FIC, as underwriter, received
$17,338,405 in commissions from the sale of shares of the Funds, after
allowing $15,592 to other dealers. Shareholder servicing costs included
$6,283,485 in transfer agent fees accrued to ADM and $1,959,567 in
retirement accounts custodian fees accrued to FIFSB.
Pursuant to Distribution Plans adopted under Rule 12b-1 of the 1940 Act,
each Fund is authorized to pay FIC a fee up to .30% of the average daily
net assets of the Class A shares and 1% of the average daily net assets of
the Class B shares on an annualized basis each fiscal year, payable
monthly. The fee consists of a distribution fee and a service fee. The
service fee is paid for the ongoing servicing of clients who are
shareholders of that Fund. For the year ended September 30, 2004, total
distribution plan fees accrued to FIC by the Funds amounted to $9,397,823.
Wellington Management Company, LLP ("Wellington") serves as investment
subadviser to All-Cap Growth Fund, Focused Equity Fund and Global Fund. The
subadviser is paid by FIMCO and not by the Funds.
4. Forward Currency Contracts--A forward currency contract is an obligation
to purchase or sell a specific currency for an agreed-upon price at a
future date. When a Fund purchases or sells foreign securities it
customarily enters into a forward currency contract to minimize foreign
exchange risk between the trade date and the settlement date of such
transactions. The Fund could be exposed to risk if counter parties to the
contracts are unable to meet the terms of their contracts or if the value
of the foreign currency changes unfavorably. Forward currency contracts are
"marked-to-market" daily at the applicable translation rate and the
resulting unrealized gains or losses are reflected in the Fund's assets.
Global Fund had the following forward currency contracts outstanding at
September 30, 2004:
Contracts to Buy Unrealized
Foreign Currency In Exchange for Settlement Date Gain
- ---------------------------- --------------- --------------- ----------
54,158,935 Japanese Yen US$ 486,188 10/1/04 US$ 5,205
20,616,962 Japanese Yen 186,017 10/4/04 1,045
730,019 Australian Dollar 523,080 10/5/04 5,709
26,846,377 Japanese Yen 242,954 10/5/04 628
33,210,000 Japanese Yen 298,544 10/6/04 2,776
--------------- ----------
$1,736,783 $15,363
=============== ----------
Contracts to Sell Unrealized
Foreign Currency In Exchange for Settlement Date Gain (Loss)
- ---------------------------- --------------- --------------- ----------
213,689 British Pound US$ 387,334 10/1/04 US$ 652
524,445 Euro 646,168 10/1/04 (5,192)
45,628 Swiss Franc 36,247 10/1/04 (293)
67,591 Swiss Franc 53,688 10/4/04 (441)
--------------- ----------
$1,123,437 $(5,274)
=============== ----------
Net Unrealized Gain on Forward Currency Contracts $10,089
==========
5. Capital--Each Fund sells two classes of shares, Class A and Class B,
each with a public offering price that reflects different sales charges and
expense levels. Class A shares are sold with an initial sales charge of up
to 5.75% of the amount invested and together with the Class B shares are
subject to distribution plan fees as described in Note 3. Class B shares
are sold without an initial sales charge, but are generally subject to a
contingent deferred sales charge which declines in steps from 4% to 0% over
a six-year period. Class B shares automatically convert into Class A shares
after eight years. Realized and unrealized gains or losses, investment
income and expenses (other than distribution plan fees and certain other
class expenses) are allocated daily to each class of shares based upon the
relative proportion of net assets of each class. The Series Fund has
established an unlimited number of no par value shares of beneficial
interest for both Class A and Class B shares. Of the 100,000,000 $0.001 par
value shares originally designated to each Fund, Series Fund II has
classified 50,000,000 shares as Class A and 50,000,000 shares as Class B
for each Fund. Of the 100,000,000 $1.00 par value Global Fund shares
originally authorized, the Fund has designated 65,000,000 shares as Class A
and 35,000,000 shares as Class B.
Notes to Financial Statements (continued)
September 30, 2004
6. Restricted Securities--Certain restricted securities are exempt from the
registration requirements under Rule 144A of the Securities Act of 1933 and
may only be sold to qualified institutional investors. At September 30,
2004, Total Return Fund held two 144A securities with an aggregate value of
$1,936,881 representing .7% of the Fund's net assets. These securities are
valued as set forth in Note 1A.
7. Tax Components of Capital and Distributions to Shareholders--The tax
character of distributions declared for the years ended September 30, 2004
and 2003 were as follows:
Distributions Declared
from Ordinary Income
---------------------------------
Fund in 2004 in 2003
- ---- -------------- --------------
Total Return $3,663,467 $3,030,869
Value 1,979,769 1,908,744
Blue Chip -- --
Growth & Income 1,198,784 1,561,227
All-Cap Growth -- --
Mid-Cap Opportunity -- --
Special Situations -- --
Focused Equity -- --
Global -- --
As of September 30, 2004, the components of distributable earnings on a tax
basis were as follows:
Total
Undistributed Capital Distributable
Ordinary Loss Unrealized Income
Fund Income Carryovers Appreciation (Deficit)
- ---- ------------ ------------ ------------ ------------
Total Return $ 409,647 $(22,473,294) $26,481,310 $ 4,417,663
Value 156,825 (59,796,762) 38,183,188 (21,456,749)
Blue Chip -- (129,277,387) 77,487,093 (51,790,294)
Growth & Income 1,142,907 (78,057,817) 92,705,942 15,791,032
All-Cap Growth -- (17,185,776) 22,444,772 5,258,996
Mid-Cap Opportunity -- (12,290,944) 52,507,335 40,216,391
Special Situations -- (60,973,556) 34,385,874 (26,587,682)
Focused Equity -- (26,520,358) 2,352,020 (24,168,338)
Global 15,795 (30,872,163) 26,713,693 (4,142,675)
This page intentionally left blank.
Financial Highlights
FIRST INVESTORS
The following table sets forth the per share operating performance data for a share outstanding,
total return, ratios to average net assets and other supplemental data for each fiscal year ended
September 30, except as otherwise indicated.
