As filed with the Securities and Exchange Commission on August 30, 2004
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF
REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file Number: 811-4255
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NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST
------------------------------------------------------
(Exact Name of the Registrant as Specified in Charter)
605 Third Avenue, 2nd Floor
New York, New York 10158-0180
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(Address of Principal Executive Offices - Zip Code)
Registrant's Telephone Number, including area code: (212) 476-8800
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Peter E. Sundman, Chief Executive Officer
Neuberger Berman Advisers Management Trust
605 Third Avenue, 2nd Floor
New York, New York 10158-0180
Jeffrey S. Puretz, Esq.
Dechert LLP
1775 I Street, N.W.
Washington, D.C. 20006
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(Names and Addresses of agents for service)
Date of fiscal year end: December 31, 2004
Date of reporting period: June 30, 2004
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the
collection of information contained in Form N-CSR unless the Form displays a
currently valid Office of Management and Budget ("OMB") control number. Please
direct comments concerning the accuracy of the information collection burden
estimate and any suggestions for reducing the burden to Secretary, Securities
and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The
OMB has reviewed this collection of information under the clearance requirements
of 44 U.S.C. Section 3507.
ITEM 1. REPORTS TO SHAREHOLDERS
Semi-Annual Report [NEUBERGER BERMAN LOGO]
June 30, 2004
Neuberger Berman
Advisers
Management
Trust
Balanced
Portfolio[RegTM]
B0731 08/04
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Balanced Portfolio Managers' Commentary
The AMT Balanced Portfolio ended the first half of 2004 with a gain of 3.92%, as
the market began rewarding stocks with solid business fundamentals as opposed to
unproven growth prospects, a trend that favored our equity investment process.
The bond market remained challenging, but our conservative investment style
preserved capital on the bond side of the portfolio.
The largest contribution to relative performance on the equity portion came from
stock selection in the information technology, consumer discretionary and
financial sectors. Stocks that did well in IT included companies that develop
and provide specialized technologies to businesses such as Zebra Technologies.
Within consumer discretionary, our emphasis in entertainment and leisure and
specialty retail companies were some of the primary reasons for this
outperformance with Royal Caribbean Cruises and PETsMART both performing well.
Within the financials sector, Capital One Financial, First Marblehead, and
Investors Financial Services were all strong performers, as they represent less
interest rate sensitive names within that sector.
In the aggregate, our equity sector allocation was slightly negative on a
year-to-date basis, with our underweight position in both consumer staples and
healthcare accounting for much of the underperformance.
Even though we are not pessimistic in terms of the overall economy and
inflation, we are not optimistic in terms of near-term stock performance. We
expect equities to struggle as profit growth slows, interest rates increase, and
the Presidential election remains tight. Over the past six years, the S&P 500 is
essentially flat in price while earnings have increased by a third. The market's
forward P/E has collapsed from 21 to 16 during this period. However, the stock
market is still not cheap, since a P/E of 16 is the long-term average. We
believe P/Es will continue to wilt in the heat of the summer months.
Uncertainties about next year's economy will most likely increase as more
difficult earnings comparisons will begin this quarter. If fears become more
intense and investors overreact, we expect poor near-term equity performance to
provide a platform for better equity performance in the latter part of this
year.
We seek to continue to position the portfolio with tilts toward lower volatility
stocks in higher quality companies with lower earnings variability. As interest
rates move higher and growth rates slow, we believe that companies with
financial strength should be favored.
On the bond side of the portfolio, at the beginning of 2004, we had a relatively
conservative duration, moderately below the duration of the benchmark index. The
portfolio's defensive posture was a reflection of our recognition that low bond
yields provide only a thin cushion to offset potential price declines associated
with the strengthening economy. We maintained the portfolio's conservative
positioning throughout the reporting period, a stance that helped preserve
shareholder capital following the surprisingly strong March employment report
and the Federal Reserve's anticipated interest rate hike in June.
We employed shifts in sector allocation to take advantage of evolving
opportunities in the market. Over the reporting period, we reduced our
allocation to corporate securities from 22.4% of the overall portfolio at the
beginning of the period to 17.3% at the end of June. We also steadily increased
our allocation to U.S. Treasury Securities from 8.8% of the overall portfolio to
18.8% at the end of June, which helped to maintain the portfolio's high credit
quality. These changes are consistent with the conservative structuring of the
portfolio.
1
As expected, the Federal Reserve Board's Open Market Committee took action by
moving the Fed Funds target rate up 0.25% at its June 30 meeting. In the past,
Fed Chairman Alan Greenspan has employed a measured approach to adjusting the
target rate, taking small discrete steps and then patiently waiting to evaluate
the impact on the economy before proceeding further. In his commentary, Mr.
Greenspan has hinted that the Fed will use a similar approach in the coming
months. We will continue to evaluate these factors and adjust the portfolio
accordingly.
As interest rates rise and additional opportunities become more attractive, we
will once again reach out on the risk spectrum in search of ways to create
value in the fund.
Sincerely,
/s/ Ted Giuliano
/s/ John Dugenske
/s/ Jon D. Brorson
/s/ Kenneth J. Turek
TED GIULIANO, JOHN DUGENSKE,
JON D. BRORSON, KENNETH J. TUREK
PORTFOLIO CO-MANAGERS
1. 11.95%, 1.59%, and 7.37% were the average annual total returns for the 1-, 5-
and 10-year periods ended June 30, 2004. Neuberger Berman Management Inc.
("NBMI") has agreed to absorb certain expenses of the AMT Portfolios. Without
this arrangement, which is subject to change, the total returns of the
Portfolios would be less. Total return includes reinvestment of dividends and
capital gain distributions. Performance data quoted represent past performance
and the investment return and principal value of an investment will fluctuate so
that the shares, when redeemed, may be worth more or less than original cost.
Current performance may be lower or higher than the performance data quoted. For
performance data current to the most recent month end, please visit www.nb.com/
amtperformance. The performance information does not reflect fees and expenses
of the variable annuity and variable life insurance policies or the pension
plans whose proceeds are invested in the portfolio.
2. The Russell Midcap[RegTM] Growth Index measures the performance of those
Russell Midcap[RegTM] Index companies with higher price-to-book ratios and
higher forecasted growth values. The Russell Midcap Index measures the
performance of the 800 smallest companies in the Russell 1000[RegTM] Index,
which represents approximately 27% of the total market capitalization of the
Russell 1000 Index (which, in turn, consists of the 1,000 largest U.S.
companies, based on market capitalization). The S&P 500 Index is widely regarded
as the standard for measuring large-cap U.S. stock market performance and
includes a representative sample of leading companies in leading industries. The
Merrill Lynch 1-3 Year Treasury Index is an unmanaged total return market value
index consisting of all coupon-bearing U.S. Treasury publicly placed debt
securities with maturities between 1 to 3 years. Please note that indices do not
take into account any fees and expenses of investing in the individual
securities that they track, and that individuals cannot invest directly in any
index. Data about the performance of these indices are prepared or obtained by
NBMI and include reinvestment of all dividends and capital gain distributions.
The Portfolio may invest in many securities not included in the above-described
indices.
Any ratios or other measurements using a factor of forecasted earnings of a
company discussed herein are based on consensus estimates, not Neuberger
Berman's own projections, and they may or may not be realized. In addition, any
revision to a forecast could affect the market price of a security. By quoting
them herein, Neuberger Berman does not offer an opinion as to the accuracy of
and does not guarantee these forecasted numbers.
2
The investments for the Portfolio are managed by the same portfolio manager(s)
who manage one or more other mutual funds that have similar names, investment
objectives and investment styles as the Portfolio. You should be aware that the
Portfolio is likely to differ from the other mutual funds in size, cash flow
pattern and tax matters. Accordingly, the holdings and performance of the
Portfolio can be expected to vary from those of the other mutual funds.
The composition, industries and holdings of the Portfolio are subject to change.
Shares of the separate Portfolios of Neuberger Berman Advisers Management Trust
are sold only through the currently effective prospectus and are not available
to the general public. Shares of this Portfolio may be purchased only by life
insurance companies to be used with their separate accounts that fund variable
annuity and variable life insurance policies and by certain qualified pension
and retirement plans.
(C) 2004 Neuberger Berman Management Inc., distributor. All rights reserved.
3
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Balanced Portfolio
Number of Shares Market Value+
Common Stocks (56.7%)
Aerospace (0.3%)
7,500 Rockwell Collins $ 249,900
Biotechnology (2.4%)
16,100 Alkermes, Inc. 218,960*\P
10,000 Celgene Corp. 572,600*
8,500 Gilead Sciences 569,500*
5,250 Martek Biosciences 294,893*
17,500 Protein Design Labs 334,775*
----------
1,990,728
Building, Construction & Furnishing (0.3%)
5,200 Centex Corp. 237,900
Business Services (4.3%)
25,500 Alliance Data Systems 1,077,375*
14,050 Corporate Executive Board 811,949
17,000 Education Management 558,620*
9,050 Getty Images 543,000*\P
13,000 Stericycle, Inc. 672,620*
----------
3,663,564
Communications Equipment (0.8%)
9,000 F5 Networks 238,320*
19,000 Juniper Networks 466,830*
----------
705,150
Computer Related (1.0%)
11,500 Apple Computer 374,210*
5,000 Lexmark International
Group 482,650*
----------
856,860
Consumer Cyclicals (0.6%)
14,000 Williams-Sonoma 461,440*
Consumer Discretionary (0.2%)
6,600 XM Satellite Radio
Holdings 180,114*
Diversified (0.4%)
6,000 iShares Russell 2000
Growth Index Fund 375,000\P
Electrical & Electronics (1.3%)
21,000 Jabil Circuit 528,780*
18,500 Molex Inc. 593,480
----------
1,122,260
Energy (2.7%)
8,500 Canadian Natural
Resources 254,150
8,000 Murphy Oil 589,600
9,000 Smith International 501,840*
32,061 XTO Energy 955,097
----------
2,300,687
Entertainment (0.9%)
18,500 International Game
Technology 714,100
4
Number of Shares Market Value+
Financial Services (3.8%)
20,000 CapitalSource Inc. $ 489,000*
11,500 First Marblehead 462,990*
12,000 Franklin Resources 600,960
19,000 Investors Financial
Services 828,020\P
8,200 Moody's Corp. 530,212
5,900 Piper Jaffray 266,857*
----------
3,178,039
Food & Beverage (0.9%)
8,000 Whole Foods Market 763,600
Health Care (4.4%)
6,000 Allergan, Inc. 537,120
12,000 C. R. Bard 679,800
17,500 Caremark Rx 576,450*
7,200 Henry Schein 454,608*
4,500 INAMED Corp. 282,825*
7,500 Invitrogen Corp. 539,925*
10,000 Teva Pharmaceutical
Industries ADR 672,900\P
----------
3,743,628
Industrial (5.6%)
12,600 American Standard 507,906*
14,500 Danaher Corp. 751,825\P
20,000 Donaldson Co. 586,000
10,500 Eaton Corp. 679,770
18,000 Fastenal Co. 1,022,940\P
13,000 Gentex Corp. 515,840
7,200 Harman International
Industries 655,200
----------
4,719,481
Instruments (0.2%)
5,200 Thermo Electron 157,857*
Leisure (1.7%)
5,000 Marriott International 249,400
13,000 Multimedia Games 348,660*\P
18,500 Royal Caribbean Cruises 803,085\P
----------
1,401,145
Media (1.6%)
7,500 E.W. Scripps 787,500
17,925 Univision Communications 572,345*\P
----------
1,359,845
Medical Equipment (3.9%)
7,850 Advanced Neuromodulation
Systems 257,480*
5,500 Fisher Scientific
International 317,625*
6,000 Kinetic Concepts 299,400*
9,500 Kyphon Inc. 267,710*
7,000 ResMed Inc. 356,720*
13,050 Varian Medical Systems 1,035,518*
9,000 Zimmer Holdings 793,800*
----------
3,328,253
See Notes to Schedule of Investments 5
Schedule of Investments Balanced Portfolio cont'd
Number of Shares Market Value+
Packing & Containers (1.1%)
14,500 Packaging Corp. of America $ 346,550
22,600 Pactiv Corp. 563,644*
-----------
910,194
Restaurants (0.6%)
13,500 Applebee's International 310,770
6,500 Wendy's International 226,460
-----------
537,230
Retail (4.8%)
16,800 Coach, Inc. 759,192*
17,500 Nordstrom, Inc. 745,675
21,000 PETsMART, Inc. 681,450\P
19,500 Staples, Inc. 571,545
13,500 Starbucks Corp. 586,980*
3,900 Talbots, Inc. 152,685
18,000 Tuesday Morning 522,000*
-----------
4,019,527
Semiconductors (2.9%)
9,500 Broadcom Corp. 444,315*
12,500 Linear Technology 493,375
17,000 Microchip Technology 536,180
25,300 Microsemi Corp. 359,513*
28,000 National Semiconductor 615,720*
-----------
2,449,103
Software (2.1%)
4,000 Cognos, Inc. 144,640*
9,700 Electronic Arts 529,135*
15,000 Mercury Interactive 747,450*
45,500 TIBCO Software 384,475*
-----------
1,805,700
Technology (4.4%)
15,000 Agilent Technologies 439,200*
17,500 Altera Corp. 388,850*
14,200 Check Point Software
Technologies 383,258*
21,000 Cognizant Technology
Solutions 533,610*\P
31,500 Corning Inc. 411,390*
11,000 Symbol Technologies 162,140
16,500 Zebra Technologies 1,435,500*
-----------
3,753,948
Telecommunications (2.2%)
17,000 Avaya Inc. 268,430*
75,000 Nextel Partners 1,194,000*
14,000 Western Wireless 404,740*
-----------
1,867,170
Transportation (1.3%)
8,500 C.H. Robinson Worldwide 389,640
17,400 J. B. Hunt Transport
Services 671,292
-----------
1,060,932
Total Common Stocks
(Cost $36,778,441) 47,913,355
-----------
See Notes to Schedule of Investments 6
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Balanced Portfolio cont'd
Principal Amount Rating Market Value+
Moody's S&P
U.S. Treasury Securities (18.8%)
$ 350,000 U.S. Treasury Bills, 0.93%, due 7/1/04 TSY TSY $ 350,000
2,435,000 U.S. Treasury Bills, 0.98%, due 8/19/04 TSY TSY 2,431,072
160,000 U.S. Treasury Notes, 1.88%, due 9/30/04 TSY TSY 160,200
90,000 U.S. Treasury Notes, 2.13%, due 10/31/04 TSY TSY 90,172
430,000 U.S. Treasury Notes, 2.00%, due 11/30/04 TSY TSY 430,722
1,500,000 U.S. Treasury Notes, 1.63%, due 3/31/05 TSY TSY 1,497,071&&
250,000 U.S. Treasury Notes, 1.50%, due 7/31/05 TSY TSY 248,330
130,000 U.S. Treasury Notes, 1.88%, due 11/30/05 TSY TSY 129,101
750,000 U.S. Treasury Notes, 1.88%, due 12/31/05 TSY TSY 743,760
3,900,000 U.S. Treasury Notes, 1.88%, due 1/31/06 TSY TSY 3,862,829
4,920,000 U.S. Treasury Notes, 2.00%, due 5/15/06 TSY TSY 4,861,767
325,000 U.S. Treasury Notes, 3.00%, due 2/15/08 TSY TSY 320,519
750,000 U.S. Treasury Notes, 3.25%, due 1/15/09 TSY TSY 735,586&&
--------------
Total U.S. Treasury Securities (Cost $16,054,479) 15,861,129
--------------
Mortgage-Backed Securities (5.1%)
Fannie Mae
159,397 Collateralized Mortgage Obligations, Planned Amortization
Certificates, Ser. 2003-16, Class PA, 4.50%, due 11/25/09 AGY AGY 161,518
Freddie Mac
138,532 Collateralized Mortgage Obligations, Planned Amortization
Certificates, Ser. 2592, Class PA, 4.50%, due 12/15/07 AGY AGY 139,013
113,069 Pass-Through Certificates, 5.00%, due 2/1/07 AGY AGY 115,162
145,448 Pass-Through Certificates, 5.50%, due 2/1/07 AGY AGY 149,097
Government National Mortgage Association
800,000 5.00%, TBA, 30 Year Maturity AGY AGY 775,000&e
1,200,000 Pass-Through Certificates, 4.50%, due 6/15/34 AGY AGY 1,129,250
750,000 Pass-Through Certificates, 5.00%, due 3/15/34 AGY AGY 728,110
1,111,697 Pass-Through Certificates, 6.00%, due 1/15/33 AGY AGY 1,141,142
--------------
Total Mortgage-Backed Securities (Cost $4,322,091) 4,338,292
--------------
Corporate Debt Securities (17.3%)
210,000 Abitibi-Consolidated, Inc., Bonds, 8.30%, due 8/1/05 Ba2 BB 217,339
120,000 Allied Waste North America, Inc., Guaranteed Senior Notes,
Ser. B, 7.63%, due 1/1/06 Ba3 BB- 125,850
150,000 Allied Waste North America, Inc., Guaranteed Notes, Ser. B,
8.88%, due 4/1/08 Ba3 BB- 164,250
400,000 Allstate Corp., Senior Notes, 7.88%, due 5/1/05 A1 A+ 417,470
200,000 American General Finance Corp., Floating Rate Notes, Ser. G,
1.91%, due 9/20/04 A1 A+ 200,327
200,000 AT&T Wireless Services, Inc., Senior Notes, 7.35%, due 3/1/06 Baa2 BBB 213,420
550,000 Bank One Corp., Notes, 6.50%, due 2/1/06 Aa3 A+ 580,420
250,000 BankBoston N.A., Subordinated Notes, 6.50%, due 12/19/07 Aa2 A+ 271,343
200,000 Bausch & Lomb, Inc., Notes, 6.75%, due 12/15/04 Ba1 BBB- 203,179
410,000 Bear Stearns Co., Inc., Notes, 6.50%, due 5/1/06 A1 A 433,994
400,000 Boeing Capital Corp., Senior Notes, 5.65%, due 5/15/06 A3 A 420,300
300,000 Bombardier Capital, Inc., Notes, 7.50%, due 8/15/04 Baa3 BBB- 301,248**
400,000 British Telecom PLC, Notes, 7.88%, due 12/15/05 Baa1 A- 427,665
190,000 Capital One Bank, Senior Notes, 8.25%, due 6/15/05 Baa2 BBB- 199,197
270,000 Caterpillar Financial Services Corp., Floating Rate Medium-Term
Notes, 1.28%, due 8/16/04 A2 A 270,047
335,000 Caterpillar Financial Services Corp., Notes, 6.88%, due 8/1/04 A2 A 336,257
145,000 Chase Manhattan Corp., Subordinated Notes, 7.25%, due 6/1/07 A1 A 159,190
200,000 Comcast Cable Communications, Senior Notes, 6.38%, due 1/30/06 Baa3 BBB 209,409
120,000 Cox Communications, Inc., Notes, 7.50%, due 8/15/04 Baa2 BBB 120,711
See Notes to Schedule of Investments 7
Schedule of Investments Balanced Portfolio cont'd
Principal Amount Rating Market Value+
Moody's S&P
$ 200,000 Cox Communications, Inc., Notes, 7.75%, due 8/15/06 Baa2 BBB $ 217,355
210,000 Daimler Chrysler N.A. Holdings Corp., Guaranteed Notes, 6.40%,
due 5/15/06 A3 BBB 221,024
50,000 Delhaize America, Inc., Guaranteed Notes, 7.38%, due 4/15/06 Ba1 BB+ 52,689
170,000 EOP Operating Limited Partnership, Notes, 6.63%, due 2/15/05 Baa1 BBB+ 174,242
200,000 Everest Reinsurance Holdings, Inc., Senior Notes, 8.50%, due
3/15/05 A3 A- 207,385
500,000 General Electric Capital Corp., Medium-Term Notes, Ser. A, 4.25%,
due 1/28/05 Aaa AAA 506,279
150,000 Great Lakes Power, Inc., Notes, 8.30%, due 3/1/05 Baa3 BBB- 155,251
470,000 Gulf Canada Resources, Senior Notes, 8.38%, due 11/15/05 A3 501,677
300,000 HCA, Inc., Notes, 5.25%, due 11/6/08 Ba1 BBB- 298,145
200,000 Hertz Corp., Senior Notes, 8.25%, due 6/1/05 Baa2 207,535
200,000 International Lease Finance Corp., Floating Rate Notes, 2.39%,
due 7/13/04 A1 AA- 201,242
280,000 ITT Corp., Notes, 6.75%, due 11/15/05 Ba1 BB+ 288,400
600,000 John Deere Capital Corp., Floating Rate Senior Notes, 1.56%,
due 8/20/04 A3 A- 600,903
110,000 Jones Intercable, Inc., Senior Notes, 7.63%, due 4/15/08 Baa3 BBB 121,283
400,000 Lear Corp., Guaranteed Senior Notes, Ser. B, 7.96%, due 5/15/05 Baa3 BBB- 417,088
190,000 Mallinckrodt Group, Inc., Notes, 6.50%, due 11/15/07 Ba3 BBB 204,512
400,000 Merrill Lynch & Co., Inc., Floating Rate Medium-Term Notes, Ser. B,
1.43%, due 8/3/04 Aa3 A+ 400,407
235,000 Morgan Stanley Dean Witter & Co., Notes, 7.75%, due 6/15/05 Aa3 A+ 246,452
210,000 National Rural Utilities Cooperative Finance Corp., Collateral Trust,
6.00%, due 5/15/06 A1 A+ 220,991
400,000 Pacific Bell, Notes, 6.25%, due 3/1/05 A1 A+ 410,692
200,000 Pemex Project Funding Master Trust, Guaranteed Notes, 9.13%,
due 10/13/10 Baa1 BBB- 229,000
250,000 Powergen US Funding LLC, Notes, 4.50%, due 10/15/04 A3 BBB+ 251,757
100,000 Quest Diagnostics, Inc., Senior Notes, 6.75%, due 7/12/06 Baa2 BBB 106,730
225,000 Raytheon Co., Notes, 6.50%, due 7/15/05 Baa3 BBB- 232,908
200,000 Reliant Energy Resources Corp., Notes, Ser. B, 8.13%, due 7/15/05 Ba1 BBB 210,081
225,000 Royal Caribbean Cruises Ltd., Senior Notes, 8.13%, due 7/28/04 Ba2 BB+ 225,788
370,000 Sara Lee Corp., Medium-Term Notes, Ser. B, 6.40%, due 6/9/05 A3 A+ 382,120
380,000 Time Warner, Inc., Notes, 5.63%, due 5/1/05 Baa1 BBB+ 389,307
200,000 Tyco International Group S.A., Guaranteed Notes, 5.88%, due 11/1/04 Baa3 BBB 202,331
380,000 Tyco International Group S.A., Guaranteed Notes, 6.38%, due 6/15/05 Baa3 BBB 391,758
325,000 Tyson Foods, Inc., Notes, 6.63%, due 10/1/04 Baa3 BBB 327,734
240,000 Walt Disney Co., Notes, 4.88%, due 7/2/04 BBB+ 240,000
400,000 Washington Mutual, Inc., Senior Notes, 5.63%, due 1/15/07 A3 A- 418,451
90,000 Weyerhaeuser Co., Notes, 5.50%, due 3/15/05 Baa2 BBB 91,903
--------------
Total Corporate Debt Securities (Cost $14,439,368) 14,625,036
--------------
See Notes to Schedule of Investments 8
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Balanced Portfolio cont'd
Principal Amount Rating Market Value+
Moody's S&P
Foreign Government (0.9%)
EUR 600,000 Bundesobligation, 3.50%, due 10/10/08
(Cost $771,321) Aaa AAA $ 731,748^
--------------
Repurchase Agreements (1.7%)
$1,392,000 State Street Bank and Trust Co. Repurchase Agreement, 1.15%,
due 7/1/04, dated 6/30/04, Maturity Value $1,392,044,
Collateralized by $1,080,000 U.S. Treasury Bills, 8.13%,
due 8/15/19 (Collateral Value $1,439,824)
(Cost $1,392,000) 1,392,000#
--------------
Short-Term Investments (7.5%)
6,134,800 N&B Securities Lending Quality Fund, LLC 6,134,800++
222,361 Neuberger Berman Institutional Cash Fund Trust Class 222,361@
--------------
Total Short-Term Investments (Cost $6,357,161) 6,357,161#
--------------
Total Investments (108.0%) (Cost $80,114,861) 91,218,721##
Liabilities, less cash, receivables and other assets [(8.0%)] (6,775,007)
--------------
Total Net Assets (100.0%) $ 84,443,714
--------------
See Notes to Schedule of Investments 9
Notes to Schedule of Investments Balanced Portfolio
+ Investments in equity securities by the Fund are valued at the latest sales
price where that price is readily available; equity securities for which no
sales were reported, unless otherwise noted, are valued at the mean between
the closing bid and asked prices. Securities traded primarily on the NASDAQ
Stock Market are normally valued by the Fund at the NASDAQ Official Closing
Price ("NOCP") provided by NASDAQ each business day. The NOCP is the most
recently reported price as of 4:00:02 p.m., Eastern time, unless that price
is outside the range of the "inside" bid and asked prices (i.e., the bid
and asked prices that dealers quote to each other when trading for their
own accounts); in that case, NASDAQ will adjust the price to equal the
inside bid or asked price, whichever is closer. Because of delays in
reporting trades, the NOCP may not be based on the price of the last trade
to occur before the market closes. Investments in debt securities by the
Fund are valued daily by obtaining bid price quotations from independent
pricing services on all securities available in each service's data base.
For all other debt securities requiring daily quotations, bid prices are
obtained from principal market makers in those securities. The Fund values
all other securities by a method the Board of Trustees of Neuberger Berman
Advisers Management Trust (the "Board") believes accurately reflects fair
value. Numerous factors may be considered when determining the fair value
of a security, including available analyst, media or other reports, trading
in futures or ADRs and whether the issuer of the security being fair valued
has other securities outstanding. Foreign security prices are furnished by
independent quotation services expressed in local currency values. Foreign
security prices are translated from the local currency into U.S. dollars
using the exchange rate as of 12:00 p.m., Eastern time. The Board has
approved the use of FT Interactive Data Corporation ("FT Interactive") to
assist in determining the fair value of the Fund's foreign equity
securities in the wake of certain significant events. Specifically, when
changes in the value of a certain index suggest that the closing prices on
the foreign exchanges no longer represent the amount that the Fund could
expect to receive for those securities, FT Interactive will provide
adjusted prices for certain foreign equity securities based on an analysis
showing historical correlations between the prices of those securities and
changes in the index. In the absence of precise information about the
market values of these foreign securities as of the close of the New York
Stock Exchange, the Board has determined on the basis of available data
that prices adjusted in this way are likely to be closer to the prices the
Fund could realize on a current sale than are the prices of those
securities established at the close of the foreign markets in which the
securities primarily trade. However, fair value prices are necessarily
estimates, and there is no assurance that such a price will be at or close
to the price at which the security next trades. Short-term debt securities
with less than 60 days until maturity may be valued at cost which, when
combined with interest earned, approximates market value.
# At cost, which approximates market value.
## At June 30, 2004, the cost of investments for U.S. Federal income tax
purposes was $80,114,861. Gross unrealized appreciation of investments was
$12,176,784 and gross unrealized depreciation of investments was
$1,072,924, resulting in net unrealized appreciation of $11,103,860, based
on cost for U.S. Federal income tax purposes.
* Non-income producing security.
** Security exempt from registration under the Securities Act of 1933. These
securities may be resold in transactions exempt from registration, normally
to qualified institutional buyers under Rule 144A. At June 30, 2004, these
securities amounted to $301,248 or 0.4% of net assets.
\P All or a portion of this security is on loan (see Note A of Notes to
Financial Statements).
@ Neuberger Berman Institutional Cash Fund is also managed by Neuberger
Berman Management Inc. (see Note A of Notes to Financial Statements).
See Notes to Financial Statements 10
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Schedule of Investments Balanced Portfolio cont'd
e TBA (To Be Assigned) Securities are purchased on a forward commitment basis
with an approximate principal amount and no definite maturity date. The
actual principal amount and maturity date will be determined upon
settlement when the specific mortgage pools are assigned.
++ Affiliated issuer (see Note A of Notes to Financial Statements).
^ Principal amount is stated in the currency in which the security is
denominated.
EUR = Euro Currency
& Security purchased on a when-issued basis. At June 30, 2004, these
securities amounted to $775,000.
&& Security is segregated as collateral for when-issued purchase commitments
and financial futures contracts margin.
See Notes to Financial Statements 11
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Assets and Liabilities
------------
Balanced
Neuberger Berman Advisers Management Trust Portfolio
Assets
Investments in securities, at market value*+ (Note A)-see Schedule of Investments:
==================================================================================================
Unaffiliated issuers $ 84,861,560
- --------------------------------------------------------------------------------------------------
Affiliated issuers 6,357,161
- --------------------------------------------------------------------------------------------------
91,218,721
- --------------------------------------------------------------------------------------------------
Cash 897
==================================================================================================
Dividends and interest receivable 321,868
- --------------------------------------------------------------------------------------------------
Receivable for securities sold 773,939
==================================================================================================
Receivable for Fund shares sold 1,354
- --------------------------------------------------------------------------------------------------
Prepaid expenses and other assets 14,600
- --------------------------------------------------------------------------------------------------
Total Assets 92,331,379
- --------------------------------------------------------------------------------------------------
Liabilities
Payable for collateral on securities loaned (Note A) 6,134,800
==================================================================================================
Payable for forward foreign currency exchange contracts sold (Note C) 4,796
- --------------------------------------------------------------------------------------------------
Payable for securities purchased 1,270,454
==================================================================================================
Payable for Fund shares redeemed 333,445
- --------------------------------------------------------------------------------------------------
Payable to investment manager-net (Note B) 36,354
==================================================================================================
Payable to administrator (Note B) 19,847
- --------------------------------------------------------------------------------------------------
Payable for variation margin (Note A) 18,437
==================================================================================================
Accrued expenses and other payables 69,532
- --------------------------------------------------------------------------------------------------
Total Liabilities 7,887,665
- --------------------------------------------------------------------------------------------------
Net Assets at value $ 84,443,714
- --------------------------------------------------------------------------------------------------
Net Assets consist of:
Paid-in capital $113,380,309
==================================================================================================
Undistributed net investment income (loss) 932,686
- --------------------------------------------------------------------------------------------------
Accumulated net realized gains (losses) on investments (40,927,971)
==================================================================================================
Net unrealized appreciation (depreciation) in value of investments 11,058,690
- --------------------------------------------------------------------------------------------------
Net Assets at value $ 84,443,714
- --------------------------------------------------------------------------------------------------
Shares Outstanding ($.001 par value; unlimited shares authorized) 9,096,361
==================================================================================================
Net Asset Value, offering and redemption price per share $ 9.28
- --------------------------------------------------------------------------------------------------
+Securities on loan, at market value:
Unaffiliated issuers $ 5,996,581
================================================================================================
*Cost of investments:
Unaffiliated issuers $ 73,757,700
================================================================================================
Affiliated issuers 6,357,161
------------------------------------------------------------------------------------------------
Total cost of investments $ 80,114,861
- --------------------------------------------------------------------------------------------------
See Notes to Financial Statements 12
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST FOR THE SIX MONTHS ENDED JUNE 30,
2004 (UNAUDITED)
Statement of Operations
----------
Balanced
Neuberger Berman Advisers Management Trust Portfolio
Investment Income
Income:
Interest income (Note A) $ 601,121
==========================================================================================================
Dividend income-unaffiliated issuers 85,726
- ----------------------------------------------------------------------------------------------------------
Income from securities loaned-net (Note A) 35,000
==========================================================================================================
Income from investments in affiliated issuers (Note A) 1,498
- ----------------------------------------------------------------------------------------------------------
Foreign taxes withheld (Note A) (506)
- ----------------------------------------------------------------------------------------------------------
Total income 722,839
- ----------------------------------------------------------------------------------------------------------
Expenses:
Investment management fee (Notes A & B) 230,909
==========================================================================================================
Administration fee (Note B) 125,950
- ----------------------------------------------------------------------------------------------------------
Audit fees 17,230
==========================================================================================================
Custodian fees (Note B) 47,578
- ----------------------------------------------------------------------------------------------------------
Insurance expense 606
==========================================================================================================
Legal fees 5,803
- ----------------------------------------------------------------------------------------------------------
Registration and filing fees 9,357
==========================================================================================================
Shareholder reports 13,659
- ----------------------------------------------------------------------------------------------------------
Shareholder servicing agent fees 7,147
==========================================================================================================
Trustees' fees and expenses 13,453
- ----------------------------------------------------------------------------------------------------------
Miscellaneous 1,374
- ----------------------------------------------------------------------------------------------------------
Total expenses 473,066
Investment management fee waived (Note A) (199)
Expenses reduced by custodian fee expense offset and commission recapture arrangements (Note B) (5,083)
- ----------------------------------------------------------------------------------------------------------
Total net expenses 467,784
- ----------------------------------------------------------------------------------------------------------
Net investment income (loss) 255,055
- ----------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) on Investments (Note A)
Net realized gain (loss) on:
Investment securities sold in unaffiliated issuers 2,231,234
=======================================================================================================
Financial futures contracts 40,472
-------------------------------------------------------------------------------------------------------
Foreign currency 41,626
=======================================================================================================
Change in net unrealized appreciation (depreciation) in value of:
Investment securities in unaffiliated issuers 736,407
-------------------------------------------------------------------------------------------------------
Foreign currency (5,170)
=======================================================================================================
Financial futures contracts (40,000)
-------------------------------------------------------------------------------------------------------
Net gain (loss) on investments 3,004,569
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations $3,259,624
- ----------------------------------------------------------------------------------------------------------
See Notes to Financial Statements 13
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Changes in Net Assets
Balanced Portfolio
----------------------------
Six Months
Ended Year
June 30, Ended
2004 December 31,
Neuberger Berman Advisers Management Trust (Unaudited) 2003
Increase (Decrease) in Net Assets:
From Operations:
Net investment income (loss) $ 255,055 $ 662,413
======================================================================================================
Net realized gain (loss) on investments 2,313,332 4,370,243
- ------------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of investments 691,237 7,209,917
- ------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations 3,259,624 12,242,573
- ------------------------------------------------------------------------------------------------------
Distributions to Shareholders From:
Net investment income - (1,410,014)
======================================================================================================
From Fund Share Transactions (Note D):
Proceeds from shares sold 3,127,712 8,153,281
======================================================================================================
Proceeds from reinvestment of dividends and distributions - 1,410,014
- ------------------------------------------------------------------------------------------------------
Payments for shares redeemed (6,889,209) (15,951,532)
- ------------------------------------------------------------------------------------------------------
Net increase (decrease) from Fund share transactions (3,761,497) (6,388,237)
- ------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets (501,873) 4,444,322
Net Assets:
Beginning of period 84,945,587 80,501,265
- ------------------------------------------------------------------------------------------------------
End of period $84,443,714 $ 84,945,587
- ------------------------------------------------------------------------------------------------------
Undistributed net investment income (loss) at end of period $ 932,686 $ 677,631
- ------------------------------------------------------------------------------------------------------
See Notes to Financial Statements 14
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Financial Statements Balanced Portfolio
Note A--Summary of Significant Accounting Policies:
1 General: Balanced Portfolio (the "Fund") is a separate operating series of
Neuberger Berman Advisers Management Trust (the "Trust"), a Delaware
statutory trust organized pursuant to a Trust Instrument dated May 23,
1994. The Trust is currently comprised of ten separate operating series
(each a "Series," collectively, the "Funds") each of which (except Focus
Portfolio) is diversified. The Trust is registered as an open-end
management investment company under the Investment Company Act of 1940, as
amended, and its shares are registered under the Securities Act of 1933, as
amended. The Fund currently offers only Class I shares. The Board of
Trustees of the Trust may establish additional series or classes of shares
without the approval of shareholders.
The assets of each Series belong only to that Series, and the liabilities
of each Series are borne solely by that Series and no other.
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States requires Neuberger
Berman Management Inc. ("Management") to make estimates and assumptions at
the date of the financial statements. Actual results could differ from
those estimates.
2 Portfolio valuation: Investment securities are valued as indicated in the
notes following the Schedule of Investments.
3 Foreign currency translation: The accounting records of the Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into
U.S. dollars using the exchange rate as of 12:00 p.m., Eastern time, to
determine the value of investments, other assets and liabilities. Purchase
and sale prices of securities, and income and expenses, are translated into
U.S. dollars at the prevailing rate of exchange on the respective dates of
such transactions. Net unrealized foreign currency gain (loss) arises from
changes in the value of assets and liabilities, other than investments in
securities, as a result of changes in exchange rates and is stated
separately in the Statement of Operations.
4 Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the
ex-dividend date or, for certain foreign dividends, as soon as the Fund
becomes aware of the dividends. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, including accretion of original issue discount,
where applicable, and accretion of market discount on long-term bonds and
short-term investments, is recorded on the accrual basis. Realized gains
and losses from securities transactions and foreign currency transactions
are recorded on the basis of identified cost and stated separately in the
Statement of Operations.
5 Forward foreign currency contracts: The Fund may enter into forward foreign
currency contracts ("contracts") in connection with planned purchases or
sales of securities to hedge the U.S. dollar value of portfolio securities
denominated in a foreign currency. The gain or loss arising from the
difference between the original contract price and the closing price of
such contract is included in net realized gains or losses on foreign
currency transactions. Fluctuations in the value of forward foreign
currency contracts
15
Notes to Financial Statements Balanced Portfolio cont'd
are recorded for financial reporting purposes as unrealized gains or losses
by the Fund. The Fund has no specific limitation on the percentage of
assets which may be committed to these types of contracts. The Fund could
be exposed to risks if a counter party to a contract were unable to meet
the terms of its contract or if the value of the foreign currency changes
unfavorably. The U.S. dollar value of foreign currency underlying all
contractual commitments held by the Fund is determined using forward
foreign currency exchange rates supplied by an independent pricing service.
6 Federal income taxes: The Funds are treated as separate entities for U.S.
Federal income tax purposes. It is the policy of the Fund to continue to
qualify as a regulated investment company by complying with the provisions
available to certain investment companies, as defined in applicable
sections of the Internal Revenue Code, and to make distributions of
investment company taxable income and net capital gains (after reduction
for any amounts available for U.S. Federal income tax purposes as capital
loss carryforwards) sufficient to relieve it from all, or substantially
all, U.S. Federal income taxes. Accordingly, the Fund paid no U.S. Federal
income taxes and no provision for U.S. Federal income taxes was required.
7 Dividends and distributions to shareholders: The Fund may earn income, net
of expenses, daily on its investments. Income dividends and distributions
from net realized capital gains, if any, generally are distributed in
October. Income dividends and capital gain distributions to shareholders
are recorded on the ex-dividend date. To the extent the Fund's net realized
capital gains, if any, can be offset by capital loss carryforwards
($28,845,814 and $13,734,010 expiring in 2009 and 2010, respectively,
determined as of December 31, 2003), it is the policy of the Fund not to
distribute such gains.
Under current tax law, certain capital and net foreign currency losses
realized after October 31 within the taxable year may be deferred and
treated as occurring on the first day of the following tax year. For the
year ended December 31, 2003, the Fund elected to defer $604,724 of net
capital and currency losses arising between November 1, 2003 and December
31, 2003.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a tax return of
capital. Differences in the recognition or classification of income between
the financial statements and tax earnings and profits which result in
temporary over-distributions for financial statement purposes are
classified as distributions in excess of net investment income or
accumulated net realized gains in the components of net assets on the
Statement of Assets and Liabilities.
The tax character of distributions paid during the years ended December 31,
2003 and 2002 was as follows:
Distributions Paid From:
Ordinary Income Total
2003 2002 2003 2002
$1,410,014 $2,524,587 $1,410,014 $2,524,587
16
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
As of December 31, 2003, the components of distributable earnings
(accumulated losses) on a U.S. Federal income tax basis were as follows:
Unrealized
Undistributed Appreciation Loss Carryforwards
Ordinary Income (Depreciation) and Deferrals Total
$989,969 $9,998,360 $(43,184,548) $(32,196,219)
The difference between book basis and tax basis is attributable primarily
to foreign bond bifurcation, the tax deferral of losses on wash sales, post
October losses, and amortization of bond premiums.
8 Foreign taxes: Foreign taxes withheld represent amounts withheld by foreign
tax authorities, net of refunds recoverable.
9 Expense allocation: Certain expenses are applicable to multiple funds.
Expenses directly attributable to a Series are charged to that Series.
Expenses of the Trust that are not directly attributed to a Series are
allocated among the Funds, on the basis of relative net assets, except
where a more appropriate allocation of expenses to each of the Funds can
otherwise by made fairly. Expenses borne by the complex of related
investment companies, which includes open-end and closed-end investment
companies for which Management serves as investment manager, that are not
directly attributed to a Series or the Trust, are allocated among the Fund
and the other investment companies in the complex or series thereof, on the
basis of relative net assets, except where a more appropriate allocation of
expenses to each investment company in the complex or series thereof can
otherwise be made fairly.
10 Financial futures contracts: The Fund may buy and sell financial futures
contracts to hedge against changes in securities prices resulting from
changes in prevailing interest rates. At the time the Fund enters into a
financial futures contract, it is required to deposit with its custodian a
specified amount of cash or liquid securities, known as "initial margin,"
ranging upward from 1.1% of the value of the financial futures contract
being traded. Each day, the futures contract is valued at the official
settlement price of the board of trade or U.S. commodity exchange on which
such futures contract is traded. Subsequent payments, known as "variation
margin," to and from the broker are made on a daily basis as the market
price of the financial futures contract fluctuates. Daily variation margin
adjustments, arising from this "mark to market," are recorded by the Fund
as unrealized gains or losses.
Although some financial futures contracts by their terms call for actual
delivery or acceptance of financial instruments, in most cases the
contracts are closed out prior to delivery by offsetting purchases or sales
of matching financial futures contracts. When the contracts are closed, the
Fund recognizes a gain or loss. Risks of entering into futures contracts
include the possibility there may be an illiquid market and/or a change in
the value of the contract may not correlate with changes in the value of
the underlying securities.
For U.S. Federal income tax purposes, the futures transactions undertaken
by the Fund may cause the Fund to recognize gains or losses from marking to
market even though its positions have not been sold or terminated, may
affect the character of the gains or losses recognized as long-term or
short-term, and may affect the timing of some capital gains and losses
realized by the Fund. Also, the Fund's losses on
17
Notes to Financial Statements Balanced Portfolio cont'd
transactions involving futures contracts may be deferred rather than being
taken into account currently in calculating the Fund's taxable income.
During the six months ended June 30, 2004, the Fund entered into various
financial futures contracts. At June 30, 2004, open positions in financial
futures contracts were as follows:
Unrealized
Expiration Open Contracts Position Depreciation
September 2004 50 U.S. Treasury Notes, 5 Year Short $40,000
At June 30, 2004, the Fund had deposited $50,000 in U.S. Treasury Notes,
3.25%, due 1/15/09, in a segregated account to cover margin requirements on
open financial futures contracts.
11 Security lending: Pursuant to an Exemptive Order issued by the Securities
and Exchange Commission, the Fund entered into a Securities Lending
Agreement ("Agreement") with Neuberger Berman, LLC ("Neuberger") on April
17, 2003. Securities loans involve certain risks in the event a borrower
should fail financially, including delays or inability to recover the lent
securities or foreclose against the collateral. The investment manager,
under the general supervision of the Trust's Board of Trustees, monitors
the creditworthiness of the parties to whom the Fund makes security loans.
The Fund will not lend securities on which covered call options have been
written, or lend securities on terms which would prevent the Fund from
qualifying as a regulated investment company. The Fund receives cash
collateral equal to at least 102% of the current market value of the loaned
securities. The Fund invests the cash collateral in the N&B Securities
Lending Quality Fund, LLC, which is managed by State Street Bank and Trust
Company ("State Street") pursuant to guidelines approved by the Trust's
investment manager. Neuberger guaranteed minimum revenue to the Fund under
the Agreement, and received a portion of any revenue earned in excess of
the guaranteed amount as a lending agency fee.
The Agreement has been renewed and approved by the Board of Trustees as of
July 1, 2004 with substantially the same terms. Under this current
Agreement, Neuberger guarantees minimum revenue to the Fund and receives
any revenue earned in excess of the guaranteed amount as a lending agency
fee.
At June 30, 2004, the Fund had not paid Neuberger any fees under the
Agreement.
Income earned on the securities loaned, if any, is reflected in the
Statement of Operations under the caption Income from securities
loaned-net.
12 Repurchase agreements: The Fund may enter into repurchase agreements with
institutions that the Fund's investment manager has determined are
creditworthy. Each repurchase agreement is recorded at cost. The Fund
requires that the securities purchased in a repurchase transaction be
transferred to the custodian in a manner sufficient to enable the Fund to
assert a perfected security interest in those securities in the event of a
default under the repurchase agreement. The Fund monitors, on a daily
basis, the value of the securities transferred to ensure that their value,
including accrued interest, is greater than amounts owed to the Fund under
each such repurchase agreement.
13 Transactions with other funds managed by Neuberger Berman Management Inc.:
Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission, the Fund may invest in the Neuberger Berman Institutional Cash
Fund (the "Cash Fund"), a fund managed by Management and
18
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
having the same Board members as the Fund. The Cash Fund seeks to provide
as high a level of current income as is consistent with the preservation of
capital and the maintenance of liquidity. For any cash that the Fund
invests in the Cash Fund, Management waives a portion of its management fee
equal to the management fee it receives from the Cash Fund on those assets.
For the six months ended June 30, 2004, such waived fees amounted to $199.
For the six months ended June 30, 2004, income earned on this investment
amounted to $1,498 and is reflected in the Statement of Operations under
the caption Income from investments in affiliated issuers.
Note B--Management Fees, Administration Fees, Distribution Arrangements,
and Other Transactions With Affiliates:
Fund shares are issued and redeemed in connection with investments in and
payments under certain variable annuity contracts and variable life
insurance policies issued through separate accounts of life insurance
companies and are also offered directly to qualified pension and retirement
plans.
The Fund retains Management as its investment manager under a Management
Agreement. For such investment management services, the Fund pays
Management a fee at the annual rate of 0.55% of the first $250 million of
the Fund's average daily net assets, 0.525% of the next $250 million, 0.50%
of the next $250 million, 0.475% of the next $250 million, 0.45% of the
next $500 million, 0.425% of the next $2.5 billion, and 0.40% of average
daily net assets in excess of $4 billion.
The Fund retains Management as its administrator under an Administration
Agreement. The Fund pays Management an administration fee at the annual
rate of 0.30% of its average daily net assets under this agreement.
Additionally, Management retains State Street as its sub-administrator
under a Sub-Administration Agreement. Management pays State Street a fee
for all services received under the agreement.
The Trustees of the Trust adopted a non-fee distribution plan for the Fund.
Management has contractually undertaken through December 31, 2007 to
reimburse the Fund for its operating expenses (excluding the fees payable
to Management, interest, taxes, brokerage commissions, extraordinary
expenses, and transaction costs) ("Operating Expenses") which exceed, in
the aggregate, 1.00% per annum of its average daily net assets (the
"Expense Limitation"). For the six months ended June 30, 2004, no
reimbursement to the Fund was required. The Fund has agreed to repay
Management through December 31, 2010 for its excess Operating Expenses
previously reimbursed by Management, so long as its annual Operating
Expenses during that period do not exceed its Expense Limitation, and the
repayment is made within three years after the year in which Management
issued the reimbursement. During the six months ended June 30, 2004, there
was no reimbursement to Management. At June 30, 2004, the Fund has no
contingent liability to Management under the agreement.
On October 31, 2003, Management and Neuberger, a member firm of the New
York Stock Exchange and sub-adviser to the Fund, became indirect
wholly-owned subsidiaries of Lehman Brothers Holdings Inc. ("Lehman"), a
publicly-owned holding company. Neuberger is retained by Management to
furnish it with investment recommendations and research information without
added cost to the Fund. Several
19
Notes to Financial Statements Balanced Portfolio cont'd
individuals who are officers and/or Trustees of the Trust are also
employees of Neuberger and/or Management.
On July 1, 2003, the Fund entered into a commission recapture program,
which enables it to pay some of its operational expenses by recouping a
portion of the commissions it pays to a broker that is not a related party
of the Fund. Expenses paid through this program may include costs of
custodial, transfer agency or accounting services. For the six months ended
June 30, 2004, the impact of this arrangement was a reduction of $5,004.
The Fund has an expense offset arrangement in connection with its custodian
contract. The impact of this arrangement, reflected in the Statement of
Operations under the caption Custodian fees, was a reduction of $79.
Note C--Securities Transactions:
Cost of purchases and proceeds of sales and maturities of long-term
securities (excluding short-term securities, financial futures contracts,
and foreign currency contracts) for the six months ended June 30, 2004 were
as follows:
Purchases of U.S. Purchases excluding U.S. Sales and Maturities of U.S. Sales and Maturities excluding
Government and Agency Government and Agency Government and Agency U.S. Government and Agency
Obligations Obligations Obligations Obligations
$26,930,135 $13,792,127 $22,658,038 $16,612,348
During the six months ended June 30, 2004, brokerage commissions on
securities transactions amounted to $67,047, of which Neuberger received
$0, Lehman received $14,319, and other brokers received $52,728.
During the six months ended June 30, 2004, the Fund entered into various
contracts to deliver currencies at specified future dates. At June 30,
2004, open contracts were as follows:
Contracts to In Exchange Settlement Net Unrealized
Sell Deliver For Date Value Depreciation
Euro Dollar 575,000 $694,945 8/23/04 $699,741 $4,796
Note D--Fund Share Transactions:
Share activity for the six months ended June 30, 2004 and for the year
ended December 31, 2003 was as follows:
For the For the
Six Months Ended Year Ended
June 30, December 31,
2004 2003
Shares Sold 344,729 971,681
Shares Issued on Reinvestment of Dividends
and Distributions - 161,699
Shares Redeemed (760,031) (1,931,366)
-------- ----------
Total (415,302) (797,986)
-------- ----------
20
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Note E--Line of Credit:
At June 30, 2004, the Fund was a participant in a single committed,
unsecured $150,000,000 line of credit with State Street, to be used only
for temporary or emergency purposes. Interest is charged on borrowings
under this agreement at the overnight Federal Funds Rate plus 0.50% per
annum. A facility fee of 0.10% per annum of the available line of credit is
charged, of which the Fund has agreed to pay its pro rata share, based on
the ratio of its individual net assets to the net assets of all
participants at the time the fee is due and payable. The fee is paid
quarterly in arrears. No compensating balance is required. Other investment
companies managed by Management also participate in this line of credit on
the same terms. Because several investment companies participate, there is
no assurance that the Fund will have access to the entire $150,000,000 at
any particular time. The Fund had no loans outstanding pursuant to this
line of credit at June 30, 2004, nor had the Fund utilized this line of
credit at any time prior to that date.
Note F--Unaudited Financial Information:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent auditors. Annual reports
contain audited financial statements.
21
Financial Highlights Balanced Portfolio+
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements.++
Six Months
Ended
June 30, Year Ended December 31,
----------- --------------------------------------------------------
2004 2003 2002 2001 2000 1999
(Unaudited)
Net Asset Value, Beginning of Period $ 8.93 $ 7.81 $ 9.66 $ 17.28 $20.89 $16.34
------ ------- ------- ------- ------ ------
Income From Investment Operations:
Net Investment Income (Loss) .03 .07 .12 .22Y .30 .26
Net Gains or Losses on Securities
(both realized and unrealized) .32 1.20 (1.75) (2.27)Y (.61) 4.96
------ ------- ------- ------- ------ ------
Total From Investment Operations .35 1.27 (1.63) (2.05) (.31) 5.22
------ ------- ------- ------- ------ ------
Less Distributions From:
Net Investment Income -- (.15) (.22) (.28) (.37) (.27)
Net Capital Gains -- -- -- (5.29) (2.93) (.40)
------ ------- ------- ------- ------- ------
Total Distributions -- (.15) (.22) (5.57) (3.30) (.67)
------ ------- ------- ------- ------ ------
Net Asset Value, End of Period $ 9.28 $ 8.93 $ 7.81 $ 9.66 $17.28 $20.89
------ ------- ------- ------- ------ ------
Total Return++ +3.92%** +16.28% -17.15% -13.36% -4.55% +33.56%
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $ 84.4 $ 84.9 $ 80.5 $ 112.0 $147.6 $165.3
Ratio of Gross Expenses to Average Net Assets# 1.13%* 1.12% 1.12% 1.07% .99% 1.02%
Ratio of Net Expenses to Average Net Assets[sec] 1.11%* 1.11% 1.12% 1.07% .99% 1.02%
Ratio of Net Investment Income (Loss)
to Average Net Assets .61%* .82% 1.37% 2.10%Y 1.49% 1.60%
Portfolio Turnover Rate 49% 121% 106% 88% 124% 121%
See Notes to Financial Highlights 22
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Financial Highlights Balanced Portfolio
+ The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's proportionate share of AMT Balanced
Investment's income and expenses through April 30, 2000 under the prior
master/feeder fund structure.
++ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each
fiscal period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Current returns may be lower or higher than the performance data
quoted. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. Total return would
have been lower if Management had not waived certain expenses. The total
return information shown does not reflect charges and other expenses that
apply to the separate account or the related insurance policies, and the
inclusion of these charges and other expenses would reduce the total
return for all fiscal periods shown. Performance data current to the most
recent month-end are available at www.nb.com.
# The Fund is required to calculate an expense ratio without taking into
consideration any expense reductions related to expense offset and
commission recapture arrangements.
++ The per share amounts which are shown have been computed based on the
average number of shares outstanding during each fiscal period.
[sec] After waiver of a portion of the investment management fee. Had the
investment manager not undertaken such action, the annualized ratios of
net expenses to average daily net assets would have been:
Six Months Year Ended
Ended June 30, December 31,
2004 2003
1.11% 1.11%
Y For fiscal years ended after December 31, 2000, funds are required by the
American Institute of Certified Public Accountants to amortize premiums
and discounts on fixed income securities. Accordingly, for the year ended
December 31, 2001, the per share amounts and ratios shown decreased or
increased as follows:
Year Ended
December 31, 2001
Net Investment Income (.004)
Net Gains or Losses on Securities .004
Ratio of Net Investment Income to Average Net Assets (.04%)
* Annualized.
** Not annualized.
23
Trustees and Officers (Unaudited)
The following tables set forth information concerning the trustees and officers
of the Trust. All persons named as trustees and officers also serve in similar
capacities for other funds administered or managed by NB Management and
Neuberger Berman. The Statement of Additional Information includes additional
information about fund trustees and is available upon request, without charge,
by calling (800) 877-9700.
Information about the Board of Trustees
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Independent Trustees Position and Fund Complex
Length of Time Overseen by Other Directorships Held Outside
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Fund Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
John Cannon (74) Trustee since Consultant. Formerly, Chairman 38 Independent Trustee or Director of
2000 and Chief Investment Officer, three series of Oppenheimer Funds:
CDC Investment Advisors Limited Term New York Municipal
(registered investment adviser) Fund, Rochester Fund Municipals,
(1993-January 1999); prior and Oppenheimer Convertible
thereto, President and Chief Securities Fund since 1992.
Executive Officer, AMA
Investment Advisors, an affiliate
of the American Medical
Association.
- ------------------------------------------------------------------------------------------------------------------------------------
Faith Colish (68) Trustee since Counsel, Carter Ledyard & 38 Director, American Bar Retirement
1984 Milburn LLP (law firm) since Association (ABRA) since 1997
October 2002; Formerly, (not-for-profit membership
Attorney-at-Law and President, association).
Faith Colish, A Professional
Corporation, 1980 to 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Walter G. Ehlers (71) Trustee since Consultant; Retired President 38 None.
1989 and Trustee, Teachers
Insurance & Annuity (TIAA)
and College Retirement
Equities Fund (CREF).
- ------------------------------------------------------------------------------------------------------------------------------------
C. Anne Harvey (66) Trustee since Consultant, C. A. Harvey 38 President, Board of Associates to
1998 Associates, since June 2001; The National Rehabilitation
Formerly, Director, AARP, 1978 Hospital's Board of Directors since
to December 2001. 2002; Formerly, Member, Individual
Investors Advisory Committee to the
New York Stock Exchange Board of
Directors, 1998 to June 2002;
Member, American Savings Education
Council's Policy Board (ASEC),
1998-2000; Member, Executive
Committee, Crime Prevention
Coalition of America, 1997-2000.
- ------------------------------------------------------------------------------------------------------------------------------------
24
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Independent Trustees Position and Fund Complex
Length of Time Overseen by Other Directorships Held Outside
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Fund Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Barry Hirsch (71) Trustee since Attorney-at-Law. Formerly, 38 None.
2000 Senior Counsel, Loews
Corporation (diversified
financial corporation) May
2002 until April 2003; formerly,
Senior Vice President, Secretary
and General Counsel, Loews
Corporation.
- ------------------------------------------------------------------------------------------------------------------------------------
Robert A. Kavesh (76) Trustee since Marcus Nadler Professor of 38 Director, DEL Laboratories, Inc.
2000 Finance and Economics (cosmetics and pharmaceuticals)
Emeritus, New York University, since 1978; The Caring Community
Stern School of Business. (not-for-profit).
- ------------------------------------------------------------------------------------------------------------------------------------
Howard A. Mileaf (67) Trustee since Retired. Formerly, Vice 38 Director, WHX Corporation
1999 President and Special Counsel, (holding company) since August
WHX Corporation (holding 2002; Director, WebFinancial
company), 1993-2001. Corporation (holding company)
since December 2002; Director,
State Theatre of New Jersey (not-
for-profit theater) since 2000;
formerly Director, Kevlin
Corporation (manufacturer of
microwave and other products).
- ------------------------------------------------------------------------------------------------------------------------------------
William E. Rulon (71) Trustee since Retired. Senior Vice President, 38 Director, Pro-Kids Golf and
2000 Foodmaker, Inc. (operator and Learning Academy (teach golf and
franchiser of restaurants) until computer usage to "at risk"
January 1997. children) since 1998; Formerly,
Director, Prandium, Inc.
(restaurants) from March 2001 until
July 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Cornelius T. Ryan (72) Trustee since Founding General Partner, 38 Director, Capital Cash Management
2000 Oxford Partners and Oxford Trust (money market fund),
Bioscience Partners (venture Narragansett Insured Tax-Free
capital partnerships) and Income Fund, Rocky Mountain
President, Oxford Venture Equity Fund, Prime Cash Fund,
Corporation. several private companies and
QuadraMed Corporation
(NASDAQ).
- ------------------------------------------------------------------------------------------------------------------------------------
25
Trustees and Officers (Unaudited) cont'd
- ----------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Independent Trustees Position and Fund Complex
Length of Time Overseen by Other Directorships Held Outside
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Fund Complex by Trustee
- ----------------------------------------------------------------------------------------------------------------------------------
Tom Decker Seip (54) Trustee since General Partner, Seip 38 Director, H&R Block, Inc. (financial
2000 Investments LP (a private services company) since May 2001;
investment partnership); Director, Forward Management, Inc.
formerly, President and CEO, (asset management) since 2001;
Westaff, Inc. (temporary Formerly, Director, General Magic
staffing), May 2001 to January (voice recognition software),
2002; Senior Executive at the November 2001 until 2002; Director,
Charles Schwab Corporation E-Finance Corporation (credit
from 1983 to 1999, including decisioning services), 1999-2003;
Chief Executive Officer, Director, Save-Daily.com (micro
Charles Schwab Investment investing services), 1999-2003;
Management, Inc. and Trustee, Director, Offroad Capital Inc.
Schwab Family of Funds and (pre-public internet commerce
Schwab Investments from 1997 company).
to 1998 and Executive Vice
President--Retail Brokerage,
Charles Schwab Investment
Management from 1994
to 1997.
- ------------------------------------------------------------------------------------------------------------------------------------
Candace L. Straight (56) Trustee since Private investor and consultant 38 Director, The Proformance Insurance
1999 specializing in the insurance Company (personal lines property
industry; Formerly, Advisory and casualty insurance company)
Director, Securitas Capital LLC since March 2004; Director,
(a global private equity Providence Washington (property
investment firm dedicated to and casualty insurance company),
making investments in the since December 1998; Director,
insurance sector), 1998 until Summit Global Partners (insurance
December 2002. brokerage firm) since October 2000.
- ------------------------------------------------------------------------------------------------------------------------------------
Peter P. Trapp (59) Trustee since Regional Manager for Atlanta 38 None.
1984 Region, Ford Motor Credit
Company since August 1997;
Formerly, President, Ford
Life Insurance Company, April
1995 until August 1997.
- ------------------------------------------------------------------------------------------------------------------------------------
26
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Trustees who are Portfolios in
"Interested Persons" Position and Fund Complex
Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Edward I. OBrien* (75) Trustee since Formerly, Member, Investment 38 Director, Legg Mason, Inc. (financial
2000 Policy Committee, Edward services holding company) since
Jones, 1993-2001; President, 1993; formerly, Director, Boston
Securities Industry Association Financial Group (real estate and tax
("SIA") (securities industry's shelters) 1993-1999.
representative in government
relations and regulatory matters
at the federal and state levels)
1974-1992; Adviser to SIA,
November 1992-November 1993.
- ------------------------------------------------------------------------------------------------------------------------------------
Jack L. Rivkin* (63) President and Executive Vice President and 38 Director, Dale Carnegie and
Trustee since Chief Investment Officer, Associates, Inc. (private company)
December Neuberger Berman Inc. since 1998; Director, Emagin Corp.
2002 (holding company) since 2002 (public company) since 1997;
and 2003, respectively; Director, Solbright, Inc. (private
Executive Vice President and company) since 1998; Director,
Chief Investment Officer, Infogate, Inc. (private company)
Neuberger Berman since 2002 since 1997.
and 2003, respectively; Director
and Chairman, NB
Management since December
2002; Formerly, Executive Vice
President, Citigroup
Investments, Inc. from
September 1995 to February
2002; Executive Vice President,
Citigroup Inc. from September
1995 to February 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Peter E. Sundman* (45) Chairman of Executive Vice President, 38 Director, Neuberger Berman Inc.
the Board, Neuberger Berman Inc. (holding company) from 1999
Chief (holding company) since 1999; through March 2003; President and
Executive Head of Neuberger Berman Director, NB Management since
Officer and Inc.'s Mutual Funds and 1999; Director and Vice President,
Trustee since Institutional Business since Neuberger Berman Agency, Inc.
2000; 1999; Executive Vice President, since 2000.
President and Neuberger Berman since 1999;
Chief Principal, Neuberger Berman
Executive from 1997 until 1999; Senior
Officer from Vice President, NB
1998 to 2000 Management from 1996
until 1999.
- ------------------------------------------------------------------------------------------------------------------------------------
27
Trustees and Officers (Unaudited) cont'd
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the Trust's Trust Instrument, each Trustee shall hold office
for life or until his or her successor is elected or the Trust terminates;
except that (a) any Trustee may resign by delivering a written resignation;
(b) any Trustee may be removed with or without cause at any time by a
written instrument signed by at least two-thirds of the other Trustees; (c)
any Trustee who requests to be retired, or who has become unable to serve,
may be retired by a written instrument signed by a majority of the other
Trustees; and (d) any Trustee may be removed at any shareholder meeting by
a vote of at least two-thirds of the outstanding shares.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
* Indicates a Trustee who is an "interested person" within the meaning of the
1940 Act. Mr. Sundman and Mr. Rivkin are interested persons of the Trust by
virtue of the fact that they are officers and/or directors of NB Management
and Executive Vice Presidents of Neuberger Berman. Mr. O'Brien is an
interested person of the Trust by virtue of the fact that he is a director
of Legg Mason, Inc., a wholly owned subsidiary of which, from time to time,
serves as a broker or dealer to the Funds and other funds for which NB
Management serves as investment manager.
28
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Information about the Officers of the Trust
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- ----------------------------------------------------------------------------------------------------------------------
Claudia A. Brandon (47) Secretary since 1985 Vice President--Mutual Fund Board Relations, NB
Management since 2000; Vice President, Neuberger
Berman since 2002 and employee since 1999; Vice
President, NB Management from 1986 to 1999; Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(four since 2002, three since 2003, and one since 2004).
Robert Conti (48) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President, Neuberger Berman from 1999 until 2003; Senior
Vice President, NB Management since 2000; Controller,
NB Management until 1996; Treasurer, NB Management
from 1996 until 1999; Vice President, eleven registered
investment companies for which NB Management acts as
investment manager and administrator (three since 2000,
four since 2002, three since 2003, and one since 2004).
Brian P. Gaffney (50) Vice President since 2000 Managing Director, Neuberger Berman since 1999; Senior
Vice President, NB Management since 2000; Vice
President, NB Management from 1997 until 1999; Vice
President, eleven registered investment companies for
which NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three
since 2003, and one since 2004).
Sheila R. James (39) Assistant Secretary since 2002 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1991 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003 and one since 2004).
Kevin Lyons (49) Assistant Secretary since 2003 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1993 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(Ten since 2003 and one since 2004).
29
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- --------------------------------------------------------------------------------------------------------------------------
John M. McGovern (34) Assistant Treasurer since 2002 Vice President, Neuberger Berman since 2004; Employee,
NB Management since 1993; Assistant Treasurer, eleven
registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003, and one since 2004).
Barbara Muinos (45) Treasurer and Principal Financial Vice President, Neuberger Berman since 1999; Assistant
and Accounting Officer since 2002; Vice President, NB Management from 1993 to 1999;
prior thereto, Assistant Treasurer Treasurer and Principal Financial and Accounting Officer,
since 1996 eleven registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003, and one since 2004);
Assistant Treasurer, three registered investment companies
for which NB Management acts as investment manager and
administrator from 1996 until 2002.
Frederic B. Soule (58) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President; Neuberger Berman from 1999 until 2003; Vice
President, NB Management from 1995 until 1999; Vice
President, eleven registered investment companies for
which NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three
since 2003, and one since 2004).
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the By-Laws of the Trust, each officer elected by the Trustees
shall hold office until his or her successor shall have been elected and
qualified or until his or her earlier death, inability to serve, or
resignation. Officers serve at the pleasure of the Trustees and may be
removed at any time with or without cause.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
30
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Proxy Voting Policies and Procedures
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to portfolio securities is available, without
charge, by calling 1-800-877-9700 (toll-free) and on the website of the
Securities and Exchange Commission, at www.sec.gov. Beginning September 2004,
information regarding how the Fund voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 will also be
available without charge, by calling 1-800-877-9700 (toll-free), on the website
of the Securities and Exchange Commission, at www.sec.gov, and on the Fund's
website at www.nb.com http://www.nb.com.
31
Semi-Annual Report [NEUBERGER BERMAN LOGO]
June 30, 2004
Neuberger Berman
Advisers
Management
Trust
Fasciano
Portfolio
D0312 08/04
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Fasciano Portfolio Manager's Commentary
- ---------------------------------------
The Fasciano Portfolio underperformed its benchmark, the Russell 2000 Index, as
small-cap stocks made good progress in the first half of 2004.(2)
The market environment in this reporting period was much more friendly to our
style of investing than was last year's. In 2003, the portfolio generated a
respectable double-digit gain, but still trailed its benchmark. In general, our
holdings had met our fundamental expectations, but investors were considerably
more excited by the smaller, more speculative stocks that drove the Russell
2000's returns. In the first half of 2004, however, investors began migrating
out of last year's big winners and into the more established, higher quality
companies that we favor. This has translated into much better returns versus
our benchmark.
In the first half of 2004, our industrials sector investments had the most
favorable impact on returns. We were overweighted in industrials and our
holdings gained nearly twice as much as the benchmark sector component returns.
Five industrial companies appeared on our top-ten performance list. Landstar
Systems is a trucking firm that doesn't own any trucks. Landstar simply books
shipping business from its corporate clients and for a fee distributes the
business to independent truckers. Landstar's low overhead business model has
translated into high profit margins and good earnings growth. Kroll is a
business security firm that provides a variety of services including background
checks on prospective employees, forensic accounting, and litigation support.
We thought Kroll was a unique company and insurance giant Marsh & McLennan,
which recently acquired Kroll at a nice premium to our cost, must have thought
so as well. IDEX Corp. is a well-established company in the pump and valve
business that continues to build on a good earnings track record. MSC
Industrial Direct is still a small-cap company, but has become the largest
distributor of maintenance and repair products to the factory floor. The
company's catalog is enormous and their next-day delivery system keeps
attracting new customers. G&K Services is a uniform rental company that has
been a direct beneficiary of new jobs created this year.
Technology holdings made the second largest contribution to returns. Our tech
sector winners included ScanSource, a wholesale distributor of bar code
printers and telephony products, and Plantronics, an innovator in wireless
headsets. ScanSource continues to benefit from its close business relationship
with Zebra Technologies, a leading manufacturer of state-of-the-art bar code
printers. Plantronics' wireless headset business is being boosted by strong
demand in offices and on the road, where government entities in the U.S. and
Europe are passing safety legislation requiring hands-free cellular
telecommunications in the car.
Healthcare was our poorest performing sector. We were equal weighted in
healthcare versus the benchmark, but collectively our healthcare holdings
declined by 5.1% versus a 9.6% gain for the Russell 2000's healthcare
component. Dental supply company Young Innovations was our worst performing
stock. There is nothing wrong with the dental supply business. In fact,
favorable demographics--aging Americans spending more money on dental
care--should continue to promote well above average growth. Young Innovations
stock declined sharply when the
1
company announced it would not offer dealer incentives at the end of the second
quarter, causing its customers to defer purchases. It also announced it would
be consolidating its manufacturing operations. Although over the long term,
this will help the company cut costs and improve profit margins, over the short
term it will result in some additional charges and expenses, which could
negatively impact this year's earnings. Short-term earnings dislocations don't
trouble us and we continue to believe Young Innovations will be a productive
long-term investment. KV Pharmaceuticals also disappointed. Its fiscal fourth
quarter earnings met consensus expectations, but sales were lower than
anticipated. Although we think this is a short-term blip rather than a serious
problem, skittish investors bailed out.
It appears the economy is on a moderate upward trajectory that should foster
decent sales growth. Recent years' cost cutting and productivity gains have
improved profit margins for most companies. So, rising sales should translate
into good earnings growth. This is generally a favorable backdrop for stocks.
Although there are pockets in the small-cap market where future earnings are
not likely to justify current valuations, we are still finding what we believe
are lots of great small growth companies that are under-followed by Wall Street
and under-owned by institutions, and therefore priced attractively relative to
above-average growth prospects. We can never be sure whether these stocks will
reward us over the next quarter or two. However, we are generally confident
that they will contribute to long-term returns.
Sincerely,
/s/ Michael F. Fasciano
MICHAEL F. FASCIANO
PORTFOLIO MANAGER
1. 22.74% and 14.65% were the average annual total returns for the 1-year and
since inception (07/12/02) periods ended June 30, 2004. Neuberger Berman
Management Inc. ("NBMI") has agreed to absorb certain expenses of the AMT
Portfolios. Without this arrangement, which is subject to change, the total
returns of the Portfolios would be less. Total return includes reinvestment of
dividends and capital gain distributions. Performance data quoted represent
past performance and the investment return and principal value of an investment
will fluctuate so that the shares, when redeemed, may be worth more or less
than original cost. Current performance may be lower or higher than the
performance data quoted. For performance data current to the most recent month
end, please visit www.nb.com/amtperformance. The performance information does
not reflect fees and expenses of the variable annuity and variable life
insurance policies or the pension plans whose proceeds are invested in the
portfolio.
2. The Russell 2000[RegTM] Index is an unmanaged index consisting of securities
of the 2,000 issuers having the smallest capitalization in the Russell
3000[RegTM] Index (which measures the performance of the 3,000 largest U.S.
companies based on total market capitalization), representing approximately 8%
of the Russell 3000 total market capitalization. The smallest company's market
capitalization is roughly $117 million. Please note that indices do not take
into account any fees and expenses of investing in the individual securities
that they track, and that individuals cannot invest directly in any index. Data
about the performance of this index are prepared or obtained by NBMI and
include reinvestment of all dividends and capital gain distributions. The
Portfolio may invest in many securities not included in the above-described
index.
2
The investments for the Portfolio are managed by the same portfolio manager(s)
who manage one or more other mutual funds that have similar names, investment
objectives and investment styles as the Portfolio. You should be aware that the
Portfolio is likely to differ from the other mutual funds in size, cash flow
pattern and tax matters. Accordingly, the holdings and performance of the
Portfolio can be expected to vary from those of the other mutual funds.
The composition, industries and holdings of the Portfolio are subject to
change.
Shares of the separate Portfolios of Neuberger Berman Advisers Management Trust
are sold only through the currently effective prospectus and are not available
to the general public. Shares of this Portfolio may be purchased only by life
insurance companies to be used with their separate accounts that fund variable
annuity and variable life insurance policies and by qualified pension and
retirement plans.
(C) 2004 Neuberger Berman Management Inc., distributor. All rights reserved.
3
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Fasciano Portfolio
- ------------------------------------------
Number of Shares Market Value+
Common Stocks (88.8%)
Auto/Truck Replacement Parts (1.3%)
3,060 American Axle &
Manufacturing Holdings $111,262
Banking & Financial (1.7%)
3,510 Boston Private Financial
Holdings 81,291
1,380 Wintrust Financial 69,704
--------
150,995
Basic Materials (0.2%)
900 AMCOL International 17,055
Biotechnology (1.1%)
2,290 Techne Corp. 99,501*
Business Services (4.6%)
1,810 Clark, Inc. 33,575*
5,580 G & K Services 224,260
400 Ritchie Bros. Auctioneers 11,644
2,480 Rollins, Inc. 57,065
2,920 Watson Wyatt & Co. 77,818
--------
404,362
Commercial Services (5.4%)
3,730 Modine Manufacturing 118,801
2,900 National Processing 83,375*
8,410 OM Group 277,614*
--------
479,790
Consumer Products & Services (9.9%)
4,680 Blyth, Inc. 161,413
5,260 Central Parking 98,309
4,720 Plantronics, Inc. 198,712*
4,600 Snap-on 154,330
6,560 Spartech Corp. 170,166
2,847 Tootsie Roll Industries 92,528
--------
875,458
Distributor (5.2%)
5,560 D & K Healthcare
Resources 66,720
5,680 MSC Industrial Direct 186,531
3,530 ScanSource, Inc. 209,753*
--------
463,004
Electrical & Electronics (0.1%)
200 Daktronics, Inc. 4,990*
700 LoJack Corp. 6,153*
--------
11,143
Entertainment (1.7%)
3,090 International Speedway 150,298
Filters (0.7%)
1,370 CLARCOR Inc. 62,746
Financial Services (5.6%)
840 FactSet Research Systems 39,707
2,130 Financial Federal 75,104*
1,620 Greater Bay Bancorp 46,818
4
Number of Shares Market Value+
5,200 HCC Insurance Holdings $173,732
2,580 ITLA Capital 104,670*
2,990 W.P. Stewart & Co. 61,265
--------
501,296
Health Care (3.2%)
3,850 Apria Healthcare Group 110,495*
2,060 Charles River Laboratories
International 100,672*
1,400 CUNO Inc. 74,690*
--------
285,857
Health Products & Services (8.6%)
10,120 Hooper Holmes 58,089
1,590 ICU Medical 53,313*#
7,010 K-V Pharmaceutical 161,861*
2,590 Landauer, Inc. 115,669
4,990 Priority Healthcare 114,520*
5,280 STERIS Corp. 119,117*
5,630 Young Innovations 143,002
--------
765,571
Heavy Industry (0.9%)
2,830 Chicago Bridge & Iron 78,816
Insurance (4.8%)
11,400 Assured Guaranty 193,230*
3,350 Direct General 108,071
1,630 Hilb, Rogal and Hamilton 58,158
1,910 RLI Corp. 69,715
--------
429,174
Internet (0.5%)
1,470 j2 Global Communications 40,866*
Machinery & Equipment (4.8%)
5,040 IDEX Corp. 173,124
2,950 Lindsay Manufacturing 70,859
3,340 Regal-Beloit 74,348
4,870 Robbins & Myers 109,332
--------
427,663
Oil & Gas (3.6%)
1,665 CARBO Ceramics 113,637
2,480 FMC Technologies 71,424*
3,460 Offshore Logistics 97,295*
1,340 Universal Compression
Holdings 41,111*
--------
323,467
Publishing & Broadcasting (10.4%)
100 Courier Corp. 4,174
6,500 Emmis Communications 136,370*
8,510 Journal Communications 160,243
6,630 Journal Register 132,600*
2,610 Lee Enterprises 125,306
880 McClatchy Co. 61,732
2,500 Meredith Corp. 137,400
3,340 Pulitzer Inc. 163,326
--------
921,151
See Notes to Schedule of Investments 5
Schedule of Investments Fasciano Portfolio cont'd
- -------------------------------------------------
Number of Shares Market Value+
Real Estate (1.2%)
1,020 Beazer Homes USA $ 102,316
Restaurants (2.9%)
4,240 Ruby Tuesday 116,388
7,880 Steak n Shake 143,574*
----------
259,962
Retail (1.9%)
1,600 Christopher & Banks 28,336
2,390 Regis Corp. 106,570
1,200 Sharper Image 37,668*
----------
172,574
Semiconductors (0.5%)
1,440 Cabot Microelectronics 44,078*
Technology (0.9%)
5,860 Methode Electronics 76,004
Transportation (4.1%)
3,080 Heartland Express 84,269
5,370 Landstar System 283,912*
----------
368,181
Waste Management (3.0%)
3,570 Stericycle, Inc. 184,712*
2,745 Waste Connections 81,417*
-----------
266,129
Total Common Stocks
(Cost $6,741,600) 7,888,719
-----------
Principal Amount
Short-Term Investments (19.4%)
$ 38,500 N&B Securities Lending
Quality Fund, LLC 38,500++
1,685,934 Neuberger Berman
Institutional Cash
Fund Trust Class 1,685,934@
----------
Total Short-Term Investments
(Cost $1,724,434) 1,724,434#
----------
Total Investments (108.2%)
(Cost $8,466,034) 9,613,153##
Liabilities, less cash, receivables
and other assets [(8.2%)] (725,386)
----------
Total Net Assets (100.0%) $8,887,767
----------
See Notes to Schedule of Investments 6
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Schedule of Investments Fasciano Portfolio
- ---------------------------------------------------
+ Investments in equity securities by the Fund are valued at the latest sales
price where that price is readily available; securities for which no sales
were reported, unless otherwise noted, are valued at the mean between the
closing bid and asked prices. Securities traded primarily on the NASDAQ
Stock Market are normally valued by the Fund at the NASDAQ Official Closing
Price ("NOCP") provided by NASDAQ each business day. The NOCP is the most
recently reported price as of 4:00:02 p.m., Eastern time, unless that price
is outside the range of the "inside" bid and asked prices (i.e., the bid and
asked prices that dealers quote to each other when trading for their own
accounts); in that case, NASDAQ will adjust the price to equal the inside
bid or asked price, whichever is closer. Because of delays in reporting
trades, the NOCP may not be based on the price of the last trade to occur
before the market closes. The Fund values all other securities by a method
the Board of Trustees of Neuberger Berman Advisers Management Trust (the
"Board") believes accurately reflects fair value. Numerous factors may be
considered when determining the fair value of a security, including
available analyst, media or other reports, trading in futures or ADRs and
whether the issuer of the security being fair valued has other securities
outstanding. Foreign security prices are furnished by independent quotation
services expressed in local currency values. Foreign security prices are
translated from the local currency into U.S. dollars using the exchange rate
as of 12:00 p.m., Eastern time. The Board has approved the use of FT
Interactive Data Corporation ("FT Interactive") to assist in determining the
fair value of the Fund's foreign equity securities in the wake of certain
significant events. Specifically, when changes in the value of a certain
index suggest that the closing prices on the foreign exchanges no longer
represent the amount that the Fund could expect to receive for those
securities, FT Interactive will provide adjusted prices for certain foreign
equity securities based on an analysis showing historical correlations
between the prices of those securities and changes in the index. In the
absence of precise information about the market values of these foreign
securities as of the close of the New York Stock Exchange, the Board has
determined on the basis of available data that prices adjusted in this way
are likely to be closer to the prices the Fund could realize on a current
sale than are the prices of those securities established at the close of the
foreign markets in which the securities primarily trade. However, fair value
prices are necessarily estimates, and there is no assurance that such a
price will be at or close to the price at which the security next trades.
Short-term debt securities with less than 60 days until maturity may be
valued at cost which, when combined with interest earned, approximates
market value.
# At cost, which approximates market value.
## At June 30, 2004, the cost of investments for U.S. Federal income tax
purposes was $8,466,034. Gross unrealized appreciation of investments was
$1,221,459 and gross unrealized depreciation of investments was $74,340,
resulting in net unrealized appreciation of $1,147,119, based on cost for
U.S. Federal income tax purposes.
* Non-income producing security.
# All or a portion of this security is on loan (see Note A of Notes to
Financial Statements).
@ Neuberger Berman Institutional Cash Fund is also managed by Neuberger Berman
Management Inc. (see Note A of Notes to Financial Statements).
++ Affiliated issuer (see Note A of Notes to Financial Statements).
See Notes to Financial Statements 7
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Assets and Liabilities
- -----------------------------------
Fasciano
Neuberger Berman Advisers Management Trust Portfolio
Assets
Investments in securities, at market value+* (Note A)-see Schedule of Investments:
================================================================================================
Unaffiliated issuers $7,888,719
- ------------------------------------------------------------------------------------------------
Affiliated issuers 1,724,434
- ------------------------------------------------------------------------------------------------
9,613,153
- ------------------------------------------------------------------------------------------------
Dividends and interest receivable 4,895
================================================================================================
Receivable for Fund shares sold 45,419
- ------------------------------------------------------------------------------------------------
Receivable from administrator-net (Note B) 3,454
- ------------------------------------------------------------------------------------------------
Prepaid expenses and other assets 124
================================================================================================
Total Assets 9,667,045
================================================================================================
Liabilities
Payable for collateral on securities loaned (Note A) 38,500
================================================================================================
Payable for securities purchased 719,334
- ------------------------------------------------------------------------------------------------
Payable for Fund shares redeemed 111
- ------------------------------------------------------------------------------------------------
Payable to investment manager-net (Note B) 5,384
================================================================================================
Accrued expenses and other payables 15,949
- ------------------------------------------------------------------------------------------------
Total Liabilities 779,278
- ------------------------------------------------------------------------------------------------
Net Assets at value $8,887,767
- ------------------------------------------------------------------------------------------------
Net Assets consist of:
Paid-in capital $7,659,720
================================================================================================
Undistributed net investment income (loss) (24,241)
- ------------------------------------------------------------------------------------------------
Accumulated net realized gains (losses) on investments 105,169
- ------------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) in value of investments 1,147,119
- ------------------------------------------------------------------------------------------------
Net Assets at value $8,887,767
- ------------------------------------------------------------------------------------------------
Shares Outstanding ($.001 par value; unlimited shares authorized) 679,071
================================================================================================
Net Asset Value, offering and redemption price per share $ 13.09
- ------------------------------------------------------------------------------------------------
+Securities on loan, at market value:
Unaffiliated issuers $ 36,883
- ------------------------------------------------------------------------------------------------
*Cost of investments:
Unaffiliated issuers $6,741,600
----------------------------------------------------------------------------------------------
Affiliated issuers 1,724,434
----------------------------------------------------------------------------------------------
Total cost of investments $8,466,034
- ------------------------------------------------------------------------------------------------
See Notes to Financial Statements 8
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST FOR THE SIX MONTHS ENDED JUNE 30,
2004 (UNAUDITED)
Statement of Operations
- -----------------------
Fasciano
Neuberger Berman Advisers Management Trust Portfolio
Investment Income
Income:
Dividend income-unaffiliated issuers $ 22,152
=====================================================================================================
Income from investments in affiliated issuers (Note A) 3,462
- -----------------------------------------------------------------------------------------------------
Foreign taxes withheld (Note A) (31)
- -----------------------------------------------------------------------------------------------------
Total income 25,583
- -----------------------------------------------------------------------------------------------------
Expenses:
Investment management fee (Notes A & B) 30,105
=====================================================================================================
Administration fee (Note B) 10,625
- -----------------------------------------------------------------------------------------------------
Distribution fees (Note B) 8,854
=====================================================================================================
Audit fees 12,975
- -----------------------------------------------------------------------------------------------------
Custodian fees (Note B) 12,639
=====================================================================================================
Insurance expense 44
- -----------------------------------------------------------------------------------------------------
Legal fees 394
=====================================================================================================
Shareholder reports 4,532
- -----------------------------------------------------------------------------------------------------
Trustees' fees and expenses 13,453
=====================================================================================================
Miscellaneous 999
- -----------------------------------------------------------------------------------------------------
Total expenses 94,620
Expenses reimbursed by administrator (Note B) (43,996)
- -----------------------------------------------------------------------------------------------------
Investment management fee waived (Note A) (437)
- -----------------------------------------------------------------------------------------------------
Expenses reduced by custodian fee expense offset and commission recapture arrangements (Note B) (363)
- -----------------------------------------------------------------------------------------------------
Total net expenses 49,824
- -----------------------------------------------------------------------------------------------------
Net investment income (loss) (24,241)
- -----------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) on Investments (Note A)
Net realized gain (loss) on:
Investment securities sold in unaffiliated issuers 110,263
=====================================================================================================
Change in net unrealized appreciation (depreciation) in value of:
Investment securities in unaffiliated issuers 311,355
- -----------------------------------------------------------------------------------------------------
Net gain (loss) on investments 421,618
- -----------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations $397,377
- -----------------------------------------------------------------------------------------------------
See Notes to Financial Statements 9
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Changes in Net Assets
- ----------------------------------
Fasciano Portfolio
---------------------------
Six Months
Ended Year
June 30, Ended
2004 December 31,
Neuberger Berman Advisers Management Trust (Unaudited) 2003
Increase (Decrease) in Net Assets:
From Operations:
Net investment income (loss) $ (24,241) $ (20,088)
===================================================================================================
Net realized gain (loss) on investments 110,263 15,201
- ---------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of investments 311,355 836,449
- ---------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations 397,377 831,562
- ---------------------------------------------------------------------------------------------------
Distributions to Shareholders From:
Net realized gain on investments - (2,283)
===================================================================================================
From Fund Share Transactions (Note D):
Proceeds from shares sold 4,709,222 9,153,720
===================================================================================================
Proceeds from reinvestment of dividends and distributions - 2,283
- ---------------------------------------------------------------------------------------------------
Payments for shares redeemed (2,410,604) (4,265,714)
- ---------------------------------------------------------------------------------------------------
Net increase (decrease) from Fund share transactions 2,298,618 4,890,289
- ---------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets 2,695,995 5,719,568
Net Assets:
Beginning of period 6,191,772 472,204
- ---------------------------------------------------------------------------------------------------
End of period $ 8,887,767 $ 6,191,772
- ---------------------------------------------------------------------------------------------------
Undistributed net investment income (loss) at end of period $ (24,241) $ -
- ---------------------------------------------------------------------------------------------------
See Notes to Financial Statements 10
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Financial Statements Fasciano Portfolio
- ------------------------------------------------
Note A--Summary of Significant Accounting Policies:
1 General: Fasciano Portfolio (the "Fund") is a separate operating series of
Neuberger Berman Advisers Management Trust (the "Trust"), a Delaware
statutory trust organized pursuant to a Trust Instrument dated May 23,
1994. The Trust is currently comprised of ten separate operating series
(each a "Series," collectively, the "Funds") each of which (except Focus
Portfolio) is diversified. The Trust is registered as an open-end
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"), and its shares are registered under the
Securities Act of 1933, as amended. The Fund currently offers only Class S
shares. The Board of Trustees of the Trust may establish additional series
or classes of shares without the approval of shareholders.
The assets of each Series belong only to that Series, and the liabilities
of each Series are borne solely by that Series and no other.
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States requires Neuberger
Berman Management Inc. ("Management") to make estimates and assumptions at
the date of the financial statements. Actual results could differ from
those estimates.
2 Portfolio valuation: Investment securities are valued as indicated in the
notes following the Schedule of Investments.
3 Foreign currency translation: The accounting records of the Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into
U.S. dollars using the exchange rate as of 12:00 p.m., Eastern time, to
determine the value of investments, other assets and liabilities. Purchase
and sale prices of securities, and income and expenses, are translated into
U.S. dollars at the prevailing rate of exchange on the respective dates of
such transactions. Net unrealized foreign currency gain (loss) arises from
changes in the value of assets and liabilities, other than investments in
securities, as a result of changes in exchange rates and is stated
separately in the Statement of Operations.
4 Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the
ex-dividend date or, for certain foreign dividends, as soon as the Fund
becomes aware of the dividends. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, including accretion of original issue discount,
where applicable, and accretion of discount on short-term investments, is
recorded on the accrual basis. Realized gains and losses from securities
transactions and foreign currency transactions are recorded on the basis of
identified cost and stated separately in the Statement of Operations.
5 Federal income taxes: The Funds are treated as separate entities for U.S.
Federal income tax purposes. It is the policy of the Fund to continue to
qualify as a regulated investment company by complying with the provisions
available to certain investment companies, as defined in applicable
sections of the Internal Revenue Code, and to make distributions of
investment company taxable income and net capital gains (after reduction
for any amounts available for U.S. Federal income tax purposes as capital
loss
11
Notes to Financial Statements Fasciano Portfolio cont'd
- -------------------------------------------------------
carryforwards) sufficient to relieve it from all, or substantially all,
U.S. Federal income taxes. Accordingly, the Fund paid no U.S. Federal
income taxes and no provision for U.S. Federal income taxes was required.
6 Dividends and distributions to shareholders: The Fund may earn income, net
of expenses, daily on its investments. Income dividends and distributions
from net realized capital gains, if any, generally are distributed in
October. Income dividends and capital gain distributions to shareholders
are recorded on the ex-dividend date. To the extent the Fund's net realized
capital gains, if any, can be offset by capital loss carryforwards, it is
the policy of the Fund not to distribute such gains.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a tax return of
capital. Differences in the recognition or classification of income between
the financial statements and tax earnings and profits which result in
temporary over-distributions for financial statement purposes are
classified as distributions in excess of net investment income or
accumulated net realized gains in the components of net assets on the
Statement of Assets and Liabilities.
The tax character of distributions paid during the periods ended December
31, 2003 and 2002 was as follows:
Distributions Paid From:
Long-Term
Ordinary Income Capital Gain Total
2003 2002 2003 2002 2003 2002
$2,283 $ -- $ -- $ -- $2,283 $ --
As of December 31, 2003, the components of distributable earnings
(accumulated losses) on a U.S. Federal income tax basis were as follows:
Undistributed Undistributed Unrealized
Ordinary Long-Term Appreciation
Income Gain (Depreciation) Total
$4,148 $31,915 $794,607 $830,670
The difference between book basis and tax basis is attributable primarily
to net operating losses and the tax deferral of losses on wash sales.
7 Foreign taxes: Foreign taxes withheld represent amounts withheld by foreign
tax authorities, net of refunds recoverable.
8 Expense allocation: Certain expenses are applicable to multiple funds.
Expenses directly attributable to a Series are charged to that Series.
Expenses of the Trust that are not directly attributed to a Series are
allocated among the Funds, on the basis of relative net assets, except
where a more appropriate allocation of expenses to each of the Funds can
otherwise be made fairly. Expenses borne by the complex of related
investment companies, which includes open-end and closed-end investment
companies for which Management serves as investment manager, that are not
directly attributed to a Series or the Trust, are allocated among the Fund
and the other investment companies in the complex or series thereof, on the
basis of relative net assets, except where a more appropriate allocation of
expenses to each investment company in the complex or series thereof can
otherwise be made fairly.
12
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
9 Security lending: Pursuant to an Exemptive Order issued by the Securities
and Exchange Commission, the Fund entered into a Securities Lending
Agreement ("Agreement") with Neuberger Berman, LLC ("Neuberger") on April
17, 2003. Securities loans involve certain risks in the event a borrower
should fail financially, including delays or inability to recover the lent
securities or foreclose against the collateral. The investment manager,
under the general supervision of the Trust's Board of Trustees, monitors
the creditworthiness of the parties to whom the Fund makes security loans.
The Fund will not lend securities on which covered call options have been
written, or lend securities on terms which would prevent the Fund from
qualifying as a regulated investment company. The Fund receives cash
collateral equal to at least 102% of the current market value of the loaned
securities. The Fund invests the cash collateral in the N&B Securities
Lending Quality Fund, LLC, which is managed by State Street Bank and Trust
Company ("State Street") pursuant to guidelines approved by the Trust's
investment manager. Neuberger received a portion of the revenue under the
Agreement as a lending agency fee.
The Agreement has been renewed and approved by the Board of Trustees as of
July 1, 2004 with substantially the same terms. Under this current
Agreement, Neuberger guarantees minimum revenue to the Fund and receives
any revenue earned in excess of the guaranteed amount as a lending agency
fee.
At June 30, 2004, the Fund had not paid Neuberger any fees under the
Agreement.
Income earned on the securities loaned, if any, is reflected in the
Statement of Operations under the caption Income from securities
loaned-net.
10 Transactions with other funds managed by Neuberger Berman Management
Inc.: Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission, the Fund may invest in the Neuberger Berman Institutional Cash
Fund (the "Cash Fund"), a fund managed by Management and having the same
Board members as the Fund. The Cash Fund seeks to provide as high a level
of current income as is consistent with the preservation of capital and the
maintenance of liquidity. For any cash that the Fund invests in the Cash
Fund, Management waives a portion of its management fee equal to the
management fee it receives from the Cash Fund on those assets. For the six
months ended June 30, 2004 such waived fees amounted to $437. For the six
months ended June 30, 2004, income earned on this investment amounted to
$3,462 and is reflected in the Statement of Operations under the caption
Income from investments in affiliated issuers.
Note B--Management Fees, Administration Fees, Distribution Arrangements,
and Other Transactions With Affiliates:
Fund shares are issued and redeemed in connection with investments in and
payments under certain variable annuity contracts and variable life
insurance policies issued through separate accounts of life insurance
companies and are also offered directly to qualified pension and retirement
plans.
The Fund retains Management as its investment manager under a Management
Agreement. For such investment management services, the Fund pays
Management a fee at the annual rate of 0.85% of the first $500 million of
the Fund's average daily net assets, 0.825% of the next $500 million, 0.80%
of the next
13
Notes to Financial Statements Fasciano Portfolio cont'd
- -------------------------------------------------------
$500 million, 0.775% of the next $500 million, 0.75% of the next $500
million, and 0.725% of average daily net assets in excess of $2.5 billion.
The Fund retains Management as its administrator under an Administration
Agreement. The Fund pays Management an administration fee at the annual
rate of 0.30% of its average daily net assets under this agreement.
Additionally, Management retains State Street as its sub-administrator
under a Sub-Administration Agreement. Management pays State Street a fee
for all services received under the agreement.
Management acts as agent in arranging for the sale of Fund shares without
commission and bears advertising and promotion expenses. The Trustees of
the Trust have adopted a distribution plan (the "Plan") with respect to the
Fund, pursuant to Rule 12b-1 under the 1940 Act. The Plan provides that, as
compensation for administrative and other services provided to the Fund,
Management's activities and expenses related to the sale and distribution
of the Fund's shares, and ongoing services provided to investors in the
Fund, Management receives from the Fund a fee at the annual rate of 0.25%
of its average daily net assets. Management receives this amount to provide
distribution and shareholder servicing for the Fund and pays a portion of
it to institutions that provide such services. Those institutions may use
the payments for, among other purposes, compensating employees engaged in
sales and/or shareholder servicing. The amount of fees paid by the Fund
during any year may be more or less than the cost of distribution and other
services provided to the Fund. NASD rules limit the amount of annual
distribution fees that may be paid by a mutual fund and impose a ceiling on
the cumulative distribution fees paid. The Trust's Plan complies with those
rules.
Management has contractually undertaken through December 31, 2007 to
reimburse the Fund for its operating expenses (including the fees payable
to Management but excluding interest, taxes, brokerage commissions,
extraordinary expenses, and transaction costs) ("Operating Expenses") which
exceed, in the aggregate, 1.40% per annum of its average daily net assets
(the "Expense Limitation"). For the six months ended June 30, 2004, such
excess expenses amounted to $43,996. The Fund has agreed to repay
Management through December 31, 2010 for its excess Operating Expenses
previously reimbursed by Management, so long as its annual Operating
Expenses during that period do not exceed its Expense Limitation, and the
repayment is made within three years after the year in which Management
issued the reimbursement. During the six months ended June 30, 2004, there
was no reimbursement to Management. At June 30, 2004, the Fund has a
contingent liability to Management under this agreement of $180,600.
On October 31, 2003, Management and Neuberger, a member firm of the New
York Stock Exchange and sub-adviser to the Fund, became indirect
wholly-owned subsidiaries of Lehman Brothers Holdings Inc. ("Lehman"), a
publicly-owned holding company. Neuberger is retained by Management to
furnish it with investment recommendations and research information without
added cost to the Fund. Several individuals who are officers and/or
Trustees of the Trust are also employees of Neuberger and/or Management.
On July 1, 2003, the Fund entered into a commission recapture program,
which enables it to pay some of its operational expenses by recouping a
portion of the commissions it pays to a broker that is not a related party
of the Fund. Expenses paid through this program may include costs of
custodial, transfer agency or accounting services. For the six months ended
June 30, 2004, the impact of this arrangement was a reduction of $361.
14
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
The Fund has an expense offset arrangement in connection with its custodian
contract. The impact of this arrangement, reflected in the Statement of
Operations under the caption Custodian fees, was a reduction of $2.
Note C--Securities Transactions:
During the six months ended June 30, 2004, there were purchase and sale
transactions (excluding short-term securities) of $2,222,879 and $382,641,
respectively.
During the six months ended June 30, 2004, brokerage commissions on
securities transactions amounted to $3,288, of which Neuberger received $0,
Lehman received $662, and other brokers received $2,626.
Note D--Fund Share Transactions:
Share activity for the six months ended June 30, 2004 and for the year
ended December 31, 2003 was as follows:
For the For the
Six Months Ended Year Ended
June 30, December 31,
2004 2003
Shares Sold 370,420 830,800
Shares Issued on Reinvestment of
Dividends and Distributions - 198
Shares Redeemed (190,872) (379,061)
-------- --------
Total 179,548 451,937
-------- --------
Note E--Line of Credit:
At June 30, 2004, the Fund was a participant in a single committed,
unsecured $150,000,000 line of credit with State Street, to be used only
for temporary or emergency purposes. Interest is charged on borrowings
under this agreement at the overnight Federal Funds Rate plus 0.50% per
annum. A facility fee of 0.10% per annum of the available line of credit is
charged, of which the Fund has agreed to pay its pro rata share, based on
the ratio of its individual net assets to the net assets of all
participants at the time the fee is due and payable. The fee is paid
quarterly in arrears. No compensating balance is required. Other investment
companies managed by Management also participate in this line of credit on
the same terms. Because several investment companies participate, there is
no assurance that the Fund will have access to the entire $150,000,000 at
any particular time. The Fund had no loans outstanding pursuant to this
line of credit at June 30, 2004, nor had the Fund utilized this line of
credit at any time prior to that date.
Note F--Unaudited Financial Information:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent auditors. Annual reports
contain audited financial statements.
15
Financial Highlights Fasciano Portfolio
- ---------------------------------------
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements.++
Period from
Six Months Ended Year Ended July 12, 2002^
June 30, December 31, to December 31,
---------------- ------------ ---------------
2004 2003 2002
(Unaudited)
Net Asset Value, Beginning of Period $12.40 $ 9.92 $10.00
------ ------ ------
Income From Investment Operations:
Net Investment Income (Loss) (.04) (.08) (.01)
Net Gains or Losses on Securities
(both realized and unrealized) .73 2.57 (.07)
------ ------ ------
Total From Investment Operations .69 2.49 (.08)
------ ------ ------
Less Distributions From:
Net Capital Gains - (.01) -
------ ------ ------
Net Asset Value, End of Period $13.09 $12.40 $ 9.92
------ ------ ------
Total Return++ +5.56%** +25.06% -0.80%**
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $ 8.9 $ 6.2 $ 0.5
Ratio of Gross Expenses to Average Net Assets# 1.42%* 1.42% 1.40%*
Ratio of Net Expenses to Average Net Assets[sec] 1.41%* 1.40% 1.40%*
Ratio of Net Investment Income (Loss) to Average Net Assets (.68)%* (.69)% (.31)%*
Portfolio Turnover Rate 6% 70% 20%
See Notes to Financial Highlights 16
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Financial Highlights Fasciano Portfolio
- ------------------------------------------------
++ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each
fiscal period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Current returns may be lower or higher than the performance data
quoted. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. Total return would
have been lower if Management had not reimbursed and/or waived certain
expenses. The total return information shown does not reflect charges and
other expenses that apply to the separate account or the related insurance
policies, and the inclusion of these charges and other expenses would
reduce the total return for all fiscal periods shown. Performance data
current to the most recent month-end are available at www.nb.com.