- -----------------------------------------------------------------------------------------------------
P E R S H A R E D A T A
----------------------------------------------------------------------------------------
Less Distributions
Investment Operations from
------------------------------------- ----------------------
Net Asset Net Realized
Value, Net and Unrealized Total from Net Net
Beginning Investment Gain (Loss) on Investment Investment Realized Total
of Period Income Investments Operations Income Gain Distributions
- -----------------------------------------------------------------------------------------------------
TOTAL RETURN FUND
- -----------------
Class A
- -------
2000 $14.34 $ .31 $ 2.29 $ 2.60 $ .27 $ .40 $ .67
2001 16.27 .26 (2.86) (2.60) .32 1.07 1.39
2002++ 12.28 .22 (1.59) (1.37) .32 -- .32
2003 10.59 .20 1.44 1.64 .21 -- .21
2004 12.02 .20 .96 1.16 .20 -- .20
Class B
- -------
2000 14.17 .21 2.24 2.45 .17 .40 .57
2001 16.05 .18 (2.84) (2.66) .21 1.07 1.28
2002++ 12.11 .15 (1.59) (1.44) .21 -- .21
2003 10.46 .09 1.44 1.53 .13 -- .13
2004 11.86 .12 .94 1.06 .12 -- .12
- -----------------------------------------------------------------------------------------------------
VALUE FUND+++
- -----------------
Class A
- -------
2000 $ 7.99 $ .13 $ 1.21 $ 1.34 $ .13 $ .60 $ .73
2001 8.60 .10 (2.10) (2.00) .11 .56 .67
2002++ 5.93 .11 (1.65) (1.54) .13 -- .13
2003 4.26 .08 .73 .81 .08 -- .08
2004 4.99 .07 .96 1.03 .07 -- .07
Class B
- -------
2000 7.88 .08 1.18 1.26 .07 .60 .67
2001 8.47 .06 (2.07) (2.01) .06 .56 .62
2002++ 5.84 .07 (1.63) (1.56) .08 -- .08
2003 4.20 .05 .71 .76 .04 -- .04
2004 4.92 .03 .95 .98 .03 -- .03
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
R A T I O S / S U P P L E M E N T A L D A T A
- ------------------------ --------------------------------------------------------------------------------
Ratio to Average Net
Ratio to Average Net Assets Before Expenses
Assets** Waived or Assumed
Net Asset -------------------- ----------------------
Value, Net Assets Net Net Portfolio
End of Total End of Period Investment Investment Turnover
Period Return* (in millions) Expenses Income Expenses Income Rate
- -----------------------------------------------------------------------------------------------------------
TOTAL RETURN FUND
- -----------------
Class A
- -------
2000 $16.27 18.67% $120 1.33% 2.00% 1.58% 1.75% 118%
2001 12.28 (17.31) 121 1.37 2.02 1.62 1.77 130
2002++ 10.59 (11.44) 129 1.47 1.91 1.72 1.66 185
2003 12.02 15.58 177 1.52 1.72 1.77 1.47 80
2004 12.98 9.65 231 1.44 1.60 1.65 1.39 41
Class B
- -------
2000 16.05 17.79 16 2.03 1.30 2.28 1.05 118
2001 12.11 (17.82) 19 2.07 1.32 2.32 1.07 130
2002++ 10.46 (12.09) 22 2.17 1.21 2.42 .96 185
2003 11.86 14.71 28 2.22 1.02 2.47 .77 80
2004 12.80 8.92 36 2.14 .90 2.35 .69 41
- -----------------------------------------------------------------------------------------------------------
VALUE FUND+++
- -----------------
Class A
- -------
2000 $ 8.60 17.58% $187 1.31% 1.57% N/A N/A 46%
2001 5.93 (24.98) 149 1.37 1.47 N/A N/A 51
2002++ 4.26 (26.34) 99 1.51 1.93 N/A N/A 40
2003 4.99 19.04 126 1.67 1.69 N/A N/A 198
2004 5.95 20.57 185 1.48 1.21 N/A N/A 11
Class B
- -------
2000 8.47 16.77 32 2.01 .87 N/A N/A 46
2001 5.84 (25.46) 26 2.07 .77 N/A N/A 51
2002++ 4.20 (26.94) 17 2.21 1.23 N/A N/A 40
2003 4.92 18.26 19 2.37 .99 N/A N/A 198
2004 5.87 19.91 23 2.18 .51 N/A N/A 11
- -----------------------------------------------------------------------------------------------------------
Financial Highlights (continued)
FIRST INVESTORS
- -----------------------------------------------------------------------------------------------------
P E R S H A R E D A T A
----------------------------------------------------------------------------------------
Less Distributions
Investment Operations from
------------------------------------- ----------------------
Net Asset Net Net Realized
Value, Investment and Unrealized Total from Net Net
Beginning Income Gain (Loss) on Investment Investment Realized Total
of Period (Loss) Investments Operations Income Gain Distributions
- -----------------------------------------------------------------------------------------------------
BLUE CHIP FUND
- --------------------
Class A
- -------
2000 $27.15 $(.09) $ 5.68 $ 5.59 $ -- $1.65 $1.65
2001 31.09 -- (8.64) (8.64) .01 3.30 3.31
2002 19.14 (.03) (4.55) (4.58) -- -- --
2003 14.56 -- 2.58 2.58 -- -- --
2004 17.14 .01 1.54 1.55 -- -- --
Class B
- -------
2000 26.61 (.25) 5.50 5.25 -- 1.65 1.65
2001 30.21 (.16) (8.33) (8.49) -- 3.30 3.30
2002 18.42 (.16) (4.35) (4.51) -- -- --
2003 13.91 (.11) 2.46 2.35 -- -- --
2004 16.26 (.13) 1.48 1.35 -- -- --
- -----------------------------------------------------------------------------------------------------
GROWTH & INCOME FUND
- --------------------
Class A
- -------
2000 $15.18 $ .01 $ 2.98 $ 2.99 $.01 $1.55 $1.56
2001 16.61 .06 (3.99) (3.93) .03 1.49 1.52
2002++ 11.16 .03 (2.31) (2.28) .05 -- .05
2003 8.83 .04 1.85 1.89 .04 -- .04
2004 10.68 .06 1.43 1.49 .03 -- .03
Class B
- -------
2000 14.90 (.08) 2.90 2.82 -- 1.55 1.55
2001 16.17 (.01) (3.88) (3.89) -- 1.49 1.49
2002++ 10.79 (.04) (2.24) (2.28) -- -- --
2003 8.51 (.03) 1.78 1.75 -- -- --
2004 10.26 (.03) 1.39 1.36 -- -- --
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
R A T I O S / S U P P L E M E N T A L D A T A
- ------------------------ --------------------------------------------------------------------------------
Ratio to Average Net
Ratio to Average Net Assets Before Expenses
Assets** Waived or Assumed
-------------------- ----------------------
Net Asset Net Net
Value, Net Assets Investment Investment Portfolio
End of Total End of Period Income Income Turnover
Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate
- -----------------------------------------------------------------------------------------------------------
BLUE CHIP FUND
- --------------------
Class A
- -------
2000 $31.09 21.49% $615 1.27% (.31)% 1.34% (.38)% 125%
2001 19.14 (30.88) 445 1.35 (.02) 1.43 (.10) 117
2002 14.56 (23.93) 333 1.48 (.17) 1.58 (.27) 144
2003 17.14 17.72 383 1.56 -- 1.68 (.12) 111
2004 18.69 9.04 414 1.47 .03 1.58 (.08) 94
Class B
- -------
2000 30.21 20.60 105 1.97 (1.01) 2.04 (1.08) 125
2001 18.42 (31.33) 78 2.05 (.72) 2.13 (.80) 117
2002 13.91 (24.48) 57 2.18 (.87) 2.28 (.97) 144
2003 16.26 16.90 62 2.26 (.70) 2.38 (.82) 111
2004 17.61 8.30 61 2.17 (.67) 2.28 (.78) 94
- -----------------------------------------------------------------------------------------------------------
GROWTH & INCOME FUND
- --------------------
Class A
- -------
2000 $16.61 21.31% $494 1.28% .05% N/A N/A 142%
2001 11.16 (25.91) 383 1.34 .47 N/A N/A 168
2002++ 8.83 (20.53) 318 1.46 .33 N/A N/A 169
2003 10.68 21.49 400 1.52 .44 N/A N/A 70
2004 12.14 13.95 499 1.42 .53 N/A N/A 32
Class B
- -------
2000 16.17 20.49 107 1.98 (.65) N/A N/A 142
2001 10.79 (26.38) 82 2.04 (.23) N/A N/A 168
2002++ 8.51 (21.13) 65 2.16 (.37) N/A N/A 169
2003 10.26 20.56 76 2.22 (.26) N/A N/A 70
2004 11.62 13.26 83 2.12 (.17) N/A N/A 32
- -----------------------------------------------------------------------------------------------------------
Financial Highlights (continued)
FIRST INVESTORS
- -----------------------------------------------------------------------------------------------------
P E R S H A R E D A T A
----------------------------------------------------------------------------------------
Less Distributions
Investment Operations from
------------------------------------- ----------------------
Net Asset Net Net Realized
Value, Investment and Unrealized Total from Net Net
Beginning Income Gain (Loss) on Investment Investment Realized Total
of Period (Loss) Investments Operations Income Gain Distributions
- -----------------------------------------------------------------------------------------------------
ALL-CAP GROWTH FUND
- -------------------
Class A
- -------
2001(a) $10.00 $(.05) $(3.42) $(3.47) -- -- --
2002 6.53 (.06) (1.14) (1.20) -- -- --
2003 5.33 (.06) 1.48 1.42 -- -- --
2004 6.75 (.07) 1.12 1.05 -- -- --
Class B
- -------
2001(a) 10.00 (.08) (3.43) (3.51) -- -- --
2002 6.49 (.10) (1.13) (1.23) -- -- --
2003 5.26 (.09) 1.44 1.35 -- -- --
2004 6.61 (.12) 1.10 .98 -- -- --
- -----------------------------------------------------------------------------------------------------
MID-CAP OPPORTUNITY FUND
- ------------------------
Class A
- -------
2000 $21.02 (.10) $ 8.02 $ 7.92 -- $2.28 $2.28
2001 26.66 (.05) (7.67) (7.72) -- 1.30 1.30
2002 17.64 (.13) (1.73) (1.86) -- -- --
2003 15.78 (.12) 3.52 3.40 -- -- --
2004 19.18 (.09) 3.62 3.53 -- -- --
Class B
- -------
2000 20.35 (.20) 7.67 7.47 -- 2.28 2.28
2001 25.54 (.18) (7.32) (7.50) -- 1.30 1.30
2002 16.74 (.24) (1.63) (1.87) -- -- --
2003 14.87 (.23) 3.31 3.08 -- -- --
2004 17.95 (.23) 3.38 3.15 -- -- --
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
R A T I O S / S U P P L E M E N T A L D A T A
- ------------------------ --------------------------------------------------------------------------------
Ratio to Average Net
Ratio to Average Net Assets Before Expenses
Assets** Waived or Assumed
-------------------- ----------------------
Net Asset Net Net
Value, Net Assets Investment Investment Portfolio
End of Total End of Period Income Income Turnover
Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate
- -----------------------------------------------------------------------------------------------------------
ALL-CAP GROWTH FUND
- -------------------
Class A
- -------
2001(a) $ 6.53 (34.70)% $ 35 1.75%+ (.90)%+ 2.10%+ (1.25)%+ 84%
2002 5.33 (18.38) 44 1.75 (1.03) 1.98 (1.26) 138
2003 6.75 26.64 77 1.94 (1.15) 1.96 (1.17) 126
2004 7.80 15.56 130 1.68 (1.12) N/A N/A 75
Class B
- -------
2001(a) 6.49 (35.10) 8 2.45+ (1.60)+ 2.80+ (1.95)+ 84
2002 5.26 (18.95) 9 2.45 (1.73) 2.68 (1.96) 138
2003 6.61 25.67 14 2.64 (1.85) 2.66 (1.87) 126
2004 7.59 14.83 20 2.38 (1.82) N/A N/A 75
- -----------------------------------------------------------------------------------------------------------
MID-CAP OPPORTUNITY FUND
- ------------------------
Class A
- -------
2000 $26.66 41.41% $120 1.42% (.52)% 1.67% (.77)% 180%
2001 17.64 (30.34) 109 1.51 (.27) 1.76 (.52) 123
2002 15.78 (10.55) 131 1.70 (.82) 1.95 (1.07) 112
2003 19.18 21.55 192 1.73 (.80) 1.97 (1.04) 37
2004 22.71 18.41 277 1.56 (.46) 1.73 (.63) 40
Class B
- -------
2000 25.54 40.46 24 2.12 (1.22) 2.37 (1.47) 180
2001 16.74 (30.84) 22 2.21 (.97) 2.46 (1.22) 123