# The Fund is required to calculate an expense ratio without taking into
consideration any expense reductions related to expense offset and
commission recapture arrangements.
[sec] After reimbursement of expenses by the investment manager. Had the
investment manager not undertaken such action, the annualized ratio of net
expenses to average daily net assets would have been:
Period from
July 12, 2002 to
December 31, 2002
38.27%
After waiver of a portion of the investment management fee and
reimbursement of expenses by the investment manager. Had the investment
manager not undertaken such actions, the annualized ratios of net expenses
to average daily net assets would have been:
Six Months Ended Year Ended
June 30, December 31,
2004 2003
2.66% 4.58%
^ The date investment operations commenced.
++ The per share amounts which are shown have been computed based on the
average number of shares outstanding during each fiscal period.
* Annualized.
** Not annualized.
17
Trustees and Officers (Unaudited)
- ---------------------------------
The following tables set forth information concerning the trustees and officers
of the Trust. All persons named as trustees and officers also serve in similar
capacities for other funds administered or managed by NB Management and
Neuberger Berman. The Statement of Additional Information includes additional
information about fund trustees and is available upon request, without charge,
by calling (800) 877-9700.
Information about the Board of Trustees
- ----------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Position and Fund Complex Other Directorships
Independent Trustees Length of Time Overseen by Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ----------------------------------------------------------------------------------------------------------------------------------
John Cannon (74) Trustee since Consultant. Formerly, Chairman 38 Independent Trustee or Director of
2000 and Chief Investment Officer, three series of Oppenheimer Funds:
CDC Investment Advisors Limited Term New York Municipal
(registered investment adviser) Fund, Rochester Fund Municipals,
(1993-January 1999); prior and Oppenheimer Convertible
thereto, President and Chief Securities Fund since 1992.
Executive Officer, AMA
Investment Advisors, an affiliate
of the American Medical
Association.
- ----------------------------------------------------------------------------------------------------------------------------------
Faith Colish (68) Trustee since Counsel, Carter Ledyard & 38 Director, American Bar Retirement
1984 Milburn LLP (law firm) since Association (ABRA) since 1997
October 2002; Formerly, (not-for-profit membership
Attorney-at-Law and President, association).
Faith Colish, A Professional
Corporation, 1980 to 2002.
- ----------------------------------------------------------------------------------------------------------------------------------
Walter G. Ehlers (71) Trustee since Consultant; Retired President 38 None.
1989 and Trustee, Teachers
Insurance & Annuity (TIAA)
and College Retirement
Equities Fund (CREF).
- ----------------------------------------------------------------------------------------------------------------------------------
C. Anne Harvey (66) Trustee since Consultant, C. A. Harvey 38 President, Board of Associates to
1998 Associates, since June 2001; The National Rehabilitation
Formerly, Director, AARP, 1978 Hospital's Board of Directors since
to December 2001. 2002; Formerly, Member, Individual
Investors Advisory Committee to the
New York Stock Exchange Board of
Directors, 1998 to June 2002;
Member, American Savings
Education Council's Policy Board
(ASEC),1998-2000; Member,
Executive Committee, Crime
Prevention Coalition of America,
1997-2000.
- ----------------------------------------------------------------------------------------------------------------------------------
18
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
- ----------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Position and Fund Complex Other Directorships
Independent Trustees Length of Time Overseen by Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ----------------------------------------------------------------------------------------------------------------------------------
Barry Hirsch (71) Trustee since Attorney-at-Law. Formerly, 38 None.
2000 Senior Counsel, Loews
Corporation (diversified
financial corporation) May
2002 until April 2003; formerly,
Senior Vice President, Secretary
and General Counsel, Loews
Corporation.
- ----------------------------------------------------------------------------------------------------------------------------------
Robert A. Kavesh (76) Trustee since Marcus Nadler Professor of 38 Director, DEL Laboratories, Inc.
2000 Finance and Economics (cosmetics and pharmaceuticals)
Emeritus, New York University, since 1978; The Caring Community
Stern School of Business. (not-for-profit).
- ----------------------------------------------------------------------------------------------------------------------------------
Howard A. Mileaf (67) Trustee since Retired. Formerly, Vice 38 Director, WHX Corporation
1999 President and Special Counsel, (holding company) since August
WHX Corporation (holding 2002; Director, WebFinancial
company), 1993-2001. Corporation (holding company)
since December 2002; Director, State
Theatre of New Jersey (not-for-
profit theater) since 2000; formerly
Director, Kevlin Corporation
(manufacturer of microwave and
other products).
- ----------------------------------------------------------------------------------------------------------------------------------
William E. Rulon (71) Trustee since Retired. Senior Vice President, 38 Director, Pro-Kids Golf and
2000 Foodmaker, Inc. (operator and Learning Academy (teach golf and
franchiser of restaurants) until computer usage to "at risk"
January 1997. children) since 1998; Formerly,
Director, Prandium, Inc.
(restaurants) from March 2001 until
July 2002.
- ----------------------------------------------------------------------------------------------------------------------------------
Cornelius T. Ryan (72) Trustee since Founding General Partner, 38 Director, Capital Cash Management
2000 Oxford Partners and Oxford Trust (money market fund),
Bioscience Partners (venture Narragansett Insured Tax-Free
capital partnerships) and Income Fund, Rocky Mountain
President, Oxford Venture Equity Fund, Prime Cash Fund,
Corporation. several private companies and
QuadraMed Corporation
(NASDAQ).
- ----------------------------------------------------------------------------------------------------------------------------------
19
Trustees and Officers (Unaudited) cont'd
- ----------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Position and Fund Complex Other Directorships
Independent Trustees Length of Time Overseen by Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ----------------------------------------------------------------------------------------------------------------------------------
Tom Decker Seip (54) Trustee since General Partner, Seip 38 Director, H&R Block, Inc. (financial
2000 Investments LP (a private services company) since May 2001;
investment partnership); Director, Forward Management, Inc.
formerly, President and CEO, (asset management) since 2001;
Westaff, Inc. (temporary Formerly, Director, General Magic
staffing), May 2001 to January (voice recognition software),
2002; Senior Executive at the November 2001 until 2002; Director,
Charles Schwab Corporation E-Finance Corporation (credit
from 1983 to 1999, including decisioning services), 1999-2003;
Chief Executive Officer, Director, Save-Daily.com (micro
Charles Schwab Investment investing services), 1999-2003;
Management, Inc. and Trustee, Director, Offroad Capital Inc.
Schwab Family of Funds and (pre-public internet commerce
Schwab Investments from 1997 company).
to 1998 and Executive Vice
President--Retail Brokerage,
Charles Schwab Investment
Management from 1994
to 1997.
- ----------------------------------------------------------------------------------------------------------------------------------
Candace L. Straight (56) Trustee since Private investor and consultant 38 Director, The Proformance Insurance
1999 specializing in the insurance Company (personal lines property
industry; Formerly, Advisory and casualty insurance company)
Director, Securitas Capital LLC since March 2004; Director,
(a global private equity Providence Washington (property
investment firm dedicated to and casualty insurance company),
making investments in the since December 1998; Director,
insurance sector), 1998 until Summit Global Partners (insurance
December 2002. brokerage firm) since October 2000.
- ----------------------------------------------------------------------------------------------------------------------------------
Peter P. Trapp (59) Trustee since Regional Manager for Atlanta 38 None.
1984 Region, Ford Motor Credit
Company since August 1997;
Formerly, President, Ford
Life Insurance Company, April
1995 until August 1997.
- ----------------------------------------------------------------------------------------------------------------------------------
20
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
- ----------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Trustees who are Position and Fund Complex Other Directorships
"Interested Persons" Length of Time Overseen by Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ----------------------------------------------------------------------------------------------------------------------------------
Edward I. OBrien* (75) Trustee since Formerly, Member, Investment 38 Director, Legg Mason, Inc.(financial
2000 Policy Committee, Edward services holding company) since
Jones, 1993-2001; President, 1993; formerly, Director, Boston
Securities Industry Association Financial Group (real estate and tax
("SIA") (securities industry's shelters) 1993-1999.
representative in government
relations and regulatory matters
at the federal and state levels)
1974-1992; Adviser to SIA,
November 1992-November 1993.
- ----------------------------------------------------------------------------------------------------------------------------------
Jack L. Rivkin* (63) President and Executive Vice President and 38 Director, Dale Carnegie and
Trustee since Chief Investment Officer, Associates, Inc. (private company)
December Neuberger Berman Inc. since 1998; Director, Emagin Corp.
2002 (holding company) since 2002 (public company) since 1997;
and 2003, respectively; Director, Solbright, Inc. (private
Executive Vice President and company) since 1998; Director,
Chief Investment Officer, Infogate, Inc. (private company)
Neuberger Berman since 2002 since 1997.
and 2003, respectively; Director
and Chairman, NB
Management since December
2002; Formerly, Executive Vice
President, Citigroup
Investments, Inc. from
September 1995 to February
2002; Executive Vice President,
Citigroup Inc. from September
1995 to February 2002.
- ----------------------------------------------------------------------------------------------------------------------------------
Peter E. Sundman* (45) Chairman of Executive Vice President, 38 Director, Neuberger Berman Inc.
the Board, Neuberger Berman Inc. (holding company) from 1999
Chief (holding company) since 1999; through March 2003; President and
Executive Head of Neuberger Berman Director, NB Management since
Officer and Inc.'s Mutual Funds and 1999; Director and Vice President,
Trustee since Institutional Business since Neuberger Berman Agency, Inc.
2000; 1999; Executive Vice President, since 2000.
President and Neuberger Berman since 1999;
Chief Principal, Neuberger Berman
Executive from 1997 until 1999; Senior
Officer from Vice President, NB
1998 to 2000 Management from 1996
until 1999.
- ----------------------------------------------------------------------------------------------------------------------------------
21
Trustees and Officers (Unaudited) cont'd
- ----------------------------------------
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the Trust's Trust Instrument, each Trustee shall hold office for
life or until his or her successor is elected or the Trust terminates;
except that (a) any Trustee may resign by delivering a written resignation;
(b) any Trustee may be removed with or without cause at any time by a
written instrument signed by at least two-thirds of the other Trustees; (c)
any Trustee who requests to be retired, or who has become unable to serve,
may be retired by a written instrument signed by a majority of the other
Trustees; and (d) any Trustee may be removed at any shareholder meeting by a
vote of at least two-thirds of the outstanding shares.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
* Indicates a Trustee who is an "interested person" within the meaning of the
1940 Act. Mr. Sundman and Mr. Rivkin are interested persons of the Trust by
virtue of the fact that they are officers and/or directors of NB Management
and Executive Vice Presidents of Neuberger Berman. Mr. O'Brien is an
interested person of the Trust by virtue of the fact that he is a director
of Legg Mason, Inc., a wholly owned subsidiary of which, from time to time,
serves as a broker or dealer to the Funds and other funds for which NB
Management serves as investment manager.
22
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Information about the Officers of the Trust
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- ---------------------------------------------------------------------------------------------------------------------------
Claudia A. Brandon (47) Secretary since 1985 Vice President--Mutual Fund Board Relations, NB
Management since 2000; Vice President, Neuberger
Berman since 2002 and employee since 1999; Vice
President, NB Management from 1986 to 1999; Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(four since 2002, three since 2003, and one since 2004).
Robert Conti (48) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President, Neuberger Berman from 1999 until 2003; Senior
Vice President, NB Management since 2000; Controller,
NB Management until 1996; Treasurer, NB Management
from 1996 until 1999; Vice President, eleven registered
investment companies for which NB Management acts as
investment manager and administrator (three since 2000,
four since 2002, three since 2003, and one since 2004).
Brian P. Gaffney (50) Vice President since 2000 Managing Director, Neuberger Berman since 1999; Senior
Vice President, NB Management since 2000; Vice
President, NB Management from 1997 until 1999; Vice
President, eleven registered investment companies for which
NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three since
2003, and one since 2004).
Sheila R. James (39) Assistant Secretary since 2002 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1991 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003 and one since 2004).
Kevin Lyons (49) Assistant Secretary since 2003 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1993 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(Ten since 2003 and one since 2004).
23
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- -----------------------------------------------------------------------------------------------------------------------------
John M. McGovern (34) Assistant Treasurer since 2002 Vice President, Neuberger Berman since 2004; Employee,
NB Management since 1993; Assistant Treasurer, eleven
registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003, and one since 2004).
Barbara Muinos (45) Treasurer and Principal Financial Vice President, Neuberger Berman since 1999; Assistant
and Accounting Officer since 2002; Vice President, NB Management from 1993 to 1999;
prior thereto, Assistant Treasurer Treasurer and Principal Financial and Accounting Officer,
since 1996 eleven registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003, and one since 2004);
Assistant Treasurer, three registered investment companies
for which NB Management acts as investment manager and
administrator from 1996 until 2002.
Frederic B. Soule (58) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President; Neuberger Berman from 1999 until 2003; Vice
President, NB Management from 1995 until 1999; Vice
President, eleven registered investment companies for which
NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three since
2003, and one since 2004).
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the By-Laws of the Trust, each officer elected by the Trustees
shall hold office until his or her successor shall have been elected and
qualified or until his or her earlier death, inability to serve, or
resignation. Officers serve at the pleasure of the Trustees and may be
removed at any time with or without cause.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
24
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Proxy Voting Policies and Procedures
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to portfolio securities is available, without
charge, by calling 1-800-877-9700 (toll-free) and on the website of the
Securities and Exchange Commission, at www.sec.gov. Beginning September 2004,
information regarding how the Fund voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 will also be
available without charge, by calling 1-800-877-9700 (toll-free), on the website
of the Securities and Exchange Commission, at www.sec.gov, and on the Fund's
website at www.nb.com [http://www.nb.com].
25
Semi-Annual Report
June 30, 2004
D0313 08/04
[Logo]
Neuberger Berman
Advisers
Management
Trust
Focus
Portfolio
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Focus Portfolio Managers' Commentary
AMT Focus declined roughly three percent over the first six months of 2004,
underperforming its benchmarks, the Russell 1000 Value Index and the Standard &
Poor's 500 Index.(2)
Portfolio performance this year has been volatile, which is not surprising
given our concentration. Our underperformance year-to-date, while obviously
undesirable, is also not surprising considering our significant outperformance
in 2003, a year in which we returned roughly three times more than our
benchmarks.
Positive portfolio performance continued into the start of the new year, and we
comfortably outperformed the Russell Index through the first three months of
2004. Our financial stocks drove positive absolute and relative returns; our
selection of stocks outperformed Russell sector components. Our consumer credit
companies, such as Capital One Financial, and investment banking and brokerage
stocks, including J.P. Morgan Chase and Citigroup, performed well thanks to
generally sound market conditions, strengthening capital markets activity,
improving credit-quality trends and strong earnings reports. Our one industrial
holding, MemberWorks, also contributed to strong portfolio performance.
Such substantial outperformance is generally unsustainable, however, and at the
start of the second quarter, our portfolio began to retreat as a better-than-
expected employment report ignited concern that the Federal Reserve
would soon raise interest rates, and perhaps, aggressively. While corporations
saw this as a positive sign of an improving economy, investors began to fear
that rising rates would halt the earnings growth of many financial companies.
Rising rates also sparked fears of a slowdown in technology, as did concerns
about high inventory levels, China's future, and the then-approaching seasonal
slowdown in tech. With the majority of our portfolio invested in financials and
information technology, AMT Focus' performance was adversely affected. This
occurred despite the fact that almost all of our companies reported
better-than-expected earnings results.
While our financial companies lost some of the ground they had gained in the
first quarter, they did end the full six-month period with gains. Our
industrial and consumer discretionary holdings, though they detracted in the
second quarter, also contributed positively to absolute and relative
year-to-date returns; our selection of stocks outperformed their index sector
counterparts over the period. Our information technology holdings, on the other
hand, detracted from total return and were the major cause of portfolio
underperformance.
While we are certainly not pleased with the way in which the market has treated
some of our companies, we are long-term investors and remain confident in the
long-term outlook for our portfolio. We realize, of course, that many investors
may have a much shorter investment time horizon.
The fact that many investors are worried over whether companies such as
Citigroup and J.P. Morgan Chase will be able to cope with rising interest rates
has hurt our short-term performance. But we are not worried about whether these
companies' managements are capable of prospering
1
in a period of rising rates; we believe they are. We therefore currently remain
committed to our investments in the group.
We've never been ones to follow the herd. We will continue to do what we've said
we will do, which is to build a portfolio that trades at a discount to the
market and, at the same time, has what we believe to be superior earnings growth
characteristics. The way to do this is to buy companies when they are out of
favor with the market majority: those "under a rock or under a cloud." We are
confident that our strategy will succeed over the long-term--that eventually the
clouds will lift and the sun will come out.
Sincerely,
/s/ Kent Simons
/s/ Robert B. Corman
KENT SIMONS AND ROBERT B. CORMAN
PORTFOLIO CO-MANAGERS
1. 33.88% and 45.28% were the average annual total returns for the 1-year and
since inception (08/08/02) periods ended June 30, 2004. Neuberger Berman
Management Inc. ("NBMI") has agreed to absorb certain expenses of the AMT
Portfolios. Without this arrangement, which is subject to change, the total
returns of the Portfolios would be less. Total return includes reinvestment of
dividends and capital gain distributions. Performance data quoted represent
past performance and the investment return and principal value of an investment
will fluctuate so that the shares, when redeemed, may be worth more or less
than original cost. Current performance may be lower or higher than the
performance data quoted. For performance data current to the most recent month
end, please visit www.nb.com/amtperformance. The performance information does
not reflect fees and expenses of the variable annuity and variable life
insurance policies or the pension plans whose proceeds are invested in the
portfolio.
2. The S&P 500 Index is widely regarded as the standard for measuring large-cap
U.S. stock market performance and includes a representative sample of leading
companies in leading industries. The Russell 1000[RegTM] Index measures the
performance of the 1,000 largest companies in the Russell 3000[RegTM]Index
(which measures performance of the 3,000 largest U.S. companies based on total
market capitalization). The Russell 1000 Index represents approximately 92% of
the total market capitalization of the Russell 3000 Index. The Russell 1000
Value Index measures the performance of those Russell 1000 companies with lower
price-to-book ratios and lower forecasted growth values. Please note that
indices do not take into account any fees and expenses of investing in the
individual securities that they track, and that individuals cannot invest
directly in any index. Data about the performance of these indices are prepared
or obtained by NBMI and include reinvestment of all dividends and capital gain
distributions. The Portfolio may invest in many securities not included in the
above-described indices.
The investments for the Portfolio are managed by the same portfolio manager(s)
who manage one or more other mutual funds that have similar names, investment
objectives and investment styles as the Portfolio. You should be aware that the
Portfolio is likely to differ from the other mutual funds in size, cash flow
pattern and tax matters. Accordingly, the holdings and performance of the
Portfolio can be expected to vary from those of the other mutual funds.
The composition, industries and holdings of the Portfolio are subject to
change.
Shares of the separate Portfolios of Neuberger Berman Advisers Management Trust
are sold only through the currently effective prospectus and are not available
to the general public. Shares of this Portfolio may be purchased only by life
insurance companies to be used with their separate accounts that fund variable
annuity and variable life insurance policies and by qualified pension and
retirement plans.
(C) 2004 Neuberger Berman Management Inc., distributor. All rights reserved.
2
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Focus Portfolio
Number of Shares Market Value+
Common Stocks (95.7%)
Autos & Housing (3.2%)
500 Autoliv, Inc. $ 21,100
1,200 Rush Enterprises 15,600*
----------
36,700
Consumer Goods & Services (8.0%)
1,300 Fresh Del Monte Produce 32,851
2,000 MemberWorks Inc. 59,240*
----------
92,091
Financial Services (40.7%)
966 Bank of America 81,743
2,000 Capital One Financial 136,760
900 Citigroup Inc. 41,850
900 Fannie Mae 64,224
1,200 J.P. Morgan Chase 46,524
1,000 Merrill Lynch 53,980
3,000 Providian Financial 44,010*
----------
469,091
Media & Entertainment (0.9%)
1,500 UnitedGlobalCom 10,890*
Retail (10.9%)
1,100 Furniture Brands
International 27,555
2,000 Select Comfort 56,800*
1,700 TJX Cos. 41,038
----------
125,393
Technology (32.0%)
1,300 Advanced Micro Devices 20,670*
1,200 Amdocs Ltd. 28,116*
4,500 Amkor Technology 36,810*
1,000 Computer Associates 28,060
1,200 Flextronics International 19,140*
3,500 International Rectifier 144,970*
600 Nokia Corp. ADR 8,724
1,100 Novell, Inc. 9,229*
1,700 NVIDIA Corp. 34,850*
5,000 NYFIX, Inc. 24,450*
700 VeriSign, Inc. 13,930*
----------
368,949
Total Common Stocks
(Cost $871,947) 1,103,114
----------
Principal Amount Market Value+
U.S. Treasury Securities (5.2%)
$60,000 U.S. Treasury Bills, 0.94%,
due 7/1/04
(Cost $60,000) $ 60,000#
----------
Short-Term Investments (0.4%)
4,917 Neuberger Berman
Institutional Cash Fund
Trust Class
(Cost $4,917) 4,917@#
----------
Total Investments (101.3%)
(Cost $936,864) 1,168,031##
Liabilities, less cash, receivables and
other assets [(1.3%)] (14,617)
----------
Total Net Assets (100.0%) $1,153,414
----------
See Notes to Schedule of Investments 3
Notes to Schedule of Investments Focus Portfolio
+ Investments in equity securities by the Fund are valued at the latest sales
price where that price is readily available; securities for which no sales
were reported, unless otherwise noted, are valued at the mean between the
closing bid and asked prices. Securities traded primarily on the NASDAQ Stock
Market are normally valued by the Fund at the NASDAQ Official Closing Price
("NOCP") provided by NASDAQ each business day. The NOCP is the most recently
reported price as of 4:00:02 p.m., Eastern time, unless that price is outside
the range of the "inside" bid and asked prices (i.e., the bid and asked
prices that dealers quote to each other when trading for their own accounts);
in that case, NASDAQ will adjust the price to equal the inside bid or asked
price, whichever is closer. Because of delays in reporting trades, the NOCP
may not be based on the price of the last trade to occur before the market
closes. The Fund values all other securities by a method the Board of
Trustees of Neuberger Berman Advisers Management Trust (the "Board") believes
accurately reflects fair value. Numerous factors may be considered when
determining the fair value of a security, including available analyst, media
or other reports, trading in futures or ADRs and whether the issuer of the
security being fair valued has other securities outstanding. Foreign security
prices are furnished by independent quotation services expressed in local
currency values. Foreign security prices are translated from the local
currency into U.S. dollars using the exchange rate as of 12:00 p.m., Eastern
time. The Board has approved the use of FT Interactive Data Corporation ("FT
Interactive") to assist in determining the fair value of the Fund's foreign
equity securities in the wake of certain significant events. Specifically,
when changes in the value of a certain index suggest that the closing prices
on the foreign exchanges no longer represent the amount that the Fund could
expect to receive for those securities, FT Interactive will provide adjusted
prices for certain foreign equity securities based on an analysis showing
historical correlations between the prices of those securities and changes in
the index. In the absence of precise information about the market values of
these foreign securities as of the close of the New York Stock Exchange, the
Board has determined on the basis of available data that prices adjusted in
this way are likely to be closer to the prices the Fund could realize on a
current sale than are the prices of those securities established at the close
of the foreign markets in which the securities primarily trade. However, fair
value prices are necessarily estimates, and there is no assurance that such a
price will be at or close to the price at which the security next trades.
Short-term debt securities with less than 60 days until maturity may be
valued at cost which, when combined with interest earned, approximates market
value.
# At cost, which approximates market value.
## At June 30, 2004, the cost of investments for U.S. Federal income tax
purposes was $936,864. Gross unrealized appreciation of investments was
$255,426 and gross unrealized depreciation of investments was $24,259,
resulting in net unrealized appreciation of $231,167, based on cost for U.S.
Federal income tax purposes.
* Non-income producing security.
@ Neuberger Berman Institutional Cash Fund is also managed by Neuberger Berman
Management Inc. (see Note A of Notes to Financial Statements).
See Notes to Financial Statements 4
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Assets and Liabilities
Focus
Neuberger Berman Advisers Management Trust Portfolio
Assets
Investments in securities, at market value* (Note A)-see Schedule of Investments:
===============================================================================================
Unaffiliated issuers $1,163,114
- -----------------------------------------------------------------------------------------------
Affiliated issuers 4,917
- -----------------------------------------------------------------------------------------------
1,168,031
- -----------------------------------------------------------------------------------------------
Dividends and interest receivable 78
===============================================================================================
Receivable from administrator-net (Note B) 4,985
- -----------------------------------------------------------------------------------------------
Prepaid expenses and other assets 24
- -----------------------------------------------------------------------------------------------
Total Assets 1,173,118
- -----------------------------------------------------------------------------------------------
Liabilities
Payable for Fund shares redeemed 51
===============================================================================================
Payable to investment manager-net (Note B) 499
- -----------------------------------------------------------------------------------------------
Accrued expenses and other payables 19,154
- -----------------------------------------------------------------------------------------------
Total Liabilities 19,704
- -----------------------------------------------------------------------------------------------
Net Assets at value $1,153,414
- -----------------------------------------------------------------------------------------------
Net Assets consist of:
Paid-in capital $ 766,905
===============================================================================================
Undistributed net investment income (loss) (2,313)
- -----------------------------------------------------------------------------------------------
Accumulated net realized gains (losses) on investments 157,655
===============================================================================================
Net unrealized appreciation (depreciation) in value of investments 231,167
- -----------------------------------------------------------------------------------------------
Net Assets at value $1,153,414
- -----------------------------------------------------------------------------------------------
Shares Outstanding ($.001 par value; unlimited shares authorized) 57,135
- -----------------------------------------------------------------------------------------------
Net Asset Value, offering and redemption price per share $ 20.19
- -----------------------------------------------------------------------------------------------
*Cost of investments:
Unaffiliated issuers $ 931,947
=============================================================================================
Affiliated issuers 4,917
---------------------------------------------------------------------------------------------
Total cost of investments $ 936,864
- -----------------------------------------------------------------------------------------------
See Notes to Financial Statements 5
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST FOR THE SIX MONTHS ENDED JUNE 30,
2004 (UNAUDITED)
Statement of Operations
Focus
Neuberger Berman Advisers Management Trust Portfolio
Investment Income
Income:
Dividend income-unaffiliated issuers $ 5,677
=======================================================================================================
Dividend income-affiliated issuers 62
- -------------------------------------------------------------------------------------------------------
Interest income (Note A) 7
=======================================================================================================
Income from investments in affiliated issuers (Note A) 226
- -------------------------------------------------------------------------------------------------------
Foreign taxes withheld (Note A) (32)
- -------------------------------------------------------------------------------------------------------
Total income 5,940
- -------------------------------------------------------------------------------------------------------
Expenses:
Investment management fee (Notes A & B) 3,383
=======================================================================================================
Administration fee (Note B) 1,845
- -------------------------------------------------------------------------------------------------------
Distribution fees (Note B) 1,538
=======================================================================================================
Audit fees 12,975
- -------------------------------------------------------------------------------------------------------
Custodian fees (Note B) 5,391
=======================================================================================================
Insurance expense 9
- -------------------------------------------------------------------------------------------------------
Legal fees 81
=======================================================================================================
Shareholder reports 3,065
- -------------------------------------------------------------------------------------------------------
Trustees' fees and expenses 13,453
=======================================================================================================
Miscellaneous 971
- -------------------------------------------------------------------------------------------------------
Total expenses 42,711
Expenses reimbursed by administrator (Note B) (34,394)
- -------------------------------------------------------------------------------------------------------
Investment management fee waived (Note A) (29)
- -------------------------------------------------------------------------------------------------------
Expenses reduced by custodian fee expense offset and commission recapture arrangements (Note B) (35)
- -------------------------------------------------------------------------------------------------------
Total net expenses 8,253
- -------------------------------------------------------------------------------------------------------
Net investment income (loss) (2,313)
- -------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) on Investments (Note A)
Net realized gain (loss) on:
Investment securities sold in unaffiliated issuers 33,263
====================================================================================================
Investment securities sold in affiliated issuers 6,948
----------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) in value of:
Investment securities in unaffiliated issuers (78,046)
----------------------------------------------------------------------------------------------------
Net gain (loss) on investments (37,835)
- -------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations $ (40,148)
- -------------------------------------------------------------------------------------------------------
See Notes to Financial Statements 6
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Changes in Net Assets
Focus Portfolio
--------------------------------
Six Months
Ended Year
June 30, Ended
2004 December 31,
Neuberger Berman Advisers Management Trust (Unaudited) 2003
Increase (Decrease) in Net Assets:
From Operations:
Net investment income (loss) $ (2,313) $ (3,575)
=====================================================================================================
Net realized gain (loss) on investments 40,211 123,733
- -----------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of investments (78,046) 303,355
- -----------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations (40,148) 423,513
- -----------------------------------------------------------------------------------------------------
Distributions to Shareholders From:
Net realized gain on investments - (7,067)
- -----------------------------------------------------------------------------------------------------
From Fund Share Transactions (Note D):
Proceeds from shares sold 96,633 745,221
=====================================================================================================
Proceeds from reinvestment of dividends and distributions - 7,067
- -----------------------------------------------------------------------------------------------------
Payments for shares redeemed (87,128) (213,704)
- -----------------------------------------------------------------------------------------------------
Net increase (decrease) from Fund share transactions 9,505 538,584
- -----------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets (30,643) 955,030
Net Assets:
Beginning of period 1,184,057 229,027
- -----------------------------------------------------------------------------------------------------
End of period $ 1,153,414 $ 1,184,057
- -----------------------------------------------------------------------------------------------------
Undistributed net investment income (loss) at end of period $ (2,313) $ -
- -----------------------------------------------------------------------------------------------------
See Notes to Financial Statements 7
Notes to Financial Statements Focus Portfolio
Note A--Summary of Significant Accounting Policies:
1 General: Focus Portfolio (the "Fund") is a separate operating series of
Neuberger Berman Advisers Management Trust (the "Trust"), a Delaware statutory
trust organized pursuant to a Trust Instrument dated May 23, 1994. The Trust is
currently comprised of ten separate operating series (each a "Series,"
collectively, the "Funds") each of which (except the Fund) is diversified. The
Trust is registered as an open-end management investment company under the
Investment Company Act of 1940, as amended (the "1940 Act"), and its shares are
registered under the Securities Act of 1933, as amended. The Fund currently
offers only Class S shares. The Board of Trustees of the Trust may establish
additional series or classes of shares without the approval of shareholders.
The assets of each Series belong only to that Series, and the liabilities of
each Series are borne solely by that Series and no other.
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States requires Neuberger Berman
Management Inc. ("Management") to make estimates and assumptions at the date of
the financial statements. Actual results could differ from those estimates.
2 Portfolio valuation: Investment securities are valued as indicated in the
notes following the Schedule of Investments.
3 Foreign currency translation: The accounting records of the Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars using the exchange rate as of 12:00 p.m., Eastern time, to determine
the value of investments, other assets and liabilities. Purchase and sale
prices of securities, and income and expenses, are translated into U.S. dollars
at the prevailing rate of exchange on the respective dates of such
transactions. Net unrealized foreign currency gain (loss) arises from changes
in the value of assets and liabilities, other than investments in securities,
as a result of changes in exchange rates and is stated separately in the
Statement of Operations.
4 Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the ex-dividend
date or, for certain foreign dividends, as soon as the Fund becomes aware of
the dividends. Non-cash dividends included in dividend income, if any, are
recorded at the fair market value of the securities received. Interest income,
including accretion of original issue discount, where applicable, and accretion
of discount on short-term investments, is recorded on the accrual basis.
Realized gains and losses from securities transactions and foreign currency
transactions are recorded on the basis of identified cost and stated separately
in the Statement of Operations.
5 Federal income taxes: The Funds are treated as separate entities for U.S.
Federal income tax purposes. It is the policy of the Fund to continue to
qualify as a regulated investment company by complying with the provisions
available to certain investment companies, as defined in applicable sections of
the Internal Revenue Code, and to make distributions of investment company
taxable income and net capital gains (after reduction for any amounts available
for U.S. Federal income tax purposes as capital loss carryforwards) sufficient
to relieve it from all, or substantially all, U.S. Federal income taxes.
Accordingly, the Fund paid no U.S. Federal income taxes and no provision for
U.S. Federal income taxes was required.
8
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
6 Dividends and distributions to shareholders: The Fund may earn income, net of
expenses, daily on its investments. Income dividends and distributions from net
realized capital gains, if any, generally are distributed in October. Income
dividends and capital gain distributions to shareholders are recorded on the
ex-dividend date. To the extent the Fund's net realized capital gains, if any,
can be offset by capital loss carryforwards, it is the policy of the Fund not
to distribute such gains.
Under current tax law, certain capital and net foreign currency losses realized
after October 31 within the taxable year may be deferred and treated as
occurring on the first day of the following tax year. For the year ended
December 31, 2003, the Fund elected to defer $718 of net capital losses arising
between November 1, 2003 and December 31, 2003.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a tax return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains in the components of net assets on the Statement of Assets and
Liabilities.
The tax character of distributions paid during the periods ended December 31,
2003 and 2002 was as follows:
Distributions Paid From:
Ordinary Income Total
2003 2002 2003 2002
$7,067 $ - $7,067 $ -
As of December 31, 2003, the components of distributable earnings (accumulated
losses) on a U.S. Federal income tax basis were as follows:
Undistributed Undistributed Unrealized Loss
Ordinary Long-Term Appreciation Carryforwards
Income Gain (Depreciation) and Deferrals Total
$113,929 $6,615 $306,831 $ (718) $426,657
The difference between book basis and tax basis is attributable primarily to
net operating losses, post October losses, and the tax deferral of losses on
wash sales.
7 Foreign taxes: Foreign taxes withheld represent amounts withheld by foreign
tax authorities, net of refunds recoverable.
8 Expense allocation: Certain expenses are applicable to multiple funds.
Expenses directly attributable to a Series are charged to that Series. Expenses
of the Trust that are not directly attributed to a Series are allocated among
the Funds, on the basis of relative net assets, except where a more appropriate
allocation of expenses to each of the Funds can otherwise by made fairly.
Expenses borne by the complex of related investment companies, which includes
open-end and closed-end investment companies for which Management serves as
investment manager, that are not directly attributed to a Series or the Trust,
are allocated among the Fund and the other investment companies in the complex
or series thereof, on the basis of relative net assets, except where a more
appropriate allocation of expenses to each investment company in the complex or
series thereof can otherwise be made fairly.
9
Notes to Financial Statements Focus Portfolio cont'd
9 Security lending: Pursuant to an Exemptive Order issued by the Securities and
Exchange Commission, the Fund entered into a Securities Lending Agreement
("Agreement") with Neuberger Berman, LLC ("Neuberger") on April 17, 2003.
Securities loans involve certain risks in the event a borrower should fail
financially, including delays or inability to recover the lent securities or
foreclose against the collateral. The investment manager, under the general
supervision of the Trust's Board of Trustees, monitors the creditworthiness of
the parties to whom the Fund makes security loans. The Fund will not lend
securities on which covered call options have been written, or lend securities
on terms which would prevent the Fund from qualifying as a regulated investment
company. The Fund receives cash collateral equal to at least 102% of the
current market value of the loaned securities. The Fund invests the cash
collateral in the N&B Securities Lending Quality Fund, LLC, which is managed by
State Street Bank and Trust Company ("State Street") pursuant to guidelines
approved by the Trust's investment manager. Neuberger received a portion of the
revenue under the Agreement as a lending agency fee.
The Agreement has been renewed and approved by the Board of Trustees as of July
1, 2004 with substantially the same terms. Under this current Agreement,
Neuberger guarantees minimum revenue to the Fund and receives any revenue
earned in excess of the guaranteed amount as a lending agency fee.
At June 30, 2004, the Fund had not paid Neuberger any fees under the Agreement.
Income earned on the securities loaned, if any, is reflected in the Statement
of Operations under the caption Income from securities loaned-net.
10 Transactions with other funds managed by Neuberger Berman Management Inc.:
Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission, the Fund may invest in the Neuberger Berman Institutional Cash Fund
(the "Cash Fund"), a fund managed by Management and having the same Board
members as the Fund. The Cash Fund seeks to provide as high a level of current
income as is consistent with the preservation of capital and the maintenance of
liquidity. For any cash that the Fund invests in the Cash Fund, Management
waives a portion of its management fee equal to the management fee it receives
from the Cash Fund on those assets. For the six months ended June 30, 2004,
such waived fees amounted to $29. For the six months ended June 30, 2004,
income earned on this investment amounted to $226 and is reflected in the
Statement of Operations under the caption Income from investments in affiliated
issuers.
Note B--Management Fees, Administration Fees, Distribution Arrangements, and
Other Transactions With Affiliates:
Fund shares are issued and redeemed in connection with investments in and
payments under certain variable annuity contracts and variable life insurance
policies issued through separate accounts of life insurance companies and are
also offered directly to qualified pension and retirement plans.
The Fund retains Management as its investment manager under a Management
Agreement. For such investment management services, the Fund pays Management a
fee at the annual rate of 0.55% of the first $250 million of the Fund's average
daily net assets, 0.525% of the next $250 million, 0.50% of the next $250
million, 0.475% of the next $250 million, 0.45% of the next $500 million,
0.425% of the next $2.5 billion, and 0.40% of average daily net assets in
excess of $4 billion.
10
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
The Fund retains Management as its administrator under an Administration
Agreement. The Fund pays Management an administration fee at the annual rate of
0.30% of its average daily net assets under this agreement. Additionally,
Management retains State Street as its sub-administrator under a
Sub-Administration Agreement. Management pays State Street a fee for all
services received under the agreement.
Management acts as agent in arranging for the sale of Fund shares without
commission and bears advertising and promotion expenses. The Trustees of the
Trust have adopted a distribution plan (the "Plan") with respect to the Fund,
pursuant to Rule 12b-1 under the 1940 Act. The Plan provides that, as
compensation for administrative and other services provided to the Fund,
Management's activities and expenses related to the sale and distribution of
the Fund's shares, and ongoing services provided to investors in the Fund,
Management receives from the Fund a fee at the annual rate of 0.25% of its
average daily net assets. Management receives this amount to provide
distribution and shareholder servicing for the Fund and pays a portion of it to
institutions that provide such services. Those institutions may use the
payments for, among other purposes, compensating employees engaged in sales
and/or shareholder servicing. The amount of fees paid by the Fund during any
year may be more or less than the cost of distribution and other services
provided to the Fund. NASD rules limit the amount of annual distribution fees
that may be paid by a mutual fund and impose a ceiling on the cumulative
distribution fees paid. The Trust's Plan complies with those rules.
Management has contractually undertaken through December 31, 2007 to reimburse
the Fund for its operating expenses (including the fees payable to Management
but excluding interest, taxes, brokerage commissions, extraordinary expenses,
and transaction costs) ("Operating Expenses") which exceed, in the aggregate,
1.25% per annum of its average daily net assets (the "Expense Limitation"). For
the six months ended June 30, 2004, such excess expenses amounted to $34,394.
The Fund has agreed to repay Management through December 31, 2010 for its
excess Operating Expenses previously reimbursed by Management, so long as its
annual Operating Expenses during that period do not exceed its Expense
Limitation, and the repayment is made within three years after the year in
which Management issued the reimbursement. During the six months ended June 30,
2004, there was no reimbursement to Management. At June 30, 2004, the Fund has
a contingent liability to Management under this agreement of $149,786.
On October 31, 2003, Management and Neuberger, a member firm of the New York
Stock Exchange and sub-adviser to the Fund, became indirect wholly-owned
subsidiaries of Lehman Brothers Holdings Inc. ("Lehman"), a publicly-owned
holding company. Neuberger is retained by Management to furnish it with
investment recommendations and research information without added cost to the
Fund. Several individuals who are officers and/or Trustees of the Trust are
also employees of Neuberger and/or Management.
On July 1, 2003, the Fund entered into a commission recapture program, which
enables it to pay some of its operational expenses by recouping a portion of
the commissions it pays to a broker that is not a related party of the Fund.
Expenses paid through this program may include costs of custodial, transfer
agency or accounting services. For the six months ended June 30, 2004, the
impact of this arrangement was a reduction of $35.
11
Notes to Financial Statements Focus Portfolio cont'd
The Fund has an expense offset arrangement in connection with its custodian
contract. The impact of this arrangement, reflected in the Statement of
Operations under the caption Custodian fees, was a reduction of $0.
Note C--Securities Transactions:
During the six months ended June 30, 2004, there were purchase and sale
transactions (excluding short-term securities) of $197,762 and $150,495,
respectively.
During the six months ended June 30, 2004, brokerage commissions on securities
transactions amounted to $650, of which Neuberger received $0, Lehman received
$75, and other brokers received $575.
Note D--Fund Share Transactions:
Share activity for the six months ended June 30, 2004 and for the year ended
December 31, 2003 was as follows:
For the For the
Six Months Ended Year Ended
June 30, December 31,
2004 2003
Shares Sold 4,342 49,999
Shares Issued on Reinvestment of Dividends and Distributions - 345
Shares Redeemed (4,106) (14,274)
------ -------
Total 236 36,070
====== =======
Note E--Line of Credit:
At June 30, 2004, the Fund was a participant in a single committed, unsecured
$150,000,000 line of credit with State Street, to be used only for temporary or
emergency purposes. Interest is charged on borrowings under this agreement at
the overnight Federal Funds Rate plus 0.50% per annum. A facility fee of 0.10%
per annum of the available line of credit is charged, of which the Fund has
agreed to pay its pro rata share, based on the ratio of its individual net
assets to the net assets of all participants at the time the fee is due and
payable. The fee is paid quarterly in arrears. No compensating balance is
required. Other investment companies managed by Management also participate in
this line of credit on the same terms. Because several investment companies
participate, there is no assurance that the Fund will have access to the entire
$150,000,000 at any particular time. The Fund had no loans outstanding pursuant
to this line of credit at June 30, 2004, nor had the Fund utilized this line of
credit at any time prior to that date.
Note F--Unaudited Financial Information:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent auditors. Annual reports
contain audited financial statements.
12
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Financial Highlights Focus Portfolio
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements.++
Period from
Six Months Ended Year Ended August 8, 2002^
June 30, December 31, to December 31,
---------------- ------------ ----------------
2004 2003 2002
(Unaudited)
Net Asset Value, Beginning of Period $ 20.81 $ 11.00 $ 10.00
-------- -------- -------
Income From Investment Operations:
Net Investment Income (Loss) (.04) (.09) (.03)
Net Gains or Losses on Securities
(both realized and unrealized) (0.58) 10.03 1.03
-------- -------- -------
Total From Investment Operations (0.62) 9.94 1.00
-------- -------- -------
Less Distributions From:
Net Capital Gains - (.13) -
-------- -------- -------
Net Asset Value, End of Period $ 20.19 $ 20.81 $ 11.00
-------- -------- -------
Total Return++ -2.98%** +90.42% +10.00%**
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $ 1.2 $ 1.2 $ 0.2
Ratio of Gross Expenses to Average Net Assets# 1.35%* 1.32% 1.25%*
Ratio of Net Expenses to Average Net Assets[sec] 1.34%* 1.29% 1.25%*
Ratio of Net Investment Income (Loss) to Average Net Assets (.38)%* (.51)% (.69)%*
Portfolio Turnover Rate 13% 101% 63%
See Notes to Financial Highlights 13
Notes to Financial Highlights Focus Portfolio
++ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each
fiscal period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Current returns may be lower or higher than the performance data
quoted. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. Total return would
have been lower if Management had not reimbursed and/or waived certain
expenses. The total return information shown does not reflect charges and
other expenses that apply to the separate account or the related insurance
policies, and the inclusion of these charges and other expenses would
reduce the total return for all fiscal periods shown. Performance data
current to the most recent month-end are available at www.nb.com.
# The Fund is required to calculate an expense ratio without taking into
consideration any expense reductions related to expense offset and
commission recapture arrangements.
[sec] After reimbursement of expenses by the investment manager. Had the
investment manager not undertaken such action, the annualized ratio of net
expenses to average daily net assets would have been:
Period from
August 8, 2002 to
December 31, 2002
63.28%
After reimbursement of expenses by the investment manager and waiver of a
portion of the investment management fee. Had the investment manager not
undertaken such actions, the annualized ratios of net expenses to average
daily net assets would have been:
Six Months Ended Year Ended
June 30, December 31,
2004 2003
6.94% 12.48%
^ The date investment operations commenced.
++ The per share amounts which are shown have been computed based on the
average number of shares outstanding during each fiscal period.
* Annualized.
** Not annualized.
14
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Trustees and Officers (Unaudited)
The following tables set forth information concerning the trustees and officers
of the Trust. All persons named as trustees and officers also serve in similar
capacities for other funds administered or managed by NB Management and
Neuberger Berman. The Statement of Additional Information includes additional
information about fund trustees and is available upon request, without charge,
by calling (800) 877-9700.
Information about the Board of Trustees
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Position and Fund Complex Other Directorships
Independent Trustees Length of Time Overseen by Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
John Cannon (74) Trustee since Consultant. Formerly, Chairman 38 Independent Trustee or Director of
2000 and Chief Investment Officer, three series of Oppenheimer Funds:
CDC Investment Advisors Limited Term New York Municipal
(registered investment adviser) Fund, Rochester Fund Municipals,
(1993-January 1999); prior and Oppenheimer Convertible
thereto, President and Chief Securities Fund since 1992.
Executive Officer, AMA
Investment Advisors, an affiliate
of the American Medical
Association.
- ------------------------------------------------------------------------------------------------------------------------------------
Faith Colish (68) Trustee since Counsel, Carter Ledyard & 38 Director, American Bar Retirement
1984 Milburn LLP (law firm) since Association (ABRA) since 1997
October 2002; Formerly, (not-for-profit membership
Attorney-at-Law and President, association).
Faith Colish, A Professional
Corporation, 1980 to 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Walter G. Ehlers (71) Trustee since Consultant; Retired President 38 None.
1989 and Trustee, Teachers
Insurance & Annuity (TIAA)
and College Retirement
Equities Fund (CREF).
- ------------------------------------------------------------------------------------------------------------------------------------
C. Anne Harvey (66) Trustee since Consultant, C. A. Harvey 38 President, Board of Associates to
1998 Associates, since June 2001; The National Rehabilitation
Formerly, Director, AARP, 1978 Hospital's Board of Directors since
to December 2001. 2002; Formerly, Member, Individual
Investors Advisory Committee to the
New York Stock Exchange Board of
Directors, 1998 to June 2002;
Member, American Savings
Education Council's Policy Board
(ASEC),1998-2000; Member,
Executive Committee, Crime
Prevention Coalition of America,
1997-2000.
- ------------------------------------------------------------------------------------------------------------------------------------
15
Trustees and Officers (Unaudited) cont'd
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Position and Fund Complex Other Directorships
Independent Trustees Length of Time Overseen by Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Barry Hirsch (71) Trustee since Attorney-at-Law. Formerly, 38 None.
2000 Senior Counsel, Loews
Corporation (diversified
financial corporation) May
2002 until April 2003; formerly,
Senior Vice President, Secretary
and General Counsel, Loews
Corporation.
- ------------------------------------------------------------------------------------------------------------------------------------
Robert A. Kavesh (76) Trustee since Marcus Nadler Professor of 38 Director, DEL Laboratories, Inc.
2000 Finance and Economics (cosmetics and pharmaceuticals)
Emeritus, New York University, since 1978; The Caring Community
Stern School of Business. ( not-for-profit).
- ------------------------------------------------------------------------------------------------------------------------------------
Howard A. Mileaf (67) Trustee since Retired. Formerly, Vice 38 Director, WHX Corporation
1999 President and Special Counsel, (holding company) since August
WHX Corporation (holding 2002; Director, WebFinancial
company), 1993-2001. Corporation (holding company)
since December 2002; Director, State
Theatre of New Jersey (not-for-
profit theater) since 2000; formerly,
Director, Kevlin Corporation
(manufacturer of microwave and
other products).
- ------------------------------------------------------------------------------------------------------------------------------------
William E. Rulon (71) Trustee since Retired. Senior Vice President, 38 Director, Pro-Kids Golf and
2000 Foodmaker, Inc. (operator and Learning Academy (teach golf and
franchiser of restaurants) until computer usage to "at risk" children)
January 1997. since 1998; Formerly, Director,
Prandium, Inc. (restaurants) from
March 2001 until July 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Cornelius T. Ryan (72) Trustee since Founding General Partner, 38 Director, Capital Cash Management
2000 Oxford Partners and Oxford Trust (money market fund),
Bioscience Partners (venture Narragansett Insured Tax-Free
capital partnerships) and Income Fund, Rocky Mountain
President, Oxford Venture Equity Fund, Prime Cash Fund,
Corporation. several private companies and
QuadraMed Corporation
(NASDAQ).
- ------------------------------------------------------------------------------------------------------------------------------------
16
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Position and Fund Complex Other Directorships
Independent Trustees Length of Time Overseen by Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Tom Decker Seip (54) Trustee since General Partner, Seip 38 Director, H&R Block, Inc. (financial
2000 Investments LP (a private services company) since May 2001;
investment partnership); Director, Forward Management, Inc.
formerly, President and CEO, (asset management) since 2001;
Westaff, Inc. (temporary Formerly, Director, General Magic
staffing), May 2001 to January (voice recognition software),
2002; Senior Executive at the November 2001 until 2002; Director,
Charles Schwab Corporation E-Finance Corporation (credit
from 1983 to 1999, including decisioning services), 1999-2003;
Chief Executive Officer, Director, Save-Daily.com (micro
Charles Schwab Investment investing services), 1999-2003;
Management, Inc. and Trustee, Director, Offroad Capital Inc.
Schwab Family of Funds and (pre-public internet commerce
Schwab Investments from 1997 company).
to 1998 and Executive Vice
President--Retail Brokerage,
Charles Schwab Investment
Management from 1994
to 1997.
- ------------------------------------------------------------------------------------------------------------------------------------
Candace L. Straight (56) Trustee since Private investor and consultant 38 Director, The Proformance Insurance
1999 specializing in the insurance Company (personal lines property
industry; Formerly, Advisory and casualty insurance company)
Director, Securitas Capital LLC since March 2004; Director,
(a global private equity Providence Washington (property
investment firm dedicated to and casualty insurance company),
making investments in the since December 1998; Director,
insurance sector), 1998 until Summit Global Partners (insurance
December 2002. brokerage firm) since October 2000.
- ------------------------------------------------------------------------------------------------------------------------------------
Peter P. Trapp (59) Trustee since Regional Manager for Atlanta 38 None.