2002 14.87 (11.17) 25 2.40 (1.52) 2.65 (1.77) 112
2003 17.95 20.71 35 2.43 (1.50) 2.67 (1.74) 37
2004 21.10 17.55 46 2.26 (1.16) 2.43 (1.33) 40
- -----------------------------------------------------------------------------------------------------------
Financial Highlights (continued)
FIRST INVESTORS
- -----------------------------------------------------------------------------------------------------
P E R S H A R E D A T A
----------------------------------------------------------------------------------------
Less Distributions
Investment Operations from
------------------------------------- ----------------------
Net Asset Net Net Realized
Value, Investment and Unrealized Total from Net Net
Beginning Income Gain (Loss) on Investment Investment Realized Total
of Period (Loss) Investments Operations Income Gain Distributions
- -----------------------------------------------------------------------------------------------------
SPECIAL SITUATIONS FUND
- --------------------------
Class A
- -------
2000 $23.40 $(.18) $ 9.81 $ 9.63 -- $1.21 $1.21
2001 31.82 (.18) (11.59) (11.77) -- 4.89 4.89
2002 15.16 (.19) (2.31) (2.50) -- -- --
2003 12.66 (.17) 3.14 2.97 -- -- --
2004 15.63 (.18) 1.39 1.21 -- -- --
Class B
- -------
2000 22.62 (.33) 9.38 9.05 -- 1.21 1.21
2001 30.46 (.29) (11.00) (11.29) -- 4.89 4.89
2002 14.28 (.29) (2.15) (2.44) -- -- --
2003 11.84 (.25) 2.93 2.68 -- -- --
2004 14.52 (.30) 1.32 1.02 -- -- --
- -----------------------------------------------------------------------------------------------------
FOCUSED EQUITY FUND
- -------------------
Class A
- -------
2000 $10.88 $(.08) $ (.42) $ (.50) -- -- --
2001 10.38 (.03) (2.63) (2.66) -- -- --
2002 7.72 (.07) (1.92) (1.99) -- -- --
2003 5.73 (.02) 1.52 1.50 -- -- --
2004 7.23 (.02) .62 .60 -- -- --
Class B
- -------
2000 10.84 (.15) (.43) (.58) -- -- --
2001 10.26 (.09) (2.59) (2.68) -- -- --
2002 7.58 (.13) (1.86) (1.99) -- -- --
2003 5.59 (.07) 1.48 1.41 -- -- --
2004 7.00 (.08) .61 .53 -- -- --
- -----------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------
R A T I O S / S U P P L E M E N T A L D A T A
- ------------------------ --------------------------------------------------------------------------------
Ratio to Average Net
Ratio to Average Net Assets Before Expenses
Assets** Waived or Assumed
-------------------- ----------------------
Net Asset Net Net
Value, Net Assets Investment Investment Portfolio
End of Total End of Period Income Income Turnover
Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate
- -----------------------------------------------------------------------------------------------------------
SPECIAL SITUATIONS FUND
- --------------------------
Class A
- -------
2000 $31.82 43.07% $276 1.41% (.68)% 1.60% (.87)% 161%
2001 15.16 (42.86) 164 1.54 (.94) 1.75 (1.15) 183
2002 12.66 (16.49) 138 1.69 (1.24) 1.93 (1.48) 153
2003 15.63 23.46 169 1.80 (1.26) 2.05 (1.51) 111
2004 16.84 7.74 190 1.63 (1.08) 1.86 (1.31) 119
Class B
- -------
2000 30.46 41.94 34 2.11 (1.38) 2.30 (1.57) 161
2001 14.28 (43.26) 21 2.24 (1.64) 2.45 (1.85) 183
2002 11.84 (17.09) 18 2.39 (1.94) 2.63 (2.18) 153
2003 14.52 22.63 20 2.50 (1.96) 2.75 (2.21) 111
2004 15.54 7.03 21 2.33 (1.78) 2.56 (2.01) 119
- -----------------------------------------------------------------------------------------------------------
FOCUSED EQUITY FUND
- -------------------
Class A
- -------
2000 $10.38 (4.60)% $ 75 1.62% (.76)% 1.52% (.66)% 178%
2001 7.72 (25.63) 51 1.75 (.35) N/A N/A 240
2002 5.73 (25.78) 38 1.83 (.90) N/A N/A 150
2003 7.23 26.18 48 1.99 (.35) N/A N/A 49
2004 7.83 8.30 49 1.85 (.30) N/A N/A 39
Class B
- -------
2000 10.26 (5.35) 18 2.32 (1.46) 2.22 (1.36) 178
2001 7.58 (26.12) 13 2.45 (1.05) N/A N/A 240
2002 5.59 (26.25) 9 2.53 (1.60) N/A N/A 150
2003 7.00 25.22 11 2.69 (1.05) N/A N/A 49
2004 7.53 7.57 11 2.55 (1.00) N/A N/A 39
- -----------------------------------------------------------------------------------------------------------
Financial Highlights (continued)
FIRST INVESTORS
- -----------------------------------------------------------------------------------------------------
P E R S H A R E D A T A
----------------------------------------------------------------------------------------
Less Distributions
Investment Operations from
------------------------------------- ----------------------
Net Asset Net Net Realized
Value, Investment and Unrealized Total from Net Net
Beginning Income Gain (Loss) on Investment Investment Realized Total
of Period (Loss) Investments Operations Income Gain Distributions
- -----------------------------------------------------------------------------------------------------
GLOBAL FUND
- -----------
Class A
- -------
2000 $ 8.11 $(.02) $ .91 $ .89 -- $ .89 $ .89
2001 8.11 (.01) (2.13) (2.14) -- .76 .76
2002 5.21 (.01) (.96) (.97) -- -- --
2003 4.24 (.01) .93 .92 -- -- --
2004 5.16 (.01) .78 .77 -- -- --
Class B
- -------
2000 7.88 (.07) .88 .81 -- .89 .89
2001 7.80 (.06) (2.03) (2.09) -- .76 .76
2002 4.95 -- (.95) (.95) -- -- --
2003 4.00 (.04) .88 .84 -- -- --
2004 4.84 (.05) .73 .68 -- -- --
- -----------------------------------------------------------------------------------------------------
* Calculated without sales charges.