1984 Region, Ford Motor Credit
Company since August 1997;
Formerly, President, Ford
Life Insurance Company, April
1995 until August 1997.
- ------------------------------------------------------------------------------------------------------------------------------------
17
Trustees and Officers (Unaudited) cont'd
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Trustees who are Position and Fund Complex Other Directorships
"Interested Persons" Length of Time Overseen by Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Edward I. OBrien* (75) Trustee since Formerly, Member, Investment 38 Director, Legg Mason, Inc.(financial
2000 Policy Committee, Edward services holding company) since
Jones, 1993-2001; President, 1993; formerly, Director, Boston
Securities Industry Association Financial Group (real estate and tax
("SIA") (securities industry's shelters) 1993-1999.
representative in government
relations and regulatory matters
at the federal and state levels)
1974-1992; Adviser to SIA,
November 1992-November 1993.
- ------------------------------------------------------------------------------------------------------------------------------------
Jack L. Rivkin* (63) President and Executive Vice President and 38 Director, Dale Carnegie and
Trustee since Chief Investment Officer, Associates, Inc. (private company)
December Neuberger Berman Inc. since 1998; Director, Emagin Corp.
2002 (holding company) since 2002 (public company) since 1997;
and 2003, respectively; Director, Solbright, Inc. (private
Executive Vice President and company) since 1998; Director,
Chief Investment Officer, Infogate, Inc. (private company)
Neuberger Berman since 2002 since 1997.
and 2003, respectively; Director
and Chairman, NB
Management since December
2002; Formerly, Executive Vice
President, Citigroup
Investments, Inc. from
September 1995 to February
2002; Executive Vice President,
Citigroup Inc. from September
1995 to February 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Peter E. Sundman* (45) Chairman of Executive Vice President, 38 Director, Neuberger Berman Inc.
the Board, Neuberger Berman Inc. (holding company) from 1999
Chief (holding company) since 1999; through March 2003; President and
Executive Head of Neuberger Berman Director, NB Management since
Officer and Inc.'s Mutual Funds and 1999; Director and Vice President,
Trustee since Institutional Business since Neuberger Berman Agency, Inc.
2000; 1999; Executive Vice President, since 2000.
President and Neuberger Berman since 1999;
Chief Principal, Neuberger Berman
Executive from 1997 until 1999; Senior
Officer from Vice President, NB
1998 to 2000 Management from 1996
until 1999.
- ------------------------------------------------------------------------------------------------------------------------------------
18
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the Trust's Trust Instrument, each Trustee shall hold office for
life or until his or her successor is elected or the Trust terminates;
except that (a) any Trustee may resign by delivering a written resignation;
(b) any Trustee may be removed with or without cause at any time by a
written instrument signed by at least two-thirds of the other Trustees; (c)
any Trustee who requests to be retired, or who has become unable to serve,
may be retired by a written instrument signed by a majority of the other
Trustees; and (d) any Trustee may be removed at any shareholder meeting by a
vote of at least two-thirds of the outstanding shares.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
* Indicates a Trustee who is an "interested person" within the meaning of the
1940 Act. Mr. Sundman and Mr. Rivkin are interested persons of the Trust by
virtue of the fact that they are officers and/or directors of NB Management
and Executive Vice Presidents of Neuberger Berman. Mr. O'Brien is an
interested person of the Trust by virtue of the fact that he is a director
of Legg Mason, Inc., a wholly owned subsidiary of which, from time to time,
serves as a broker or dealer to the Funds and other funds for which NB
Management serves as investment manager.
19
Information about the Officers of the Trust
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- -------------------------------------------------------------------------------------------------------------------------
Claudia A. Brandon (47) Secretary since 1985 Vice President--Mutual Fund Board Relations, NB
Management since 2000; Vice President, Neuberger
Berman since 2002 and employee since 1999; Vice
President, NB Management from 1986 to 1999; Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(four since 2002, three since 2003, and one since 2004).
Robert Conti (48) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President, Neuberger Berman from 1999 until 2003; Senior
Vice President, NB Management since 2000; Controller,
NB Management until 1996; Treasurer, NB Management
from 1996 until 1999; Vice President, eleven registered
investment companies for which NB Management acts as
investment manager and administrator (three since 2000,
four since 2002, three since 2003, and one since 2004).
Brian P. Gaffney (50) Vice President since 2000 Managing Director, Neuberger Berman since 1999; Senior
Vice President, NB Management since 2000; Vice
President, NB Management from 1997 until 1999; Vice
President, eleven registered investment companies for which
NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three since
2003, and one since 2004).
Sheila R. James (39) Assistant Secretary since 2002 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1991 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003 and one since 2004).
Kevin Lyons (49) Assistant Secretary since 2003 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1993 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(Ten since 2003 and one since 2004).
20
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- ------------------------------------------------------------------------------------------------------------------------------
John M. McGovern (34) Assistant Treasurer since 2002 Vice President, Neuberger Berman since 2004; Employee,
NB Management since 1993; Assistant Treasurer, eleven
registered investment companies for which NB
Management acts as investment manager and
administrator (seven since 2002, three since 2003, and one
since 2004).
Barbara Muinos (45) Treasurer and Principal Financial Vice President, Neuberger Berman since 1999; Assistant
and Accounting Officer since 2002; Vice President, NB Management from 1993 to 1999;
prior thereto, Assistant Treasurer Treasurer and Principal Financial and Accounting Officer,
since 1996 eleven registered investment companies for which NB
Management acts as investment manager and
administrator (seven since 2002, three since 2003, and one
since 2004); Assistant Treasurer, three registered
investment companies for which NB Management acts as
investment manager and administrator from 1996 until
2002.
Frederic B. Soule (58) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President; Neuberger Berman from 1999 until 2003; Vice
President, NB Management from 1995 until 1999; Vice
President, eleven registered investment companies for
which NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three
since 2003, and one since 2004).
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the By-Laws of the Trust, each officer elected by the Trustees
shall hold office until his or her successor shall have been elected and
qualified or until his or her earlier death, inability to serve, or
resignation. Officers serve at the pleasure of the Trustees and may be
removed at any time with or without cause.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
21
Proxy Voting Policies and Procedures
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to portfolio securities is available, without
charge, by calling 1-800-877-9700 (toll-free) and on the website of the
Securities and Exchange Commission, at www.sec.gov. Beginning September 2004,
information regarding how the Fund voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 will also be
available without charge, by calling 1-800-877-9700 (toll-free), on the website
of the Securities and Exchange Commission, at www.sec.gov, and on the Fund's
website at www.nb.com [http://www.nb.com].
22
Semi-Annual Report
June 30, 2004
B0732 08/04
[LOGO]
Neuberger Berman
Advisers
Management
Trust
Growth
Portfolio(Reg)
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Growth Portfolio Managers' Commentary
The AMT Growth Portfolio ended the first half of 2004 with a gain of 7.49%,
outperforming the Russell Midcap Growth Index return of 5.94%.2 This
outperformance reflected the fact that the market began rewarding stocks with
solid business fundamentals as opposed to unproven growth prospects, a trend
that favored our investment process. Our stock selection boosted our performance
across most sectors of the portfolio.
The largest contribution to relative performance came from stock selection in
the information technology, consumer discretionary and financial sectors. Stocks
that did well in IT included companies that develop and provide specialized
technologies to businesses such as Zebra Technologies. Within consumer
discretionary, our emphasis in entertainment and leisure and specialty retail
companies were some of the primary reasons for this outperformance with Royal
Caribbean Cruises and PETsMART both performing well. Within the financials
sector, Capital One Financial, First Marblehead, and Investors Financial
Services were all strong performers, as they represent less interest rate
sensitive names within that sector.
In the aggregate, our sector allocation was slightly negative on a year-to-date
basis, with our underweight position in both consumer staples and healthcare
accounting for much of the underperformance.
After beginning the year with strong advances, the market began trading sideways
during the second quarter. In the aggregate, for the first half of 2004, the
markets have confounded consensus expectations by trading in very narrow ranges
with only a 7% swing on the Standard & Poor's 500 Index. As we anticipated early
in the year, the equity markets have experienced substantial rotation between
cyclical (materials/technology) and defensive (healthcare/staples)
industries/sectors as investors reacted to the shifting economic news.
Economic forecasting is exceptionally difficult this year as we formulate the
top-down part of our strategy. In addition to the initiation of a tightening
cycle by the Fed, we face the expiration of some tax cuts this year, a slowing
Chinese economy, U.S. political uncertainty and volatile oil prices. Like a pig
in a python, the lower dollar, faster than expected U.S. growth and the strong
Asian demand for commodities last year are working their way through the system
and causing rates of inflation to accelerate this year. We believe that many of
these influences have dissipated, however, so the Fed may not need to react as
strongly as investors fear.
As investors grapple with higher inflation and the expected continuing interest
rate hikes by the Fed, worries are also growing that the economy is slowing.
Recently, Wal-Mart, Target and General Motors lowered their top-line forecasts.
Similar to our view on inflation, we are also relatively sanguine about economic
growth. It is important to note that while overall growth is fine, the
composition of economic activity is changing from a mortgage refinanced/lower
tax consumer-led recovery to one being sustained by corporate investment,
inventory building and steady job creation.
Even though we are not pessimistic in terms of the overall economy and
inflation, we are not optimistic in terms of near-term stock performance. We
expect equities to struggle as profit growth slows, interest rates increase, and
the Presidential election remains tight. Over the past six years, the S&P 500 is
essentially flat in price while earnings have increased by a third. The market's
forward P/E has collapsed from 21 to 16 during this period. However, the stock
market is still not cheap, since a P/E of 16 is the long-term average. We
believe P/Es will continue to wilt in the heat of the summer months.
Uncertainties about next year's economy will most likely increase as more
difficult earnings comparisons will begin this
1
quarter. If fears become more intense and investors overreact, we expect poor
near-term equity performance to provide a platform for better equity performance
in the latter part of this year.
We have reduced our position in the materials sector to an underweight relative
to the benchmark on the basis of our concerns that global growth rates have
peaked. Industrials and energy remain moderately overweighted, financials
moderately underweighted, utilities underweighted, and other sectors relatively
neutral weighted.
We seek to continue to position the portfolio with tilts toward lower volatility
stocks in higher quality companies with lower earnings variability. As interest
rates move higher and growth rates slow, we believe that companies with
financial strength should be favored.
Sincerely,
/s/ Jon D. Brorson
JON D. BRORSON
PORTFOLIO MANAGER AND
GROWTH EQUITY GROUP
TEAM LEADER
/s/ Kenneth J. Turek
KENNETH J. TUREK
PORTFOLIO MANAGER
1. 23.48%, (2.68%) and 7.36% were the average annual total returns for the 1-,
5- and 10-year periods ended June 30, 2004. Neuberger Berman Management Inc.
("NBMI") has agreed to absorb certain expenses of the AMT Portfolios. Without
this arrangement, which is subject to change, the total returns of the
Portfolios would be less. Total return includes reinvestment of dividends and
capital gain distributions. Performance data quoted represent past performance
and the investment return and principal value of an investment will fluctuate so
that the shares, when redeemed, may be worth more or less than original cost.
Current performance may be lower or higher than the performance data quoted. For
performance data current to the most recent month end, please visit
www.nb.com/amtperformance. The performance information does not reflect fees and
expenses of the variable annuity and variable life insurance policies or the
pension plans whose proceeds are invested in the portfolio.
2. The Russell Midcap(Reg) Growth Index measures the performance of those
Russell Midcap(Reg) Index companies with higher price-to-book ratios and higher
forecasted growth values. The Russell Midcap Index measures the performance of
the 800 smallest companies in the Russell 1000(Reg) Index, which represents
approximately 27% of the total market capitalization of the Russell 1000 Index
(which, in turn, consists of the 1,000 largest U.S. companies, based on market
capitalization). The S&P 500 Index is widely regarded as the standard for
measuring large-cap U.S. stock market performance and includes a representative
sample of leading companies in leading industries. Please note that indices do
not take into account any fees and expenses of investing in the individual
securities that they track, and that individuals cannot invest directly in any
index. Data about the performance of these indices are prepared or obtained by
NBMI and include reinvestment of all dividends and capital gain distributions.
The Portfolio may invest in many securities not included in the above-described
indices.
2
Any ratios or other measurements using a factor of forecasted earnings of a
company discussed herein are based on consensus estimates, not Neuberger
Berman's own projections, and they may or may not be realized. In addition, any
revision to a forecast could affect the market price of a security. By quoting
them herein, Neuberger Berman does not offer an opinion as to the accuracy of
and does not guarantee these forecasted numbers.
The investments for the Portfolio are managed by the same portfolio manager(s)
who manage one or more other mutual funds that have similar names, investment
objectives and investment styles as the Portfolio. You should be aware that the
Portfolio is likely to differ from the other mutual funds in size, cash flow
pattern and tax matters. Accordingly, the holdings and performance of the
Portfolio can be expected to vary from those of the other mutual funds.
The composition, industries and holdings of the Portfolio are subject to change.
Shares of the separate Portfolios of Neuberger Berman Advisers Management Trust
are sold only through the currently effective prospectus and are not available
to the general public. Shares of this Portfolio may be purchased only by life
insurance companies to be used with their separate accounts that fund variable
annuity and variable life insurance policies and by qualified pension and
retirement plans.
(C) 2004 Neuberger Berman Management Inc., distributor. All rights reserved.
3
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Growth Portfolio
Number of Shares Market Value+
Common Stocks (99.4%)
Aerospace (0.5%)
33,000 Rockwell Collins $ 1,099,560
Biotechnology (4.2%)
70,500 Alkermes, Inc. 958,800*\P
46,500 Celgene Corp. 2,662,590*
37,800 Gilead Sciences 2,532,600*
22,500 Martek Biosciences 1,263,825*\P
76,500 Protein Design Labs 1,463,445*\P
-----------
8,881,260
Building, Construction & Furnishing (0.5%)
22,700 Centex Corp. 1,038,525
Business Services (7.6%)
113,500 Alliance Data Systems 4,795,375*
62,000 Corporate Executive Board 3,582,980
73,000 Education Management 2,398,780*
40,000 Getty Images 2,400,000*\P
56,500 Stericycle, Inc. 2,923,310*
-----------
16,100,445
Communications Equipment (1.4%)
39,000 F5 Networks 1,032,720*
83,000 Juniper Networks 2,039,310*\P
-----------
3,072,030
Computer Related (1.8%)
50,500 Apple Computer 1,643,270*
21,500 Lexmark International Group 2,075,395*
-----------
3,718,665
Electrical & Electronics (2.3%)
81,000 Jabil Circuit 2,039,580*
85,000 Molex Inc. 2,726,800
-----------
4,766,380
Energy (4.8%)
37,500 Canadian Natural Resources 1,121,250
35,500 Murphy Oil 2,616,350
39,500 Smith International 2,202,520*
140,416 XTO Energy 4,182,993
-----------
10,123,113
Finance (2.0%)
88,000 CapitalSource Inc. 2,151,600*\P
51,000 First Marblehead 2,053,260*\P
-----------
4,204,860
Financial Services (4.8%)
54,000 Franklin Resources 2,704,320
86,500 Investors Financial Services 3,769,670\P
37,300 Moody's Corp. 2,411,818\P
26,400 Piper Jaffray 1,194,072*
-----------
10,079,880
4
Number of Shares Market Value+
Food & Beverage (0.5%)
28,000 Constellation Brands $ 1,039,640*
Health Care (11.4%)
28,500 Allergan, Inc. 2,551,320\P
55,000 C. R. Bard 3,115,750
76,500 Caremark Rx 2,519,910*
31,600 Henry Schein 1,995,224*
32,000 Invitrogen Corp. 2,303,680*\P
45,900 Teva Pharmaceutical
Industries ADR 3,088,611\P
60,500 Varian Medical Systems 4,800,675*
41,500 Zimmer Holdings 3,660,300*
-----------
24,035,470
Industrial (9.8%)
55,500 American Standard 2,237,205*
63,000 Danaher Corp. 3,266,550\P
87,000 Donaldson Co. 2,549,100
46,500 Eaton Corp. 3,010,410
80,000 Fastenal Co. 4,546,400\P
59,500 Gentex Corp. 2,360,960
31,500 Harman International Industries 2,866,500
-----------
20,837,125
Instruments (0.3%)
22,800 Thermo Electron 692,144*
Leisure (4.4%)
83,000 International Game Technology 3,203,800
20,500 Marriott International 1,022,540
54,500 Multimedia Games 1,461,690*\P
84,000 Royal Caribbean Cruises 3,646,440\P
-----------
9,334,470
Media (2.7%)
35,000 E.W. Scripps 3,675,000
61,500 Univision Communications 1,963,695*\P
-----------
5,638,695
Medical Equipment (3.7%)
35,000 Advanced Neuromodulation
Systems 1,148,000*
24,500 Fisher Scientific International 1,414,875*\P
19,000 INAMED Corp. 1,194,150*
26,300 Kinetic Concepts 1,312,370*
41,000 Kyphon Inc. 1,155,380*
30,500 ResMed Inc. 1,554,280*\P
-----------
7,779,055
Packing & Containers (1.2%)
100,000 Pactiv Corp. 2,494,000*
Paper (0.7%)
65,000 Packaging Corp. of America 1,553,500
See Notes to Schedule of Investments 5
Schedule of Investments Growth Portfolio cont'd
Number of Shares Market Value+
Restaurants (1.1%)
58,500 Applebee's International $ 1,346,670
28,000 Wendy's International 975,520
-----------
2,322,190
Retail (10.8%)
75,500 Coach, Inc. 3,411,845*\P
80,500 Nordstrom, Inc. 3,430,105
92,000 PETsMART, Inc. 2,985,400\P
87,000 Staples, Inc. 2,549,970
60,500 Starbucks Corp. 2,630,540*\P
17,200 Talbots, Inc. 673,380
60,000 Tuesday Morning 1,740,000*
36,500 Whole Foods Market 3,483,925\P
62,000 Williams-Sonoma 2,043,520*\P
-----------
22,948,685
Semiconductors (5.9%)
77,000 Altera Corp. 1,710,940*
44,000 Broadcom Corp. 2,057,880*
53,500 Linear Technology 2,111,645
75,000 Microchip Technology 2,365,500
111,600 Microsemi Corp. 1,585,836*
124,000 National Semiconductor 2,726,760*\P
-----------
12,558,561
Software (3.6%)
17,000 Cognos, Inc. 614,720*
36,500 Electronic Arts 1,991,075*
66,000 Mercury Interactive 3,288,780*\P
200,000 TIBCO Software 1,690,000*
-----------
7,584,575
Technology (7.6%)
67,000 Agilent Technologies 1,961,760*
62,400 Check Point Software
Technologies 1,684,176*
91,500 Cognizant Technology
Solutions 2,325,015*\P
153,000 Corning Inc. 1,998,180*
48,500 Symbol Technologies 714,890
85,500 Zebra Technologies 7,438,500*
-----------
16,122,521
Telecommunications (3.6%)
76,500 Avaya Inc. 1,207,935*
241,000 Nextel Partners 3,836,720*
62,500 Western Wireless 1,806,875*\P
29,000 XM Satellite Radio
Holdings 791,410*
-----------
7,642,940
6
Number of Shares Market Value+
Transportation (2.2%)
36,500 C.H. Robinson Worldwide $ 1,673,159
78,400 J.B. Hunt Transport Services 3,024,672
------------
4,697,831
Total Common Stocks
(Cost $160,555,534) 210,366,120
------------
Principal Amount
Short-Term Investments (26.8%)
$56,704,200 N&B Securities Lending
Quality Fund, LLC 56,704,200++
142,207 Neuberger Berman
Institutional Cash Fund
Trust Class 142,207@
------------
Total Short-Term Investments
(Cost $56,846,407) 56,846,407#
------------
Total Investments (126.2%)
(Cost $217,401,941) 267,212,527##
Liabilities, less cash, receivables
and other assets [(26.2%)] (55,543,841)
------------
Total Net Assets (100.0%) $211,668,686
------------
See Notes to Schedule of Investments 7
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Schedule of Investments Growth Portfolio
+ Investments in equity securities by the Fund are valued at the latest sales
price where that price is readily available; securities for which no sales
were reported, unless otherwise noted, are valued at the mean between the
closing bid and asked prices. Securities traded primarily on the NASDAQ
Stock Market are normally valued by the Fund at the NASDAQ Official Closing
Price ("NOCP") provided by NASDAQ each business day. The NOCP is the most
recently reported price as of 4:00:02 p.m., Eastern time, unless that price
is outside the range of the "inside" bid and asked prices (i.e., the bid
and asked prices that dealers quote to each other when trading for their
own accounts); in that case, NASDAQ will adjust the price to equal the
inside bid or asked price, whichever is closer. Because of delays in
reporting trades, the NOCP may not be based on the price of the last trade
to occur before the market closes. The Fund values all other securities by
a method the Board of Trustees of Neuberger Berman Advisers Management
Trust (the "Board") believes accurately reflects fair value. Numerous
factors may be considered when determining the fair value of a security,
including available analyst, media or other reports, trading in futures or
ADRs and whether the issuer of the security being fair valued has other
securities outstanding. Foreign security prices are furnished by
independent quotation services expressed in local currency values. Foreign
security prices are translated from the local currency into U.S. dollars
using the exchange rate as of 12:00 p.m., Eastern time. The Board has
approved the use of FT Interactive Data Corporation ("FT Interactive") to
assist in determining the fair value of the Fund's foreign equity
securities in the wake of certain significant events. Specifically, when
changes in the value of a certain index suggest that the closing prices on
the foreign exchanges no longer represent the amount that the Fund could
expect to receive for those securities, FT Interactive will provide
adjusted prices for certain foreign equity securities based on an analysis
showing historical correlations between the prices of those securities and
changes in the index. In the absence of precise information about the
market values of these foreign securities as of the close of the New York
Stock Exchange, the Board has determined on the basis of available data
that prices adjusted in this way are likely to be closer to the prices the
Fund could realize on a current sale than are the prices of those
securities established at the close of the foreign markets in which the
securities primarily trade. However, fair value prices are necessarily
estimates, and there is no assurance that such a price will be at or close
to the price at which the security next trades. Short-term debt securities
with less than 60 days until maturity may be valued at cost which, when
combined with interest earned, approximates market value.
# At cost, which approximates market value.
## At June 30, 2004, the cost of investments for U.S. Federal income tax
purposes was $217,401,941. Gross unrealized appreciation of investments was
$52,160,261 and gross unrealized depreciation of investments was
$2,349,675, resulting in net unrealized appreciation of $49,810,586, based
on cost for U.S. Federal income tax purposes.
* Non-income producing security.
\P All or a portion of this security is on loan (see Note A of Notes to
Financial Statements).
@ Neuberger Berman Institutional Cash Fund is also managed by Neuberger
Berman Management Inc. (see Note A of Notes to Financial Statements).
++ Affiliated issuer (see Note A of Notes to Financial Statements).
See Notes to Financial Statements 8
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Assets and Liabilities
Growth
Neuberger Berman Advisers Management Trust Portfolio
Assets
Investments in securities, at market value*+ (Note A)-see Schedule of Investments:
====================================================================================================
Unaffiliated issuers $ 210,366,120
- ----------------------------------------------------------------------------------------------------
Affiliated issuers 56,846,407
- ----------------------------------------------------------------------------------------------------
267,212,527
- ----------------------------------------------------------------------------------------------------
Dividends and interest receivable 38,640
- ----------------------------------------------------------------------------------------------------
Receivable for securities sold 3,590,345
====================================================================================================
Receivable for Fund shares sold 30,549
- ----------------------------------------------------------------------------------------------------
Prepaid expenses and other assets 42,123
- ----------------------------------------------------------------------------------------------------
Total Assets 270,914,184
- ----------------------------------------------------------------------------------------------------
Liabilities
Payable for collateral on securities loaned (Note A) 56,704,200
====================================================================================================
Payable for securities purchased 2,205,964
- ----------------------------------------------------------------------------------------------------
Payable for Fund shares redeemed 151,685
====================================================================================================
Payable to investment manager-net (Note B) 89,526
- ----------------------------------------------------------------------------------------------------
Payable to administrator (Note B) 48,894
====================================================================================================
Accrued expenses and other payables 45,229
- ----------------------------------------------------------------------------------------------------
Total Liabilities 59,245,498
- ----------------------------------------------------------------------------------------------------
Net Assets at value $ 211,668,686
- ----------------------------------------------------------------------------------------------------
Net Assets consist of:
Paid-in capital $ 451,266,246
====================================================================================================
Undistributed net investment income (loss) (487,902)
- ----------------------------------------------------------------------------------------------------
Accumulated net realized gains (losses) on investments (288,920,273)
====================================================================================================
Net unrealized appreciation (depreciation) in value of investments 49,810,615
- ----------------------------------------------------------------------------------------------------
Net Assets at value $ 211,668,686
- ----------------------------------------------------------------------------------------------------
Shares Outstanding ($.001 par value; unlimited shares authorized) 18,898,166
====================================================================================================
Net Asset Value, offering and redemption price per share $ 11.20
- ----------------------------------------------------------------------------------------------------
+Securities on loan, at market value:
Unaffiliated issuers $ 55,555,928
====================================================================================================
*Cost of investments:
Unaffiliated issuers $ 160,555,534
- ----------------------------------------------------------------------------------------------------
Affiliated issuers 56,846,407
- ----------------------------------------------------------------------------------------------------
Total cost of investments $ 217,401,941
- ----------------------------------------------------------------------------------------------------
See Notes to Financial Statements 9
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST FOR THE SIX MONTHS ENDED JUNE 30, 2004 (UNAUDITED)
Statement of Operations
Growth
Neuberger Berman Advisers Management Trust Portfolio
Investment Income
Income:
Dividend income-unaffiliated issuers $ 386,187
=======================================================================================================
Income from securities loaned-net (Note A) 100,000
- -------------------------------------------------------------------------------------------------------
Income from investments in affiliated issuers (Note A) 2,074
=======================================================================================================
Interest income (Note A) 740
- -------------------------------------------------------------------------------------------------------
Foreign taxes withheld (Note A) (2,317)
- -------------------------------------------------------------------------------------------------------
Total income 486,684
- -------------------------------------------------------------------------------------------------------
Expenses:
Investment management fee (Notes A & B) 572,987
=======================================================================================================
Administration fee (Note B) 312,538
- -------------------------------------------------------------------------------------------------------
Audit fees 17,883
=======================================================================================================
Custodian fees (Note B) 56,221
- -------------------------------------------------------------------------------------------------------
Insurance expense 1,540
=======================================================================================================
Legal fees 14,453
- -------------------------------------------------------------------------------------------------------
Shareholder reports 8,720
=======================================================================================================
Trustees' fees and expenses 13,453
- -------------------------------------------------------------------------------------------------------
Miscellaneous 1,942
- -------------------------------------------------------------------------------------------------------
Total expenses 999,737
Investment management fee waived (Note A) (283)
Expenses reduced by custodian fee expense offset and commission recapture arrangements
(Note B) (24,868)
- -------------------------------------------------------------------------------------------------------
Total net expenses 974,586
- -------------------------------------------------------------------------------------------------------
Net investment income (loss) (487,902)
- -------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) on Investments (Note A) Net realized gain
(loss) on:
Investment securities sold in unaffiliated issuers 10,457,066
====================================================================================================
Change in net unrealized appreciation (depreciation) in value of:
Investment securities in unaffiliated issuers 5,142,279
----------------------------------------------------------------------------------------------------
Foreign currency 29
----------------------------------------------------------------------------------------------------
Net gain (loss) on investments 15,599,374
- -------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations $15,111,472
- -------------------------------------------------------------------------------------------------------
See Notes to Financial Statements 10
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Changes in Net Assets
Growth Portfolio
-------------------------------
Six Months
Ended Year
June 30, Ended
2004 December 31,
Neuberger Berman Advisers Management Trust (Unaudited) 2003
Increase (Decrease) in Net Assets:
From Operations:
Net investment income (loss) $ (487,902) $ (1,143,607)
=======================================================================================================
Net realized gain (loss) on investments 10,457,066 19,742,814
- -------------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of investments 5,142,308 33,843,552
- -------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations 15,111,472 52,442,759
- -------------------------------------------------------------------------------------------------------
From Fund Share Transactions (Note D):
Proceeds from shares sold 4,213,670 54,281,902
=======================================================================================================
Payments for shares redeemed (22,525,891) (77,700,782)
- -------------------------------------------------------------------------------------------------------
Net increase (decrease) from Fund share transactions (18,312,221) (23,418,880)
- -------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets (3,200,749) 29,023,879
Net Assets:
Beginning of period 214,869,435 185,845,556
- -------------------------------------------------------------------------------------------------------
End of period $211,668,686 $214,869,435
- -------------------------------------------------------------------------------------------------------
Undistributed net investment income (loss) at end of period $ (487,902) $ --
- -------------------------------------------------------------------------------------------------------
See Notes to Financial Statements 11
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Financial Statements Growth Portfolio
Note A--Summary of Significant Accounting Policies:
1 General: Growth Portfolio (the "Fund") is a separate operating series of
Neuberger Berman Advisers Management Trust (the "Trust"), a Delaware statutory
trust organized pursuant to a Trust Instrument dated May 23, 1994. The Trust is
currently comprised of ten separate operating series (each a "Series,"
collectively, the "Funds") each of which (except Focus Portfolio) is
diversified. The Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act"),
and its shares are registered under the Securities Act of 1933, as amended. The
Fund currently offers only Class I shares. The Board of Trustees of the Trust
may establish additional series or classes of shares without the approval of
shareholders.
The assets of each Series belong only to that Series, and the liabilities of
each Series are borne solely by that Series and no other.
The preparation of financial statements in accordance with accounting principles
generally accepted in the United States requires Neuberger Berman Management
Inc. ("Management") to make estimates and assumptions at the date of the
financial statements. Actual results could differ from those estimates.
2 Portfolio valuation: Investment securities are valued as indicated in the
notes following the Schedule of Investments.
3 Foreign currency translation: The accounting records of the Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars using the exchange rate as of 12:00 p.m., Eastern time, to determine the
value of investments, other assets and liabilities. Purchase and sale prices of
securities, and income and expenses, are translated into U.S. dollars at the
prevailing rate of exchange on the respective dates of such transactions. Net
unrealized foreign currency gain (loss) arises from changes in the value of
assets and liabilities, other than investments in securities, as a result of
changes in exchange rates and is stated separately in the Statement of
Operations.
4 Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the ex-dividend
date or, for certain foreign dividends, as soon as the Fund becomes aware of the
dividends. Non-cash dividends included in dividend income, if any, are recorded
at the fair market value of the securities received. Interest income, including
accretion of original issue discount, where applicable, and accretion of
discount on short-term investments, is recorded on the accrual basis. Realized
gains and losses from securities transactions and foreign currency transactions
are recorded on the basis of identified cost and stated separately in the
Statement of Operations. Included in net realized gain (loss) on investment
securities sold are proceeds from the settlements of class action litigation in
which the Fund participated as a plaintiff. The amount of such proceeds for the
six months ended June 30, 2004 was $56,650.
5 Federal income taxes: The Funds are treated as separate entities for U.S.
Federal income tax purposes. It is the policy of the Fund to continue to qualify
as a regulated investment company by complying with the provisions available to
certain investment companies, as defined in applicable sections of the Internal
12
Notes to Financial Statements Growth Portfolio cont'd
Revenue Code, and to make distributions of investment company taxable income and
net capital gains (after reduction for any amounts available for U.S. Federal
income tax purposes as capital loss carryforwards) sufficient to relieve it from
all, or substantially all, U.S. Federal income taxes. Accordingly, the Fund paid
no U.S. Federal income taxes and no provision for U.S. Federal income taxes was
required.
6 Dividends and distributions to shareholders: The Fund may earn income, net of
expenses, daily on its investments. Income dividends and distributions from net
realized capital gains, if any, generally are distributed in October. Income
dividends and capital gain distributions to shareholders are recorded on the
ex-dividend date. To the extent the Fund's net realized capital gains, if any,
can be offset by capital loss carryforwards ($228,884,941 and $70,119,797
expiring in 2009 and 2010, respectively, determined as of December 31, 2003), it
is the policy of the Fund not to distribute such gains.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a tax return of capital.
Differences in the recognition or classification of income between the financial
statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains in the components of net assets on the Statement of Assets and
Liabilities.
As of December 31, 2003, the components of distributable earnings (accumulated
losses) on a U.S. Federal income tax basis were as follows:
Unrealized Loss
Appreciation Carryforwards
(Depreciation) and Deferrals Total
$44,295,706 $(299,004,738) $(254,709,032)
The difference between book basis and tax basis is attributable primarily to net
operating losses and the tax deferral of losses on wash sales.
7 Expense allocation: Certain expenses are applicable to multiple funds.
Expenses directly attributable to a Series are charged to that Series. Expenses
of the Trust that are not directly attributed to a Series are allocated among
the Funds, on the basis of relative net assets, except where a more appropriate
allocation of expenses to each of the Funds can otherwise be made fairly.
Expenses borne by the complex of related investment companies, which includes
open-end and closed-end investment companies for which Management serves as
investment manager, that are not directly attributed to a Series or the Trust,
are allocated among the Fund and the other investment companies in the complex
or series thereof, on the basis of relative net assets, except where a more
appropriate allocation of expenses to each investment company in the complex or
series thereof can otherwise be made fairly.
8 Security lending: Pursuant to an Exemptive Order issued by the Securities and
Exchange Commission, the Fund entered into a Securities Lending Agreement
("Agreement") with Neuberger Berman, LLC ("Neuberger") on April 17, 2003.
Securities loans involve certain risks in the event a borrower should fail
financially, including delays or inability to recover the lent securities or
foreclose against the collateral. The investment manager, under the general
supervision of the Trust's Board of Trustees, monitors the creditworthiness of
the parties to whom the Fund makes security loans. The Fund will not lend
securities
13
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
on which covered call options have been written, or lend securities on terms
which would prevent the Fund from qualifying as a regulated investment company.
The Fund receives cash collateral equal to at least 102% of the current market
value of the loaned securities. The Fund invests the cash collateral in the N&B
Securities Lending Quality Fund, LLC, which is managed by State Street Bank and
Trust Company ("State Street") pursuant to guidelines approved by the Trust's
investment manager. Neuberger guaranteed minimum revenue to the Fund under the
Agreement, and received a portion of any revenue earned in excess of the
guaranteed amount as a lending agency fee.
The Agreement has been renewed and approved by the Board of Trustees as of July
1, 2004 with substantially the same terms. Under this current Agreement,
Neuberger guarantees minimum revenue to the Fund and receives any revenue earned
in excess of the guaranteed amount as a lending agency fee.
At June 30, 2004, the Fund had not paid Neuberger any fees under the Agreement.
Income earned on the securities loaned, if any, is reflected in the Statement of
Operations under the caption Income from securities loaned-net.
9 Foreign taxes: Foreign taxes withheld represent amounts withheld by foreign
tax authorities, net of refunds recoverable.
10 Repurchase agreements: The Fund may enter into repurchase agreements with
institutions that the Fund's investment manager has determined are creditworthy.
Each repurchase agreement is recorded at cost. The Fund requires that the
securities purchased in a repurchase agreement be transferred to the custodian
in a manner sufficient to enable the Fund to assert a perfected security
interest in those securities in the event of a default under the repurchase
agreement. The Fund monitors, on a daily basis, the value of the securities
transferred to ensure that their value, including accrued interest, is greater
than amounts owed to the Fund under each such repurchase agreement.
11 Transactions with other funds managed by Neuberger Berman Management Inc.:
Pursuant to an Exemptive Order issued by the Securities and Exchange Commission,
the Fund may invest in the Neuberger Berman Institutional Cash Fund (the "Cash
Fund"), a fund managed by Management and having the same Board members as the
Fund. The Cash Fund seeks to provide as high a level of current income as is
consistent with the preservation of capital and the maintenance of liquidity.
For any cash that the Fund invests in the Cash Fund, Management waives a portion
of its management fee equal to the management fee it receives from the Cash Fund
on those assets. For the six months ended June 30, 2004, such waived fees
amounted to $283. For the six months ended June 30, 2004, income earned on this
investment amounted to $2,074 and is reflected in the Statement of Operations
under the caption Income from investments in affiliated issuers.
14
Notes to Financial Statements Growth Portfolio cont'd
Note B--Management Fees, Administration Fees, Distribution Arrangements, and
Other Transactions With Affiliates:
Fund shares are issued and redeemed in connection with investments in and
payments under certain variable annuity contracts and variable life insurance
policies issued through separate accounts of life insurance companies and are
also offered directly to qualified pension and retirement plans.
The Fund retains Management as its investment manager under a Management
Agreement. For such investment management services, the Fund pays Management a
fee at the annual rate of 0.55% of the first $250 million of the Fund's average
daily net assets, 0.525% of the next $250 million, 0.50% of the next $250
million, 0.475% of the next $250 million, 0.45% of the next $500 million, 0.425%
of the next $2.5 billion, and 0.40% of average daily net assets in excess of $4
billion.
The Fund retains Management as its administrator under an Administration
Agreement. The Fund pays Management an administration fee at the annual rate of
0.30% of its average daily net assets under this agreement. Additionally,
Management retains State Street as its sub-administrator under a Sub-
Administration Agreement. Management pays State Street a fee for all services
received under the agreement.
The Trustees of the Trust adopted a non-fee distribution plan for the Fund.
Management has contractually undertaken through December 31, 2007 to reimburse
the Fund for its operating expenses (excluding the fees payable to Management,
interest, taxes, brokerage commissions, extraordinary expenses, and transaction
costs) ("Operating Expenses") which exceed, in the aggregate, 1.00% per annum of
its average daily net assets (the "Expense Limitation"). For the six months
ended June 30, 2004, no reimbursement to the Fund was required. The Fund has
agreed to repay Management through December 31, 2010 for its excess Operating
Expenses previously reimbursed by Management, so long as its annual Operating
Expenses during that period do not exceed its Expense Limitation, and the
repayment is made within three years after the year in which Management issued
the reimbursement. During the six months ended June 30, 2004, there was no
reimbursement to Management. At June 30, 2004, the Fund has no contingent
liability to Management under the agreement.
On October 31, 2003, Management and Neuberger, a member firm of the New York
Stock Exchange and sub-adviser to the Fund, became indirect wholly-owned
subsidiaries of Lehman Brothers Holdings Inc. ("Lehman"), a publicly-owned
holding company. Neuberger is retained by Management to furnish it with
investment recommendations and research information without added cost to the
Fund. Several individuals who are officers and/or Trustees of the Trust are also
employees of Neuberger and/or Management.
On July 1, 2003, the Fund entered into a commission recapture program, which
enables it to pay some of its operational expenses by recouping a portion of the
commissions it pays to a broker that is not a related party of the Fund.
Expenses paid through this program may include costs of custodial, transfer
agency or accounting services. For the six months ended June 30, 2004, the
impact of this arrangement was a reduction of $24,838.
15
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
The Fund has an expense offset arrangement in connection with its custodian
contract. The impact of this arrangement, reflected in the Statement of
Operations under the caption Custodian fees, was a reduction of $30.
Note C--Securities Transactions:
During the six months ended June 30, 2004, there were purchase and sale
transactions (excluding short-term securities) of $94,558,938 and $114,311,340,
respectively.
During the six months ended June 30, 2004, brokerage commissions on securities
transactions amounted to $302,312, of which Neuberger received $0, Lehman
received $58,665, and other brokers received $243,647.
Note D--Fund Share Transactions:
Share activity for the six months ended June 30, 2004 and for the year ended
December 31, 2003 was as follows:
For the For the
Six Months Ended Year Ended
June 30, December 31,
2004 2003
Shares Sold 392,827 5,950,038
Shares Redeemed (2,113,372) (8,765,385)
---------- ----------
Total (1,720,545) (2,815,347)
---------- ----------
Note E--Line of Credit:
At June 30, 2004, the Fund was a participant in a single committed, unsecured
$150,000,000 line of credit with State Street, to be used only for temporary or
emergency purposes. Interest is charged on borrowings under this agreement at
the overnight Federal Funds Rate plus 0.50% per annum. A facility fee of 0.10%
per annum of the available line of credit is charged, of which the Fund has
agreed to pay its pro rata share, based on the ratio of its individual net
assets to the net assets of all participants at the time the fee is due and
payable. The fee is paid quarterly in arrears. No compensating balance is
required. Other investment companies managed by Management also participate in
this line of credit on the same terms. Because several investment companies
participate, there is no assurance that the Fund will have access to the entire
$150,000,000 at any particular time. The Fund had no loans outstanding pursuant
to this line of credit at June 30, 2004.
Note F--Unaudited Financial Information:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent auditors. Annual reports
contain audited financial statements.
16
Financial Highlights Growth Portfolio+
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements.++
Six Months
Ended
June 30, Year Ended December 31,
----------- -------------------------------------------------------
2004 2003 2002 2001 2000 1999
(Unaudited)
Net Asset Value, Beginning of Period $10.42 $ 7.93 $ 11.52 $ 30.65 $ 37.27 $ 26.29
------ ------ ------- ------- ------- -------
Income From Investment Operations:
Net Investment Income (Loss) (.02) (.05) (.06) (.07) (.17) (.12)
Net Gains or Losses on Securities
(both realized and unrealized) .80 2.54 (3.53) (7.41) (3.16) 12.51
------ ------ ------- ------- ------- -------
Total From Investment Operations .78 2.49 (3.59) (7.48) (3.33) 12.39
------ ------ ------- ------- ------- -------
Less Distributions From:
Net Capital Gains -- -- -- (11.65) (3.29) (1.41)
------ ------ ------- ------- ------- -------
Net Asset Value, End of Period $11.20 $10.42 $ 7.93 $ 11.52 $ 30.65 $ 37.27
------ ------ ------- ------- ------- -------
Total Return++ +7.49%** +31.40% -31.16% -30.36% -11.66% +50.40%
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $211.7 $214.9 $ 185.8 $ 356.2 $ 640.6 $ 732.8
Ratio of Gross Expenses to Average Net Assets# .96%* .94% .96% .89% .90% .92%
Ratio of Net Expenses to Average Net Assets[sec] .94%* .93% .96% .89% .90% .92%
Ratio of Net Investment Income (Loss) to Average Net Assets (.47)%* (.58)% (.65)% (.50)% (.45)% (.46)%
Portfolio Turnover Rate 45% 149% 97% 91% 125% 119%
See Notes to Financial Highlights 17
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Financial Highlights Growth Portfolio
+ The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's proportionate share of AMT Growth
Investment's income and expenses through April 30, 2000 under the prior
master/feeder fund structure.
++ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each
fiscal period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Current returns may be lower or higher than the performance data
quoted. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. Total return would
have been lower if Management had not waived certain expenses. The total
return information shown does not reflect charges and other expenses that
apply to the separate account or the related insurance policies, and the
inclusion of these charges and other expenses would reduce the total
return for all fiscal periods shown. Performance data current to the most
recent month-end are available at www.nb.com.
# The Fund is required to calculate an expense ratio without taking into
consideration any expense reductions related to expense offset and
commission recapture arrangements.
++ The per share amounts which are shown have been computed based on the
average number of shares outstanding during each fiscal period.
[sec] After waiver of a portion of the investment management fee. Had the
investment manager not undertaken such action, the annualized ratios of
net expenses to average daily net assets would have been:
Six Months Ended Year Ended
June 30, December 31,
2004 2003
0.94% 0.93%
* Annualized.
** Not annualized.
18
Trustees and Officers (Unaudited)
The following tables set forth information concerning the trustees and officers
of the Trust. All persons named as trustees and officers also serve in similar
capacities for other funds administered or managed by NB Management and
Neuberger Berman. The Statement of Additional Information includes additional
information about fund trustees and is available upon request, without charge,
by calling (800) 877-9700.
Information about the Board of Trustees
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
John Cannon (74) Trustee since Consultant. Formerly, Chairman 38 Independent Trustee or Director of
2000 and Chief Investment Officer, three series of Oppenheimer Funds:
CDC Investment Advisors Limited Term New York Municipal
(registered investment adviser) Fund, Rochester Fund Municipals,
(1993-January 1999); prior and Oppenheimer Convertible
thereto, President and Chief Securities Fund since 1992.
Executive Officer, AMA Investment
Advisors, an affiliate of the
American Medical Association.
Faith Colish (68) Trustee since Counsel, Carter Ledyard & 38 Director, American Bar Retirement
1984 Milburn LLP (law firm) since Association (ABRA) since 1997
October 2002; Formerly, (not-for-profit membership
Attorney-at-Law and President, association).
Faith Colish, A Professional
Corporation, 1980 to 2002.
Walter G. Ehlers (71) Trustee since Consultant; Retired President 38 None.
1989 and Trustee, Teachers
Insurance & Annuity (TIAA)
and College Retirement
Equities Fund (CREF).
C. Anne Harvey (66) Trustee since Consultant, C. A. Harvey 38 President, Board of Associates to
1998 Associates, since June 2001; The National Rehabilitation
Formerly, Director, AARP, 1978 to Hospital's Board of Directors since
December 2001. 2002; Formerly, Member, Individual
Investors Advisory Committee to the
New York Stock Exchange Board of
Directors, 1998 to June 2002;
Member, American Savings
Education Council's Policy Board
(ASEC),1998-2000; Member,
Executive Committee, Crime
Prevention Coalition of America,
1997-2000.
19
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Barry Hirsch (71) Trustee since Attorney-at-Law. Formerly, 38 None.
2000 Senior Counsel, Loews
Corporation (diversified financial
corporation) May 2002 until April
2003; formerly, Senior Vice
President, Secretary and General
Counsel, Loews Corporation.
Robert A. Kavesh (76) Trustee since Marcus Nadler Professor of 38 Director, DEL Laboratories, Inc.
2000 Finance and Economics (cosmetics and pharmaceuticals)
Emeritus, New York University, since 1978; The Caring Community
Stern School of Business. (not-for-profit).
Howard A. Mileaf (67) Trustee since Retired. Formerly, Vice 38 Director, WHX Corporation
1999 President and Special Counsel, (holding company) since August
WHX Corporation (holding company), 2002; Director, WebFinancial
1993-2001. Corporation (holding company)
since December 2002; Director, State
Theatre of New Jersey (not-for-
profit theater) since 2000; formerly,
Director, Kevlin Corporation
(manufacturer of microwave and
other products).
William E. Rulon (71) Trustee since Retired. Senior Vice President, 38 Director, Pro-Kids Golf and
2000 Foodmaker, Inc. (operator and Learning Academy (teach golf and
franchiser of restaurants) until computer usage to "at risk" children)
January 1997. since 1998; Formerly, Director,
Prandium, Inc. (restaurants) from
March 2001 until July 2002.
Cornelius T. Ryan (72) Trustee since Founding General Partner, 38 Director, Capital Cash Management
2000 Oxford Partners and Oxford Trust (money market fund),
Bioscience Partners (venture Narragansett Insured Tax-Free
capital partnerships) and Income Fund, Rocky Mountain
President, Oxford Venture Equity Fund, Prime Cash Fund,
Corporation. several private companies and
QuadraMed Corporation (NASDAQ).
20
Trustees and Officers (Unaudited) cont'd
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Tom Decker Seip (54) Trustee since General Partner, Seip 38 Director, H&R Block, Inc. (financial
2000 Investments LP (a private services company) since May 2001;
investment partnership); formerly, Director, Forward Management, Inc.
President and CEO, Westaff, Inc. (asset management) since 2001;
(temporary staffing), May 2001 to Formerly, Director, General Magic
January 2002; Senior Executive at (voice recognition software),
the Charles Schwab Corporation November 2001 until 2002; Director,
from 1983 to 1999, including Chief E-Finance Corporation (credit
Executive Officer, Charles Schwab decisioning services), 1999-2003;
Investment Management, Inc. and Director, Save-Daily.com (micro
Trustee, Schwab Family of Funds investing services), 1999-2003;
and Schwab Investments from 1997 Director, Offroad Capital Inc.
to 1998 and Executive Vice (pre-public internet commerce
President--Retail Brokerage, company).
Charles Schwab Investment
Management from 1994 to 1997.
Candace L. Straight (56) Trustee since Private investor and consultant 38 Director, The Proformance Insurance
1999 specializing in the insurance Company (personal lines property
industry; Formerly, Advisory and casualty insurance company)
Director, Securitas Capital LLC (a since March 2004; Director,
global private equity investment Providence Washington (property
firm dedicated to making and casualty insurance company),
investments in the insurance since December 1998; Director,
sector), 1998 until December 2002. Summit Global Partners (insurance
brokerage firm) since October 2000.
Peter P. Trapp (59) Trustee since Regional Manager for Atlanta 38 None.
1984 Region, Ford Motor Credit
Company since August 1997;
Formerly, President, Ford Life
Insurance Company, April 1995
until August 1997.
21
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Number of
Portfolios in
Trustees who are Position and Fund Complex
"Interested Persons" Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Edward I. OBrien* (75) Trustee since Formerly, Member, Investment 38 Director, Legg Mason, Inc. (financial
2000 Policy Committee, Edward services holding company) since
Jones, 1993-2001; President, 1993; formerly, Director, Boston
Securities Industry Association Financial Group (real estate and tax
("SIA") (securities industry's shelters) 1993-1999.
representative in government
relations and regulatory matters
at the federal and state levels)
1974-1992; Adviser to SIA,
November 1992-November 1993.
Jack L. Rivkin* (63) President and Executive Vice President and 38 Director, Dale Carnegie and
Trustee since Chief Investment Officer, Associates, Inc. (private company)
December Neuberger Berman Inc. since 1998; Director, Emagin Corp.
2002 (holding company) since 2002 (public company) since 1997;
and 2003, respectively; Executive Director, Solbright, Inc. (private
Vice President and Chief company) since 1998; Director,
Investment Officer, Neuberger Infogate, Inc. (private company)
Berman since 2002 and 2003, since 1997.
respectively; Director and
Chairman, NB Management since
December 2002; Formerly, Executive
Vice President, Citigroup
Investments, Inc. from September
1995 to February 2002; Executive
Vice President, Citigroup Inc.
from September 1995 to February
2002.
Peter E. Sundman* (45) Chairman of Executive Vice President, 38 Director, Neuberger Berman Inc.
the Board, Neuberger Berman Inc. (holding company) from 1999
Chief (holding company) since 1999; through March 2003; President and
Executive Head of Neuberger Berman Director, NB Management since
Officer and Inc.'s Mutual Funds and 1999; Director and Vice President,
Trustee since Institutional Business since Neuberger Berman Agency, Inc.
2000; 1999; Executive Vice President, since 2000.
President and Neuberger Berman since 1999;
Chief Principal, Neuberger Berman
Executive from 1997 until 1999; Senior
Officer from Vice President, NB
1998 to 2000 Management from 1996
until 1999.