** Net of expenses waived or assumed by the investment adviser
(Note 3).
+ Annualized
++ Prior to October 1, 2001, the Total Return Fund, Growth & Income
Fund, and Value Fund did not amortize premiums on debt securities. The
per share data and ratios prior to 2001 have not been restated. The
cumulative effect of this accounting change had no impact on the total
net assets of the Funds.
+++ Prior to December 31, 2002, known as Utilities Income Fund.
(a) For the period October 25, 2000 (commencement of operations) to
September 30, 2001.
See notes to financial statements
- -----------------------------------------------------------------------------------------------------------
R A T I O S / S U P P L E M E N T A L D A T A
- ------------------------ --------------------------------------------------------------------------------
Ratio to Average Net
Ratio to Average Net Assets Before Expenses
Assets** Waived or Assumed
-------------------- ----------------------
Net Asset Net Net
Value, Net Assets Investment Investment Portfolio
End of Total End of Period Income Income Turnover
Period Return* (in millions) Expenses (Loss) Expenses (Loss) Rate
- -----------------------------------------------------------------------------------------------------------
GLOBAL FUND
- -----------
Class A
- -------
2000 $ 8.11 11.73% $350 1.65% (.26)% N/A N/A 102%
2001 5.21 (28.87) 234 1.77 (.21) N/A N/A 116
2002 4.24 (18.62) 173 1.87 (.35) N/A N/A 125
2003 5.16 21.70 192 1.98 (.19) N/A N/A 112
2004 5.93 14.92 209 1.86 (.13) N/A N/A 105
Class B
- -------
2000 7.80 10.99 26 2.35 (.96) N/A N/A 102
2001 4.95 (29.42) 18 2.47 (.91) N/A N/A 116
2002 4.00 (19.19) 14 2.57 (1.05) N/A N/A 125
2003 4.84 21.00 15 2.68 (.89) N/A N/A 112
2004 5.52 14.05 15 2.56 (.83) N/A N/A 105
- -----------------------------------------------------------------------------------------------------------
Report of Independent Registered Public Accounting Firm
To the Shareholders and Boards of Directors/Trustees of
First Investors Series Fund
First Investors Series Fund II, Inc.
First Investors Global Fund, Inc.
We have audited the accompanying statements of assets and liabilities,
including the portfolios of investments of the Blue Chip Fund, Special
Situations Fund and Total Return Fund (each a series of First Investors
Series Fund), the All-Cap Growth Fund, Focused Equity Fund, Growth & Income
Fund, Mid-Cap Opportunity Fund and Value Fund (each a series of First
Investors Series Fund II, Inc.), and First Investors Global Fund, Inc. as
of September 30, 2004, the related statements of operations for the year
then ended, the statements of changes in net assets for each of the two
years in the period then ended, and the financial highlights for each of
the periods indicated thereon. These financial statements and financial
highlights are the responsibility of the Funds' management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require
that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements and financial highlights are free of
material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
September 30, 2004, by correspondence with the custodian and brokers. Where
brokers have not replied to our confirmation requests, we have carried out
other appropriate auditing procedures. An audit also includes assessing the
accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position
of the Blue Chip Fund, Special Situations Fund, Total Return Fund, All-Cap
Growth Fund, Focused Equity Fund, Growth & Income Fund, Mid-Cap Opportunity
Fund, Value Fund, and Global Fund as of September 30, 2004, and the results
of their operations for the year then ended, changes in their net assets
for each of the two years in the period then ended, and their financial
highlights for the periods presented, in conformity with accounting
principles generally accepted in the United States of America.
Tait, Weller & Baker
Philadelphia, Pennsylvania
November 1, 2004
This page intentionally left blank.
FIRST INVESTORS EQUITY FUNDS
Directors/Trustees and Officers*
Position(s)
Held with Principal Number of Other
Funds and Occupation(s) Portfolios in Trusteeships
Name, Year of Birth Length of During Past Fund Complex Directorships
and Address Service 5 Years Overseen Held
- ------------------- ------------------ ------------------ ------------ ------------
DISINTERESTED DIRECTORS/TRUSTEES
Robert M. Grohol 1932 Director/Trustee None/Retired 50 None
c/o First Investors since 6/30/00
Management Company, Inc.
95 Wall Street
New York, NY 10005
Rex R. Reed 1922 Director/Trustee None/Retired 50 None
c/o First Investors since 3/31/84
Management Company, Inc.
95 Wall Street
New York, NY 10005
Herbert Rubinstein 1921 Director/Trustee None/Retired 50 None
c/o First Investors since 9/20/79
Management Company, Inc.