22
Trustees and Officers (Unaudited) cont'd
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the Trust's Trust Instrument, each Trustee shall hold office
for life or until his or her successor is elected or the Trust terminates;
except that (a) any Trustee may resign by delivering a written resignation;
(b) any Trustee may be removed with or without cause at any time by a
written instrument signed by at least two-thirds of the other Trustees; (c)
any Trustee who requests to be retired, or who has become unable to serve,
may be retired by a written instrument signed by a majority of the other
Trustees; and (d) any Trustee may be removed at any shareholder meeting by
a vote of at least two-thirds of the outstanding shares.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
* Indicates a Trustee who is an "interested person" within the meaning of the
1940 Act. Mr. Sundman and Mr. Rivkin are interested persons of the Trust by
virtue of the fact that they are officers and/or directors of NB Management
and Executive Vice Presidents of Neuberger Berman. Mr. O'Brien is an
interested person of the Trust by virtue of the fact that he is a director
of Legg Mason, Inc., a wholly owned subsidiary of which, from time to time,
serves as a broker or dealer to the Funds and other funds for which NB
Management serves as investment manager.
23
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Information about the Officers of the Trust
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- ------------------------------------------------------------------------------------------------------------------------------------
Claudia A. Brandon (47) Secretary since 1985 Vice President--Mutual Fund Board Relations, NB Management since 2000;
Vice President, Neuberger Berman since 2002 and employee since 1999;
Vice President, NB Management from 1986 to 1999; Secretary, eleven
registered investment companies for which NB Management acts as
investment manager and administrator (four since 2002, three since
2003, and one since 2004).
Robert Conti (48) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice President,
Neuberger Berman from 1999 until 2003; Senior Vice President, NB
Management since 2000; Controller, NB Management until 1996;
Treasurer, NB Management from 1996 until 1999; Vice President, eleven
registered investment companies for which NB Management acts as
investment manager and administrator (three since 2000, four since
2002, three since 2003, and one since 2004).
Brian P. Gaffney (50) Vice President since 2000 Managing Director, Neuberger Berman since 1999; Senior Vice President,
NB Management since 2000; Vice President, NB Management from 1997
until 1999; Vice President, eleven registered investment companies for
which NB Management acts as investment manager and administrator
(three since 2000, four since 2002, three since 2003, and one since
2004).
Sheila R. James (39) Assistant Secretary since 2002 Employee, Neuberger Berman since 1999; Employee, NB Management from
1991 to 1999; Assistant Secretary, eleven registered investment
companies for which NB Management acts as investment manager and
administrator (seven since 2002, three since 2003 and one since 2004).
Kevin Lyons (49) Assistant Secretary since 2003 Employee, Neuberger Berman since 1999; Employee, NB Management from
1993 to 1999; Assistant Secretary, eleven registered investment
companies for which NB Management acts as investment manager and
administrator (Ten since 2003 and one since 2004).
24
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- ------------------------------------------------------------------------------------------------------------------------------------
John M. McGovern (34) Assistant Treasurer since 2002 Vice President, Neuberger Berman since 2004; Employee,
NB Management since 1993; Assistant Treasurer, eleven
registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003, and one since 2004).
Barbara Muinos (45) Treasurer and Principal Financial Vice President, Neuberger Berman since 1999; Assistant Vice
and Accounting Officer since 2002; President, NB Management from 1993 to 1999; Treasurer and
prior thereto, Assistant Treasurer Principal Financial and Accounting Officer, eleven
since 1996 registered investment companies for which NB Management acts
as investment manager and administrator (seven since 2002,
three since 2003, and one since 2004); Assistant Treasurer,
three registered investment companies for which NB
Management acts as investment manager and administrator from
1996 until 2002.
Frederic B. Soule (58) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President; Neuberger Berman from 1999 until 2003; Vice
President, NB Management from 1995 until 1999; Vice
President, eleven registered investment companies for which
NB Management acts as investment manager and administrator
(three since 2000, four since 2002, three since 2003, and
one since 2004).
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the By-Laws of the Trust, each officer elected by the Trustees
shall hold office until his or her successor shall have been elected and
qualified or until his or her earlier death, inability to serve, or
resignation. Officers serve at the pleasure of the Trustees and may be
removed at any time with or without cause.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
25
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Proxy Voting Policies and Procedures
A description of the policies and procedures that the Fund uses to determine how
to vote proxies relating to portfolio securities is available, without charge,
by calling 1-800-877-9700 (toll-free) and on the website of the Securities and
Exchange Commission, at www.sec.gov. Beginning September 2004, information
regarding how the Fund voted proxies relating to portfolio securities during the
most recent 12-month period ended June 30 will also be available without charge,
by calling 1-800-877-9700 (toll-free), on the website of the Securities and
Exchange Commission, at www.sec.gov, and on the Fund's website at www.nb.com.
26
Semi-Annual Report [NEUBERGER | BERMAN LOGO]
June 30, 2004 A Lehman Brothers Company
Neuberger Berman
Advisers
Management
Trust
Guardian
Portfolio
B0733 08/04
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Guardian Portfolio Manager's Commentary
While returns were relatively modest in the first half of 2004, we are pleased
to report that the Guardian Portfolio outperformed both its Standard & Poor's
500 Index and Russell 1000 Value Index benchmarks during the period.2
Concerned by the shift in Federal Reserve policy, high oil prices, geopolitical
tensions, and the threat of terrorism, investors largely ignored consistently
positive economic news and strong corporate profit growth in the first half of
2004. Although the stock market as a whole has remained in a trading range,
there was considerable volatility within and across market sectors, creating an
even greater challenge for investors.
Energy sector investments had the most favorable impact on portfolio returns. We
were overweighted in energy and our holdings significantly outperformed the
benchmark energy sector components. Newfield Exploration, EOG Resources, and
Schlumberger appeared on our top ten performance list. Our initial attraction to
energy stocks was based on the fact that although global demand was rising,
there was very little capital being devoted to increasing production. The
ensuing supply/demand imbalance resulted in higher energy prices, improved
profits for energy companies, and strong performance from our energy holdings.
Despite good gains in the first half, we believe our energy investments continue
to represent good value. Although OPEC appears to be making a sincere effort to
bring energy prices down, strikes in the Norwegian and Nigerian oil fields and
sabotage in Iraq have restrained supply while global inventories remain low.
Since energy demand generally strengthens in the latter half of the year, we
believe that the window of opportunity to increase energy inventories to a level
that would help significantly reduce prices may have closed.
Industrial sector investments also contributed to relative performance. We were
overweighted in industrials versus the benchmarks and our holdings outperformed
by a wide margin. Defense electronics company L-3 Communications was the
portfolio's top performer. L-3 is a leading supplier of defense electronics and
battlefield communications systems. Although still a relatively small part of
its business, L-3 has developed several technologies with potential homeland
security applications, including ship-to-Coast Guard signaling devices and
sensor-based detectors for checking the contents of shipping containers. The
company is also one of two licensed vendors for baggage screening equipment for
U.S. airports. Going forward, we think these homeland security oriented products
will become bigger contributors to L-3's earnings and enhance future growth.
Our consumer discretionary sector investments retreated. Comcast, the nation's
largest cable television operator, was among the disappointments as its shares
were buffeted by multiple investor concerns. Initially, investors were
disappointed by Comcast's unsolicited bid for Disney. Then investors worried
when the Regional Bell Operating Companies (RBOCs) began discussing new fiber
strategies that could facilitate competing broadband video services. Finally,
there was some general concern that corporate advertising spending was not
recovering as quickly as anticipated. For the time being, it appears that
Comcast has given up on Disney and is unlikely to make a run at another
"content" company. While the RBOCs appear committed to getting into the video
business, it's going to cost a lot of money and take considerable time to
improve their broadband infrastructure before they can become serious
competitors to the established cable television operators like Comcast. In fact,
we suspect that over the next few years, the cable companies will have more
success capturing telephony business from the telephone companies than the
telcos will have winning over cable TV customers. While in general, advertising
spending has disappointed, cable television companies are
1
getting a bigger piece of the pie. This is a direct result of giant Comcast's
(20 million homes served) interconnection agreements with other large cable
operators. In the past, cable operators sold low cost, low margin ads to local
businesses. Now, they can approach national advertisers with more compelling
demographics. This should improve Comcast's and other CATV operators'
advertising profits.
The economy appears to be making the transition from recovery to a slower growth
expansion phase. Anxious investors have been focusing on the potential negatives
rather than the positives. However, six months from now, if there are no
external events that derail the economy, we believe investor sentiment will
improve and companies that execute their business plans and deliver solid
earnings growth will be rewarded in the stock market. Recall that our investment
process is based on our own intensive fundamental research. We are
valuation-sensitive, long-term investors who evaluate the business potential for
portfolio candidates based on our targeted three-to-five year holding period.
Within industry sectors, we seek out the companies that we believe are best
positioned to deliver industry leading business performance. Furthermore, we are
strongly biased toward companies in industry sectors benefiting from favorable
secular trends. We believe that these are the kind of stocks that can
distinguish themselves in the year ahead.
Sincerely,
/s/ARTHUR MORETTI
- -----------------
ARTHUR MORETTI
PORTFOLIO MANAGER
1. For Class I, 20.44%, (0.28%) and 7.32% were the average annual total returns
for the 1-year, 5- year and since inception (11/03/97) periods ended June 30,
2004. For Class S, 20.19%, (0.37%) and 7.25% were the average annual total
returns for the 1-year, 5-year and since inception (11/03/97) periods ended June
30, 2004. Performance shown prior to August 2002 for the Class S shares is of
the Class I shares, which has lower expenses and typically higher returns than
Class S shares. Neuberger Berman Management Inc. ("NBMI") has agreed to absorb
certain expenses of the AMT Portfolios. Without this arrangement, which is
subject to change, the total returns of the Portfolios would be less. Total
return includes reinvestment of dividends and capital gain distributions.
Performance data quoted represent past performance and the investment return and
principal value of an investment will fluctuate so that the shares, when
redeemed, may be worth more or less than original cost. Current performance may
be lower or higher than the performance data quoted. For performance data
current to the most recent month end, please visit www.nb.com/amtperformance.
The performance information does not reflect fees and expenses of the variable
annuity and variable life insurance policies or the pension plans whose proceeds
are invested in the portfolio.
2. The S&P 500 Index is widely regarded as the standard for measuring large-cap
U.S. stock market performance and includes a representative sample of leading
companies in leading industries. The Russell 1000[RegTM]Index measures the
performance of the 1,000 largest companies in the Russell 3000[RegTM] Index
(which measures the performance of the 3,000 largest U.S. companies based on
total market capitalization). The Russell 1000 Index represents approximately
92% of the total market capitalization of the Russell 3000 Index. The Russell
1000 Value Index measures the performance of those Russell 1000 companies with
lower price-to-book ratios and lower forecasted growth values. Please note that
indices do not take into account any fees and expenses of investing in the
individual securities that they track, and that individuals cannot invest
directly in any index. Data about the performance of these indices are prepared
or obtained by NBMI and include reinvestment of all dividends and capital gain
distributions. The Portfolio may invest in many securities not included in the
above-described indices.
The composition, industries and holdings of the Portfolio are subject to change.
2
The investments for the Portfolio are managed by the same portfolio manager(s)
who manage one or more other mutual funds that have similar names, investment
objectives and investment styles as the Portfolio. You should be aware that the
Portfolio is likely to differ from the other mutual funds in size, cash flow
pattern and tax matters. Accordingly, the holdings and performance of the
Portfolio can be expected to vary from those of the other mutual funds.
Shares of the separate Portfolios of Neuberger Berman Advisers Management Trust
are sold only through the currently effective prospectus and are not available
to the general public. Shares of this Portfolio may be purchased only by life
insurance companies to be used with their separate accounts that fund variable
annuity and variable life insurance policies and by qualified pension and
retirement plans.
(C) 2004 Neuberger Berman Management Inc., distributor. All rights reserved.
3
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Guardian Portfolio
Number of Shares Market Value+
Common Stocks (97.7%)
Banking & Financial (6.8%)
92,700 Fifth Third Bancorp $ 4,985,406
128,700 State Street 6,311,448\P
-----------
11,296,854
Consumer Cyclicals (3.1%)
123,400 Target Corp. 5,240,798
Defense (4.1%)
103,400 L-3 Communications
Holdings 6,907,120\P
Diversified (3.3%)
105,700 Danaher Corp. 5,480,545\P
Energy (2.4%)
76,250 BP PLC ADR 4,084,713
Financial Services (6.0%)
45,400 Ambac Financial Group 3,334,176
69,000 Citigroup Inc. 3,208,500
37,000 Goldman Sachs 3,483,920
-----------
10,026,596
Health Products & Services (6.6%)
64,900 Quest Diagnostics 5,513,255\P
89,200 UnitedHealth Group 5,552,700
-----------
11,065,955
Industrial Gases (3.2%)
134,000 Praxair, Inc. 5,347,940
Insurance (6.6%)
1,775 Berkshire Hathaway Class B 5,245,125*
153,500 Willis Group Holdings 5,748,575
-----------
10,993,700
Media (9.1%)
151,000 Comcast Corp. Class A
Special 4,169,110*
763,956 Liberty Media 6,867,964*
49,697 Liberty Media International
Class A 1,843,759*
323,860 UnitedGlobalCom 2,351,224*
-----------
15,232,057
Oil & Gas (7.7%)
74,700 EOG Resources 4,460,337
152,100 Newfield Exploration 8,478,054*
-----------
12,938,391
Oil Services (1.2%)
31,000 Schlumberger Ltd. 1,968,810
Pharmaceutical (4.7%)
48,200 Millipore Corp. 2,717,034*
116,500 Novartis AG ADR 5,184,250
-----------
7,901,284
4
Number of Shares Market Value+
Real Estate (4.7%)
74,500 AMB Property $ 2,579,935
174,850 Equity Residential 5,198,290
------------
7,778,225
Technology (6.1%)
142,300 Dell Inc. 5,097,186*
168,200 National Instruments 5,155,330
------------
10,252,516
Technology--Semiconductor (5.0%)
242,600 Altera Corp. 5,390,572*
124,300 Texas Instruments 3,005,574
------------
8,396,146
Technology--Semiconductor Capital Equipment (3.2%)
235,600 Teradyne, Inc. 5,348,120*
Telecommunications (3.3%)
248,300 Vodafone Group ADR 5,487,430\P
Transportation (3.7%)
41,200 Burlington Northern Santa Fe 1,444,884
108,600 Canadian National Railway 4,733,874
------------
6,178,758
Utilities (2.9%)
595,900 National Grid Transco 4,596,710
5,400 National Grid Transco ADR 211,518\P
------------
4,808,228
Waste Management (4.0%)
94,400 Republic Services 2,731,936\P
131,100 Waste Management 4,018,215
------------
6,750,151
Total Common Stocks
(Cost $126,465,936) 163,484,337
Principal Amount
Short-Term Investments (17.3%)
$25,496,000 N&B Securities Lending
Quality Fund, LLC $ 25,496,000++
3,359,173 Neuberger Berman
Institutional Cash Fund
Trust Class 3,359,173@
------------
Total Short-Term Investments
(Cost $28,855,173) 28,855,173#
------------
Total Investments (115.0%)
(Cost $155,321,109)
192,339,510##
Liabilities, less cash, receivables and
other assets [(15.0%)]
(25,072,452)
------------
Total Net Assets (100.0%)
$167,267,058
------------
See Notes to Schedule of Investments 5
Notes to Schedule of Investments Guardian Portfolio
- ---------------------------------------------------
+ Investments in equity securities by the Fund are valued at the latest sales
price where that price is readily available; securities for which no sales
were reported, unless otherwise noted, are valued at the mean between the
closing bid and asked prices. Securities traded primarily on the NASDAQ
Stock Market are normally valued by the Fund at the NASDAQ Official Closing
Price ("NOCP") provided by NASDAQ each business day. The NOCP is the most
recently reported price as of 4:00:02 p.m., Eastern time, unless that price
is outside the range of the "inside" bid and asked prices (i.e., the bid
and asked prices that dealers quote to each other when trading for their
own accounts); in that case, NASDAQ will adjust the price to equal the
inside bid or asked price, whichever is closer. Because of delays in
reporting trades, the NOCP may not be based on the price of the last trade
to occur before the market closes. The Fund values all other securities by
a method the Board of Trustees of Neuberger Berman Advisers Management
Trust (the "Board") believes accurately reflects fair value. Numerous
factors may be considered when determining the fair value of a security,
including available analyst, media or other reports, trading in futures or
ADRs and whether the issuer of the security being fair valued has other
securities outstanding. Foreign security prices are furnished by
independent quotation services expressed in local currency values. Foreign
security prices are translated from the local currency into U.S. dollars
using the exchange rate as of 12:00 p.m., Eastern time. The Board has
approved the use of FT Interactive Data Corporation ("FT Interactive") to
assist in determining the fair value of the Fund's foreign equity
securities in the wake of certain significant events. Specifically, when
changes in the value of a certain index suggest that the closing prices on
the foreign exchanges no longer represent the amount that the Fund could
expect to receive for those securities, FT Interactive will provide
adjusted prices for certain foreign equity securities based on an analysis
showing historical correlations between the prices of those securities and
changes in the index. In the absence of precise information about the
market values of these foreign securities as of the close of the New York
Stock Exchange, the Board has determined on the basis of available data
that prices adjusted in this way are likely to be closer to the prices the
Fund could realize on a current sale than are the prices of those
securities established at the close of the foreign markets in which the
securities primarily trade. However, fair value prices are necessarily
estimates, and there is no assurance that such a price will be at or close
to the price at which the security next trades. Short-term debt securities
with less than 60 days until maturity may be valued at cost which, when
combined with interest earned, approximates market value.
# At cost, which approximates market value.
## At June 30, 2004, the cost of investments for U.S. Federal income tax
purposes was $155,321,109. Gross unrealized appreciation of investments was
$37,744,962 and gross unrealized depreciation of investments was $726,561,
resulting in net unrealized appreciation of $37,018,401, based on cost for
U.S. Federal income tax purposes.
* Non-income producing security.
\P All or a portion of this security is on loan (see Note A of Notes to
Financial Statements).
@ Neuberger Berman Institutional Cash Fund is also managed by Neuberger
Berman Management Inc. (see Note A of Notes to Financial Statements).
++ Affiliated issuer (see Note A of Notes to Financial Statements).
See Notes to Financial Statements 6
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Assets and Liabilities
- -----------------------------------
Guardian
Neuberger Berman Advisers Management Trust Portfolio
Assets
Investments in securities, at market value*+ (Note A)-see Schedule of Investments:
===================================================================================================
Unaffiliated issuers $163,484,337
- ---------------------------------------------------------------------------------------------------
Affiliated issuers 28,855,173
- ---------------------------------------------------------------------------------------------------
192,339,510
===================================================================================================
Dividends and interest receivable 422,509
- ---------------------------------------------------------------------------------------------------
Receivable for securities sold 223,812
===================================================================================================
Receivable for Fund shares sold 4,175
- ---------------------------------------------------------------------------------------------------
Prepaid expenses and other assets 12,761
- ---------------------------------------------------------------------------------------------------
Total Assets 193,002,767
- ---------------------------------------------------------------------------------------------------
Liabilities
Payable for collateral on securities loaned (Note A) 25,496,000
===================================================================================================
Payable for Fund shares redeemed 98,008
===================================================================================================
Payable to investment manager-net (Note B) 72,322
- ---------------------------------------------------------------------------------------------------
Payable to administrator (Note B) 39,610
===================================================================================================
Accrued expenses and other payables 29,769
- ---------------------------------------------------------------------------------------------------
Total Liabilities 25,735,709
- ---------------------------------------------------------------------------------------------------
Net Assets at value $167,267,058
- ---------------------------------------------------------------------------------------------------
Net Assets consist of:
Paid-in capital $180,539,955
===================================================================================================
Undistributed net investment income (loss) 654,178
- ---------------------------------------------------------------------------------------------------
Accumulated net realized gains (losses) on investments (50,943,492)
===================================================================================================
Net unrealized appreciation (depreciation) in value of investments 37,016,417
- ---------------------------------------------------------------------------------------------------
Net Assets at value $167,267,058
- ---------------------------------------------------------------------------------------------------
Net Assets
Class I $167,068,170
===================================================================================================
Class S 198,888
- ---------------------------------------------------------------------------------------------------
Shares Outstanding ($.001 par value; unlimited shares authorized)
Class I $ 11,464,739
===================================================================================================
Class S 13,626
- ---------------------------------------------------------------------------------------------------
Net Asset Value, offering and redemption price per share
Class I $ 14.57
===================================================================================================
Class S 14.60
- ---------------------------------------------------------------------------------------------------
+Securities on loan, at market value:
Unaffiliated issuers $ 24,993,352
- ---------------------------------------------------------------------------------------------------
*Cost of investments:
Unaffiliated issuers $126,465,936
===================================================================================================
Affiliated issuers 28,855,173
- ---------------------------------------------------------------------------------------------------
Total cost of investments $155,321,109
- ---------------------------------------------------------------------------------------------------
See Notes to Financial Statements 7
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST FOR THE SIX MONTHS ENDED
JUNE 30, 2004 (UNAUDITED)
Statement of Operations
- -----------------------
Guardian
Neuberger Berman Advisers Management Trust Portfolio
Investment Income
Income:
Dividend income-unaffiliated issuers $1,085,582
=======================================================================================================
Income from securities loaned-net (Note A) 27,500
- -------------------------------------------------------------------------------------------------------
Income from investments in affiliated issuers (Note A) 14,741
=======================================================================================================
Interest Income (Note A) 1,261
- -------------------------------------------------------------------------------------------------------
Foreign taxes withheld (Note A) (45,245)
- -------------------------------------------------------------------------------------------------------
Total income 1,083,839
- -------------------------------------------------------------------------------------------------------
Expenses:
Investment management fee (Notes A & B) 461,210
=======================================================================================================
Administration fee (Note B):
Class I 251,318
-----------------------------------------------------------------------------------------------------
Class S 251
=====================================================================================================
Distribution fees (Note B):
Class S 209
=====================================================================================================
Audit fees 17,883
- -------------------------------------------------------------------------------------------------------
Custodian fees (Note B) 48,757
=======================================================================================================
Insurance expense 1,213
- -------------------------------------------------------------------------------------------------------
Legal fees 11,501
=======================================================================================================
Shareholder reports 5,911
- -------------------------------------------------------------------------------------------------------
Trustees' fees and expenses 13,453
=======================================================================================================
Miscellaneous 1,853
- -------------------------------------------------------------------------------------------------------
Total expenses 813,559
- -------------------------------------------------------------------------------------------------------
Investment management fee waived (Note A) (1,855)
- -------------------------------------------------------------------------------------------------------
Expenses reduced by custodian fee expense offset and commission recapture arrangements
(Note B) (6,016)
- -------------------------------------------------------------------------------------------------------
Total net expenses 805,688
- -------------------------------------------------------------------------------------------------------
Net investment income (loss) 278,151
- ------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) on Investments (Note A)
Net realized gain (loss) on:
Investment securities sold in unaffiliated issuers 5,968,368
=====================================================================================================
Foreign currency 257
-----------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) in value of:
Investment securities in unaffiliated issuers 654,042
-----------------------------------------------------------------------------------------------------
Foreign currency (5,445)
-----------------------------------------------------------------------------------------------------
Net gain (loss) on investments 6,617,222
=======================================================================================================
Net increase (decrease) in net assets resulting from operations $6,895,373
=======================================================================================================
See Notes to Financial Statements 8
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Changes in Net Assets
- ----------------------------------
Guardian Portfolio
------------------------------
Six Months
Ended Year
June 30, Ended
2004 December 31,
Neuberger Berman Advisers Management Trust (Unaudited) 2003
Increase (Decrease) in Net Assets:
From Operations:
Net investment income (loss) $ 278,151 $ 375,178
- ------------------------------------------------------------------------------------------------------
Net realized gain (loss) on investments 5,968,625 2,521,652
- ------------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of investments 648,597 40,016,655
- ------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations 6,895,373 42,913,485
- ------------------------------------------------------------------------------------------------------
Distributions to Shareholders From:
Net investment income:
Class I - (1,313,767)
----------------------------------------------------------------------------------------------------
Class S - (231)
====================================================================================================
Total distributions to shareholders - (1,313,998)
- ------------------------------------------------------------------------------------------------------
From Fund Share Transactions (Note D):
Proceeds from shares sold:
Class I 11,229,389 68,474,538
====================================================================================================
Class S 46,273 20,926
----------------------------------------------------------------------------------------------------
Proceeds from reinvestment of dividends and distributions:
Class I - 1,313,767
====================================================================================================
Class S - 231
----------------------------------------------------------------------------------------------------
Payments for shares redeemed:
Class I (20,282,823) (82,374,724)
====================================================================================================
Class S (693) (2,764)
----------------------------------------------------------------------------------------------------
Net increase (decrease) from Fund share transactions (9,007,854) (12,568,026)
- ------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets (2,112,481) 29,031,461
Net Assets:
Beginning of period 169,379,539 140,348,078
- ------------------------------------------------------------------------------------------------------
End of period $167,267,058 $169,379,539
- ------------------------------------------------------------------------------------------------------
Undistributed net investment income (loss) at end of period $ 654,178 $ 376,027
- ------------------------------------------------------------------------------------------------------
See Notes to Financial Statements 9
Notes to Financial Statements Guardian Portfolio
- ------------------------------------------------
Note A--Summary of Significant Accounting Policies:
1 General: Guardian Portfolio (the "Fund") is a separate operating series of
Neuberger Berman Advisers Management Trust (the "Trust"), a Delaware
statutory trust organized pursuant to a Trust Instrument dated May 23,
1994. The Trust is currently comprised of ten separate operating series
(each a "Series," collectively, the "Funds") each of which (except Focus
Portfolio) is diversified. The Trust is registered as an open-end
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"), and its shares are registered under the
Securities Act of 1933, as amended. The Fund currently offers Class I and
Class S shares. The Board of Trustees of the Trust may establish additional
series or classes of shares without the approval of shareholders.
The assets of each Series belong only to that Series, and the liabilities
of each Series are borne solely by that Series and no other.
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States requires Neuberger
Berman Management Inc. ("Management") to make estimates and assumptions at
the date of the financial statements. Actual results could differ from
those estimates.
2 Portfolio valuation: Investment securities are valued as indicated in the
notes following the Schedule of Investments.
3 Foreign currency translation: The accounting records of the Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into
U.S. dollars using the exchange rate as of 12:00 p.m., Eastern time, to
determine the value of investments, other assets and liabilities. Purchase
and sale prices of securities, and income and expenses, are translated into
U.S. dollars at the prevailing rate of exchange on the respective dates of
such transactions. Net unrealized foreign currency gain (loss) arises from
changes in the value of assets and liabilities, other than investments in
securities, as a result of changes in exchange rates and is stated
separately in the Statement of Operations.
4 Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the
ex-dividend date or, for certain foreign dividends, as soon as the Fund
becomes aware of the dividends. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, including accretion of original issue discount,
where applicable, and accretion of discount on short-term investments, is
recorded on the accrual basis. Realized gains and losses from securities
transactions and foreign currency transactions are recorded on the basis of
identified cost and stated separately in the Statement of Operations.
Included in net realized gain (loss) on investment securities sold are
proceeds from the settlements of class action litigation in which the Fund
participated as a plaintiff. The amount of such proceeds for the six months
ended June 30, 2004 was $98,457.
5 Federal income taxes: The Funds are treated as separate entities for U.S.
Federal income tax purposes. It is the policy of the Fund to continue to
qualify as a regulated investment company by complying with the provisions
available to certain investment companies, as defined in applicable
sections of the Internal
10
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Revenue Code, and to make distributions of investment company taxable
income and net capital gains (after reduction for any amounts available for
U.S. Federal income tax purposes as capital loss carryforwards) sufficient
to relieve it from all, or substantially all, U.S. Federal income taxes.
Accordingly, the Fund paid no U.S. Federal income taxes and no provision
for U.S. Federal income taxes was required.
6 Dividends and distributions to shareholders: The Fund may earn income, net
of expenses, daily on its investments. Income dividends and distributions
from net realized capital gains, if any, generally are distributed in
October. Income dividends and capital gain distributions to shareholders
are recorded on the ex-dividend date. To the extent the Fund's net realized
capital gains, if any, can be offset by capital loss carryforwards
($11,716,397, $39,047,105 and $5,695,372 expiring in 2009, 2010 and 2011,
respectively, determined as of December 31, 2003), it is the policy of the
Fund not to distribute such gains.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a tax return of
capital. Differences in the recognition or classification of income between
the financial statements and tax earnings and profits which result in
temporary over-distributions for financial statement purposes are
classified as distributions in excess of net investment income or
accumulated net realized gains in the components of net assets on the
Statement of Assets and Liabilities.
The tax character of distributions paid during the years ended December 31,
2003 and 2002 was as follows:
Distributions Paid From:
Ordinary Income Total
2003 2002 2003 2002
$1,313,998 $1,258,878 $1,313,998 $1,258,878
As of December 31, 2003, the components of distributable earnings
(accumulated losses) on a U.S. Federal income tax basis were as follows:
Undistributed Unrealized Loss
Ordinary Appreciation Carryforwards
Income (Depreciation) and Deferrals Total
$376,027 $35,914,577 $(56,458,874) $(20,168,270)
The difference between book basis and tax basis is attributable primarily
to the tax deferral of losses on wash sales, and the realization for tax
purposes of unrealized gain (loss) on certain forward foreign currency
contracts.
7 Foreign taxes: Foreign taxes withheld represent amounts withheld by foreign
tax authorities, net of refunds recoverable.
8 Expense allocation: Certain expenses are applicable to multiple funds.
Expenses directly attributable to a Series are charged to that Series.
Expenses of the Trust that are not directly attributed to a Series are
allocated among the Funds, on the basis of relative net assets, except
where a more appropriate allocation of expenses to each of the Funds can
otherwise be made fairly. Expenses borne by the complex of related
investment companies, which includes open-end and closed-end investment
companies for which Management serves as investment manager, that are not
directly attributed to a Series or the Trust are allocated among the Fund
and the other investment companies in the complex or series thereof, on the
11
Notes to Financial Statements Guardian Portfolio cont'd
- -------------------------------------------------------
basis of relative net assets, except where a more appropriate allocation of
expenses to each investment company in the complex or series thereof can
otherwise be made fairly. The Fund's expenses (other than those specific to
each class) are allocated proportionally each day between the classes based
upon the relative net assets of each class.
9 Security lending: Pursuant to an Exemptive Order issued by the Securities
and Exchange Commission, the Fund entered into a Securities Lending
Agreement ("Agreement") with Neuberger Berman, LLC ("Neuberger") on April
17, 2003. Securities loans involve certain risks in the event a borrower
should fail financially, including delays or inability to recover the lent
securities or foreclose against the collateral. The investment manager,
under the general supervision of the Trust's Board of Trustees, monitors
the creditworthiness of the parties to whom the Fund makes security loans.
The Fund will not lend securities on which covered call options have been
written, or lend securities on terms which would prevent the Fund from
qualifying as a regulated investment company. The Fund receives cash
collateral equal to at least 102% of the current market value of the loaned
securities. The Fund invests the cash collateral in the N&B Securities
Lending Quality Fund, LLC, which is managed by State Street Bank and Trust
Company ("State Street") pursuant to guidelines approved by the Trust's
investment manager. Neuberger guaranteed minimum revenue to the Fund under
the Agreement, and received a portion of any revenue earned in excess of
the guaranteed amount as a lending agency fee.
The Agreement has been renewed and approved by the Board of Trustees as of
July 1, 2004 with substantially the same terms. Under this current
Agreement, Neuberger guarantees minimum revenue to the Fund and receives
any revenue earned in excess of the guaranteed amount as a lending agency
fee.
At June 30, 2004, the Fund had not paid Neuberger any fees under the
Agreement.
Income earned on the securities loaned, if any, is reflected in the
Statement of Operations under the caption Income from securities
loaned-net.
10 Repurchase agreements: The Fund may enter into repurchase agreements with
institutions that the Fund's investment manager has determined are
creditworthy. Each repurchase agreement is recorded at cost. The Fund
requires that the securities purchased in a repurchase agreement be
transferred to the custodian in a manner sufficient to enable the Fund to
assert a perfected security interest in those securities in the event of a
default under the repurchase agreement. The Fund monitors, on a daily
basis, the value of the securities transferred to ensure that their value,
including accrued interest, is greater than amounts owed to the Fund under
each such repurchase agreement.
11 Transactions with other funds managed by Neuberger Berman Management Inc.:
Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission, the Fund may invest in the Neuberger Berman Institutional Cash
Fund (the "Cash Fund"), a fund managed by Management and having the same
Board members as the Fund. The Cash Fund seeks to provide as high a level
of current income as is consistent with the preservation of capital and the
maintenance of liquidity. For any cash that the Fund invests in the Cash
Fund, Management waives a portion of its management fee equal to the
management fee it receives from the Cash Fund on those assets. For the six
months ended June 30, 2004, such waived fees amounted to $1,855. For the
six months ended June 30, 2004, income earned on this
12
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
investment amounted to $14,741 and is reflected in the Statement of
Operations under the caption Income from investments in affiliated issuers.
12 Other: All net investment income and realized and unrealized capital gains
and losses of the Fund are allocated, on the basis of relative net assets,
pro rata among its respective classes.
Note B--Management Fees, Administration Fees, Distribution Arrangements,
and Other Transactions With Affiliates:
Fund shares are issued and redeemed in connection with investments in and
payments under certain variable annuity contracts and variable life
insurance policies issued through separate accounts of life insurance
companies and are also offered directly to qualified pension and retirement
plans.
The Fund retains Management as its investment manager under a Management
Agreement. For such investment management services, the Fund pays
Management a fee at the annual rate of 0.55% of the first $250 million of
the Fund's average daily net assets, 0.525% of the next $250 million, 0.50%
of the next $250 million, 0.475% of the next $250 million, 0.45% of the
next $500 million, 0.425% of the next $2.5 billion, and 0.40% of average
daily net assets in excess of $4 billion.
The Fund retains Management as its administrator under an Administration
Agreement. Each class pays Management an administration fee at the annual
rate of 0.30% of its average daily net assets under this agreement.
Additionally, Management retains State Street as its sub-administrator
under a Sub-Administration Agreement. Management pays State Street a fee
for all services received under the agreement.
The Trustees of the Trust adopted a non-fee distribution plan for the
Fund's Class I.
For the Fund's Class S, Management acts as agent in arranging for the sale
of class shares without commission and bears advertising and promotion
expenses. The Trustees of the Trust have adopted a distribution plan (the
"Plan") with respect to this class, pursuant to Rule 12b-1 under the 1940
Act. The Plan provides that, as compensation for administrative and other
services provided to this class, Management's activities and expenses
related to the sale and distribution of this class of shares, and ongoing
services provided to investors in this class, Management receives from this
class a fee at the annual rate of 0.25% of Class S's average daily net
assets. Management receives this amount to provide distribution and
shareholder servicing for this class and pays a portion of it to
institutions that provide such services. Those institutions may use the
payments for, among other purposes, compensating employees engaged in sales
and/or shareholder servicing. The amount of fees paid by this class during
any year may be more or less than the cost of distribution and other
services provided to this class. NASD rules limit the amount of annual
distribution fees that may be paid by a mutual fund and impose a ceiling on
the cumulative distribution fees paid. The Trust's Plan complies with those
rules.
Management has contractually undertaken through December 31, 2007 to
reimburse the Fund's Class I and Class S shares for their operating
expenses (excluding the fees payable to Management (including the fees
payable to Management with respect to the Fund's Class S shares), interest,
taxes, brokerage commissions, extraordinary expenses, and transaction
costs) ("Operating Expenses") which exceed, in the
13
Notes to Financial Statements Guardian Portfolio cont'd
- -------------------------------------------------------
aggregate, 1.00% and 1.25%, respectively, per annum of their average daily
net assets (the "Expense Limitation"). For the six months ended June 30,
2004, no reimbursement to the Fund's Class I and Class S shares was
required. The Fund's Class I and Class S shares each have agreed to repay
Management through December 31, 2010 for their excess Operating Expenses
previously reimbursed by Management, so long as their annual Operating
Expenses during that period do not exceed their Expense Limitations, and
the repayments are made within three years after the year in which
Management issued the reimbursement.. During the six months ended June 30,
2004, there was no reimbursement to Management. At June 30, 2004, the
Fund's Class I and Class S shares have no contingent liability to
Management under these agreements.
On October 31, 2003, Management and Neuberger, a member firm of the New
York Stock Exchange and sub-adviser to the Fund, became indirect
wholly-owned subsidiaries of Lehman Brothers Holdings Inc. ("Lehman"), a
publicly-owned holding company. Neuberger is retained by Management to
furnish it with investment recommendations and research information without
added cost to the Fund. Several individuals who are officers and/or
Trustees of the Trust are also employees of Neuberger and/or Management.
On July 1, 2003, the Fund entered into a commission recapture program,
which enables it to pay some of its operational expenses by recouping a
portion of the commissions it pays to a broker that is not a related party
of the Fund. Expenses paid through this program may include costs of
custodial, transfer agency or accounting services. For the six months ended
June 30, 2004, the impact of this arrangement was a reduction of $6,002.
The Fund has an expense offset arrangement in connection with its custodian
contract. The impact of this arrangement, reflected in the Statement of
Operations under the caption Custodian fees, was a reduction of $14.
Note C--Securities Transactions:
During the six months ended June 30, 2004, there were purchase and sale
transactions (excluding short-term securities) of $20,758,203 and
$26,766,016, respectively.
During the six months ended June 30, 2004, brokerage commissions on
securities transactions amounted to $78,374, of which Neuberger received
$0, Lehman received $16,045 and other brokers received $62,329.
14
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Note D--Fund Share Transactions:
Share activity for the six months ended June 30, 2004 and for the year
ended December 31, 2003 was as follows:
For the Six Months Ended June 30, 2004 For the Year Ended December 31, 2003
Shares
Shares Issued on
Issued on Reinvestment
Reinvestment of of Dividends
Shares Dividends and Shares Shares and Shares
Sold Distributions Redeemed Total Sold Distributions Redeemed Total
Class I 783,456 - (1,419,974) (636,518) 5,816,296 101,921 (6,922,626) (1,004,409)
Class S 3,239 - (50) 3,189 1,657 18 (222) 1,453
Note E--Line of Credit:
At June 30, 2004, the Fund was a participant in a single committed,
unsecured $150,000,000 line of credit with State Street, to be used only
for temporary or emergency purposes. Interest is charged on borrowings
under this agreement at the overnight Federal Funds Rate plus 0.50% per
annum. A facility fee of 0.10% per annum of the available line of credit is
charged, of which the Fund has agreed to pay its pro rata share, based on
the ratio of its individual net assets to the net assets of all
participants at the time the fee is due and payable. The fee is paid
quarterly in arrears. No compensating balance is required. Other investment
companies managed by Management also participate in this line of credit on
the same terms. Because several investment companies participate, there is
no assurance that the Fund will have access to the entire $150,000,000 at
any particular time. The Fund had no loans outstanding pursuant to this
line of credit at June 30, 2004, nor had the Fund utilized this line of
credit at any time prior to that date.
Note F--Unaudited Financial Information:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent auditors. Annual reports
contain audited financial statements.
15
Financial Highlights Guardian Portfolio
The following tables include selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements.++
Six Months
Ended
June 30, Year Ended December 31,
---------- -------------------------------------------------------
Class I+
2004 2003 2002 2001 2000 1999
(Unaudited)
Net Asset Value, Beginning of Period $13.98 $ 10.70 $ 14.64 $15.93 $15.85 $ 13.84
------ ------- ------- ------ ------ -------
Income From Investment Operations:
Net Investment Income (Loss) .02 .03 .10 .11 .09 .09
Net Gains or Losses on Securities
(both realized and unrealized) .57 3.36 ( 3.95) (.33) .08- 1.97
------ ------- ------- ------ ------ -------
Total From Investment Operations .59 3.39 ( 3.85) (.22) .17 2.06
------ ------- ------- ------ ------- -------
Less Distributions From:
Net Investment Income - (.11) (.09) (.07) (.09) (.05)
Net Capital Gains - - - (1.00) - -
------ ------- ------- ------ ------ -------
Total Distributions - (.11) (.09) (1.07) (.09) (.05)
------ ------- ------- ------ ------ ------
Net Asset Value, End of Period $14.57 $ 13.98 $ 10.70 $14.64 $15.93 $ 15.85
------ ------- ------- ------ ------ -------
Total Return++ +4.22%** +31.76% -26.45% -1.51% +1.13% +14.93%
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $167.1 $ 169.2 $ 140.3 $190.8 $131.1 $ 121.1
Ratio of Gross Expenses to Average Net Assets# .97%* .97% .98% .99% 1.00% 1.00%
Ratio of Net Expenses to Average Net Assets[sec] .96%* .97% .98% .99% 1.00% 1.00%
Ratio of Net Investment Income (Loss)
to Average Net Assets .33%* .25% .81% .74% .57% .61%
Portfolio Turnover Rate 13% 58% 147% 79% 124% 107%
Period from
Six Months Ended Year Ended August 2, 2002^
June 30, December 31, to December 31,
---------------- ------------ ---------------
Class S 2004 2003 2002
(Unaudited)
Net Asset Value, Beginning of Period $14.02 $ 10.69 $11.23
------ ------- ------
Income From Investment Operations:
Net Investment Income (Loss) .01 .00 .03
Net Gains or Losses on Securities
(both realized and unrealized) .57 3.35 (.57)
------ ------- ------
Total From Investment Operations .58 3.35 (.54)
------ ------- ------
Less Distributions From:
Net Investment Income - (.02) -
------ ------- ------
Net Asset Value, End of Period $14.60 $ 14.02 $10.69
------ ------- ------
Total Return++ +4.14%** +31.39% -4.81%**
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $ 0.2 $ 0.1 $ 0.1
Ratio of Gross Expenses to Average Net Assets# 1.22%* 1.22% 1.24%*
Ratio of Net Expenses to Average Net Assets[sec] 1.21%* 1.22% 1.24%*
Ratio of Net Investment Income (Loss) to Average Net Assets .14%* .02% .63%*
Portfolio Turnover Rate 13% 58% 147%
See Notes to Financial Highlights 16
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Financial Highlights Guardian Portfolio
- ------------------------------------------------
+ The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's Class I proportionate share of AMT Guardian
Investment's income and expenses through April 30, 2000 under the prior
master/feeder fund structure.
++ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each
fiscal period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Current returns may be lower or higher than the performance data
quoted. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. Total return would
have been lower/higher if Management had not waived/recouped certain
expenses. The total return information shown does not reflect charges and
other expenses that apply to the separate account or the related insurance
policies, and the inclusion of these charges and other expenses would
reduce the total return for all fiscal periods shown. Performance data
current to the most recent month-end are available at www.nb.com.
# The Fund is required to calculate an expense ratio without taking into
consideration any expense reductions related to expense offset
arrangements.
sec After reimbursement of expenses previously paid by the investment manager.
Had the investment manager not been reimbursed, the annualized ratios of
net expenses to average daily net assets would have been:
Year Ended December 31,
2001 2000 1999
Guardian Portfolio Class I .97% .99% .98%
After waiver of a portion of the investment management fee. Had Management
not undertaken such action, the annualized ratios of net expenses to
average daily net assets would have been:
Six Months Year Ended
Ended June 30, December 31,
2004 2003
Guardian Portfolio Class I .96% .98%
Guardian Portfolio Class S 1.21% 1.22%
^ The date investment operations commenced.
++ The per share amounts which are shown have been computed based on the
average number of shares outstanding during each fiscal period.
* Annualized.
** Not annualized.
- - The amounts shown at this caption for a share outstanding may not acord
with the change in aggregate gains and losses in securities for the fiscal
period because of the timing of sales and repurchases of class shares in
relation to fluctuating market values for the Fund.
17
Trustees and Officers (Unaudited)
The following tables set forth information concerning the trustees and officers
of the Trust. All persons named as trustees and officers also serve in similar
capacities for other funds administered or managed by NB Management and
Neuberger Berman. The Statement of Additional Information includes additional
information about fund trustees and is available upon request, without charge,
by calling (800) 877-9700.
Information about the Board of Trustees
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Independent Trustees Position and Fund Complex
Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
John Cannon (74) Trustee since Consultant. Formerly, Chairman 38 Independent Trustee or Director of
2000 and Chief Investment Officer, three series of Oppenheimer Funds:
CDC Investment Advisors Limited Term New York Municipal
(registered investment adviser) Fund, Rochester Fund Municipals,
(1993-January 1999); prior and Oppenheimer Convertible
thereto, President and Chief Securities Fund since 1992.
Executive Officer, AMA
Investment Advisors, an affiliate
of the American Medical
Association.
- ------------------------------------------------------------------------------------------------------------------------------------
Faith Colish (68) Trustee since Counsel, Carter Ledyard & 38 Director, American Bar Retirement
1984 Milburn LLP (law firm) since Association (ABRA) since 1997
October 2002; Formerly, (not-for-profit membership
Attorney-at-Law and President, association).
Faith Colish, A Professional
Corporation, 1980 to 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Walter G. Ehlers (71) Trustee since Consultant; Retired President 38 None.
1989 and Trustee, Teachers
Insurance & Annuity (TIAA)
and College Retirement
Equities Fund (CREF).
- ------------------------------------------------------------------------------------------------------------------------------------
C. Anne Harvey (66) Trustee since Consultant, C. A. Harvey 38 President, Board of Associates to
1998 Associates, since June 2001; The National Rehabilitation
Formerly, Director, AARP, 1978 Hospital's Board of Directors since
to December 2001. 2002; Formerly, Member, Individual
Investors Advisory Committee to the
New York Stock Exchange Board of
Directors, 1998 to June 2002;
Member, American Savings
Education Council's Policy Board
(ASEC),1998-2000; Member,
Executive Committee, Crime
Prevention Coalition of America,
1997-2000.
- ------------------------------------------------------------------------------------------------------------------------------------
18
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Independent Trustees Position and Fund Complex
Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Barry Hirsch (71) Trustee since Attorney-at-Law. Formerly, 38 None.
2000 Senior Counsel, Loews
Corporation (diversified
financial corporation) May
2002 until April 2003; formerly,
Senior Vice President, Secretary
and General Counsel, Loews
Corporation.
- ------------------------------------------------------------------------------------------------------------------------------------
Robert A. Kavesh (76) Trustee since Marcus Nadler Professor of 38 Director, DEL Laboratories, Inc.
2000 Finance and Economics (cosmetics and pharmaceuticals)
Emeritus, New York University, since 1978; The Caring Community
Stern School of Business. (not-for-profit).
- ------------------------------------------------------------------------------------------------------------------------------------
Howard A. Mileaf (67) Trustee since Retired. Formerly, Vice 38 Director, WHX Corporation
1999 President and Special Counsel, (holding company) since August
WHX Corporation (holding 2002; Director, WebFinancial
company), 1993-2001. Corporation (holding company)
since December 2002; Director, State
Theatre of New Jersey (not-for-
profit theater) since 2000; formerly,
Director, Kevlin Corporation
(manufacturer of microwave and
other products).
- ------------------------------------------------------------------------------------------------------------------------------------
William E. Rulon (71) Trustee since Retired. Senior Vice President, 38 Director, Pro-Kids Golf and
2000 Foodmaker, Inc. (operator and Learning Academy (teach golf and
franchiser of restaurants) until computer usage to "at risk" children)
January 1997. since 1998; Formerly, Director,
Prandium, Inc. (restaurants) from
March 2001 until
July 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Cornelius T. Ryan (72) Trustee since Founding General Partner, 38 Director, Capital Cash Management
2000 Oxford Partners and Oxford Trust (money market fund),
Bioscience Partners (venture Narragansett Insured Tax-Free
capital partnerships) and Income Fund, Rocky Mountain
President, Oxford Venture Equity Fund, Prime Cash Fund,
Corporation. several private companies and
QuadraMed Corporation
(NASDAQ).
- ------------------------------------------------------------------------------------------------------------------------------------
19
Trustees and Officers (Unaudited) cont'd
- ----------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Independent Trustees Position and Fund Complex
Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Tom Decker Seip (54) Trustee since General Partner, Seip 38 Director, H&R Block, Inc. (financial
2000 Investments LP (a private services company) since May 2001;
investment partnership); Director, Forward Management, Inc.
formerly, President and CEO, (asset management) since 2001;
Westaff, Inc. (temporary Formerly, Director, General Magic
staffing), May 2001 to January (voice recognition software),
2002; Senior Executive at the November 2001 until 2002; Director,
Charles Schwab Corporation E-Finance Corporation (credit
from 1983 to 1999, including decisioning services), 1999-2003;
Chief Executive Officer, Director, Save-Daily.com (micro
Charles Schwab Investment investing services), 1999-2003;
Management, Inc. and Trustee, Director, Offroad Capital Inc.
Schwab Family of Funds and (pre-public internet commerce
Schwab Investments from 1997 company).
to 1998 and Executive Vice
President--Retail Brokerage,
Charles Schwab Investment
Management from 1994
to 1997.
- ------------------------------------------------------------------------------------------------------------------------------------
Candace L. Straight (56) Trustee since Private investor and consultant 38 Director, The Proformance Insurance
1999 specializing in the insurance Company (personal lines property
industry; Formerly, Advisory and casualty insurance company)
Director, Securitas Capital LLC since March 2004; Director,
(a global private equity Providence Washington (property
investment firm dedicated to and casualty insurance company),
making investments in the since December 1998; Director,
insurance sector), 1998 until Summit Global Partners (insurance
December 2002. brokerage firm) since October 2000.
- ------------------------------------------------------------------------------------------------------------------------------------
Peter P. Trapp (59) Trustee since Regional Manager for Atlanta 38 None.
1984 Region, Ford Motor Credit
Company since August 1997;
Formerly, President, Ford
Life Insurance Company, April
1995 until August 1997.
- ------------------------------------------------------------------------------------------------------------------------------------
20
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Trustees who are Portfolios in
"Interested Persons" Position and Fund Complex
Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Edward I. OBrien* (75) Trustee since Formerly, Member, Investment 38 Director, Legg Mason, Inc. (financial
2000 Policy Committee, Edward services holding company) since
Jones, 1993-2001; President, 1993; formerly, Director, Boston
Securities Industry Association Financial Group (real estate and tax
("SIA") (securities industry's shelters) 1993-1999.
representative in government
relations and regulatory matters
at the federal and state levels)
1974-1992; Adviser to SIA,
November 1992-November 1993.
- ------------------------------------------------------------------------------------------------------------------------------------
Jack L. Rivkin* (63) President and Executive Vice President and 38 Director, Dale Carnegie and
Trustee since Chief Investment Officer, Associates, Inc. (private company)
December Neuberger Berman Inc. since 1998; Director, Emagin Corp.
2002 (holding company) since 2002 (public company) since 1997;
and 2003, respectively; Director, Solbright, Inc. (private
Executive Vice President and company) since 1998; Director,
Chief Investment Officer, Infogate, Inc. (private company)
Neuberger Berman since 2002 since 1997.
and 2003, respectively; Director
and Chairman, NB
Management since December
2002; Formerly, Executive Vice
President, Citigroup
Investments, Inc. from
September 1995 to February
2002; Executive Vice President,
Citigroup Inc. from September
1995 to February 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Peter E. Sundman* (45) Chairman of Executive Vice President, 38 Director, Neuberger Berman Inc.
the Board, Neuberger Berman Inc. (holding company) from 1999
Chief (holding company) since 1999; through March 2003; President and
Executive Head of Neuberger Berman Director, NB Management since
Officer and Inc.'s Mutual Funds and 1999; Director and Vice President,
Trustee since Institutional Business since Neuberger Berman Agency, Inc.
2000; 1999; Executive Vice President, since 2000.
President and Neuberger Berman since 1999;
Chief Principal, Neuberger Berman
Executive from 1997 until 1999; Senior
Officer from Vice President, NB
1998 to 2000 Management from 1996
until 1999.
- ------------------------------------------------------------------------------------------------------------------------------------
21
Trustees and Officers (Unaudited) cont'd
- ----------------------------------------
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the Trust's Trust Instrument, each Trustee shall hold office
for life or until his or her successor is elected or the Trust terminates;
except that (a) any Trustee may resign by delivering a written resignation;
(b) any Trustee may be removed with or without cause at any time by a
written instrument signed by at least two-thirds of the other Trustees; (c)
any Trustee who requests to be retired, or who has become unable to serve,
may be retired by a written instrument signed by a majority of the other
Trustees; and (d) any Trustee may be removed at any shareholder meeting by
a vote of at least two-thirds of the outstanding shares.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
* Indicates a Trustee who is an "interested person" within the meaning of the
1940 Act. Mr. Sundman and Mr. Rivkin are interested persons of the Trust by
virtue of the fact that they are officers and/or directors of NB Management
and Executive Vice Presidents of Neuberger Berman. Mr. O'Brien is an
interested person of the Trust by virtue of the fact that he is a director
of Legg Mason, Inc., a wholly owned subsidiary of which, from time to time,
serves as a broker or dealer to the Funds and other funds for which NB
Management serves as investment manager.
22
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Information about the Officers of the Trust
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- -------------------------------------------------------------------------------------------------------------------------
Claudia A. Brandon (47) Secretary since 1985 Vice President--Mutual Fund Board Relations, NB
Management since 2000; Vice President, Neuberger
Berman since 2002 and employee since 1999; Vice
President, NB Management from 1986 to 1999; Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(four since 2002, three since 2003, and one since 2004).
Robert Conti (48) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President, Neuberger Berman from 1999 until 2003; Senior
Vice President, NB Management since 2000; Controller,
NB Management until 1996; Treasurer, NB Management
from 1996 until 1999; Vice President, eleven registered
investment companies for which NB Management acts as
investment manager and administrator (three since 2000,
four since 2002, three since 2003, and one since 2004).
Brian P. Gaffney (50) Vice President since 2000 Managing Director, Neuberger Berman since 1999; Senior
Vice President, NB Management since 2000; Vice President,
NB Management from 1997 until 1999; Vice President,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(three since 2000, four since 2002, three since 2003, and
one since 2004).
Sheila R. James (39) Assistant Secretary since 2002 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1991 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003 and one since 2004).
Kevin Lyons (49) Assistant Secretary since 2003 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1993 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(Ten since 2003 and one since 2004).
23
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- -------------------------------------------------------------------------------------------------------------------------
John M. McGovern (34) Assistant Treasurer since 2002 Vice President, Neuberger Berman since 2004; Employee,
NB Management since 1993; Assistant Treasurer, eleven
registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003, and one since
2004).
Barbara Muinos (45) Treasurer and Principal Financial Vice President, Neuberger Berman since 1999; Assistant
and Accounting Officer since 2002; Vice President, NB Management from 1993 to 1999;
prior thereto, Assistant Treasurer Treasurer and Principal Financial and Accounting
since 1996 Officer, eleven registered investment companies for
which NB Management acts as investment manager and
administrator (seven since 2002, three since 2003, and
one since 2004); Assistant Treasurer, three registered
investment companies for which NB Management acts as
investment manager and administrator from 1996 until
2002.
Frederic B. Soule (58) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003;
Vice President; Neuberger Berman from 1999 until 2003;
Vice President, NB Management from 1995 until 1999;
Vice President, eleven registered investment companies
for which NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three
since 2003, and one since 2004).
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the By-Laws of the Trust, each officer elected by the Trustees
shall hold office until his or her successor shall have been elected and
qualified or until his or her earlier death, inability to serve, or
resignation. Officers serve at the pleasure of the Trustees and may be
removed at any time with or without cause.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
24
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Proxy Voting Policies and Procedures
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to portfolio securities is available, without
charge, by calling 1-800-877-9700 (toll-free) and on the website of the
Securities and Exchange Commission, at www.sec.gov. Beginning September 2004,
information regarding how the Fund voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 will also be
available without charge, by calling 1-800-877-9700 (toll-free), on the website
of the Securities and Exchange Commission, at www.sec.gov, and on the Fund's
website at www.nb.com http://www.nb.com.
25
Semi-Annual Report
June 30, 2004
B0734 08/04
[Logo]
Neuberger Berman
Advisers
Management
Trust
Limited
Maturity
Bond
Portfolio[RegTM]
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Limited Maturity Bond Portfolio Managers' Commentary
For the six months ended June 30, 2004, the Neuberger Berman AMT Limited
Maturity Bond Portfolio returned 0.00%, compared to a -0.08% decline for the
Merrill Lynch 1-3 Year Treasury Index benchmark.(2)
At the beginning of 2004, the portfolio had a relatively conservative duration
of 1.3 years, moderately below the duration of the benchmark index. The
portfolio's defensive posture was a reflection of our recognition that low bond
yields provide only a thin cushion to offset potential price declines
associated with the strengthening economy. We maintained the portfolio's
conservative positioning throughout the reporting period, a stance that helped
preserve shareholder capital following the surprisingly strong March employment
report and the Federal Reserve's anticipated interest rate hike in June.
We employed shifts in sector allocation to take advantage of evolving
opportunities in the market. Over the reporting period, we reduced our
allocation to corporate securities from 49.6% of the portfolio at the beginning
of the period to 39.8% at the end of June. We also steadily increased our
allocation to U.S. Treasury Securities from 37.9% of the portfolio on December
31, 2003, to 45.0% at the end of June, which helped to maintain the portfolio's
high credit quality. These changes are consistent with the conservative
structuring of the portfolio.
As expected, the Federal Reserve Board's Open Market Committee took action by
moving the Fed Funds target rate up 0.25% at its June 30 meeting. In the past,
Fed Chairman Alan Greenspan has employed a measured approach to adjusting the
target rate, taking small discrete steps and then patiently waiting to evaluate
the impact on the economy before proceeding further. In his commentary, Mr.
Greenspan has hinted that the Fed will use a similar approach in the coming
months. We will continue to evaluate these factors and adjust the portfolio
accordingly.
At the end of this reporting period (June 30, 2004) the portfolio had a
duration of 1.3 years versus approximately 1.7 years for the Merrill Lynch 1-3
Year Treasury Index benchmark, an average Credit Quality Rating of AA, and an
Average Yield to Maturity of 2.68%.
In closing, with short-term interest rates reaching historically low levels,
investors in our fund have enjoyed relatively strong returns over the past few
years. In this lower interest rate environment we are taking a conservative
approach and protecting these gains. As interest rates rise and additional
opportunities become more attractive, we will once again reach out on the risk
spectrum in search of ways to create value in the fund.
Sincerely,
/s/ Ted Giuliano
/s/ John Dugenske
TED GIULIANO AND
JOHN DUGENSKE
PORTFOLIO CO-MANAGERS
1
1. 0.49%, 4.86% and 5.18% were the average annual total returns for the 1-, 5-
and 10-year periods ended June 30, 2004. Neuberger Berman Management Inc.
("NBMI") has agreed to absorb certain expenses of the AMT Portfolios. Without
this arrangement, which is subject to change, the total returns of the
Portfolios would be less. Total return includes reinvestment of dividends and
capital gain distributions. Performance data quoted represent past performance
and the investment return and principal value of an investment will fluctuate
so that the shares, when redeemed, may be worth more or less than original
cost. Current performance may be lower or higher than the performance data
quoted. For performance data current to the most recent month end, please visit
www.nb.com/amtperformance. The performance information does not reflect fees
and expenses of the variable annuity and variable life insurance policies or
the pension plans whose proceeds are invested in the portfolio.
2. The Merrill Lynch 1-3 Year U.S. Treasury Index is an unmanaged total return
market value index consisting of all coupon-bearing U.S. Treasury publicly
placed debt securities with maturities between 1 to 3 years. Please note that
indices do not take into account any fees and expenses of investing in the
individual securities that they track, and that individuals cannot invest
directly in any index. Data about the performance of this index are prepared or
obtained by NBMI and include reinvestment of all dividends and capital gain
distributions. The Portfolio may invest in many securities not included in the
above-described index.
The composition, industries and holdings of the Portfolio are subject to
change.
The investments for the Portfolio are managed by the same portfolio manager(s)
who manage one or more other mutual funds that have similar names, investment
objectives and investment styles as the Portfolio. You should be aware that the
Portfolio is likely to differ from the other mutual funds in size, cash flow
pattern and tax matters. Accordingly, the holdings and performance of the
Portfolio can be expected to vary from those of the other mutual funds.
Shares of the separate Portfolios of Neuberger Berman Advisers Management Trust
are sold only through the currently effective prospectus and are not available
to the general public. Shares of this Portfolio may be purchased only by life
insurance companies to be used in their separate accounts that fund variable
annuity and variable life insurance policies and by qualified pension and
retirement plans.
(C) 2004 Neuberger Berman Management Inc., distributor. All rights reserved.
2
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Limited Maturity Bond Portfolio
Principal Amount Rating Market Value+
Moody's S&P
U.S. Treasury Securities (45.0%)
$ 2,000,000 U.S. Treasury Bills, 0.93%, due 7/1/04 TSY TSY $ 2,000,000
7,000,000 U.S. Treasury Bills, 0.98%, due 8/19/04 TSY TSY 6,988,709
3,000,000 U.S. Treasury Notes, 2.13%, due 8/31/04 TSY TSY 3,004,335
3,145,000 U.S. Treasury Notes, 1.88%, due 9/30/04 TSY TSY 3,148,931
5,200,000 U.S. Treasury Notes, 2.13%, due 10/31/04 TSY TSY 5,209,953
30,900,000 U.S. Treasury Notes, 1.63%, due 3/31/05 TSY TSY 30,839,652\o\o
985,000 U.S. Treasury Notes, 1.88%, due 11/30/05 TSY TSY 978,190
16,000,000 U.S. Treasury Notes, 1.88%, due 12/31/05 TSY TSY 15,866,880
25,500,000 U.S. Treasury Notes, 1.88%, due 1/31/06 TSY TSY 25,256,959
4,965,000 U.S. Treasury Notes, 2.25%, due 4/30/06 TSY TSY 4,931,059
32,500,000 U.S. Treasury Notes, 2.00%, due 5/15/06 TSY TSY 32,115,330
8,500,000 U.S. Treasury Notes, 3.00%, due 2/15/08 TSY TSY 8,382,794
1,235,000 U.S. Treasury Notes, 3.25%, due 1/15/09 TSY TSY 1,211,265
---------------
Total U.S. Treasury Securities (Cost $141,292,389) 139,934,057
---------------
U.S. Government Agency Securities (1.3%)
4,000,000 Federal Home Loan Bank, Disc. Notes, 4.13%, due 1/14/05
(Cost $4,022,072) AGY AGY 4,050,760
---------------
Mortgage-Backed Securities (11.7%)
Fannie Mae
1,354,870 Collateralized Mortgage Obligations, Planned Amortization
Certificates, Ser. 2003-16, Class PA, 4.50%, due 11/25/09 AGY AGY 1,372,904
Freddie Mac
1,454,591 Collateralized Mortgage Obligations, Planned Amortization
Certificates, Ser. 2592, Class PA, 4.50%, due 12/15/07 AGY AGY 1,459,635
13,009 Mortgage Participation Certificates, 10.00%, due 4/1/20 AGY AGY 14,534
678,411 Pass-Through Certificates, 5.00%, due 2/1/07 AGY AGY 690,971
Government National Mortgage Association
10,781,874 Pass-Through Certificates, 6.00%, due 1/15/33 & 10/15/33 AGY AGY 11,067,445
6,200,001 Pass-Through Certificates, 5.00%, due 3/15/34 AGY AGY 6,019,038
10,000,000 Pass-Through Certificates, 4.50%, due 6/15/34 AGY AGY 9,410,417
6,500,000 5%, TBA 30 Year Maturity AGY AGY 6,296,875\oe
---------------
Total Mortgage-Backed Securities (Cost $36,187,166) 36,331,819
---------------
Corporate Debt Securities (39.8%)
1,650,000 Abitibi-Consolidated, Inc., Bonds, 8.30%, due 8/1/05 Ba2 BB 1,707,666
1,000,000 Allied Waste North America, Inc., Guaranteed Notes, Ser. B,
8.88%, due 4/1/08 Ba3 BB- 1,095,000
1,040,000 Allied Waste North America, Inc., Guaranteed Senior Notes,
Ser. B, 7.63%, due 1/1/06 Ba3 BB- 1,090,700
3,000,000 Allstate Corp., Senior Notes, 7.88%, due 5/1/05 A1 A+ 3,131,028
975,000 American General Finance Corp., Floating Rate Notes, Ser. G,
1.91%, due 9/20/04 A1 A+ 976,592
1,765,000 AT&T Wireless Services, Inc., Senior Notes, 7.35%, due 3/1/06 Baa2 BBB 1,883,430
3,500,000 Bank One Corp., Notes, 6.50%, due 2/1/06 Aa3 A+ 3,693,582
1,500,000 Bausch & Lomb, Inc., Notes, 6.75%, due 12/15/04 Ba1 BBB- 1,523,841
2,650,000 Bear Stearns Co., Inc., Notes, 6.50%, due 5/1/06 A1 A 2,805,086
2,025,000 Beneficial Corp., Medium-Term Notes, Ser. I, 6.25%, due 1/14/05 A1 A 2,060,448
3,800,000 Boeing Capital Corp., Senior Notes, 5.65%, due 5/15/06 A3 A 3,992,854
2,700,000 Bombardier Capital, Inc., Notes, 7.50%, due 8/15/04 Baa3 BBB- 2,711,232**
550,000 Brascan Corp., Notes, 8.13%, due 12/15/08 Baa3 A- 621,364
3,300,000 British Telecom PLC, Notes, 7.88%, due 12/15/05 Baa1 A- 3,528,238
1,550,000 Capital One Bank, Senior Notes, 8.25%, due 6/15/05 Baa2 BBB- 1,625,029
See Notes to Schedule of Investments 3
Schedule of Investments Limited Maturity Bond Portfolio cont'd
Principal Amount Rating Market Value+
Moody's S&P
$ 2,100,000 Caterpillar Financial Services Corp., Floating Rate
Medium-Term Notes, 1.28%, due 8/16/04 A2 A $ 2,100,368
2,200,000 Caterpillar Financial Services Corp., Notes, 6.88%, due 8/1/04 A2 A 2,208,254
1,700,000 CBS Corp., Guaranteed Senior Notes, 7.15%, due 5/20/05 A3 A- 1,766,397
1,285,000 Chase Manhattan Corp., Subordinated Notes, 7.25%, due 6/1/07 A1 A 1,410,750
1,900,000 Comcast Cable Communications, Senior Notes, 6.38%,
due 1/30/06 Baa3 BBB 1,989,389
3,100,000 ConocoPhillips, Notes, 8.50%, due 5/25/05 A3 A- 3,259,194
1,550,000 Cox Communications, Inc., Notes, 7.75%, due 8/15/06 Baa2 BBB 1,684,501
2,800,000 Daimler Chrysler N.A. Holdings Corp., Guaranteed Notes, 6.40%,
due 5/15/06 A3 BBB 2,946,989
550,000 Delhaize America, Inc., Guaranteed Notes, 7.38%, due 4/15/06 Ba1 BB+ 579,576
1,010,000 EOP Operating Limited Partnership, Notes, 6.63%, due 2/15/05 Baa1 BBB+ 1,035,204
1,300,000 Equitable Life Assurance Society USA, Notes, 6.95%, due 12/1/05 A2 A 1,375,040**
1,550,000 Everest Reinsurance Holdings, Inc., Senior Notes, 8.50%,
due 3/15/05 A3 A- 1,607,235
500,000 Gap, Inc., Notes, 9.65%, due 12/15/05 Ba2 BB+ 542,500
2,000,000 General Electric Capital Corp., Medium-Term Notes, Ser. A,
4.25%, due 1/28/05 Aaa AAA 2,025,114
700,000 General Motors Acceptance Corp., Notes, 6.13%, due 9/15/06 A3 BBB 728,952
710,000 General Motors Acceptance Corp., Notes, 6.13%, due 2/1/07 A3 BBB 740,881
1,250,000 Great Lakes Power, Inc., Notes, 8.30%, due 3/1/05 Baa3 BBB- 1,293,756
2,500,000 HCA, Inc., Notes, 5.25%, due 11/6/08 Ba1 BBB- 2,484,538
1,600,000 Hertz Corp., Senior Notes, 8.25%, due 6/1/05 Baa2 1,660,280
1,600,000 International Lease Finance Corp., Floating Rate Notes,
2.39%, due 7/13/04 A1 AA- 1,609,939
1,700,000 ITT Corp., Notes, 6.75%, due 11/15/05 Ba1 BB+ 1,751,000
1,500,000 J.P. Morgan Chase & Co., Senior Notes, 5.63%, due 8/15/06 Aa3 A+ 1,571,745
4,800,000 John Deere Capital Corp., Floating Rate Senior Notes, 1.56%,
due 8/20/04 A3 A- 4,807,224
1,850,000 Lear Corp., Guaranteed Senior Notes, Ser. B, 7.96%, due 5/15/05 Baa3 BBB- 1,929,034
1,550,000 Mallinckrodt Group, Inc., Notes, 6.50%, due 11/15/07 Ba3 BBB 1,668,387
1,100,000 Merrill Lynch & Co., Inc., Floating Rate Medium-Term Notes,
Ser. B, 1.43%, due 8/3/04 Aa3 A+ 1,101,119
1,500,000 MetLife, Inc., Debentures, 3.91%, due 5/15/05 A2 A 1,519,982
650,000 National Rural Utilities Cooperative Finance Corp.,
Collateral Trust, 5.25%, due 7/15/04 A1 A+ 650,583
1,600,000 National Rural Utilities Cooperative Finance Corp.,
Collateral Trust, 6.00%, due 5/15/06 A1 A+ 1,683,744
3,800,000 Pacific Bell, Notes, 6.25%, due 3/1/05 A1 A+ 3,901,578
1,600,000 Pemex Project Funding Master Trust, Guaranteed Notes, 9.13%,
due 10/13/10 Baa1 BBB- 1,832,000
890,000 Phelps Dodge Corp., Notes, 6.38%, due 11/1/04 Baa3 BBB- 897,344
3,200,000 PNC Funding Corp., Guaranteed Notes, 7.00%, due 9/1/04 A2 A- 3,225,846
1,500,000 Powergen US Funding LLC, Notes, 4.50%, due 10/15/04 A3 BBB+ 1,510,542
705,000 Quest Diagnostics, Inc., Senior Notes, 6.75%, due 7/12/06 Baa2 BBB 752,445
2,200,000 Raytheon Co., Notes, 6.50%, due 7/15/05 Baa3 BBB- 2,277,323
1,600,000 Reliant Energy Resources Corp., Notes, Ser. B, 8.13%, due 7/15/05 Ba1 BBB 1,680,645
1,500,000 Royal Caribbean Cruises Ltd., Senior Notes, 8.13%, due 7/28/04 Ba2 BB+ 1,505,250
1,230,000 Safeway, Inc., Notes, 2.50%, due 11/1/05 Baa2 BBB 1,222,444
1,800,000 Sara Lee Corp., Medium-Term Notes, Ser. B, 6.40%, due 6/9/05 A3 A+ 1,858,961
1,500,000 Sprint Capital Corp., Guaranteed Notes, 7.90%, due 3/15/05 Baa3 BBB- 1,554,903
3,110,000 Time Warner, Inc., Notes, 5.63%, due 5/1/05 Baa1 BBB+ 3,186,170
1,770,000 Time Warner, Inc., Notes, 7.75%, due 6/15/05 Baa1 BBB+ 1,843,765
1,550,000 Tyco International Group S.A., Guaranteed Notes, 5.88%,
due 11/1/04 Baa3 BBB 1,568,065
See Notes to Schedule of Investments 4
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Limited Maturity Bond Portfolio cont'd
Principal Amount Rating Market Value+
Moody's S&P
$ 3,150,000 Tyco International Group S.A., Guaranteed Notes, 6.38%,
due 6/15/05 Baa3 BBB $ 3,247,468
2,000,000 Tyson Foods, Inc., Notes, 6.63%, due 10/1/04 Baa3 BBB 2,016,826
1,875,000 Walt Disney Co., Notes, 4.88%, due 7/2/04 BBB+ 1,875,000
3,100,000 Washington Mutual, Inc., Senior Notes, 5.63%, due 1/15/07 A3 A- 3,242,994
1,600,000 Wells Fargo & Co., Notes, 6.63%, due 7/15/04 Aa1 AA- 1,602,067
810,000 Weyerhaeuser Co., Notes, 5.50%, due 3/15/05 Baa2 BBB 827,129
------------
Total Corporate Debt Securities (Cost $122,500,944) 123,806,530
------------
Foreign Government (1.9%)
EUR 4,800,000 Bundesobligation, 3.50%, due 10/10/08
(Cost $6,170,564) Aaa AAA 5,853,987^
------------
Repurchase Agreements (1.6%)
5,165,000 State Street Bank and Trust Co. Repurchase Agreement, 1.15%,
due 7/1/04, dated 6/30/04, Maturity Value $5,165,165,
Collateralized by $4,050,000 U.S. Treasury Bonds, 7.88%,
due 2/15/21 (Collateral Value $5,320,688)
(Cost $5,165,000) 5,165,000#
------------
Total Investments (101.3%) (Cost $315,338,135) 315,142,153##
Liabilities, less cash, receivables and other assets [(1.3%)] (3,899,519)
------------
Total Net Assets (100.0%) $311,242,634
------------
See Notes to Schedule of Investments 5
Notes to Schedule of Investments Limited Maturity Bond Portfolio
+ Investments in securities by the Fund are valued daily by obtaining bid
price quotations from independent pricing services on all securities
available in each service's data base. For all other securities requiring
daily quotations, bid prices are obtained from principal market makers in
those securities or, if quotations are not available, by a method the Board
of Trustees of Neuberger Berman Advisers Management Trust believes
accurately reflects fair value. Numerous factors may be considered when
determining the fair value of a security, including available analyst,
media or other reports, trading in futures or ADRs and whether the issuer
of the security being fair valued has other securities outstanding. Foreign
security prices are furnished by independent quotation services expressed
in local currency values. Foreign security prices are translated from the
local currency into U.S. dollars using the exchange rate as of 12:00 p.m.,
Eastern time. Short-term debt securities with less than 60 days until
maturity may be valued at cost which, when combined with interest earned,
approximates market value.
# At cost, which approximates market value.
## At June 30, 2004, the cost of investments for U.S. Federal income tax
purposes was $315,338,135. Gross unrealized appreciation of investments was
$1,066,701 and gross unrealized depreciation of investments was $1,262,683,
resulting in net unrealized depreciation of $195,982, based on cost for
U.S. Federal income tax purposes.
** Security exempt from registration under the Securities Act of 1933. These
securities may be resold in transactions exempt from registration, normally
to qualified institutional buyers under Rule 144A. At June 30, 2004, these
securities amounted to $4,086,272 or 1.3% of net assets.
\o Security purchased on a when-issued basis. At June 30, 2004, these
securities amounted to $6,296,875.
\o\o Security is segregated as collateral for when-issued purchase commitments
and financial futures contracts margin.
^ Principal amount is stated in the currency in which the security is
denominated.
EUR = Euro Currency
e TBA (To Be Assigned) Securities are purchased on a forward commitment basis
with an approximate principal amount and no definite maturity date. The
actual principal amount and maturity date will be determined upon
settlement when the specific mortgage pools are assigned.
See Notes to Financial Statements 6
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Assets and Liabilities
Limited Maturity
Bond
Neuberger Berman Advisers Management Trust Portfolio
Assets
Investments in securities, at market value* (Note A)-see Schedule of Investments:
====================================================================================================
Unaffiliated issuers $315,142,153
- ----------------------------------------------------------------------------------------------------
Cash 1,453
- ----------------------------------------------------------------------------------------------------
Interest receivable 2,779,072
====================================================================================================
Receivable for Fund shares sold 236,732
- ----------------------------------------------------------------------------------------------------
Prepaid expenses and other assets 7,807
====================================================================================================
Total Assets 318,167,217
====================================================================================================
Liabilities
Payable for forward foreign currency exchange contracts (Note C) 38,243
====================================================================================================
Payable for securities purchased 6,310,755
- ----------------------------------------------------------------------------------------------------
Payable for Fund shares redeemed 137,010
====================================================================================================
Payable to investment manager (Note B) 61,385
- ----------------------------------------------------------------------------------------------------
Payable to administrator (Note B) 98,218
====================================================================================================
Payable for variation margin (Note A) 158,281
- ----------------------------------------------------------------------------------------------------
Accrued expenses and other payables 120,691
====================================================================================================
Total Liabilities 6,924,583
====================================================================================================
Net Assets at value $311,242,634
====================================================================================================
Net Assets consist of:
Paid-in capital $311,439,634
====================================================================================================
Undistributed net investment income (loss) 12,721,875
- ----------------------------------------------------------------------------------------------------
Accumulated net realized gains (losses) on investments (12,332,856)
====================================================================================================
Net unrealized appreciation (depreciation) in value of investments (586,019)
====================================================================================================
Net Assets at value $311,242,634
====================================================================================================
Shares Outstanding ($.001 par value; unlimited shares authorized) 23,570,820
====================================================================================================
Net Asset Value, offering and redemption price per share $ 13.20
====================================================================================================
*Cost of investments:
Unaffiliated issuers $315,338,135
====================================================================================================
See Notes to Financial Statements 7
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST FOR THE SIX MONTHS ENDED JUNE 30,
2004 (UNAUDITED)
Statement of Operations
Limited Maturity
Bond
Neuberger Berman Advisers Management Trust Portfolio
Investment Income
Income:
Interest income (Note A) $ 4,688,218
- -----------------------------------------------------------------------------------
Expenses:
Investment management fee (Note B) 382,067
===================================================================================
Administration fee (Note B) 611,308
- -----------------------------------------------------------------------------------
Audit fees 16,839
===================================================================================
Custodian fees (Note B) 67,507
- -----------------------------------------------------------------------------------
Insurance expense 2,192
===================================================================================
Legal fees 21,280
- -----------------------------------------------------------------------------------
Shareholder reports 22,910
===================================================================================
Trustees' fees and expenses 13,453
- -----------------------------------------------------------------------------------
Miscellaneous 2,334
===================================================================================
Total expenses 1,139,890
Expenses reduced by custodian fee expense offset arrangement (Note B) (214)
===================================================================================
Total net expenses 1,139,676
===================================================================================
Net investment income (loss) 3,548,542
===================================================================================
Realized and Unrealized Gain (Loss) on Investments (Note A)
Net realized gain (loss) on:
Investment securities sold in unaffiliated issuers 227,202
================================================================================
Financial futures contracts 282,265
--------------------------------------------------------------------------------
Foreign currency 333,117
================================================================================
Change in net unrealized appreciation (depreciation) in value of:
Investment securities in unaffiliated issuers (3,902,011)
--------------------------------------------------------------------------------
Foreign currency (41,287)
================================================================================
Financial futures contracts (348,749)
================================================================================
Net gain (loss) on investments (3,449,463)
===================================================================================
Net increase (decrease) in net assets resulting from operations $ 99,079
===================================================================================
See Notes to Financial Statements 8
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Changes in Net Assets
Limited Maturity Bond Portfolio
-------------------------------
Six Months
Ended Year
June 30, Ended
2004 December 31,
Neuberger Berman Advisers Management Trust (Unaudited) 2003
Increase (Decrease) in Net Assets:
From Operations:
Net investment income (loss) $ 3,548,542 $ 8,939,346
=======================================================================================================
Net realized gain (loss) on investments 842,584 3,068,536
- -------------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of investments (4,292,047) (3,818,388)
=======================================================================================================
Net increase (decrease) in net assets resulting from operations 99,079 8,189,494
=======================================================================================================
Distributions to Shareholders From:
Net investment income -- (14,350,033)
=======================================================================================================
From Fund Share Transactions (Note D):
Proceeds from shares sold 49,033,819 130,774,861
=======================================================================================================
Proceeds from reinvestment of dividends and distributions -- 14,350,033
- -------------------------------------------------------------------------------------------------------
Payments for shares redeemed (44,253,337) (205,217,357)
=======================================================================================================
Net increase (decrease) from Fund share transactions 4,780,482 (60,092,463)
=======================================================================================================
Net Increase (Decrease) in Net Assets 4,879,561 (66,253,002)
Net Assets:
Beginning of period 306,363,073 372,616,075
=======================================================================================================
End of period $311,242,634 $ 306,363,073
=======================================================================================================
Undistributed net investment income (loss) at end of period $ 12,721,875 $ 9,173,333
=======================================================================================================
See Notes to Financial Statements 9
Notes to Financial Statements Limited Maturity Bond Portfolio
Note A--Summary of Significant Accounting Policies:
1 General: Limited Maturity Bond Portfolio (the "Fund") is a separate operating
series of Neuberger Berman Advisers Management Trust (the "Trust"), a Delaware
statutory trust organized pursuant to a Trust Instrument dated May 23, 1994.
The Trust is currently comprised of ten separate operating series (each a
"Series," collectively, the "Funds") each of which (except Focus Portfolio) is
diversified. The Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act"),
and its shares are registered under the Securities Act of 1933, as amended. The
Fund currently offers only Class I shares. The Board of Trustees of the Trust
may establish additional series or classes of shares without the approval of
shareholders.
The assets of each Series belong only to that Series, and the liabilities of
each Series are borne solely by that Series and no other.
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States requires Neuberger Berman
Management Inc. ("Management") to make estimates and assumptions at the date of
the financial statements. Actual results could differ from those estimates.
2 Portfolio valuation: Investment securities are valued as indicated in the
notes following the Schedule of Investments.
3 Foreign currency translation: The accounting records of the Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars using the exchange rate as of 12:00 p.m., Eastern time, to determine
the value of investments, other assets and liabilities. Purchase and sale
prices of securities, and income and expenses, are translated into U.S. dollars
at the prevailing rate of exchange on the respective dates of such
transactions. Net unrealized foreign currency gain (loss) arises from changes
in the value of assets and liabilities, other than investments in securities,
as a result of changes in exchange rates and is stated separately in the
Statement of Operations.
4 Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Interest income, including accretion of
original issue discount, where applicable, and accretion of market discount on
long-term bonds and short-term investments, is recorded on the accrual basis.
Realized gains and losses from securities transactions and foreign currency
transactions are recorded on the basis of identified cost and stated separately
in the Statement of Operations.
5 Forward foreign currency contracts: The Fund may enter into forward foreign
currency contracts ("contracts") in connection with planned purchases or sales
of securities to hedge the U.S. dollar value of portfolio securities
denominated in a foreign currency. The gain or loss arising from the difference
between the original contract price and the closing price of such contract is
included in net realized gains or losses on foreign currency transactions.
Fluctuations in the value of forward foreign currency contracts are recorded
for financial reporting purposes as unrealized gains or losses by the Fund. The
Fund has no specific limitation on the percentage of assets which may be
committed to these types of contracts but the Fund may not invest more than 25%
of its total assets in foreign securities denominated in or indexed to
10
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
foreign currencies. The Fund could be exposed to risks if a counter party to a
contract were unable to meet the terms of its contract or if the value of the
foreign currency changes unfavorably. The U.S. dollar value of foreign currency
underlying all contractual commitments held by the Fund is determined using
forward foreign currency exchange rates supplied by an independent pricing
service.
6 Financial futures contracts: The Fund may buy and sell financial futures
contracts to hedge against changes in securities prices resulting from changes
in prevailing interest rates. At the time the Fund enters into a financial
futures contract, it is required to deposit with its custodian a specified
amount of cash or liquid securities, known as "initial margin," ranging upward
from 1.1% of the value of the financial futures contract being traded. Each
day, the futures contract is valued at the official settlement price of the
board of trade or U.S. commodity exchange on which such futures contract is
traded. Subsequent payments, known as "variation margin," to and from the
broker are made on a daily basis as the market price of the financial futures
contract fluctuates. Daily variation margin adjustments, arising from this
"mark to market," are recorded by the Fund as unrealized gains or losses.
Although some financial futures contracts by their terms call for actual
delivery or acceptance of financial instruments, in most cases the contracts
are closed out prior to delivery by offsetting purchases or sales of matching
financial futures contracts.When the contracts are closed, the Fund recognizes
a gain or loss. Risks of entering into futures contracts include the
possibility there may be an illiquid market and/or a change in the value of the
contract may not correlate with changes in the value of the underlying
securities.
For U.S. Federal income tax purposes, the futures transactions undertaken by
the Fund may cause the Fund to recognize gains or losses from marking to market
even though its positions have not been sold or terminated, may affect the
character of the gains or losses recognized as long-term or short-term, and may
affect the timing of some capital gains and losses realized by the Fund. Also,
the Fund's losses on transactions involving futures contracts may be deferred
rather than being taken into account currently in calculating the Fund's
taxable income.
During the six months ended June 30, 2004, the Fund entered into various
financial futures contracts. At June 30, 2004, open positions in financial
futures contracts were as follows:
Unrealized
Expiration Open Contracts Position Depreciation
September 2004 415 U.S. Treasury Notes, 5 Year Short $348,749
At June 30, 2004, the Fund had deposited $765,000 U.S. Treasury Notes, 1.63%,
due 3/31/05, in a segregated account to cover margin requirements on open
financial futures contracts.
7 Federal income taxes: The Funds are treated as separate entities for U.S.
Federal income tax purposes. It is the policy of the Fund to continue to
qualify as a regulated investment company by complying with the provisions
available to certain investment companies, as defined in applicable sections of
the Internal Revenue Code, and to make distributions of investment company
taxable income and net capital gains (after reduction for any amounts available
for U.S. Federal income tax purposes as capital loss carryforwards) sufficient
to relieve it from all, or substantially all, U.S. Federal income taxes.
Accordingly, the Fund paid no U.S. Federal income taxes and no provision for
U.S. Federal income taxes was required.
11
Notes to Financial Statements Limited Maturity Bond Portfolio cont'd
8 Dividends and distributions to shareholders: The Fund earns income, net of
expenses, daily on its investments. Income dividends and distributions from net
realized capital gains, if any, generally are distributed in October. Income
dividends and capital gain distributions to shareholders are recorded on the
ex-dividend date.To the extent the Fund's net realized capital gains, if any,
can be offset by capital loss carryforwards ($21,426, $2,478,607, $3,975,890
and $6,386,624 expiring in 2005, 2006, 2007 and 2008, respectively, determined
as of December 31, 2003), it is the policy of the Fund not to distribute such
gains.
Under current tax law, certain capital and net foreign currency losses realized
after October 31 within the taxable year may be deferred and treated as
occurring on the first day of the following tax year. For the year ended
December 31, 2003, the Fund elected to defer $286,603 of net capital and
currency losses arising between November 1, 2003 and December 31, 2003.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a tax return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains in the components of net assets on the Statement of Assets and
Liabilities.
The tax character of distributions paid during the years ended December 31,
2003 and 2002 was as follows:
Distributions Paid From:
Ordinary Income Total
2003 2002 2003 2002
$14,350,033 $14,469,639 $14,350,033 $14,469,639
As of December 31, 2003, the components of distributable earnings (accumulated
losses) on a U.S. Federal income tax basis were as follows:
Undistributed Unrealized Loss
Ordinary Appreciation Carryforwards
Income (Depreciation) and Deferrals Total
$11,799,768 $1,053,303 $(13,149,150) $(296,079)
The difference between book basis and tax basis is attributable primarily to
the tax deferral of losses on wash sales, foreign bond bifurcation,
amortization of bond premium, and post October losses.
9 Foreign taxes: Foreign taxes withheld represent amounts withheld by foreign
tax authorities, net of refunds recoverable.
10 Expense allocation: Certain expenses are applicable to multiple funds.
Expenses directly attributable to a Series are charged to that Series. Expenses
of the Trust that are not directly attributed to a Series are allocated among
the Funds, on the basis of relative net assets, except where a more appropriate
allocation of expenses to each of the Funds can otherwise be made fairly.
Expenses borne by the complex of related investment companies, which includes
open-end and closed-end investment companies for which Management serves as
investment manager, that are not directly attributed to a Series or the Trust,
are allocated among the Fund and the other investment companies in the complex
or series thereof, on the
12
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
basis of relative net assets, except where a more appropriate allocation of
expenses to each investment company in the complex or series thereof can
otherwise be made fairly.
11 Repurchase agreements: The Fund may enter into repurchase agreements with
institutions that the Fund's investment manager has determined are
creditworthy. Each repurchase agreement is recorded at cost. The Fund requires
that the securities purchased in a repurchase agreement be transferred to the
custodian in a manner sufficient to enable the Fund to assert a perfected
security interest in those securities in the event of a default under the
repurchase agreement. The Fund monitors, on a daily basis, the value of the
securities transferred to ensure that their value, including accrued interest,
is greater than amounts owed to the Fund under each such repurchase agreement.
Note B--Management Fees, Administration Fees, Distribution Arrangements, and
Other Transactions With Affiliates:
Fund shares are issued and redeemed in connection with investments in and
payments under certain variable annuity contracts and variable life insurance
policies issued through separate accounts of life insurance companies and are
also offered directly to qualified pension and retirement plans.
The Fund retains Management as its investment manager under a Management
Agreement. For such investment management services, the Fund pays Management a
fee at the annual rate of 0.25% of the first $500 million of the Fund's average
daily net assets, 0.225% of the next $500 million, 0.20% of the next $500
million, 0.175% of the next $500 million, and 0.15% of average daily net assets
in excess of $2 billion.
The Fund retains Management as its administrator under an Administration
Agreement. The Fund pays Management an administration fee at the annual rate of
0.40% of its average daily net assets under this agreement. Additionally,
Management retains State Street Bank and Trust Company ("State Street") as its
sub-administrator under a Sub-Administration Agreement. Management pays State
Street a fee for all services received under the agreement.
The Trustees of the Trust adopted a non-fee distribution plan for the Fund.
Management has contractually undertaken through December 31, 2007 to reimburse
the Fund for its operating expenses (excluding the fees payable to Management,
interest, taxes, brokerage commissions, extraordinary expenses, and transaction
costs) ("Operating Expenses") which exceed, in the aggregate, 1.00% per annum
of its average daily net assets (the "Expense Limitation"). For the six months
ended June 30, 2004, no reimbursement to the Fund was required. The Fund has
agreed to repay Management through December 31, 2010 for its excess Operating
Expenses previously reimbursed by Management, so long as its annual Operating
Expenses during that period do not exceed its Expense Limitation, and the
repayment is made within three years after the year in which Management issued
the reimbursement. During the six months ended June 30, 2004, there was no
reimbursement to Management. At June 30, 2004, the Fund has no contingent
liability to Management under the agreement.
13
Notes to Financial Statements Limited Maturity Bond Portfolio cont'd
On October 31, 2003, Management and Neuberger Berman, LLC ("Neuberger"), a
member firm of the New York Stock Exchange and sub-adviser to the Fund, became
indirect wholly-owned subsidiaries of Lehman Brothers Holdings Inc. ("Lehman"),
a publicly-owned holding company. Neuberger is retained by Management to
furnish it with investment recommendations and research information without
added cost to the Fund. Several individuals who are officers and/or Trustees of
the Trust are also employees of Neuberger and/or Management.
The Fund has an expense offset arrangement in connection with its custodian
contract. The impact of this arrangement, reflected in the Statement of
Operations under the caption Custodian fees, was a reduction of $214.
Note C--Securities Transactions:
Cost of purchases and proceeds of sales and maturities of long-term securities
(excluding short-term securities and financial futures contracts) for the six
months ended June 30, 2004 were as follows:
Purchases of U.S. Purchases excluding U.S. Sales and Maturities of U.S. Sales and Maturities excluding
Government and Agency Government and Agency Government and Agency U.S. Government and Agency
Obligations Obligations Obligations Obligations
$141,058,975 $27,444,051 $107,287,168 $36,738,221
During the six months ended June 30, 2004, the Fund entered into various
contracts to deliver currencies at specified future dates. At June 30, 2004,
open contracts were as follows:
Contracts to In Exchange Settlement Net Unrealized
Sell Deliver For Date Value Depreciation
Euro Dollar 4,585,000 $5,541,431 8/23/04 $5,579,674 $38,243
Note D--Fund Share Transactions:
Share activity for the six months ended June 30, 2004 and for the year ended
December 31, 2003 was as follows:
For the For the
Six Months Ended Year Ended
June 30, December 31,
2004 2003
Shares Sold 3,705,496 9,615,524
Shares Issued on Reinvestment of Dividends and Distributions -- 1,092,088
Shares Redeemed (3,343,727) (15,104,458)
---------- -----------
Total 361,769 (4,396,846)
---------- -----------
14
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Note E--Line of Credit:
At June 30, 2004, the Fund was a participant in a single committed, unsecured
$150,000,000 line of credit with State Street, to be used only for temporary or
emergency purposes. Interest is charged on borrowings under this agreement at
the overnight Federal Funds Rate plus 0.50% per annum. A facility fee of 0.10%
per annum of the available line of credit is charged, of which the Fund has
agreed to pay its pro rata share, based on the ratio of its individual net
assets to the net assets of all participants at the time the fee is due and
payable. The fee is paid quarterly in arrears. No compensating balance is
required. Other investment companies managed by Management also participate in
this line of credit on the same terms. Because several investment companies
participate, there is no assurance that the Fund will have access to the entire
$150,000,000 at any particular time. The Fund had no loans outstanding pursuant
to this line of credit at June 30, 2004, nor had the Fund utilized this line of
credit at any time prior to that date.
Note F--Unaudited Financial Information:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent auditors. Annual reports
contain audited financial statements.
15
Financial Highlights Limited Maturity Bond Portfolio+
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements.++
Six Months
Ended
June 30, Year Ended December 31,
----------- ------------------------------------------------------------
2004 2003 2002 2001 2000 1999
(Unaudited)
Net Asset Value, Beginning of Period $13.20 $13.50 $13.47 $13.19 $13.24 $13.82
------ ------ ------ ------ ------ ------
Income From Investment Operations:
Net Investment Income (Loss) .15 .37 .53 .74- .77 .77
Net Gains or Losses on Securities
(both realized and unrealized) (.15) (.05) .16 .37- .07 (.58)
------ ------ ------ ------ ------ ------
Total From Investment Operations -- .32 .69 1.11 .84 .19
------ ------ ------ ------ ------ ------
Less Distributions From:
Net Investment Income -- (.62) (.66) (.83) (.89) (.77)
------ ------ ------ ------ ------ ------
Net Asset Value, End of Period $13.20 $13.20 $13.50 $13.47 $13.19 $13.24
------ ------ ------ ------ ------ ------
Total Return++ +0.00%** +2.42% +5.34% +8.78% +6.78% +1.48%
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $311.2 $306.4 $372.6 $292.8 $214.4 $248.4
Ratio of Gross Expenses to Average Net Assets# .75%* .74% .76% .73% .76% .76%
Ratio of Net Expenses to Average Net Assets .75%* .74% .76% .73% .76% .76%
Ratio of Net Investment Income (Loss)
to Average Net Assets 2.32%* 2.73% 4.01% 5.63%- 5.93% 5.81%
Portfolio Turnover Rate 49% 84% 120% 89% 109% 139%
See Notes to Financial Highlights 16
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Financial Highlights Limited Maturity Bond Portfolio
+ The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's proportionate share of AMT Limited Maturity
Bond Investment's income and expenses through April 30, 2000 under the
prior master/feeder fund structure.
++ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each
fiscal period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Current returns may be lower or higher than the performance data
quoted. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. The total return
information shown does not reflect charges and other expenses that apply to
the separate account or the related insurance policies, and the inclusion
of these charges and other expenses would reduce the total return for all
fiscal periods shown. Performance data current to the most recent month-end
are available at www.nb.com.
# The Fund is required to calculate an expense ratio without taking into
consideration any expense reductions related to expense offset
arrangements.
++ The per share amounts which are shown have been computed based on the
average number of shares outstanding during each fiscal period.
- - For fiscal years ended after December 31, 2000, funds are required by the
American Institute of Certified Public Accountants to amortize premiums and
discounts on fixed income securities. Accordingly, for the year ended
December 31, 2001, the per share amounts and ratios shown decreased or
increased as follows:
Year Ended
December 31, 2001
Net Investment Income (.02)
Net Gains or Losses on Securities .02
Ratio of Net Investment Income to Average Net Assets (.11%)
* Annualized.
** Not annualized.
17
Trustees and Officers (Unaudited)
The following tables set forth information concerning the trustees and officers
of the Trust. All persons named as trustees and officers also serve in similar
capacities for other funds administered or managed by NB Management and
Neuberger Berman. The Statement of Additional Information includes additional
information about fund trustees and is available upon request, without charge,
by calling (800) 877-9700.
Information about the Board of Trustees
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
John Cannon (74) Trustee since Consultant. Formerly, Chairman 38 Independent Trustee or Director of
2000 and Chief Investment Officer, three series of Oppenheimer Funds:
CDC Investment Advisors Limited Term New York Municipal
(registered investment adviser) Fund, Rochester Fund Municipals,
(1993-January 1999); prior and Oppenheimer Convertible
thereto, President and Chief Securities Fund since 1992.
Executive Officer, AMA
Investment Advisors, an affiliate
of the American Medical
Association.
Faith Colish (68) Trustee since Counsel, Carter Ledyard & 38 Director, American Bar Retirement
1984 Milburn LLP (law firm) since Association (ABRA) since 1997
October 2002; Formerly, (not-for-profit membership
Attorney-at-Law and President, association).
Faith Colish, A Professional
Corporation, 1980 to 2002.
Walter G. Ehlers (71) Trustee since Consultant; Retired President 38 None.
1989 and Trustee, Teachers
Insurance & Annuity (TIAA)
and College Retirement
Equities Fund (CREF).
C. Anne Harvey (66) Trustee since Consultant, C. A. Harvey 38 President, Board of Associates to
1998 Associates, since June 2001; The National Rehabilitation
Formerly, Director, AARP, 1978 Hospital's Board of Directors since
to December 2001. 2002; Formerly, Member, Individual
Investors Advisory Committee to the
New York Stock Exchange Board of
Directors, 1998 to June 2002;
Member, American Savings
Education Council's Policy Board
(ASEC),1998-2000; Member,
Executive Committee, Crime
Prevention Coalition of America,
1997-2000.
18
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Barry Hirsch (71) Trustee since Attorney-at-Law. Formerly, 38 None.
2000 Senior Counsel, Loews
Corporation (diversified
financial corporation) May
2002 until April 2003; formerly,
Senior Vice President, Secretary
and General Counsel, Loews
Corporation.
Robert A. Kavesh (76) Trustee since Marcus Nadler Professor of 38 Director, DEL Laboratories, Inc.
2000 Finance and Economics (cosmetics and pharmaceuticals)
Emeritus, New York University, since 1978; The Caring Community
Stern School of Business. (not-for-profit).
Howard A. Mileaf (67) Trustee since Retired. Formerly, Vice 38 Director, WHX Corporation
1999 President and Special Counsel, (holding company) since August
WHX Corporation (holding 2002; Director, WebFinancial
company), 1993-2001. Corporation (holding company)
since December 2002; Director, State
Theatre of New Jersey (not-for-
profit theater) since 2000; formerly,
Director, Kevlin Corporation
(manufacturer of microwave and
other products).
William E. Rulon (71) Trustee since Retired. Senior Vice President, 38 Director, Pro-Kids Golf and
2000 Foodmaker, Inc. (operator and Learning Academy (teach golf and
franchiser of restaurants) until computer usage to "at risk" children)
January 1997. since 1998; Formerly, Director,
Prandium, Inc. (restaurants) from
March 2001 until
July 2002.
Cornelius T. Ryan (72) Trustee since Founding General Partner, 38 Director, Capital Cash Management
2000 Oxford Partners and Oxford Trust (money market fund),
Bioscience Partners (venture Narragansett Insured Tax-Free
capital partnerships) and Income Fund, Rocky Mountain
President, Oxford Venture Equity Fund, Prime Cash Fund,
Corporation. several private companies and
QuadraMed Corporation
(NASDAQ).
19
Trustees and Officers (Unaudited) cont'd
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Tom Decker Seip (54) Trustee since General Partner, Seip 38 Director, H&R Block, Inc. (financial
2000 Investments LP (a private services company) since May 2001;
investment partnership); Director, Forward Management, Inc.
formerly, President and CEO, (asset management) since 2001;
Westaff, Inc. (temporary Formerly, Director, General Magic
staffing), May 2001 to January (voice recognition software),
2002; Senior Executive at the November 2001 until 2002; Director,
Charles Schwab Corporation E-Finance Corporation (credit
from 1983 to 1999, including decisioning services), 1999-2003;
Chief Executive Officer, Director, Save-Daily.com (micro
Charles Schwab Investment investing services), 1999-2003;
Management, Inc. and Trustee, Director, Offroad Capital Inc.
Schwab Family of Funds and (pre-public internet commerce
Schwab Investments from 1997 company).
to 1998 and Executive Vice
President--Retail Brokerage,
Charles Schwab Investment
Management from 1994
to 1997.