95 Wall Street
New York, NY 10005
James M. Srygley 1932 Director/Trustee Owner 50 None
c/o First Investors since 1/19/95 Hampton
Management Company, Inc. Properties
95 Wall Street
New York, NY 10005
Robert F. Wentworth 1929 Director/Trustee None/Retired 50 None
c/o First Investors since 10/15/92
Management Company, Inc.
95 Wall Street
New York, NY 10005
Position(s)
Held with Principal Number of Other
Funds and Occupation(s) Portfolios in Trusteeships
Name, Year of Birth Length of During Past Fund Complex Directorships
and Address Service 5 Years Overseen Held
- ------------------- ------------------ ------------------ ------------ ------------
INTERESTED DIRECTORS/TRUSTEES**
Glenn O. Head 1925 Director/Trustee Chairman of 50 None
c/o First Investors since 1968 First Investors
Management Company, Inc. Corporation,
95 Wall Street First Investors
New York, NY 10005 Consolidated
Corporation,
First Investors
Management
Company, Inc., and
Administrative Data
Management Corp.,
and officer of
other affiliated
companies***
Kathryn S. Head 1955 Director/Trustee Vice President 50 None
c/o First Investors since 3/17/94 of First Investors
Management Company, Inc. Corporation,
581 Main Street President President of
Woodbridge, NJ 07095 since 11/15/01 First Investors
Consolidated
Corporation,
President of
First Investors
Management
Company, Inc.,
President of
Administrative Data
Management Corp.,
Chairman of
First Investors
Federal Savings
Bank and
officer of
other affiliated
companies***
FIRST INVESTORS EQUITY FUNDS
Directors/Trustees and Officers* (continued)
Position(s)
Held with Principal Number of Other
Funds and Occupation(s) Portfolios in Trusteeships
Name, Year of Birth Length of During Past Fund Complex Directorships
and Address Service 5 Years Overseen Held
- ------------------- ------------------ ------------------ ------------ ------------
INTERESTED DIRECTORS/TRUSTEES (continued)
John T. Sullivan 1932 Director/Trustee Of Counsel 50 None
c/o First Investors since 9/20/79 Hawkins,
Management Company, Inc. Delafield &
95 Wall Street Wood; Director
New York, NY 10005 and Chairman
of Executive
Committee of
First Investors
Corporation
* Each Director/Trustee serves for an indefinite term with the
Funds, until his/her successor is elected.
** Mr. Head and Ms. Head are interested directors/trustees because
(a) they are indirect owners of more than 5% of the voting stock of
the adviser and principal underwriter of the Funds, (b) they are
officers, directors and employees of the adviser and principal
underwriter of the Funds, and (c) they are officers of the Funds. Ms.
Head is the daughter of Mr. Head. Mr. Sullivan is an interested
director/trustee because he is a director and Chairman of the
Executive Committee of First Investors Corporation and he indirectly
owns securities issued by the adviser and principal underwriter of
the Funds.
*** Other affiliated companies consist of: First Investors Realty
Company, Inc., First Investors Life Insurance Company, First
Investors Leverage Corporation, Route 33 Realty Corporation, First
Investors Credit Funding Corporation, N.A.K. Realty Corporation, Real
Property Development Corporation, School Financial Management
Services, Inc., First Investors Federal Savings Bank, First Investors
Credit Corporation and First Investors Resources, Inc.
Position(s)
Held with Principal Number of Other
Funds and Occupation(s) Portfolios in Trusteeships
Name, Year of Birth Length of During Past Fund Complex Directorships
and Address Service 5 Years Overseen Held
- ------------------- ------------------ ------------------ ------------ ------------
OFFICER(S) WHO ARE NOT DIRECTORS/TRUSTEES
Joseph I. Benedek 1957 Treasurer Treasurer 50 None
c/o First Investors since 1988 and Principal
Management Company, Inc. Accounting Officer
581 Main Street
Woodbridge, NJ 07095
Dennis T. Fitzpatrick 1958 Vice President Portfolio Manager 2 None
c/o First Investors Series Funs, of First Investors
Management Company, Inc. since 1998 Management
95 Wall Street Company, Inc.
New York, NY 10005
George V. Ganter 1952 Vice President, Portfolio Manager 2 None
c/o First Investors Series Fund, of First Investors
Management Company, Inc. since 2000 Management
95 Wall Street Company, Inc.
New York, NY 10005
Clark D. Wagner 1959 Vice President Director of 27 None
c/o First Investors Series Fund, Fixed Income
Management Company, Inc. since 1991 (previously Chief
95 Wall Street Investment Officer)
New York, NY 10005 of First Investors
Management
Company, Inc.
FIRST INVESTORS EQUITY FUNDS
Shareholder Information
- -----------------------
Investment Adviser
First Investors Management Company, Inc.
95 Wall Street
New York, NY 10005
Subadviser (All-Cap Growth Fund,
Focused Equity Fund and Global Fund only)
Wellington Management Company, LLP
75 State Street
Boston, MA 02109
Underwriter
First Investors Corporation
95 Wall Street
New York, NY 10005
Custodian
The Bank of New York
One Wall Street
New York, NY 10286
Custodian (Global Fund only)
Brown Brothers Harriman & Co.
40 Water Street
Boston, MA 02109
Transfer Agent
Administrative Data Management Corp.
581 Main Street
Woodbridge, NJ 07095-1198
Legal Counsel
Kirkpatrick & Lockhart LLP
1800 Massachusetts Avenue, N.W.
Washington, DC 20036
Auditors
Tait, Weller & Baker
1818 Market Street
Philadelphia, PA 19103
It is the Funds' practice to mail only one copy of their annual and
semi-annual reports to all family members who reside in the same household.
Additional copies of the reports will be mailed if requested by any
shareholder in writing or by calling 800-423-4026. The Funds will ensure
that separate reports are sent to any shareholder who subsequently changes
his or her mailing address.
This report is authorized for distribution only to existing shareholders,
and, if given to prospective shareholders, must be accompanied or preceded
by the Funds' prospectus.
The Statement of Additional Information includes additional information
about the Funds' directors/trustees and is available without charge, upon
request in writing or by calling 800-423-4026.