Candace L. Straight (56) Trustee since Private investor and consultant 38 Director, The Proformance Insurance
1999 specializing in the insurance Company (personal lines property
industry; Formerly, Advisory and casualty insurance company)
Director, Securitas Capital LLC since March 2004; Director,
(a global private equity Providence Washington (property
investment firm dedicated to and casualty insurance company),
making investments in the since December 1998; Director,
insurance sector), 1998 until Summit Global Partners (insurance
December 2002. brokerage firm) since October 2000.
Peter P. Trapp (59) Trustee since Regional Manager for Atlanta 38 None.
1984 Region, Ford Motor Credit
Company since August 1997;
Formerly, President, Ford
Life Insurance Company, April
1995 until August 1997.
20
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Number of
Portfolios in
Trustees who are Position and Fund Complex
"Interested Persons" Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Edward I. OBrien* (75) Trustee since Formerly, Member, Investment 38 Director, Legg Mason, Inc. (financial
2000 Policy Committee, Edward services holding company) since
Jones, 1993-2001; President, 1993; formerly, Director, Boston
Securities Industry Association Financial Group (real estate and tax
("SIA") (securities industry's shelters) 1993-1999.
representative in government
relations and regulatory matters
at the federal and state levels)
1974-1992; Adviser to SIA,
November 1992-November 1993.
Jack L. Rivkin* (63) President and Executive Vice President and 38 Director, Dale Carnegie and
Trustee since Chief Investment Officer, Associates, Inc. (private company)
December Neuberger Berman Inc. since 1998; Director, Emagin Corp.
2002 (holding company) since 2002 (public company) since 1997;
and 2003, respectively; Director, Solbright, Inc. (private
Executive Vice President and company) since 1998; Director,
Chief Investment Officer, Infogate, Inc. (private company)
Neuberger Berman since 2002 since 1997.
and 2003, respectively; Director
and Chairman, NB
Management since December
2002; Formerly, Executive Vice
President, Citigroup
Investments, Inc. from
September 1995 to February
2002; Executive Vice President,
Citigroup Inc. from September
1995 to February 2002.
Peter E. Sundman* (45) Chairman of Executive Vice President, 38 Director, Neuberger Berman Inc.
the Board, Neuberger Berman Inc. (holding company) from 1999
Chief (holding company) since 1999; through March 2003; President and
Executive Head of Neuberger Berman Director, NB Management since
Officer and Inc.'s Mutual Funds and 1999; Director and Vice President,
Trustee since Institutional Business since Neuberger Berman Agency, Inc.
2000; 1999; Executive Vice President, since 2000.
President and Neuberger Berman since 1999;
Chief Principal, Neuberger Berman
Executive from 1997 until 1999; Senior
Officer from Vice President, NB
1998 to 2000 Management from 1996
until 1999.
21
Trustees and Officers (Unaudited) cont'd
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the Trust's Trust Instrument, each Trustee shall hold office
for life or until his or her successor is elected or the Trust terminates;
except that (a) any Trustee may resign by delivering a written resignation;
(b) any Trustee may be removed with or without cause at any time by a
written instrument signed by at least two-thirds of the other Trustees; (c)
any Trustee who requests to be retired, or who has become unable to serve,
may be retired by a written instrument signed by a majority of the other
Trustees; and (d) any Trustee may be removed at any shareholder meeting by
a vote of at least two-thirds of the outstanding shares.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
* Indicates a Trustee who is an "interested person" within the meaning of the
1940 Act. Mr. Sundman and Mr. Rivkin are interested persons of the Trust by
virtue of the fact that they are officers and/or directors of NB Management
and Executive Vice Presidents of Neuberger Berman. Mr. O'Brien is an
interested person of the Trust by virtue of the fact that he is a director
of Legg Mason, Inc., a wholly owned subsidiary of which, from time to time,
serves as a broker or dealer to the Funds and other funds for which NB
Management serves as investment manager.
22
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Information about the Officers of the Trust
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
Claudia A. Brandon (47) Secretary since 1985 Vice President--Mutual Fund Board Relations, NB
Management since 2000; Vice President, Neuberger
Berman since 2002 and employee since 1999; Vice
President, NB Management from 1986 to 1999; Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(four since 2002, three since 2003, and one since 2004).
Robert Conti (48) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President, Neuberger Berman from 1999 until 2003; Senior
Vice President, NB Management since 2000; Controller,
NB Management until 1996; Treasurer, NB Management
from 1996 until 1999; Vice President, eleven registered
investment companies for which NB Management acts as
investment manager and administrator (three since 2000,
four since 2002, three since 2003, and one since 2004).
Brian P. Gaffney (50) Vice President since 2000 Managing Director, Neuberger Berman since 1999; Senior
Vice President, NB Management since 2000; Vice
President, NB Management from 1997 until 1999; Vice
President, eleven registered investment companies for which
NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three since
2003, and one since 2004).
Sheila R. James (39) Assistant Secretary since 2002 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1991 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003 and one since 2004).
Kevin Lyons (49) Assistant Secretary since 2003 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1993 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(Ten since 2003 and one since 2004).
23
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
John M. McGovern (34) Assistant Treasurer since 2002 Vice President, Neuberger Berman since 2004; Employee,
NB Management since 1993; Assistant Treasurer, eleven
registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003, and one since 2004).
Barbara Muinos (45) Treasurer and Principal Financial Vice President, Neuberger Berman since 1999; Assistant
and Accounting Officer since 2002; Vice President, NB Management from 1993 to 1999;
prior thereto, Assistant Treasurer Treasurer and Principal Financial and Accounting Officer,
since 1996 eleven registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003, and one since 2004);
Assistant Treasurer, three registered investment companies
for which NB Management acts as investment manager and
administrator from 1996 until 2002.
Frederic B. Soule (58) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President; Neuberger Berman from 1999 until 2003; Vice
President, NB Management from 1995 until 1999; Vice
President, eleven registered investment companies for which
NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three since
2003, and one since 2004).
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the By-Laws of the Trust, each officer elected by the Trustees
shall hold office until his or her successor shall have been elected and
qualified or until his or her earlier death, inability to serve, or
resignation. Officers serve at the pleasure of the Trustees and may be
removed at any time with or without cause.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
24
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Proxy Voting Policies and Procedures
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to portfolio securities is available, without
charge, by calling 1-800-877-9700 (toll-free) and on the website of the
Securities and Exchange Commission, at www.sec.gov. Beginning September 2004,
information regarding how the Fund voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 will also be
available without charge, by calling 1-800-877-9700 (toll-free), on the website
of the Securities and Exchange Commission, at www.sec.gov, and on the Fund's
website at www.nb.com http://www.nb.com.
25
Semi-Annual Report
June 30, 2004
B0736 08/04
[LOGO]
Neuberger Berman
Advisers
Management
Trust
Mid-Cap
Growth
Portfolio(R)
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Mid-Cap Growth Portfolio Managers' Commentary
The AMT Mid-Cap Growth Portfolio ended the first half of 2004 with a gain of
7.50%, outperforming the Russell Midcap Growth index return of 5.94%.(2) This
outperformance reflected the fact that the market began rewarding stocks with
solid business fundamentals as opposed to unproven growth prospects, a trend
that favored our investment process. Our stock selection boosted our
performance across most sectors of the portfolio.
The largest contribution to relative performance came from stock selection in
the information technology, consumer discretionary and financial sectors.
Stocks that did well in IT included companies that develop and provide
specialized technologies to businesses such as Zebra Technologies. Within
consumer discretionary, our emphasis in entertainment and leisure and specialty
retail companies were some of the primary reasons for this outperformance with
Royal Caribbean Cruises and PETsMART both performing well. Within the
financials sector, Capital One Financial, First Marblehead, and Investors
Financial Services were all strong performers, as they represent less interest
rate sensitive names within that sector.
In the aggregate, our sector allocation was slightly negative on a year-to-date
basis, with our underweight position in both consumer staples and healthcare
accounting for much of the underperformance.
After beginning the year with strong advances, the market began trading
sideways during the second quarter. In the aggregate, for the first half of
2004, the markets have confounded consensus expectations by trading in very
narrow ranges with only a 7% swing on the Standard & Poor's 500 Index. As we
anticipated early in the year, the equity markets have experienced substantial
rotation between cyclical (materials/technology) and defensive
(healthcare/staples) industries/sectors as investors reacted to the shifting
economic news.
Economic forecasting is exceptionally difficult this year as we formulate the
top-down part of our strategy. In addition to the initiation of a tightening
cycle by the Fed, we face the expiration of some tax cuts this year, a slowing
Chinese economy, U.S. political uncertainty and volatile oil prices. Like a pig
in a python, the lower dollar, faster than expected U.S. growth and the strong
Asian demand for commodities last year are working their way through the system
and causing rates of inflation to accelerate this year. We believe that many of
these influences have dissipated, however, so the Fed may not need to react as
strongly as investors fear.
As investors grapple with higher inflation and the expected continuing interest
rate hikes by the Fed, worries are also growing that the economy is slowing.
Recently, Wal-Mart, Target and General Motors lowered their top-line forecasts.
Similar to our view on inflation, we are also relatively sanguine about
economic growth. It is important to note that while overall growth is fine, the
composition of economic activity is changing from a mortgage refinanced/lower
tax consumer-led recovery to one being sustained by corporate investment,
inventory building and steady job creation.
Even though we are not pessimistic in terms of the overall economy and
inflation, we are not optimistic in terms of near-term stock performance. We
expect equities to struggle as profit growth slows, interest rates increase,
and the Presidential election remains tight. Over the past six years, the S&P
500 is essentially flat in price while earnings have increased by a third. The
market's forward P/E has collapsed from 21 to 16 during this period. However,
the stock market is still not cheap, since a P/E of 16 is the long-term
average. We believe P/Es will continue to wilt in the heat of the summer
months. Uncertainties about next year's economy will most likely increase as
1
more difficult earnings comparisons will begin this quarter. If fears become
more intense and investors overreact, we expect poor near-term equity
performance to provide a platform for better equity performance in the latter
part of this year.
We have reduced our position in the materials sector to an underweight relative
to the benchmark on the basis of our concerns that global growth rates have
peaked. Industrials and energy remain moderately overweighted, financials
moderately underweighted, utilities underweighted, and other sectors relatively
neutral weighted.
We seek to continue to position the portfolio with tilts toward lower
volatility stocks in higher quality companies with lower earnings variability.
As interest rates move higher and growth rates slow, we believe that companies
with financial strength should be favored.
Sincerely,
/s/ JON D. BRORSON
JON D. BRORSON
PORTFOLIO MANAGER AND
GROWTH EQUITY
TEAM LEADER
/s/ KENNETH J. TUREK
KENNETH J. TUREK
PORTFOLIO MANAGER
1. For Class I, 22.71%, (0.14%) and 8.33% were the average annual total returns
for the 1-year, 5-year and since inception (11/03/97) periods ended June 30,
2004. For Class S, 22.46%, (0.22%) and 8.26% were the average annual total
returns for the 1-year, 5-year and since inception (11/03/97) periods ended June
30, 2004. Performance shown prior to February 2003 for the Class S shares is of
the Class I shares, which has lower expenses and typically higher returns than
the Class S shares. Neuberger Berman Management Inc. ("NBMI") has agreed to
absorb certain expenses of the AMT Portfolios. Without this arrangement, which
is subject to change, the total returns of the Portfolios would be less. Total
return includes reinvestment of dividends and capital gain distributions.
Performance data quoted represent past performance and the investment return and
principal value of an investment will fluctuate so that the shares, when
redeemed, may be worth more or less than original cost. Current performance may
be lower or higher than the performance data quoted. For performance data
current to the most recent month end, please visit www.nb.com/amtperformance.
The performance information does not reflect fees and expenses of the variable
annuity and variable life insurance policies or the pension plans whose proceeds
are invested in the portfolio.
2. The Russell Midcap[RegTM] Growth Index measures the performance of those
Russell Midcap[RegTM] Index companies with higher price-to-book ratios and
higher forecasted growth values. The Russell Midcap Index measures the
performance of the 800 smallest companies in the Russell 1000[RegTM] Index,
which represents approximately 27% of the total market capitalization of the
Russell 1000 Index (which, in turn, consists of the 1,000 largest U.S.
companies, based on market capitalization). Please note that indices do not
take into account any fees and expenses of investing in the individual
securities that they track, and that individuals cannot invest directly in any
index. Data about the performance of these indices are prepared or obtained by
NBMI and include reinvestment of all dividends and capital gain distributions.
The Portfolio may invest in many securities not included in the above-described
indices.
2
Any ratios or other measurements using a factor of forecasted earnings of a
company discussed herein are based on consensus estimates, not Neuberger
Berman's own projections, and they may or may not be realized. In addition, any
revision to a forecast could affect the market price of a security. By quoting
them herein, Neuberger Berman does not offer an opinion as to the accuracy of
and does not guarantee these forecasted numbers.
The investments for the Portfolio are managed by the same portfolio manager(s)
who manage one or more other mutual funds that have similar names, investment
objectives and investment styles as the Portfolio. You should be aware that the
Portfolio is likely to differ from the other mutual funds in size, cash flow
pattern and tax matters. Accordingly, the holdings and performance of the
Portfolio can be expected to vary from those of the other mutual funds.
The composition, industries and holdings of the Portfolio are subject to
change.
Shares of the separate Portfolios of Neuberger Berman Advisers Management Trust
are sold only through the currently effective prospectus and are not available
to the general public. Shares of this Portfolio may be purchased only by life
insurance companies to be used with their separate accounts that fund variable
annuity and variable life insurance policies and by qualified pension and
retirement plans.
(C) 2004 Neuberger Berman Management Inc., distributor. All rights reserved.
3
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Mid-Cap Growth Portfolio
Number of Shares Market Value+
Common Stocks (97.5%)
Aerospace (0.5%)
78,000 Rockwell Collins $ 2,598,960
Biotechnology (4.0%)
165,900 Alkermes, Inc. 2,256,240*\P
101,500 Celgene Corp. 5,811,890*\P
85,100 Gilead Sciences 5,701,700*
52,500 Martek Biosciences 2,948,925*\P
180,500 Protein Design Labs 3,452,965*
-----------
20,171,720
Building, Construction & Furnishing (0.5%)
53,600 Centex Corp. 2,452,200
Business Services (7.4%)
262,500 Alliance Data Systems 11,090,625*\P
144,000 Corporate Executive Board 8,321,760
172,500 Education Management 5,668,350*
95,000 Getty Images 5,700,000*\P
123,000 Stericycle, Inc. 6,364,020*
-----------
37,144,755
Communications Equipment (1.4%)
92,000 F5 Networks 2,436,160*
191,000 Juniper Networks 4,692,870*
-----------
7,129,030
Computer Related (1.7%)
119,000 Apple Computer 3,872,260*
47,500 Lexmark International Group 4,585,175*
-----------
8,457,435
Diversified (0.8%)
60,500 iShares Russell 2000 Growth
Index Fund 3,781,250\P
Electrical & Electronics (2.2%)
191,000 Jabil Circuit 4,809,380*
188,500 Molex Inc. 6,047,080
-----------
10,856,460
Energy (4.7%)
88,500 Canadian Natural Resources 2,646,150
79,000 Murphy Oil 5,822,300
92,800 Smith International 5,174,528*
331,450 XTO Energy 9,873,895
-----------
23,516,873
Finance (2.0%)
207,000 CapitalSource Inc. 5,061,150*\P
119,000 First Marblehead 4,790,940*
-----------
9,852,090
Financial Services (4.4%)
120,500 Franklin Resources 6,034,640
181,000 Investors Financial Services 7,887,980\P
82,600 Moody's Corp. 5,340,916\P
58,500 Piper Jaffray 2,645,955*
-----------
21,909,491
4
Number of Shares Market Value+
Food & Beverage (0.5%)
66,500 Constellation Brands $ 2,469,145*
Health Care (11.0%)
80,500 Allergan, Inc. 7,206,360\P
113,000 C. R. Bard 6,401,450
179,500 Caremark Rx 5,912,730*
71,500 Henry Schein 4,514,510*
74,500 Invitrogen Corp. 5,363,255*\P
102,000 Teva Pharmaceutical
Industries ADR 6,863,580\P
134,500 Varian Medical Systems 10,672,575*
92,500 Zimmer Holdings 8,158,500*
-----------
55,092,960
Industrial (9.4%)
126,000 American Standard 5,079,060*
148,000 Danaher Corp. 7,673,800\P
205,000 Donaldson Co. 6,006,500
105,000 Eaton Corp. 6,797,700
180,000 Fastenal Co. 10,229,400\P
117,500 Gentex Corp. 4,662,400
73,500 Harman International
Industries 6,688,500
-----------
47,137,360
Instruments (0.3%)
53,735 Thermo Electron 1,631,244*
Leisure (4.3%)
191,000 International Game
Technology 7,372,600
50,000 Marriott International 2,494,000
130,000 Multimedia Games 3,486,600*\P
184,100 Royal Caribbean Cruises 7,991,781\P
-----------
21,344,981
Media (2.7%)
73,000 E.W. Scripps 7,665,000\P
177,000 Univision Communications 5,651,610*\P
-----------
13,316,610
Medical Equipment (3.6%)
80,500 Advanced Neuromodulation
Systems 2,640,400*\P
58,250 Fisher Scientific
International 3,363,938*\P
44,000 INAMED Corp. 2,765,400*
61,900 Kinetic Concepts 3,088,810*\P
95,000 Kyphon Inc. 2,677,100*
72,000 ResMed Inc. 3,669,120*\P
-----------
18,204,768
Packing & Containers (1.1%)
223,600 Pactiv Corp. 5,576,584*
Paper (0.7%)
148,500 Packaging Corp. of America 3,549,150
Pharmaceutical (0.5%)
101,000 Elan Corp. ADR 2,498,740*\P
See Notes to Schedule of Investments 5
Schedule of Investments Mid-Cap Growth Portfolio cont'd
Number of Shares Market Value+
Restaurants (1.0%)
135,750 Applebee's International $ 3,124,965
61,000 Wendy's International 2,125,240
-----------
5,250,205
Retail (10.4%)
165,600 Coach, Inc. 7,483,464*
175,000 Nordstrom, Inc. 7,456,750
215,500 PETsMART, Inc. 6,992,975\P
182,500 Staples, Inc. 5,349,075
132,000 Starbucks Corp. 5,739,360*\P
40,000 Talbots, Inc. 1,566,000
177,500 Tuesday Morning 5,147,500*
79,500 Whole Foods Market 7,588,275
139,500 Williams-Sonoma 4,597,920*\P
-----------
51,921,319
Semiconductors (5.6%)
171,500 Altera Corp. 3,810,730*
96,500 Broadcom Corp. 4,513,305*\P
126,000 Linear Technology 4,973,220
162,500 Microchip Technology 5,125,250
254,500 Microsemi Corp. 3,616,445*
277,200 National Semiconductor 6,095,628*\P
-----------
28,134,578
Software (3.6%)
38,000 Cognos, Inc. 1,374,080*
97,000 Electronic Arts 5,291,350*\P
149,000 Mercury Interactive 7,424,670*\P
472,000 TIBCO Software 3,988,400*
-----------
18,078,500
Technology (7.1%)
151,000 Agilent Technologies 4,421,280*
147,200 Check Point Software
Technologies 3,972,928*
216,000 Cognizant Technology
Solutions 5,488,560*
312,000 Corning Inc. 4,074,720*
115,000 Symbol Technologies 1,695,100
180,000 Zebra Technologies 15,660,000*
-----------
35,312,588
Telecommunications (4.0%)
171,500 Avaya Inc. 2,707,985*
700,000 Nextel Partners 11,144,000*\P
141,000 Western Wireless 4,076,310*\P
68,250 XM Satellite Radio Holdings 1,862,543*
-----------
19,790,838
Transportation (2.1%)
86,500 C.H. Robinson Worldwide 3,965,160\P
170,800 J.B. Hunt Transport Services 6,589,464
-----------
10,554,624
Total Common Stocks
(Cost $376,859,750) 487,734,458
-----------
6
Principal Amount Market Value+
Short-Term Investments (31.2%)
$144,412,300 N&B Securities Lending
Quality Fund, LLC $ 144,412,300++
11,801,401 Neuberger Berman
Institutional Cash Fund
Trust Class 11,801,401@
-------------
Total Short-Term Investments
(Cost $156,213,701) 156,213,701#
-------------
Total Investments (128.7%)
(Cost $533,073,451) 643,948,159##
Liabilities, less cash, receivables and
other assets [(28.7%)] (143,415,636)
-------------
Total Net Assets (100.0%) $ 500,532,523
-------------
See Notes to Schedule of Investments 7
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Schedule of Investments Mid-Cap Growth Portfolio
+ Investments in equity securities by the Fund are valued at the latest sales
price where that price is readily available; securities for which no sales
were reported, unless otherwise noted, are valued at the mean between the
closing bid and asked prices. Securities traded primarily on the NASDAQ Stock
Market are normally valued by the Fund at the NASDAQ Official Closing Price
("NOCP") provided by NASDAQ each business day. The NOCP is the most recently
reported price as of 4:00:02 p.m., Eastern time, unless that price is outside
the range of the "inside" bid and asked prices (i.e., the bid and asked
prices that dealers quote to each other when trading for their own accounts);
in that case, NASDAQ will adjust the price to equal the inside bid or asked
price, whichever is closer. Because of delays in reporting trades, the NOCP
may not be based on the price of the last trade to occur before the market
closes. The Fund values all other securities by a method the Board of
Trustees of Neuberger Berman Advisers Management Trust (the "Board") believes
accurately reflects fair value. Numerous factors may be considered when
determining the fair value of a security, including available analyst, media
or other reports, trading in futures or ADRs and whether the issuer of the
security being fair valued has other securities outstanding. Foreign security
prices are furnished by independent quotation services expressed in local
currency values. Foreign security prices are translated from the local
currency into U.S. dollars using the exchange rate as of 12:00 p.m., Eastern
time. The Board has approved the use of FT Interactive Data Corporation ("FT
Interactive") to assist in determining the fair value of the Fund's foreign
equity securities in the wake of certain significant events. Specifically,
when changes in the value of a certain index suggest that the closing prices
on the foreign exchanges no longer represent the amount that the Fund could
expect to receive for those securities, FT Interactive will provide adjusted
prices for certain foreign equity securities based on an analysis showing
historical correlations between the prices of those securities and changes in
the index. In the absence of precise information about the market values of
these foreign securities as of the close of the New York Stock Exchange, the
Board has determined on the basis of available data that prices adjusted in
this way are likely to be closer to the prices the Fund could realize on a
current sale than are the prices of those securities established at the close
of the foreign markets in which the securities primarily trade. However, fair
value prices are necessarily estimates, and there is no assurance that such a
price will be at or close to the price at which the security next trades.
Short-term debt securities with less than 60 days until maturity may be
valued at cost which, when combined with interest earned, approximates market
value.
# At cost, which approximates market value.
## At June 30, 2004, the cost of investments for U.S. Federal income tax
purposes was $533,073,451. Gross unrealized appreciation of investments was
$116,372,343 and gross unrealized depreciation of investments was $5,497,635,
resulting in net unrealized appreciation of $110,874,708, based on cost for
U.S. Federal income tax purposes.
* Non-income producing security.
\P All or a portion of this security is on loan (see Note A of Notes to
Financial Statements).
@ Neuberger Berman Institutional Cash Fund is also managed by Neuberger Berman
Management Inc. (see Note A of Notes to Financial Statements).
++ Affiliated issuer (see Note A of Notes to Financial Statements).
See Notes to Financial Statements 8
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Assets and Liabilities
Mid-Cap
Growth
Neuberger Berman Advisers Management Trust Portfolio
Assets
Investments in securities, at market value*+ (Note A)-see Schedule of Investments:
====================================================================================================
Unaffiliated issuers $ 487,734,458
- ----------------------------------------------------------------------------------------------------
Affiliated issuers 156,213,701
- ----------------------------------------------------------------------------------------------------
643,948,159
- ----------------------------------------------------------------------------------------------------
Dividends and interest receivable 81,710
- ----------------------------------------------------------------------------------------------------
Receivable for securities sold 6,926,343
====================================================================================================
Receivable for Fund shares sold 32,303
- ----------------------------------------------------------------------------------------------------
Prepaid expenses and other assets 79,956
- ----------------------------------------------------------------------------------------------------
Total Assets 651,068,471
- ----------------------------------------------------------------------------------------------------
Liabilities
Payable for collateral on securities loaned (Note A) 144,412,300
====================================================================================================
Payable for securities purchased 5,523,216
- ----------------------------------------------------------------------------------------------------
Payable for Fund shares redeemed 158,686
====================================================================================================
Payable to investment manager-net (Note B) 205,203
- ----------------------------------------------------------------------------------------------------
Payable to administrator (Note B) 117,144
====================================================================================================
Accrued expenses and other payables 119,399
- ----------------------------------------------------------------------------------------------------
Total Liabilities 150,535,948
- ----------------------------------------------------------------------------------------------------
Net Assets at value $ 500,532,523
- ----------------------------------------------------------------------------------------------------
Net Assets consist of:
Paid-in capital $ 737,526,174
====================================================================================================
Undistributed net investment income (loss) (1,006,318)
- ----------------------------------------------------------------------------------------------------
Accumulated net realized gains (losses) on investments (346,862,108)
====================================================================================================
Net unrealized appreciation (depreciation) in value of investments 110,874,775
- ----------------------------------------------------------------------------------------------------
Net Assets at value $ 500,532,523
- ----------------------------------------------------------------------------------------------------
Net Assets
Class I $ 490,044,554
==================================================================================================
Class S 10,487,969
--------------------------------------------------------------------------------------------------
Shares Outstanding ($.001 par value; unlimited shares authorized)
Class I 29,741,661
==================================================================================================
Class S 639,307
--------------------------------------------------------------------------------------------------
Net Asset Value, offering and redemption price per share
Class I $ 16.48
==================================================================================================
Class S 16.41
--------------------------------------------------------------------------------------------------
+Securities on loan, at market value:
Unaffiliated issuers $ 140,751,736
--------------------------------------------------------------------------------------------------
*Cost of investments:
Unaffiliated issuers $ 376,859,750
--------------------------------------------------------------------------------------------------
Affiliated issuers 156,213,701
--------------------------------------------------------------------------------------------------
Total cost of investments $ 533,073,451
- ----------------------------------------------------------------------------------------------------
See Notes to Financial Statements 9
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST FOR THE SIX MONTHS ENDED JUNE 30, 2004 (UNAUDITED)
Statement of Operations
Mid-Cap
Growth
Neuberger Berman Advisers Management Trust Portfolio
Investment Income
Income:
Dividend income-unaffiliated issuers $ 847,686
========================================================================================================
Income from securities loaned-net (Note A) 212,500
- --------------------------------------------------------------------------------------------------------
Income from investments in affiliated issuers (Note A) 45,702
========================================================================================================
Interest income (Note A) 612
========================================================================================================
Foreign taxes withheld (Note A) (5,175)
- --------------------------------------------------------------------------------------------------------
Total income 1,101,325
- --------------------------------------------------------------------------------------------------------
Expenses:
Investment management fee (Notes A & B) 1,270,413
- --------------------------------------------------------------------------------------------------------
Administration fee (Note B):
Class I 696,636
-----------------------------------------------------------------------------------------------------
Class S 11,555
-----------------------------------------------------------------------------------------------------
Distribution fees (Note B):
Class S 9,629
=====================================================================================================
Audit fees 17,883
- --------------------------------------------------------------------------------------------------------
Custodian fees (Note B) 76,088
========================================================================================================
Insurance expense 3,345
- --------------------------------------------------------------------------------------------------------
Legal fees 31,978
========================================================================================================
Shareholder reports 36,196
- --------------------------------------------------------------------------------------------------------
Trustees' fees and expenses 13,453
========================================================================================================
Miscellaneous 3,210
- --------------------------------------------------------------------------------------------------------
Total expenses 2,170,386
Investment management fee waived (Note A) (5,772)
Expenses reduced by custodian fee expense offset and commission recapture arrangements (Note B) (56,971)
- --------------------------------------------------------------------------------------------------------
Total net expenses 2,107,643
- --------------------------------------------------------------------------------------------------------
Net investment income (loss) (1,006,318)
- --------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) on Investments (Note A)
Net realized gain (loss) on:
Investment securities sold in unaffiliated issuers 18,500,552
=====================================================================================================
Change in net unrealized appreciation (depreciation) in value of:
Investment securities in unaffiliated issuers 17,290,295
-----------------------------------------------------------------------------------------------------
Foreign currency 67
-----------------------------------------------------------------------------------------------------
Net gain (loss) on investments 35,790,914
- --------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations $ 34,784,596
- --------------------------------------------------------------------------------------------------------
See Notes to Financial Statements 10
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Changes in Net Assets
Mid-Cap Growth Portfolio
---------------------------------
Six Months
Ended Year
June 30, Ended
2004 December 31,
Neuberger Berman Advisers Management Trust (Unaudited) 2003
Increase (Decrease) in Net Assets:
From Operations:
Net investment income (loss) $ (1,006,318) $ (2,118,449)
======================================================================================================
Net realized gain (loss) on investments 18,500,552 4,757,260
- ------------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of investments 17,290,362 97,758,431
- ------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations 34,784,596 100,397,242
- ------------------------------------------------------------------------------------------------------
From Fund Share Transactions (Note D):
Proceeds from shares sold:
Class I 35,122,262 191,004,176
===================================================================================================
Class S 5,172,857 15,372,995
===================================================================================================
Payments for shares redeemed:
Class I (38,968,191) (193,325,218)
===================================================================================================
Class S (1,601,733) (9,600,281)
---------------------------------------------------------------------------------------------------
Net increase (decrease) from Fund share transactions (274,805) 3,451,672
- ------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets 34,509,791 103,848,914
Net Assets:
Beginning of period 466,022,732 362,173,818
- ------------------------------------------------------------------------------------------------------
End of period $ 500,532,523 $ 466,022,732
- ------------------------------------------------------------------------------------------------------
Undistributed net investment income (loss) at end of period $ (1,006,318) $ -
- ------------------------------------------------------------------------------------------------------
See Notes to Financial Statements 11
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Financial Statements Mid-Cap Growth Portfolio
Note A--Summary of Significant Accounting Policies:
1 General: Mid-Cap Growth Portfolio (the "Fund") is a separate operating series
of Neuberger Berman Advisers Management Trust (the "Trust"), a Delaware
statutory trust organized pursuant to a Trust Instrument dated May 23, 1994.
The Trust is currently comprised of ten separate operating series (each a
"Series," collectively, the "Funds") each of which (except Focus Portfolio) is
diversified. The Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act"),
and its shares are registered under the Securities Act of 1933, as amended (the
"1933 Act"). The Fund currently offers Class I and Class S shares. Class S had
no operations until February 18, 2003, other than matters relating to its
organization and registration of its shares under the 1933 Act. The Board of
Trustees of the Trust may establish additional series or classes of shares
without the approval of shareholders.
The assets of each Series belong only to that Series, and the liabilities of
each Series are borne solely by that Series and no other.
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States requires Neuberger Berman
Management Inc. ("Management") to make estimates and assumptions at the date of
the financial statements. Actual results could differ from those estimates.
2 Portfolio valuation: Investment securities are valued as indicated in the
notes following the Schedule of Investments.
3 Foreign currency translation: The accounting records of the Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars using the exchange rate as of 12:00 p.m., Eastern time, to determine
the value of investments, other assets and liabilities. Purchase and sale
prices of securities, and income and expenses, are translated into U.S. dollars
at the prevailing rate of exchange on the respective dates of such
transactions. Net unrealized foreign currency gain (loss) arises from changes
in the value of assets and liabilities, other than investments in securities,
as a result of changes in exchange rates and is stated separately in the
Statement of Operations.
4 Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the ex-dividend
date or, for certain foreign dividends, as soon as the Fund becomes aware of
the dividends. Non-cash dividends included in dividend income, if any, are
recorded at the fair market value of the securities received. Interest income,
including accretion of original issue discount, where applicable, and accretion
of discount on short-term investments, is recorded on the accrual basis.
Realized gains and losses from securities transactions and foreign currency
transactions are recorded on the basis of identified cost and stated separately
in the Statement of Operations. Included in net realized gain (loss) on
investment securities sold are proceeds from the settlements of class action
litigation in which the Fund participated as a plaintiff. The amount of such
proceeds for the six months ended June 30, 2004 was $2,420.
12
Notes to Financial Statements Mid-Cap Growth Portfolio cont'd
5 Federal income taxes: The Funds are treated as separate entities for U.S.
Federal income tax purposes. It is the policy of the Fund to continue to
qualify as a regulated investment company by complying with the provisions
available to certain investment companies, as defined in applicable sections of
the Internal Revenue Code, and to make distributions of investment company
taxable income and net capital gains (after reduction for any amounts available
for U.S. Federal income tax purposes as capital loss carryforwards) sufficient
to relieve it from all, or substantially all, U.S. Federal income taxes.
Accordingly, the Fund paid no U.S. Federal income taxes and no provision for
U.S. Federal income taxes was required.
6 Dividends and distributions to shareholders: The Fund may earn income, net of
expenses, daily on its investments. Income dividends and distributions from net
realized capital gains, if any, generally are distributed in October. Income
dividends and capital gain distributions to shareholders are recorded on the
ex-dividend date. To the extent the Fund's net realized capital gains, if any,
can be offset by capital loss carryforwards ($4,181,334, $236,225,757,
$113,423,118 and $11,059,423 expiring in 2008, 2009, 2010 and 2011,
respectively, determined as of December 31, 2003), it is the policy of the Fund
not to distribute such gains.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a tax return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains in the components of net assets on the Statement of Assets and
Liabilities.
As of December 31, 2003, the components of distributable earnings (accumulated
losses) on a U.S. Federal income tax basis were as follows:
Unrealized Loss
Appreciation Carryforwards
(Depreciation) and Deferrals Total
$93,111,385 $(364,889,632) $(271,778,247)
The difference between book basis and tax basis is attributable primarily to
net operating losses and the tax deferral of losses on wash sales.
7 Expense allocation: Certain expenses are applicable to multiple funds.
Expenses directly attributable to a Series are charged to that Series. Expenses
of the Trust that are not directly attributed to a Series are allocated among
the Funds, on the basis of relative net assets, except where a more appropriate
allocation of expenses to each of the Funds can otherwise be made fairly.
Expenses borne by the complex of related investment companies, which includes
open-end and closed-end investment companies for which Management serves as
investment manager, that are not directly attributed to a Series or the Trust,
are allocated among the Fund and the other investment companies in the complex
or series thereof, on the basis of relative net assets, except where a more
appropriate allocation of expenses to each investment company in the complex or
series thereof can otherwise be made fairly. The Fund's expenses (other than
those specific to each class) are allocated proportionally each day between the
classes based upon the relative net assets of each class.
13
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
8 Security lending: Pursuant to an Exemptive Order issued by the Securities and
Exchange Commission, the Fund entered into a Securities Lending Agreement
("Agreement") with Neuberger Berman, LLC ("Neuberger") on April 17, 2003.
Securities loans involve certain risks in the event a borrower should fail
financially, including delays or inability to recover the lent securities or
foreclose against the collateral. The investment manager, under the general
supervision of the Trust's Board of Trustees, monitors the creditworthiness of
the parties to whom the Fund makes security loans. The Fund will not lend
securities on which covered call options have been written, or lend securities
on terms which would prevent the Fund from qualifying as a regulated investment
company. The Fund receives cash collateral equal to at least 102% of the
current market value of the loaned securities. The Fund invests the cash
collateral in the N&B Securities Lending Quality Fund, LLC, which is managed by
State Street Bank and Trust Company ("State Street") pursuant to guidelines
approved by the Trust's investment manager. Neuberger guaranteed minimum
revenue to the Fund under the Agreement, and received a portion of any revenue
earned in excess of the guaranteed amount as a lending agency fee.
The Agreement has been renewed and approved by the Board of Trustees as of July
1, 2004 with substantially the same terms. Under this current Agreement,
Neuberger guarantees minimum revenue to the Fund and receives any revenue
earned in excess of the guaranteed amount as a lending agency fee.
At June 30, 2004, the Fund had not paid Neuberger any fees under the Agreement.
Income earned on the securities loaned, if any, is reflected in the Statement
of Operations under the caption Income from securities loaned-net.
9 Foreign taxes: Foreign taxes withheld represent amounts withheld by foreign
tax authorities, net of refunds recoverable.
10 Transactions with other funds managed by Neuberger Berman Management Inc.:
Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission, the Fund may invest in the Neuberger Berman Institutional Cash Fund
(the "Cash Fund"), a fund managed by Management and having the same Board
members as the Fund. The Cash Fund seeks to provide as high a level of current
income as is consistent with the preservation of capital and the maintenance of
liquidity. For any cash that the Fund invests in the Cash Fund, Management
waives a portion of its management fee equal to the management fee it receives
from the Cash Fund on those assets. For the six months ended June 30, 2004,
such waived fees amounted to $5,772. For the six months ended June 30, 2004,
income earned on this investment amounted to $45,702 and is reflected in the
Statement of Operations under the caption Income from investments in affiliated
issuers.
11 Repurchase agreements: The Fund may enter into repurchase agreements with
institutions that the Fund's investment manager has determined are
creditworthy. Each repurchase agreement is recorded at cost. The Fund requires
that the securities purchased in a repurchase agreement be transferred to the
custodian in a manner sufficient to enable the Fund to assert a perfected
security interest in those securities in the event of a default under the
repurchase agreement. The Fund monitors, on a daily basis, the value of the
securities transferred to ensure that their value, including accrued interest,
is greater than amounts owed to the Fund under each such repurchase agreement.
14
Notes to Financial Statements Mid-Cap Growth Portfolio cont'd
12 Other: All net investment income and realized and unrealized capital gains
and losses of the Fund are allocated, on the basis of relative net assets, pro
rata among its respective classes.
Note B--Management Fees, Administration Fees, Distribution Arrangements, and
Other Transactions With Affiliates:
Fund shares are issued and redeemed in connection with investments in and
payments under certain variable annuity contracts and variable life insurance
policies issued through separate accounts of life insurance companies and are
also offered directly to qualified pension and retirement plans.
The Fund retains Management as its investment manager under a Management
Agreement. For such investment management services, the Fund pays Management a
fee at the annual rate of 0.55% of the first $250 million of the Fund's average
daily net assets, 0.525% of the next $250 million, 0.50% of the next $250
million, 0.475% of the next $250 million, 0.45% of the next $500 million,
0.425% of the next $2.5 billion, and 0.40% of average daily net assets in
excess of $4 billion.
The Fund retains Management as its administrator under an Administration
Agreement. The Fund pays Management an administration fee at the annual rate of
0.30% of its average daily net assets under this agreement. Additionally,
Management retains State Street as its sub-administrator under a
Sub-Administration Agreement. Management pays State Street a fee for all
services received under the agreement.
The Trustees of the Trust adopted a non-fee distribution plan for the Fund's
Class I.
For the Fund's Class S, Management acts as agent in arranging for the sale of
class shares without commission and bears advertising and promotion expenses.
The Trustees of the Trust have adopted a distribution plan (the "Plan") with
respect to this class, pursuant to Rule 12b-1 under the 1940 Act. The Plan
provides that, as compensation for administrative and other services provided
to this class, Management's activities and expenses related to the sale and
distribution of this class of shares, and ongoing services provided to
investors in this class, Management receives from this class a fee at the
annual rate of 0.25% of Class S's average daily net assets. Management receives
this amount to provide distribution and shareholder servicing for this class
and pays a portion of it to institutions that provide such services. Those
institutions may use the payments for, among other purposes, compensating
employees engaged in sales and/or shareholder servicing. The amount of fees
paid by this class during any year may be more or less than the cost of
distribution and other services provided to this class. NASD rules limit the
amount of annual distribution fees that may be paid by a mutual fund and impose
a ceiling on the cumulative distribution fees paid. The Trust's Plan complies
with those rules.
Management has contractually undertaken through December 31, 2007 to reimburse
the Fund's Class I and Class S shares for their operating expenses (excluding
the fees payable to Management (including the fees payable to Management with
respect to the Fund's Class S shares), interest, taxes, brokerage commissions,
extraordinary expenses, and transaction costs) ("Operating Expenses") which
exceed, in the aggregate, 1.00% and 1.25%, respectively, per annum of their
average daily net assets (the "Expense Limitation"). For the six months ended
June 30, 2004, no reimbursement to the Fund's Class I and Class S shares was
required. The Fund's Class I and Class S shares each have agreed to repay
Management
15
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
through December 31, 2010 for their excess Operating Expenses previously
reimbursed by Management, so long as their annual Operating Expenses during
that period do not exceed their Expense Limitations, and the repayments are
made within three years after the year in which Management issued the
reimbursement. During the six months ended June 30, 2004, there was no
reimbursement to Management. At June 30, 2004, the Fund's Class I and Class S
shares have no contingent liability to Management under these agreements.
On October 31, 2003, Management and Neuberger, a member firm of the New York
Stock Exchange and sub-adviser to the Fund, became indirect wholly-owned
subsidiaries of Lehman Brothers Holdings Inc. ("Lehman"), a publicly-owned
holding company. Neuberger is retained by Management to furnish it with
investment recommendations and research information without added cost to the
Fund. Several individuals who are officers and/or Trustees of the Trust are
also employees of Neuberger and/or Management.
On July 1, 2003, the Fund entered into a commission recapture program, which
enables it to pay some of its operational expenses by recouping a portion of
the commissions it pays to a broker that is not a related party of the Fund.
Expenses paid through this program may include costs of custodial, transfer
agency or accounting services. For the six months ended June 30, 2004, the
impact of this arrangement was a reduction of $56,931.
The Fund has an expense offset arrangement in connection with its custodian
contract. The impact of this arrangement, reflected in the Statement of
Operations under the caption Custodian fees, was a reduction of $40.
Note C--Securities Transactions:
During the six months ended June 30, 2004, there were purchase and sale
transactions (excluding short-term securities) of $228,561,390 and
$236,619,556, respectively.
During the six months ended June 30, 2004, brokerage commissions on securities
transactions amounted to $672,478, of which Neuberger received $8, Lehman
received $137,306, and other brokers received $535,164.
Note D--Fund Share Transactions:
Share activity for the six months ended June 30, 2004 and for the year ended
December 31, 2003 was as follows:
For the Six Months For the Year Ended
Ended June 30, 2004 December 31, 2003
Shares Shares Shares Shares
Sold Redeemed Total Sold Redeemed Total
Class I 2,229,636 (2,484,681) (255,045) 14,482,662 (14,738,778) (256,116)
Class S 330,047 (101,407) 228,640 1,144,089 (733,422) 410,667
16
Notes to Financial Statements Mid-Cap Growth Portfolio cont'd
Note E--Line of Credit:
At June 30, 2004, the Fund was a participant in a single committed, unsecured
$150,000,000 line of credit with State Street, to be used only for temporary or
emergency purposes. Interest is charged on borrowings under this agreement at
the overnight Federal Funds Rate plus 0.50% per annum. A facility fee of 0.10%
per annum of the available line of credit is charged, of which the Fund has
agreed to pay its pro rata share, based on the ratio of its individual net
assets to the net assets of all participants at the time the fee is due and
payable. The fee is paid quarterly in arrears. No compensating balance is
required. Other investment companies managed by Management also participate in
this line of credit on the same terms. Because several investment companies
participate, there is no assurance that the Fund will have access to the entire
$150,000,000 at any particular time. The Fund had no loans outstanding pursuant
to this line of credit at June 30, 2004, nor had the Fund utilized this line of
credit at any time prior to that date.
Note F--Unaudited Financial Information:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent auditors. Annual reports
contain audited financial statements.
17
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Financial Highlights Mid-Cap Growth Portfolio
The following tables include selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements.++
Six Months
Ended
June 30, Year Ended December 31,
----------- --------------------------------------------------------
Class I+ 2004 2003 2002 2001 2000 1999
(Unaudited)
Net Asset Value, Beginning of Period $15.33 $ 11.97 $ 16.94 $ 22.48 $24.30 $ 16.22
------ ------- ------- ------- ------ -------
Income From Investment Operations:
Net Investment Income (Loss) (.03) (.07) (.08) (.07) (.09) (.07)
Net Gains or Losses on Securities
(both realized and unrealized) 1.18 3.43 (4.89) (5.47) (1.72) 8.55
------ ------- ------- ------- ------ -------
Total From Investment Operations 1.15 3.36 (4.97) (5.54) (1.81) 8.48
------ ------- ------- ------- ------ -------
Less Distributions From:
Net Capital Gains -- -- -- -- (.01) (.40)
------ ------- ------- ------- ------ -------
Net Asset Value, End of Period $16.48 $ 15.33 $ 11.97 $ 16.94 $22.48 $ 24.30
------ ------- ------- ------- ------ -------
Total Return++ +7.50%** +28.07% -29.34% -24.64% -7.46% +53.89%
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $490.0 $ 459.7 $ 362.2 $ 530.7 $624.1 $ 159.9
Ratio of Gross Expenses to Average Net Assets# .91%* .89% .95% .91% .98% 1.00%
Ratio of Net Expenses to Average Net Assets[sec] .89%* .88% .95% .91% .98% 1.00%
Ratio of Net Investment Income (Loss) to Average Net Assets (.42)%* (.52)% (.57)% (.38)% (.34)% (.40)%
Portfolio Turnover Rate 49% 161% 124% 99% 109% 100%
Six Months Period from
Ended February 18, 2003^
June 30, to December 31,
----------- -----------------
Class S 2004 2003
(Unaudited)
Net Asset Value, Beginning of Period $15.28 $ 11.15
------ -------
Income From Investment Operations:
Net Investment Income (Loss) (.05) (.09)
Net Gains or Losses on Securities
(both realized and unrealized) 1.18 4.22
------ -------
Total From Investment Operations 1.13 4.13
------ -------
Net Asset Value, End of Period $16.41 $ 15.28
------ -------
Total Return++ +7.40%** +37.04%**
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $ 10.5 $ 6.3
Ratio of Gross Expenses to Average Net Assets# 1.16%* 1.13%*
Ratio of Net Expenses to Average Net Assets[sec] 1.14%* 1.11%*
Ratio of Net Investment Income (Loss) to Average Net Assets (.68)%* (.71)%*
Portfolio Turnover Rate 49% 161%
See Notes to Financial Highlights 18
Notes to Financial Highlights Mid-Cap Growth Portfolio
+ The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's Class I proportionate share of AMT Mid-Cap
Growth Investment's income and expenses through April 30, 2000 under the
prior master/feeder fund structure.
++ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each
fiscal period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Current returns may be lower or higher than the performance data
quoted. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. Total return would
have been lower if Management had not reimbursed and/or waived certain
expenses. Total return would have been higher if Management had not
recouped previously reimbursed expenses. The total return information
shown does not reflect charges and other expenses that apply to the
separate account or the related insurance policies, and the inclusion of
these charges and other expenses would reduce the total return for all
fiscal periods shown. Performance data current to the most recent
month-end are available at www.nb.com.
# The Fund is required to calculate an expense ratio without taking into
consideration any expense reductions related to expense offset and
commission recapture arrangements.
[sec] After reimbursement of expenses by the investment manager. Had the
investment manager not undertaken such action, the annualized ratio of net
expenses to average daily net assets would have been:
Year Ended
December 31,
1999
Mid-Cap Growth Portfolio Class I 1.08%
After reimbursement of expenses previously paid by the investment manager.
Had the investment manager not been reimbursed, the annualized ratio of net
expenses to average daily net assets would have been:
Year Ended
December 31,
2000
Mid-Cap Growth Portfolio Class I 0.95%
After waiver of a portion of the investment management fee. Had the
investment manager not undertaken such action, the annualized ratios of net
expenses to average daily net assets would have been:
Six Months Ended Year Ended
June 30, December 31,
2004 2003
Mid-Cap Growth Portfolio Class I 0.89% 0.89%
Mid-Cap Growth Portfolio Class S 1.14% 1.11%
^ The date investment operations commenced.
++ The per share amounts which are shown have been computed based on the
average number of shares outstanding during each fiscal period.
* Annualized.
** Not annualized.
19
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Trustees and Officers (Unaudited)
The following tables set forth information concerning the trustees and officers
of the Trust. All persons named as trustees and officers also serve in similar
capacities for other funds administered or managed by NB Management and
Neuberger Berman. The Statement of Additional Information includes additional
information about fund trustees and is available upon request, without charge,
by calling (800) 877-9700.
Information about the Board of Trustees
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
John Cannon (74) Trustee since Consultant. Formerly, Chairman 38 Independent Trustee or Director of
2000 and Chief Investment Officer, three series of Oppenheimer Funds:
CDC Investment Advisors Limited Term New York Municipal
(registered investment adviser) Fund, Rochester Fund Municipals,
(1993-January 1999); prior and Oppenheimer Convertible
thereto, President and Chief Securities Fund since 1992.
Executive Officer, AMA
Investment Advisors, an affiliate
of the American Medical
Association.
Faith Colish (68) Trustee since Counsel, Carter Ledyard & 38 Director, American Bar Retirement
1984 Milburn LLP (law firm) since Association (ABRA) since 1997
October 2002; Formerly, (not-for-profit membership
Attorney-at-Law and President, association).
Faith Colish, A Professional
Corporation, 1980 to 2002.
Walter G. Ehlers (71) Trustee since Consultant; Retired President 38 None.
1989 and Trustee, Teachers
Insurance & Annuity (TIAA)
and College Retirement
Equities Fund (CREF).
C. Anne Harvey (66) Trustee since Consultant, C. A. Harvey 38 President, Board of Associates to
1998 Associates, since June 2001; The National Rehabilitation
Formerly, Director, AARP, 1978 Hospital's Board of Directors since
to December 2001. 2002; Formerly, Member, Individual
Investors Advisory Committee to the
New York Stock Exchange Board of
Directors, 1998 to June 2002;
Member, American Savings
Education Council's Policy Board
(ASEC),1998-2000; Member,
Executive Committee, Crime
Prevention Coalition of America,
1997-2000.
20
Trustees and Officers (Unaudited) cont'd
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Barry Hirsch (71) Trustee since Attorney-at-Law. Formerly, 38 None.
2000 Senior Counsel, Loews
Corporation (diversified
financial corporation) May
2002 until April 2003; formerly,
Senior Vice President, Secretary
and General Counsel, Loews
Corporation.
Robert A. Kavesh (76) Trustee since Marcus Nadler Professor of 38 Director, DEL Laboratories, Inc.
2000 Finance and Economics (cosmetics and pharmaceuticals)
Emeritus, New York University, since 1978; The Caring Community
Stern School of Business. ( not-for-profit).
Howard A. Mileaf (67) Trustee since Retired. Formerly, Vice 38 Director, WHX Corporation
1999 President and Special Counsel, (holding company) since August
WHX Corporation (holding 2002; Director, WebFinancial
company), 1993-2001. Corporation (holding company)
since December 2002; Director, State
Theatre of New Jersey (not-for-
profit theater) since 2000; formerly,
Director, Kevlin Corporation
(manufacturer of microwave and
other products).