A description of the policies and procedures that the Funds use to vote
proxies relating to a portfolio's securities is available, without charge,
upon request by calling toll free 800-423-4026 or can be viewed online or
downloaded from the EDGAR database on the Securities and Exchange
Commission's ("SEC") internet website at http://www.sec.gov. In addition,
commencing on August 31, 2004, information regarding how the Funds voted
proxies relating to portfolio securities during the most recent 12-month
period ended June 30, will be available, without charge, upon request in
writing or by calling 800-423-4026 and on the SEC's internet website at
http://www.sec.gov.
The Funds will file their complete schedule of portfolio holdings with the
SEC for the first and third quarters of each fiscal year (beginning the 1st
quarter ending December 31, 2004) on Form N-Q. The Funds' Form N-Q will be
available on the SEC's website at http://www.sec.gov; and may also be
reviewed and copied at the SEC's Public Reference Room in Washington, D.C.
Information on the operation of the Public Reference Room may be obtained
by calling 800-SEC-0330. The schedule of portfolio holdings will also be
available, without charge, upon request in writing or by calling
800-423-4026.
NOTES
NOTES
Item 2. Code of Ethics
As of the end of the period, September 30, 2004, the Registrant has
adopted a Code of Ethics that applies to the First Investors Funds'
("Funds") principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are employed
by the Funds or a third party. A copy of the code of ethics is
attached to this report as Exhibit A.
During the period of the report, there have been no amendments to the
Code of Ethics or waivers, implicit or otherwise, from its provisions.
Item 3. Audit Committee Financial Expert
The independent director currently serving as the audit committee
financial expert is Robert F. Wentworth.
The Registrant's Board has unanimously determined that Mr. Wentworth
satisfied the definition of an audit committee financial expert as
set forth in the instructions to Form N-CSR under the Investment
Company Act of 1940. Specifically, the Board determined that
Mr. Wentworth has all of the following: (i) an understanding of
generally accepted accounting principles and financial
statements; (ii) the ability to assess the general application of such
principles in connection with the accounting for estimates, accruals,
and reserves; (iii) experience preparing, auditing, analyzing or
evaluating financial statements that present the breadth and level of
complexity of accounting issues that are generally comparable to the
breadth and complexity of issues that can reasonably be expected to be
raised by the Funds' financial statements, or experience actively
supervising one or more persons engaged in such activities; (iv) an
understanding of internal controls and procedures for financial reports;
and (v) an understanding of audit committee functions. Furthermore, he
had acquired these attributes through education and many years of
relevant experience in various financial positions with American
Telephone and Telegraph Company, including the positions of
Director - Accounting, Director - Finance, Director - Financial
Reporting and Analysis, Controller, and Director of Business Planning.
Mr. Wentworth also has many years experience serving on the Audit
Committees of First Investors Funds and other organizations. Finally,
Mr. Wentworth is independent as defined in the instructions to the Form.
Item 4. Principal Accountant Fees and Services
Fiscal Year Ended
December 31,
-----------------
2003 2002
---- ----
(a) Audit Fees
First Investors
Series Fund
Total Return Fund $ 14,900 $ 14,900
Blue Chip Fund 33,900 33,900
Special Situations Fund 24,900 24,900
Series Fund II, Inc.
Value Fund 20,900 20,900
Growth & Income Fund 32,900 32,900
All-Cap Growth Fund 10,900 10,900
Mid-Cap Opportunity Fund 13,900 13,900
Focused Equity Fund 10,900 10,900
Global Fund, Inc. 34,900 34,900
(b) Audit-Related Fees
First Investors
Series Fund
Total Return Fund $ 0 $ 0
Blue Chip Fund 0 0
Special Situations Fund 0 0
Series Fund II, Inc.
Value Fund 0 0
Growth & Income Fund 0 0
All-Cap Growth Fund 0 0
Mid-Cap Opportunity Fund 0 0
Focused Equity Fund 0 0
Global Fund, Inc. 0 0
(c) Tax Fees
First Investors
Series Fund
Total Return Fund $ 3,500 $ 3,500
Blue Chip Fund 3,500 3,500
Special Situations Fund 3,500 3,500
Series Fund II, Inc.
Value Fund 3,500 3,500
Growth & Income Fund 3,500 3,500
All-Cap Growth Fund 3,500 3,500
Mid-Cap Opportunity Fund 3,500 3,500
Focused Equity Fund 3,500 3,500
Global Fund, Inc. 3,500 3,500
Nature of fees: tax returns preparation and tax compliance
(d) All Other Fees
First Investors
Series Fund
Total Return Fund $ 0 $ 0
Blue Chip Fund 0 0
Special Situations Fund 0 0
Series Fund II, Inc.
Value Fund 0 0
Growth & Income Fund 0 0
All-Cap Growth Fund 0 0
Mid-Cap Opportunity Fund 0 0
Focused Equity Fund 0 0
Global Fund, Inc. 0 0
(e)(1) Audit committee's pre-approval policies
The Audit Committee has adopted a charter under which it has the duties,
among other things,
(a) to pre-approve, and to recommend to the full Board, the
selection, retention or termination of the independent auditors to provide
audit, review or attest services to the Funds and, in connection therewith,
evaluate the independence of the auditors and to obtain the auditors'
specific representations as to their independence;
(b) to pre-approve all non-audit services to be provided to
the Funds by the independent auditor;
(c) to pre-approve all non-audit services to be provided by
the Funds' independent auditor to the Funds' investment adviser or to any
entity that controls, is controlled by or is under common control with the
Funds investment adviser ("adviser affiliate") and that provides ongoing
services to the Funds, if the engagement relates directly to the operations
and financial reporting of the Funds;
(d) to establish, if deemed necessary or appropriate as an
alternative to Audit Committee pre-approved of services to be provided by
the independent auditor as required by paragraphs (b) and (c) above,
policies and procedures to permit such services to be pre-approved by other
means, such as by action of a designated member and members of the Audit
Committee, subject to subsequent Committee review and oversight;
(e) to consider whether the non-audit services provided by the
Funds' independent auditors to the Funds' investment adviser or any adviser
affiliate that provides ongoing services to the Funds, which services were
not pre-approved by the Audit Committee, are compatible with maintaining the
auditors' independence;
(f) to meet with the Funds' independent auditors, including
meetings without management representatives, as necessary (i) to review the
arrangements for, and scope of, the annual audit, any special audits and any
other services to be provided to the Fund's by the auditors; (ii) to discuss
any matters of concern relating to the Fund's financial statements,
including any adjustments to such statements recommended by the auditors, or
other results of said audit(s); and (iii) to review the form of opinion the
auditors propose to render to the Board and shareholders;
(g) to receive and consider (i) information and comments from
the auditors with respect to the Funds' accounting and financial reporting
policies, procedures and internal control over financial reporting
(including the Funds' critical accounting policies and practices) and to
consider management's responses to any such comments; (ii) reports from the
auditors regarding any material written communications between the auditors
and management; and (iii) reports from the auditors regarding all non-audit
services provided to any entity in the Funds' investment company complex
that were not pre-approved by the Audit Committee or pursuant to
pre-approved policies and procedures established by the Audit Committee and
associated fees;
(h) to consider the effect upon the Funds of any changes in
accounting principles or practices proposed by management or the auditors;
(i) to review and approve the fees proposed to be charged to the
Funds by the auditors for each audit and non-audit service;
(j) to receive reports from Fund management in connection with
the required certifications on Form N-CSR under the 1940 Act of any
significant deficiencies in the design or operation of the Funds' internal
control over financial reporting or material weakness therein and any
reported evidence of fraud, whether or not material, involving management or
other employees of the Funds who have a significant role in the Funds'
internal control over financial reporting;
(k) to investigate improprieties or suspected improprieties in
the Funds' accounting or financial reporting brought to the attention of the
Audit Committee;
(l) to receive and consider reports from attorneys, in
accordance with the "Up-the-Ladder" Reporting Policies for attorneys who
appear or practice before the Securities and Exchange Commission in the
representation of the Funds and in accordance with applicable federal law,
and auditors relating to possible material violations of federal or state
law or fiduciary duty;
(m) to report its activities to the full Board on a regular
basis and to make such recommendations with respect to the above and other
matters as the Audit Committee may deem necessary or appropriate;
(n) to meet with the Treasurer of the Funds and, as necessary,
with internal auditors, if any, for the management company; and
(o) to perform such other functions and to have such powers as
may be necessary or appropriate in the efficient and lawful discharge of the
powers provided in this Charter.
(e)(2) None, or 0%, of the services relating to the Audit-Related Fees,
Tax Fees and All Other Fees paid by the Registrant and Related Entities
disclosed above were approved by the audit committee pursuant to paragraph
(c)(7)(i)(C) of Rule 2-01 of Regulation S-X (which permits audit committee
approval after the start of the engagement with respect to services other
than audit review or attest services, if certain conditions are satisfied).
(f) Not Applicable
(g) Aggregate non-audit fees billed by the Registrant's accountant
for services rendered to the Registrant and the Registrant's investment
adviser or any entity controlling, controlled by, or under common
control with the adviser that provides ongoing services to the
Registrant for the two fiscal years ended September 30, 2004 and 2003
were $0 and $0, respectively.
(h) Not Applicable
Item 5. Audit Committee of Listed Registrants
Audit Committee Members -
Robert M. Grohol
Rex R. Reed
Herbert Rubinstein
James M. Srygley
Robert F. Wentworth
Item 6. Schedule of Investments
Schedule is included as part of the report to
shareholders filed under Item 1 of this Form.
Item 7. Disclosure of Proxy Voting Policies & Procedures for
Closed-End Management Investment Companies
Not applicable to the Registrant
Item 8. Purchases of Equity Securities by Closed-End Management
Investment Companies and Affiliated Purchasers
Not applicable to the Registrant
Item 9. Submission of Matters to a Vote of Security Holders
The Nominating and Compensation Committee (the "Committee") of the Board of
Directors/Trustees of the First Investors Family of Funds (the "Board") was
established in November 2004. The Committee is comprised of all the
Independent Directors/Trustees. The Committee is responsible for, among
other things, selecting and nominating persons to serve as Independent
Directors/Trustees on the Board, evaluating candidates' qualifications,
reviewing the composition of the Board to determine whether it may be
appropriate to add other Independent Directors/Trustees, and reviewing
director/trustee compensation. When the Board has, or expects to have,
vacancies, the Committee shall consider shareholder recommendations for
nominations to fill such vacancies if such recommendations are submitted in
writing and addressed to the Committee at the Funds' offices at: First
Investors Funds, 95 Wall Street, New York, NY 10005.
Item 10. Controls and Procedures
(a) The Registrant's Principal Executive Officer and Principal
Financial Officer have concluded that the Registrant's disclosure controls
and procedures (as defined in Rule 30a-3(c) under the Investment Company
Act of 1940, as amended) are effective, based on their evaluation of these
disclosure controls and procedures as of a date within 90 days of the
filing date of this report.
(b) There were no significant changes in the Registrant's internal
controls or in other factors that could significantly affect these controls
subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Item 11. Exhibits
(a) Code of Ethics - Filed herewith
(b) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002 - Filed herewith
(c) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002 - Filed herewith
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934
and the Investment Company Act of 1940, the Registrant have duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
First Investors Series Fund
First Investors Series Fund II, Inc.
First Investors Global Fund, Inc.
(Registrant)
By /S/ KATHRYN S. HEAD
Kathryn S. Head
President and Principal Executive Officer
Date: December 7, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934
and the Investment Company Act of 1940, this report has been signed below by
the following persons on behalf of the Registrant and in the capacities and
on the dates indicated.
First Investors Series Fund
First Investors Series Fund II, Inc.
First Investors Global Fund, Inc.
(Registrant)
By /S/ JOSEPH I. BENEDEK
Joseph I. Benedek
Treasurer and Principal Financial Officer
Date: December 7, 2004