William E. Rulon (71) Trustee since Retired. Senior Vice President, 38 Director, Pro-Kids Golf and
2000 Foodmaker, Inc. (operator and Learning Academy (teach golf and
franchiser of restaurants) until computer usage to "at risk" children)
January 1997. since 1998; Formerly, Director,
Prandium, Inc. (restaurants) from
March 2001 until July 2002.
Cornelius T. Ryan (72) Trustee since Founding General Partner, 38 Director, Capital Cash Management
2000 Oxford Partners and Oxford Trust (money market fund),
Bioscience Partners (venture Narragansett Insured Tax-Free
capital partnerships) and Income Fund, Rocky Mountain
President, Oxford Venture Equity Fund, Prime Cash Fund,
Corporation. several private companies and
QuadraMed Corporation
(NASDAQ).
21
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Tom Decker Seip (54) Trustee since General Partner, Seip 38 Director, H&R Block, Inc. (financial
2000 Investments LP (a private services company) since May 2001;
investment partnership); Director, Forward Management, Inc.
formerly, President and CEO, (asset management) since 2001;
Westaff, Inc. (temporary Formerly, Director, General Magic
staffing), May 2001 to January (voice recognition software),
2002; Senior Executive at the November 2001 until 2002; Director,
Charles Schwab Corporation E-Finance Corporation (credit
from 1983 to 1999, including decisioning services), 1999-2003;
Chief Executive Officer, Director, Save-Daily.com (micro
Charles Schwab Investment investing services), 1999-2003;
Management, Inc. and Trustee, Director, Offroad Capital Inc.
Schwab Family of Funds and (pre-public internet commerce
Schwab Investments from 1997 company).
to 1998 and Executive Vice
President--Retail Brokerage,
Charles Schwab Investment
Management from 1994
to 1997.
Candace L. Straight (56) Trustee since Private investor and consultant 38 Director, The Proformance Insurance
1999 specializing in the insurance Company (personal lines property
industry; Formerly, Advisory and casualty insurance company)
Director, Securitas Capital LLC since March 2004; Director,
(a global private equity Providence Washington (property
investment firm dedicated to and casualty insurance company),
making investments in the since December 1998; Director,
insurance sector), 1998 until Summit Global Partners (insurance
December 2002. brokerage firm) since October 2000.
Peter P. Trapp (59) Trustee since Regional Manager for Atlanta 38 None.
1984 Region, Ford Motor Credit
Company since August 1997;
Formerly, President, Ford
Life Insurance Company, April
1995 until August 1997.
22
Trustees and Officers (Unaudited) cont'd
Number of
Portfolios in
Trustees who are Position and Fund Complex
"Interested Persons" Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Edward I. OBrien* (75) Trustee since Formerly, Member, Investment 38 Director, Legg Mason, Inc. (financial
2000 Policy Committee, Edward services holding company) since
Jones, 1993-2001; President, 1993; formerly, Director, Boston
Securities Industry Association Financial Group (real estate and tax
("SIA") (securities industry's shelters) 1993-1999.
representative in government
relations and regulatory matters
at the federal and state levels)
1974-1992; Adviser to SIA,
November 1992-November 1993.
Jack L. Rivkin* (63) President and Executive Vice President and 38 Director, Dale Carnegie and
Trustee since Chief Investment Officer, Associates, Inc. (private company)
December Neuberger Berman Inc. since 1998; Director, Emagin Corp.
2002 (holding company) since 2002 (public company) since 1997;
and 2003, respectively; Director, Solbright, Inc. (private
Executive Vice President and company) since 1998; Director,
Chief Investment Officer, Infogate, Inc. (private company)
Neuberger Berman since 2002 since 1997.
and 2003, respectively; Director
and Chairman, NB
Management since December
2002; Formerly, Executive Vice
President, Citigroup
Investments, Inc. from
September 1995 to February
2002; Executive Vice President,
Citigroup Inc. from September
1995 to February 2002.
Peter E. Sundman* (45) Chairman of Executive Vice President, 38 Director, Neuberger Berman Inc.
the Board, Neuberger Berman Inc. (holding company) from 1999
Chief (holding company) since 1999; through March 2003; President and
Executive Head of Neuberger Berman Director, NB Management since
Officer and Inc.'s Mutual Funds and 1999; Director and Vice President,
Trustee since Institutional Business since Neuberger Berman Agency, Inc.
2000; 1999; Executive Vice President, since 2000.
President and Neuberger Berman since 1999;
Chief Principal, Neuberger Berman
Executive from 1997 until 1999; Senior
Officer from Vice President, NB
1998 to 2000 Management from 1996
until 1999.
23
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the Trust's Trust Instrument, each Trustee shall hold office
for life or until his or her successor is elected or the Trust terminates;
except that (a) any Trustee may resign by delivering a written
resignation; (b) any Trustee may be removed with or without cause at any
time by a written instrument signed by at least two-thirds of the other
Trustees; (c) any Trustee who requests to be retired, or who has become
unable to serve, may be retired by a written instrument signed by a
majority of the other Trustees; and (d) any Trustee may be removed at any
shareholder meeting by a vote of at least two-thirds of the outstanding
shares.
(3) Except as otherwise indicated, each individual has held the positions
shown for at least the last five years.
* Indicates a Trustee who is an "interested person" within the meaning of
the 1940 Act. Mr. Sundman and Mr. Rivkin are interested persons of the
Trust by virtue of the fact that they are officers and/or directors of NB
Management and Executive Vice Presidents of Neuberger Berman. Mr. O'Brien
is an interested person of the Trust by virtue of the fact that he is a
director of Legg Mason, Inc., a wholly owned subsidiary of which, from
time to time, serves as a broker or dealer to the Funds and other funds
for which NB Management serves as investment manager.
24
Information about the Officers of the Trust
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- ---------------------------------------------------------------------------------------------------------------------------
Claudia A. Brandon (47) Secretary since 1985 Vice President--Mutual Fund Board Relations, NB
Management since 2000; Vice President, Neuberger
Berman since 2002 and employee since 1999; Vice
President, NB Management from 1986 to 1999; Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(four since 2002, three since 2003, and one since 2004).
Robert Conti (48) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President, Neuberger Berman from 1999 until 2003; Senior
Vice President, NB Management since 2000; Controller,
NB Management until 1996; Treasurer, NB Management
from 1996 until 1999; Vice President, eleven registered
investment companies for which NB Management acts as
investment manager and administrator (three since 2000,
four since 2002, three since 2003, and one since 2004).
Brian P. Gaffney (50) Vice President since 2000 Managing Director, Neuberger Berman since 1999; Senior
Vice President, NB Management since 2000; Vice
President, NB Management from 1997 until 1999; Vice
President, eleven registered investment companies for which
NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three since
2003, and one since 2004).
Sheila R. James (39) Assistant Secretary since 2002 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1991 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003 and one since 2004).
Kevin Lyons (49) Assistant Secretary since 2003 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1993 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(Ten since 2003 and one since 2004).
25
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- ----------------------------------------------------------------------------------------------------------------------------
John M. McGovern (34) Assistant Treasurer since 2002 Vice President, Neuberger Berman since 2004; Employee,
NB Management since 1993; Assistant Treasurer, eleven
registered investment companies for which NB
Management acts as investment manager and
administrator (seven since 2002, three since 2003, and one
since 2004).
Barbara Muinos (45) Treasurer and Principal Financial Vice President, Neuberger Berman since 1999; Assistant
and Accounting Officer since 2002; Vice President, NB Management from 1993 to 1999;
prior thereto, Assistant Treasurer Treasurer and Principal Financial and Accounting Officer,
since 1996 eleven registered investment companies for which NB
Management acts as investment manager and
administrator (seven since 2002, three since 2003, and one
since 2004); Assistant Treasurer, three registered
investment companies for which NB Management acts as
investment manager and administrator from 1996 until
2002.
Frederic B. Soule (58) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President; Neuberger Berman from 1999 until 2003; Vice
President, NB Management from 1995 until 1999; Vice
President, eleven registered investment companies for
which NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three
since 2003, and one since 2004).
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the By-Laws of the Trust, each officer elected by the Trustees
shall hold office until his or her successor shall have been elected and
qualified or until his or her earlier death, inability to serve, or
resignation. Officers serve at the pleasure of the Trustees and may be
removed at any time with or without cause.
(3) Except as otherwise indicated, each individual has held the positions
shown for at least the last five years.
26
Proxy Voting Policies and Procedures
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to portfolio securities is available, without
charge, by calling 1-800-877-9700 (toll-free) and on the website of the
Securities and Exchange Commission, at www.sec.gov. Beginning September 2004,
information regarding how the Fund voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 will also be
available without charge, by calling 1-800-877-9700 (toll-free), on the website
of the Securities and Exchange Commission, at www.sec.gov, and on the Fund's
website at www.nb.com http://www.nb.com.
27
Semi-Annual Report
June 30, 2004
B0737 08/04
[LOGO]
Neuberger Berman
Advisors
Management
Trust
Partners
Portfolio(R)
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Partners Portfolio Manager's Commentary
We are pleased to report that the Partners Portfolio modestly outperformed its
benchmarks, the Standard & Poor's 500 Index and the Russell 1000 Value Index,
in the first half of 2004.(2)
With investors obsessing over rising interest rates, Iraq, terrorism, and the
November elections, and largely ignoring excellent corporate earnings growth,
stocks made only modest progress in the first half of 2004.
Investments in the energy, industrials, and financials sectors had the most
favorable impact on returns. Although we were underweighted in energy relative
to the Russell 1000 Value Index benchmark, the performance of our holdings
nearly doubled the benchmark energy component returns. We got a "double play"
from industrials, where we were overweighted and our stock selections also
outperformed by a substantial margin. We were underweighted in financials and
returns were modest compared to our energy and industrial sector investments,
but once again stock selection contributed meaningfully to portfolio
performance.
Consumer discretionary sector investments disappointed. We were overweight in
consumer discretionary, the worst performing sector in the first half, and our
holdings underperformed the benchmark component. We missed the ball in consumer
staples, due to our focus on valuation. Our average weighting in staples was
about 1.5% compared to 7.4% for the Russell 1000 Value Index and 11.2% for the
S&P 500. Being so underweighted in the second best performing sector during
this six-month reporting period penalized relative returns.
Looking ahead to the second half of 2004 and to 2005, we expect the economy to
successfully make the transition from a monetary and fiscal stimulus generated
recovery to a somewhat slower growth self-sustaining expansion. Although
corporate earnings growth will slow from the torrid pace of the first and
second quarters, we expect at least high single digit percentage earnings gains
for the S&P 500 over the next year, making the S&P's current price/forward
earnings multiple of 16 more than reasonable. Oil prices are the biggest threat
to this scenario. We believe the economy can absorb $35-$40 per barrel oil, but
may stall if oil prices get much higher.
Our overweighting versus the Russell 1000 Value Index in the consumer
discretionary sector is a reflection of our economic outlook and the fact that
we are finding high quality companies trading at what we view as bargain
prices. Economists and market strategists have underestimated the consumer for
the past four years, citing dozens of reasons for an imminent decline in
consumer spending. Although the reasons being given today--rising interest
rates, no more tax relief, and the end of the home refinancing boom--may slow
consumer spending, we don't think the consumer will roll over. Consumer debt is
high, but prices and financing costs will likely remain low. We note that one
bad month of auto sales in June brought back big incentives including lower
sticker prices and cut-rate financing packages.
Although our weighting in the consumer discretionary sector hasn't changed much
over the last year, we have shifted our emphasis from retailers to advertising
supported media companies. Media stocks have disappointed due to the fact that
ad spending has not yet rebounded with the economy. It never does, because
companies don't increase their advertising budgets until they are confident an
economic recovery has legs. That confidence is now growing and we believe ad
spending will accelerate in the second half of 2004. The homebuilders have been
beaten down in recent months due to concerns that rising mortgage rates will
slow the housing market. Because supply/demand dynamics are so favorable--there
is only about three months of inventory of new homes--
1
and because we believe mortgage rates will remain relatively low, we think the
high quality home builders will continue to prosper.
We are now nearly equal weighted in energy, because we think it may be quite
some time before supply can catch up to demand. India and China alone have
contributed to most of the incremental demand for oil. We have yet to see a
supply side response to higher oil prices in the form of substantially
increased exploration and production activity. Until we see more money spent to
increase oil reserves and production, oil prices will very likely remain
stubbornly high. This is not good for the economy, but it is good for energy
company shareholders.
At the close of the first half of 2004, our largest weightings are in
financials, consumer discretionary, healthcare, industrials and technology
sectors, in that order. We think this is a good balance between economically
sensitive, higher growth sectors (consumer discretionary and technology) that
should do well if the economy meets our expectations and more stable growth
sectors (healthcare and financials) which should provide ballast for the
portfolio should the economy weaken more than we anticipate. Of course, stock
selection will remain the key to superior returns.
Sincerely,
/s/ S. Basu Mullick
S. BASU MULLICK
PORTFOLIO MANAGER
1. 20.94%, 0.03% and 11.23% were the average annual total returns for the
1-year, 5-year and 10-year periods ended June 30, 2004. Neuberger Berman
Management Inc. ("NBMI") has agreed to absorb certain expenses of the AMT
Portfolios. Without this arrangement, which is subject to change, the total
returns of the Portfolios would be less. Total return includes reinvestment of
dividends and capital gain distributions. Performance data quoted represent
past performance and the investment return and principal value of an investment
will fluctuate so that the shares, when redeemed, may be worth more or less
than original cost. Current performance may be lower or higher than the
performance data quoted. For performance data current to the most recent month
end, please visit www.nb.com/amtperformance. The performance information does
not reflect fees and expenses of the variable annuity and variable life
insurance policies or the pension plans whose proceeds are invested in the
portfolio.
2. The S&P 500 Index is widely regarded as the standard for measuring large-cap
U.S. stock market performance and includes a representative sample of leading
companies in leading industries. The Russell 1000[RegTM] Index measures the
performance of the 1,000 largest companies in the Russell 3000[RegTM] Index
(which measures the performance of the 3,000 largest U.S. companies based on
total market capitalization). The Russell 1000 Index represents approximately
92% of the total market capitalization of the Russell 3000 Index. The Russell
1000 Value Index measures the performance of those Russell 1000 companies with
lower price-to-book ratios and lower forecasted growth values. Please note that
indices do not take into account any fees and expenses of investing in the
individual securities that they track, and that individuals cannot invest
directly in any index. Data about the performance of these indices are prepared
or obtained by NBMI and include reinvestment of all dividends and capital gain
distributions. The Portfolio may invest in many securities not included in the
above-described indices.
2
Any ratios or other measurements using a factor of forecasted earnings of a
company discussed herein are based on consensus estimates, not Neuberger
Berman's own projections, and they may or may not be realized. In addition, any
revision to a forecast could affect the market price of a security. By quoting
them herein, Neuberger Berman does not offer an opinion as to the accuracy of
and does not guarantee these forecasted numbers.
The investments for the Portfolio are managed by the same portfolio manager(s)
who manage one or more other mutual funds that have similar names, investment
objectives and investment styles as the Portfolio. You should be aware that the
Portfolio is likely to differ from the other mutual funds in size, cash flow
pattern and tax matters. Accordingly, the holdings and performance of the
Portfolio can be expected to vary from those of the other mutual funds.
The composition, industries and holdings of the Portfolio are subject to
change.
Shares of the separate Portfolios of Neuberger Berman Advisers Management Trust
are sold only through the currently effective prospectus and are not available
to the general public. Shares of this Portfolio may be purchased only by life
insurance companies to be used with their separate accounts that fund variable
annuity and variable life insurance policies and by qualified pension and
retirement plans.
(C) 2004 Neuberger Berman Management Inc., distributor. All rights reserved.
3
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Partners Portfolio
Number of Shares Market Value+
Common Stocks (95.3%)
Advertising (1.1%)
90,800 Omnicom Group $ 6,890,812\P
Auto Related (1.3%)
130,100 Harley-Davidson 8,058,394\P
Banking & Financial (5.6%)
155,100 Fannie Mae 11,067,936
264,200 Merrill Lynch 14,261,516
210,800 State Street 10,337,632
-----------
35,667,084
Broadcasting (2.2%)
150,700 Clear Channel
Communications 5,568,365\P
279,300 EchoStar Communications 8,588,475*
-----------
14,156,840
Building, Construction & Furnishing (7.1%)
271,400 Centex Corp. 12,416,550\P
236,400 Home Depot 8,321,280\P
261,500 Lennar Corp. 11,694,280\P
26,300 NVR, Inc. 12,734,460*\P
-----------
45,166,570
Building Materials (1.6%)
112,900 American Standard 4,550,999*
14,410 Eagle Materials Class B 997,892
110,800 York International 4,550,556
-----------
10,099,447
Capital Goods (1.2%)
170,900 SPX Corp. 7,936,596
Communications (0.8%)
269,500 Cablevision Systems 5,295,675*\P
Consumer Cyclicals (3.4%)
139,700 Best Buy 7,088,378
39,800 Black & Decker 2,472,774\P
86,900 Carnival Corp. 4,084,300\P
265,500 Masco Corp. 8,278,290
-----------
21,923,742
Consumer Goods & Services (1.8%)
464,800 Cendant Corp. 11,378,304\P
Consumer Staples (2.3%)
657,364 Liberty Media 5,909,702*
247,000 Viacom Inc. Class B 8,822,840
-----------
14,732,542
Defense (0.9%)
89,200 L-3 Communications
Holdings 5,958,560\P
Diversified (1.3%)
1,474,100 ABB Ltd. 8,065,808*
Electrical & Electronics (2.2%)
412,300 Tyco International 13,663,622\P
4
Number of Shares Market Value+
Electronics (0.6%)
235,940 AU Optronics $ 3,855,260\P
Energy (2.7%)
123,800 Canadian Natural
Resources 3,701,620
198,700 Cooper Cameron 9,676,690*
182,300 Talisman Energy 3,963,202
------------
17,341,512
Financial Services (17.7%)
202,500 American Express 10,404,450
5,300 Berkshire Hathaway
Class B 15,661,500*
375,100 Citigroup Inc. 17,442,150
198,649 Countrywide Financial 13,955,092\P
336,500 General Electric 10,902,600
79,800 Goldman Sachs 7,513,968
118,400 H & R Block 5,645,312\P
115,900 Morgan Stanley 6,116,043
257,100 PMI Group 11,188,992\P
139,600 Radian Group 6,686,840
89,896 XL Capital 6,783,552\P
------------
112,300,499
Food & Beverage (0.6%)
103,100 Constellation Brands 3,828,103*
Forest Products & Paper (0.6%)
61,000 Weyerhaeuser Co. 3,850,320\P
Health Care (7.7%)
67,300 Anthem, Inc. 6,027,388*\P
247,600 Boston Scientific 10,597,280*
159,800 Caremark Rx 5,263,812*
172,500 Laboratory Corp. of
America Holdings 6,848,250*
256,200 PacifiCare Health Systems 9,904,692*
27,600 Wellpoint Health Networks 3,091,476*
206,200 Wyeth 7,456,192
------------
49,189,090
Insurance (3.2%)
101,200 Aetna Inc. 8,602,000
168,200 American International
Group 11,989,296
------------
20,591,296
Internet (0.7%)
173,800 Check Point Software
Technologies 4,690,862*
Machinery & Equipment (0.7%)
54,100 Nucor Corp. 4,152,716\P
Metals (1.6%)
82,900 Alcan Inc. 3,432,060
87,200 Freeport-McMoRan Copper
& Gold 2,890,680
47,900 Phelps Dodge 3,712,729
------------
10,035,469
See Notes to Schedule of Investments 5
Schedule of Investments Partners Portfolio cont'd
Number of Shares Market Value+
Oil & Gas (2.7%)
118,100 EOG Resources $ 7,051,751
129,700 FMC Technologies 3,735,360*
42,600 Kerr-McGee 2,290,602\P
121,100 National-Oilwell 3,813,439*
------------
16,891,152
Pharmaceutical (5.0%)
69,900 AmerisourceBergen Corp. 4,178,622\P
126,000 Par Pharmaceutical 4,436,460*
254,500 Pfizer Inc. 8,724,260
351,400 Shire Pharmaceuticals
Group ADR 9,396,436*\P
185,600 Watson Pharmaceuticals 4,992,640*
------------
31,728,418
Retail (1.0%)
136,900 Advanced Auto Parts 6,048,242*
Semiconductors (3.5%)
343,800 Applied Materials 6,745,356*
166,400 Novellus Systems 5,231,616*
176,200 STMicroelectronics
NV-New York 3,878,162
803,819 Taiwan Semiconductor
Manufacturing ADR 6,679,736
------------
22,534,870
Software (2.3%)
372,200 Microsoft Corp. 10,630,032
216,300 PeopleSoft, Inc. 4,001,550*
------------
14,631,582
Technology (4.8%)
201,100 Computer Sciences 9,337,073*\P
632,300 Compuware Corp. 4,173,180*
49,300 IBM 4,345,795
329,200 InterActiveCorp 9,922,088*\P
10,500 Lexmark International
Group 1,013,565*
106,500 Nokia Corp. ADR 1,548,510
------------
30,340,211
Telecommunications (1.6%)
140,800 Nextel Communications 3,753,728*
1,302,200 Nortel Networks 6,497,978*
------------
10,251,706
Transportation (5.5%)
431,900 Frontline Ltd. 14,862,161
179,900 General Maritime 4,936,456*
64,900 Ship Finance International 970,255
374,100 Teekay Shipping 13,983,858
------------
34,752,730
Total Common Stocks
(Cost $497,391,840) 606,008,034
------------
6
Principal Amount Market Value+
Short-Term Investments (26.7%)
$138,495,200 N&B Securities Lending
Quality Fund, LLC $138,495,200++
31,150,587 Neuberger Berman
Institutional Cash Fund
Trust Class 31,150,587@
------------
Total Short-Term Investments
(Cost $169,645,787) 169,645,787#
------------
Total Investments (122.0%)
(Cost $667,037,627) 775,653,821##
Liabilities, less cash, receivables
and other assets [(22.0%)] (139,642,903)
------------
Total Net Assets (100.0%) $636,010,918
------------
See Notes to Schedule of Investments 7
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Schedule of Investments Partners Portfolio
+ Investments in equity securities by the Fund are valued at the latest sales
price where that price is readily available; securities for which no sales
were reported, unless otherwise noted, are valued at the mean between the
closing bid and asked prices. Securities traded primarily on the NASDAQ
Stock Market are normally valued by the Fund at the NASDAQ Official Closing
Price ("NOCP") provided by NASDAQ each business day. The NOCP is the most
recently reported price as of 4:00:02 p.m., Eastern time, unless that price
is outside the range of the "inside" bid and asked prices (i.e., the bid
and asked prices that dealers quote to each other when trading for their
own accounts); in that case, NASDAQ will adjust the price to equal the
inside bid or asked price, whichever is closer. Because of delays in
reporting trades, the NOCP may not be based on the price of the last trade
to occur before the market closes. The Fund values all other securities by
a method the Board of Trustees of Neuberger Berman Advisers Management
Trust (the "Board") believes accurately reflects fair value. Numerous
factors may be considered when determining the fair value of a security,
including available analyst, media or other reports, trading in futures or
ADRs and whether the issuer of the security being fair valued has other
securities outstanding. Foreign security prices are furnished by
independent quotation services expressed in local currency values. Foreign
security prices are translated from the local currency into U.S. dollars
using the exchange rate as of 12:00 p.m., Eastern time. The Board has
approved the use of FT Interactive Data Corporation ("FT Interactive") to
assist in determining the fair value of the Fund's foreign equity
securities in the wake of certain significant events. Specifically, when
changes in the value of a certain index suggest that the closing prices on
the foreign exchanges no longer represent the amount that the Fund could
expect to receive for those securities, FT Interactive will provide
adjusted prices for certain foreign equity securities based on an analysis
showing historical correlations between the prices of those securities and
changes in the index. In the absence of precise information about the
market values of these foreign securities as of the close of the New York
Stock Exchange, the Board has determined on the basis of available data
that prices adjusted in this way are likely to be closer to the prices the
Fund could realize on a current sale than are the prices of those
securities established at the close of the foreign markets in which the
securities primarily trade. However, fair value prices are necessarily
estimates, and there is no assurance that such a price will be at or close
to the price at which the security next trades. Short-term debt securities
with less than 60 days until maturity may be valued at cost which, when
combined with interest earned, approximates market value.
# At cost, which approximates market value.
## At June 30, 2004, the cost of investments for U.S. Federal income tax
purposes was $667,037,627. Gross unrealized appreciation of investments was
$117,749,299 and gross unrealized depreciation of investments was
$9,133,105, resulting in net unrealized appreciation of $108,616,194, based
on cost for U.S. Federal income tax purposes.
* Non-income producing security.
\P All or a portion of this security is on loan (see Note A of Notes to
Financial Statements).
@ Neuberger Berman Institutional Cash Fund is also managed by Neuberger
Berman Management Inc. (see Note A of Notes to Financial Statements).
++ Affiliated issuer (see Note A of Notes to Financial Statements).
See Notes to Financial Statements 8
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Assets and Liabilities
Partners
Neuberger Berman Advisers Management Trust Portfolio
Assets
Investments in securities, at market value*+ (Note A)-see Schedule of Investments:
===================================================================================================
Unaffiliated issuers $606,008,034
- ---------------------------------------------------------------------------------------------------
Affiliated issuers 169,645,787
- ---------------------------------------------------------------------------------------------------
775,653,821
- ---------------------------------------------------------------------------------------------------
Dividends and interest receivable 2,795,061
===================================================================================================
Receivable for securities sold 2,019,931
- ---------------------------------------------------------------------------------------------------
Receivable for Fund shares sold 1,370,428
===================================================================================================
Prepaid expenses and other assets 43,925
- ---------------------------------------------------------------------------------------------------
Total Assets 781,883,166
- ---------------------------------------------------------------------------------------------------
Liabilities
Payable for collateral on securities loaned (Note A) 138,495,200
===================================================================================================
Payable for securities purchased 6,339,173
- ---------------------------------------------------------------------------------------------------
Payable for Fund shares redeemed 426,821
===================================================================================================
Payable to investment manager-net (Note B) 281,145
- ---------------------------------------------------------------------------------------------------
Payable to administrator (Note B) 161,028
===================================================================================================
Accrued expenses and other payables 168,881
- ---------------------------------------------------------------------------------------------------
Total Liabilities 145,872,248
- ---------------------------------------------------------------------------------------------------
Net Assets at value $636,010,918
- ---------------------------------------------------------------------------------------------------
Net Assets consist of:
Paid-in capital $569,877,765
===================================================================================================
Undistributed net investment income (loss) 4,264,289
- ---------------------------------------------------------------------------------------------------
Accumulated net realized gains (losses) on investments (46,747,667)
===================================================================================================
Net unrealized appreciation (depreciation) in value of investments 108,616,531
===================================================================================================
Net Assets at value $636,010,918
- ---------------------------------------------------------------------------------------------------
Shares Outstanding ($.001 par value; unlimited shares authorized) 39,198,165
===================================================================================================
Net Asset Value, offering and redemption price per share $ 16.23
- -----------------------------------------------------------------------------------------------------
+Securities on loan, at market value:
Unaffiliated issuers $135,933,849
- ---------------------------------------------------------------------------------------------------
*Cost of investments:
Unaffiliated issuers $497,391,840
- ---------------------------------------------------------------------------------------------------
Affiliated issuers 169,645,787
- ---------------------------------------------------------------------------------------------------
Total cost of investments $667,037,627
- ---------------------------------------------------------------------------------------------------
See Notes to Financial Statements 9
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST FOR THE SIX MONTHS ENDED JUNE 30, 2004 (UNAUDITED)
Statement of Operations
Partners
Neuberger Berman Advisers Management Trust Portfolio
Investment Income
Income:
Dividend income-unaffiliated issuers $ 7,120,607
===============================================================================================================
Dividend income-affiliated issuers 20,736
- ---------------------------------------------------------------------------------------------------------------
Interest income (Note A) 353
===============================================================================================================
Income from securities loaned-net (Note A) 52,455
- ---------------------------------------------------------------------------------------------------------------
Income from investments in affiliated issuers (Note A) 61,887
- ---------------------------------------------------------------------------------------------------------------
Foreign taxes withheld (Note A) (56,518)
- ---------------------------------------------------------------------------------------------------------------
Total income 7,199,520
- ---------------------------------------------------------------------------------------------------------------
Expenses:
Investment management fee (Notes A & B) 1,808,951
===============================================================================================================
Administration fee (Note B) 1,029,428
- ---------------------------------------------------------------------------------------------------------------
Audit fees 17,883
===============================================================================================================
Custodian fees (Note B) 88,075
- ---------------------------------------------------------------------------------------------------------------
Insurance expense 4,802
===============================================================================================================
Legal fees 46,536
- ---------------------------------------------------------------------------------------------------------------
Shareholder reports 44,477
===============================================================================================================
Trustees' fees and expenses 13,453
- ---------------------------------------------------------------------------------------------------------------
Miscellaneous 4,347
- ---------------------------------------------------------------------------------------------------------------
Total expenses 3,057,952
Investment management fee waived (Note A) (7,873)
===============================================================================================================
Expenses reduced by custodian fee expense offset and commission recapture arrangements (Note B) (55,281)
- ---------------------------------------------------------------------------------------------------------------
Total net expenses 2,994,798
- ---------------------------------------------------------------------------------------------------------------
Net investment income (loss) 4,204,722
- ---------------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) on Investments (Note A)
Net realized gain (loss) on:
Investment securities sold in unaffiliated issuers 56,692,682
===============================================================================================================
Investment securities sold in affiliated issuers 2,950,224
- ---------------------------------------------------------------------------------------------------------------
Foreign currency 20,080
===============================================================================================================
Change in net unrealized appreciation (depreciation) in value of:
Investment securities in unaffiliated issuers (28,971,765)
- ---------------------------------------------------------------------------------------------------------------
Foreign currency 236
- ---------------------------------------------------------------------------------------------------------------
Net gain (loss) on investments 30,691,457
- ---------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations $ 34,896,179
- ---------------------------------------------------------------------------------------------------------------
See Notes to Financial Statements 10
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Changes in Net Assets
Partners Portfolio
--------------------------------
Six Months
Ended Year
June 30, Ended
2004 December 31,
Neuberger Berman Advisers Management Trust (Unaudited) 2003
Increase (Decrease) in Net Assets:
From Operations:
Net investment income (loss) $ 4,204,722 $ 59,548
========================================================================================================
Net realized gain (loss) on investments 59,662,986 (8,891,337)
- --------------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of investments (28,971,529) 186,593,259
- --------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations 34,896,179 177,761,470
- --------------------------------------------------------------------------------------------------------
From Fund Share Transactions (Note D):
Proceeds from shares sold 39,824,963 253,815,477
========================================================================================================
Payments for shares redeemed (108,349,577) (284,495,806)
- --------------------------------------------------------------------------------------------------------
Net increase (decrease) from Fund share transactions (68,524,614) (30,680,329)
- --------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets (33,628,435) 147,081,141
Net Assets:
Beginning of period 669,639,353 522,558,212
- --------------------------------------------------------------------------------------------------------
End of period $ 636,010,918 $ 669,639,353
- --------------------------------------------------------------------------------------------------------
Undistributed net investment income (loss) at end of period $ 4,264,289 $ 59,567
- --------------------------------------------------------------------------------------------------------
See Notes to Financial Statements 11
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Notes to Financial Statements Partners Portfolio
Note A--Summary of Significant Accounting Policies:
1 General: Partners Portfolio (the "Fund") is a separate operating series of
Neuberger Berman Advisers Management Trust (the "Trust"), a Delaware statutory
trust organized pursuant to a Trust Instrument dated May 23, 1994. The Trust is
currently comprised of ten separate operating series (each a "Series,"
collectively, the "Funds") each of which (except Focus Portfolio) is
diversified. The Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act"),
and its shares are registered under the Securities Act of 1933, as amended. The
Fund currently offers only Class I shares. The Board of Trustees of the Trust
may establish additional series or classes of shares without the approval of
shareholders.
The assets of each Series belong only to that Series, and the liabilities of
each Series are borne solely by that Series and no other.
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States requires Neuberger Berman
Management Inc. ("Management") to make estimates and assumptions at the date of
the financial statements. Actual results could differ from those estimates.
2 Portfolio valuation: Investment securities are valued as indicated in the
notes following the Schedule of Investments.
3 Foreign currency translation: The accounting records of the Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars using the exchange rate as of 12:00 p.m., Eastern time, to determine
the value of investments, other assets and liabilities. Purchase and sale
prices of securities, and income and expenses, are translated into U.S. dollars
at the prevailing rate of exchange on the respective dates of such
transactions. Net unrealized foreign currency gain (loss) arises from changes
in the value of assets and liabilities, other than investments in securities,
as a result of changes in exchange rates and is stated separately in the
Statement of Operations.
4 Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the ex-dividend
date or, for certain foreign dividends, as soon as the Fund becomes aware of
the dividends. Non-cash dividends included in dividend income, if any, are
recorded at the fair market value of the securities received. Interest income,
including accretion of original issue discount, where applicable, and accretion
of discount on short-term investments, is recorded on the accrual basis.
Realized gains and losses from securities transactions and foreign currency
transactions are recorded on the basis of identified cost and stated separately
in the Statement of Operations. Included in net realized gain (loss) on
investment securities sold are proceeds from the settlements of class action
litigation in which the Fund participated as a plaintiff. The amount of such
proceeds for the six months ended June 30, 2004 was $726,010.
5 Federal income taxes: The Funds are treated as separate entities for U.S.
Federal income tax purposes. It is the policy of the Fund to continue to
qualify as a regulated investment company by complying with the provisions
available to certain investment companies, as defined in applicable sections of
the Internal
12
Notes to Financial Statements Partners Portfolio cont'd
Revenue Code, and to make distributions of investment company taxable income
and net capital gains (after reduction for any amounts available for U.S.
Federal income tax purposes as capital loss carryforwards) sufficient to
relieve it from all, or substantially all, U.S. Federal income taxes.
Accordingly, the Fund paid no U.S. Federal income taxes and no provision for
U.S. Federal income taxes was required.
6 Dividends and distributions to shareholders: The Fund may earn income, net of
expenses, daily on its investments. Income dividends and distributions from net
realized capital gains, if any, generally are distributed in October. Income
dividends and capital gain distributions to shareholders are recorded on the
ex-dividend date. To the extent the Fund's net realized capital gains, if any,
can be offset by capital loss carryforwards ($9,141,747, $72,177,018 and
$20,760,081 expiring in 2009, 2010 and 2011, respectively, determined as of
December 31, 2003), it is the policy of the Fund not to distribute such gains.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a tax return of capital.
Differences in the recognition or classification of income between the
financial statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains in the components of net assets on the Statement of Assets and
Liabilities.
The tax character of distributions paid during the years ended December 31,
2003 and 2002 was as follows:
Distributions Paid From:
Long-Term Tax Return
Ordinary Income Capital Gain of Capital Total
2003 2002 2003 2002 2003 2002 2003 2002
$ -- $3,518,207 $ -- $ -- $ -- $169,184 $ -- $3,687,391
As of December 31, 2003, the components of distributable earnings (accumulated
losses) on a U.S. Federal income tax basis were as follows:
Undistributed Unrealized Loss
Ordinary Appreciation Carryforwards
Income (Depreciation) and Deferrals Total
$59,567 $133,256,253 $(102,078,846) $31,236,974
The difference between book basis and tax basis is attributable primarily to
the tax deferral of losses on wash sales.
7 Foreign taxes: Foreign taxes withheld represent amounts withheld by foreign
tax authorities, net of refunds recoverable.
8 Expense allocation: Certain expenses are applicable to multiple funds.
Expenses directly attributable to a Series are charged to that Series. Expenses
of the Trust that are not directly attributed to a Series are allocated among
the Funds, on the basis of relative net assets, except where a more appropriate
allocation of expenses to each of the Funds can otherwise be made fairly.
Expenses borne by the complex of related investment companies, which includes
open-end and closed-end investment companies for which Management serves as
investment manager, that are not directly attributed to a Series or the Trust,
are
13
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
allocated among the Fund and the other investment companies in the complex or
series thereof, on the basis of relative net assets, except where a more
appropriate allocation of expenses to each investment company in the complex or
series thereof can otherwise be made fairly.
9 Repurchase agreements: The Fund may enter into repurchase agreements with
institutions that the Fund's investment manager has determined are
creditworthy. Each repurchase agreement is recorded at cost. The Fund requires
that the securities purchased in a repurchase transaction be transferred to the
custodian in a manner sufficient to enable the Fund to assert a perfected
security interest in those securities in the event of a default under the
repurchase agreement. The Fund monitors, on a daily basis, the value of the
securities transferred to ensure that their value, including accrued interest,
is greater than amounts owed to the Fund under each such repurchase agreement.
10 Security lending: Pursuant to an Exemptive Order issued by the Securities
and Exchange Commission, the Fund entered into a Securities Lending Agreement
("Agreement") with Neuberger Berman, LLC ("Neuberger") on April 17, 2003.
Securities loans involve certain risks in the event a borrower should fail
financially, including delays or inability to recover the lent securities or
foreclose against the collateral. The investment manager, under the general
supervision of the Trust's Board of Trustees, monitors the creditworthiness of
the parties to whom the Fund makes security loans. The Fund will not lend
securities on which covered call options have been written, or lend securities
on terms which would prevent the Fund from qualifying as a regulated investment
company. The Fund receives cash collateral equal to at least 102% of the
current market value of the loaned securities. The Fund invests the cash
collateral in the N&B Securities Lending Quality Fund, LLC, which is managed by
State Street Bank and Trust Company ("State Street") pursuant to guidelines
approved by the Trust's investment manager. Neuberger guaranteed minimum
revenue to the Fund under the Agreement, and received a portion of any revenue
earned in excess of the guaranteed amount as a lending agency fee.
The Agreement has been renewed and approved by the Board of Trustees as of July
1, 2004 with substantially the same terms. Under this current Agreement,
Neuberger guarantees minimum revenue to the Fund and receives any revenue
earned in excess of the guaranteed amount as a lending agency fee.
At June 30, 2004, the Fund had not paid Neuberger any fees under the Agreement.
Income earned on the securities loaned, if any, is reflected in the Statement
of Operations under the caption Income from securities loaned-net.
11 Transactions with other funds managed by Neuberger Berman Management Inc.:
Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission, the Fund may invest in the Neuberger Berman Institutional Cash Fund
(the "Cash Fund"), a fund managed by Management and having the same Board
members as the Fund. The Cash Fund seeks to provide as high a level of current
income as is consistent with the preservation of capital and the maintenance of
liquidity. For any cash that the Fund invests in the Cash Fund, Management
waives a portion of its management fee equal to the management fee it receives
from the Cash Fund on those assets. For the six months ended June 30, 2004,
such waived fees amounted to $7,873. For the six months ended June 30, 2004,
income earned on this
14
Notes to Financial Statements Partners Portfolio cont'd
investment amounted to $61,887 and is reflected in the Statement of Operations
under the caption Income from investments in affiliated issuers.
Note B--Management Fees, Administration Fees, Distribution Arrangements, and
Other Transactions With Affiliates:
Fund shares are issued and redeemed in connection with investments in and
payments under certain variable annuity contracts and variable life insurance
policies issued through separate accounts of life insurance companies and are
also offered directly to qualified pension and retirement plans.
The Fund retains Management as its investment manager under a Management
Agreement. For such investment management services, the Fund pays Management a
fee at the annual rate of 0.55% of the first $250 million of the Fund's average
daily net assets, 0.525% of the next $250 million, 0.50% of the next $250
million, 0.475% of the next $250 million, 0.45% of the next $500 million,
0.425% of the next $2.5 billion, and 0.40% of average daily net assets in
excess of $4 billion.
The Fund retains Management as its administrator under an Administration
Agreement. The Fund pays Management an administration fee at the annual rate of
0.30% of its average daily net assets under this agreement. Additionally,
Management retains State Street as its sub-administrator under a
Sub-Administration Agreement. Management pays State Street a fee for all
services received under the agreement.
The Trustees of the Trust adopted a non-fee distribution plan for the Fund.
Management has contractually undertaken through December 31, 2007 to reimburse
the Fund for its operating expenses (excluding the fees payable to Management,
interest, taxes, brokerage commissions, extraordinary expenses, and transaction
costs) ("Operating Expenses") which exceed, in the aggregate, 1.00% per annum
of its average daily net assets (the "Expense Limitation"). For the six months
ended June 30, 2004, no reimbursement to the Fund was required. The Fund has
agreed to repay Management through December 31, 2010 for its excess Operating
Expenses previously reimbursed by Management, so long as its annual Operating
Expenses during that period do not exceed its Expense Limitation, and the
repayment is made within three years after the year in which Management issued
the reimbursement. During the six months ended June 30, 2004, there was no
reimbursement to Management. At June 30, 2004, the Fund has no contingent
liability to Management under the agreement.
On October 31, 2003, Management and Neuberger, a member firm of the New York
Stock Exchange and sub-adviser to the Fund, became indirect wholly-owned
subsidiaries of Lehman Brothers Holdings Inc. ("Lehman"), a publicly-owned
holding company. Neuberger is retained by Management to furnish it with
investment recommendations and research information without added cost to the
Fund. Several individuals who are officers and/or Trustees of the Trust are
also employees of Neuberger and/or Management.
On July 1, 2003, the Fund entered into a commission recapture program, which
enables it to pay some of its operational expenses by recouping a portion of
the commissions it pays to a broker that is not a related party of the Fund.
Expenses paid through this program may include costs of custodial, transfer
agency or
15
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
accounting services. For the six months ended June 30, 2004, the impact of this
arrangement was a reduction of $55,026.
The Fund has an expense offset arrangement in connection with its custodian
contract. The impact of this arrangement, reflected in the Statement of
Operations under the caption Custodian fees, was a reduction of $255.
Note C--Securities Transactions:
During the six months ended June 30, 2004, there were purchase and sale
transactions (excluding short-term securities) of $223,970,761 and
$305,223,576, respectively.
During the six months ended June 30, 2004, brokerage commissions on securities
transactions amounted to $772,005, of which Neuberger received $0, Lehman
received $153,850, and other brokers received $618,155.
Note D--Fund Share Transactions:
Share activity for the six months ended June 30, 2004 and for the year ended
December 31, 2003 was as follows:
For the For the
Six Months Ended Year Ended
June 30, December 31,
2004 2003
Shares Sold 2,482,972 20,169,797
Shares Redeemed (6,756,412) (22,548,108)
---------- -----------
Total (4,273,440) (2,378,311)
---------- -----------
16
Notes to Financial Statements Partners Portfolio cont'd
Note E--Line of Credit:
At June 30, 2004, the Fund was a participant in a single committed, unsecured
$150,000,000 line of credit with State Street, to be used only for temporary or
emergency purposes. Interest is charged on borrowings under this agreement at
the overnight Federal Funds Rate plus 0.50% per annum. A facility fee of 0.10%
per annum of the available line of credit is charged, of which the Fund has
agreed to pay its pro rata share, based on the ratio of its individual net
assets to the net assets of all participants at the time the fee is due and
payable. The fee is paid quarterly in arrears. No compensating balance is
required. Other investment companies managed by Management also participate in
this line of credit on the same terms. Because several investment companies
participate, there is no assurance that the Fund will have access to the entire
$150,000,000 at any particular time. The Fund had no loans outstanding pursuant
to this line of credit at June 30, 2004, nor had the Fund utilized this line of
credit at any time prior to that date.
Note F--Unaudited Financial Information:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent auditors. Annual reports
contain audited financial statements.
17
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Financial Highlights Partners Portfolio+
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements.++
Six Months
Ended
June 30, Year Ended December 31,
----------- ------------------------------------------------------
2004 2003 2002 2001 2000 1999
(Unaudited)
Net Asset Value, Beginning of Period $15.40 $11.40 $15.10 $16.17 $19.64 $18.93
------ ------ ------ ----- ------ ------
Income From Investment Operations:
Net Investment Income (Loss) .10 .00 .01 .06 .07 .11
Net Gains or Losses on Securities
(both realized and unrealized) .73 4.00 (3.64) (.50) (.20) 1.23
------ ------ ------ ------ ------ ------
Total From Investment Operations .83 4.00 (3.63) (.44) (.13) 1.34
------ ------ ------ ------ ------ ------
Less Distributions From:
Net Investment Income -- -- (.07) (.06) (.15) (.23)
Net Capital Gains -- -- -- (.57) (3.19) (.40)
------ ------ ------ ------ ------ ------
Total Distributions -- -- (.07) (.63) (3.34) (.63)
------ ------ ------ ------ ------ ------
Net Asset Value, End of Period $16.23 $15.40 $11.40 $15.10 $16.17 $19.64
------ ------ ------ ------ ------ ------
Total Return++ +5.39%** +35.09% -24.14% -2.83% +0.70% +7.37%
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $636.0 $669.6 $522.6 $795.4 $808.3 $989.5
Ratio of Gross Expenses to Average Net Assets# .89%* .91% .91% .87% .92% .87%
Ratio of Net Expenses to Average Net Assets[sec] .87%* .90% .91% .87% .92% .87%
Ratio of Net Investment Income (Loss) to Average Net Assets 1.23%* .01% .05% .43% .42% .57%
Portfolio Turnover Rate 34% 76% 53% 74% 97% 112%
See Notes to Financial Highlights 18
Notes to Financial Highlights Partners Portfolio
+ The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's proportionate share of AMT Partners
Investment's income and expenses through April 30, 2000 under the prior
master/feeder fund structure.
++ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each
fiscal period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Current returns may be lower or higher than the performance data
quoted. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. Total return would
have been lower if Management had not waived certain expenses. The total
return information shown does not reflect charges and other expenses that
apply to the separate account or the related insurance policies, and the
inclusion of these charges and other expenses would reduce the total
return for all fiscal periods shown. Performance data current to the most
recent month-end are available at www.nb.com.
# The Fund is required to calculate an expense ratio without taking into
consideration any expense reductions related to expense offset and
commission recapture arrangements.
++ The per share amounts which are shown have been computed based on the
average number of shares outstanding during each fiscal period.
[sec] After waiver of a portion of the investment management fee. Had the
investment manager not undertaken such action, the annualized ratios of
net expenses to average daily net assets would have been:
Six Months Ended Year Ended
June 30, December 31,
2004 2003
0.88% 0.90%
* Annualized.
** Not annualized.
19
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Trustees and Officers (Unaudited)
The following tables set forth information concerning the trustees and officers
of the Trust. All persons named as trustees and officers also serve in similar
capacities for other funds administered or managed by NB Management and
Neuberger Berman. The Statement of Additional Information includes additional
information about fund trustees and is available upon request, without charge,
by calling (800) 877-9700.
Information about the Board of Trustees
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
John Cannon (74) Trustee since Consultant. Formerly, Chairman 38 Independent Trustee or Director of
2000 and Chief Investment Officer, three series of Oppenheimer Funds:
CDC Investment Advisors Limited Term New York Municipal
(registered investment adviser) Fund, Rochester Fund Municipals,
(1993-January 1999); prior and Oppenheimer Convertible
thereto, President and Chief Securities Fund since 1992.
Executive Officer, AMA
Investment Advisors, an affiliate
of the American Medical
Association.
Faith Colish (68) Trustee since Counsel, Carter Ledyard & 38 Director, American Bar Retirement
1984 Milburn LLP (law firm) since Association (ABRA) since 1997
October 2002; Formerly, (not-for-profit membership
Attorney-at-Law and President, association).
Faith Colish, A Professional
Corporation, 1980 to 2002.
Walter G. Ehlers (71) Trustee since Consultant; Retired President 38 None.
1989 and Trustee, Teachers
Insurance & Annuity (TIAA)
and College Retirement
Equities Fund (CREF).
C. Anne Harvey (66) Trustee since Consultant, C. A. Harvey 38 President, Board of Associates to
1998 Associates, since June 2001; The National Rehabilitation
Formerly, Director, AARP, 1978 Hospital's Board of Directors since
to December 2001. 2002; Formerly, Member, Individual
Investors Advisory Committee to the
New York Stock Exchange Board of
Directors, 1998 to June 2002;
Member, American Savings
Education Council's Policy Board
(ASEC),1998-2000; Member,
Executive Committee, Crime
Prevention Coalition of America,
1997-2000.
20
Trustees and Officers (Unaudited) cont'd
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Barry Hirsch (71) Trustee since Attorney-at-Law. Formerly, 38 None.
2000 Senior Counsel, Loews
Corporation (diversified
financial corporation) May
2002 until April 2003; formerly,
Senior Vice President, Secretary
and General Counsel, Loews
Corporation.
Robert A. Kavesh (76) Trustee since Marcus Nadler Professor of 38 Director, DEL Laboratories, Inc.
2000 Finance and Economics (cosmetics and pharmaceuticals)
Emeritus, New York University, since 1978; The Caring Community
Stern School of Business. (not-for-profit).
Howard A. Mileaf (67) Trustee since Retired. Formerly, Vice 38 Director, WHX Corporation
1999 President and Special Counsel, (holding company) since August
WHX Corporation (holding 2002; Director, WebFinancial
company), 1993-2001. Corporation (holding company)
since December 2002; Director, State
Theatre of New Jersey (not-for-
profit theater) since 2000; formerly,
Director, Kevlin Corporation
(manufacturer of microwave and
other products).
William E. Rulon (71) Trustee since Retired. Senior Vice President, 38 Director, Pro-Kids Golf and
2000 Foodmaker, Inc. (operator and Learning Academy (teach golf and
franchiser of restaurants) until computer usage to "at risk" children)
January 1997. since 1998; Formerly, Director,
Prandium, Inc. (restaurants) from
March 2001 until July 2002.
Cornelius T. Ryan (72) Trustee since Founding General Partner, 38 Director, Capital Cash Management
2000 Oxford Partners and Oxford Trust (money market fund),
Bioscience Partners (venture Narragansett Insured Tax-Free
capital partnerships) and Income Fund, Rocky Mountain
President, Oxford Venture Equity Fund, Prime Cash Fund,
Corporation. several private companies and
QuadraMed Corporation (NASDAQ).
21
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Tom Decker Seip (54) Trustee since General Partner, Seip 38 Director, H&R Block, Inc. (financial
2000 Investments LP (a private services company) since May 2001;
investment partnership); Director, Forward Management, Inc.
formerly, President and CEO, (asset management) since 2001;
Westaff, Inc. (temporary Formerly, Director, General Magic
staffing), May 2001 to January (voice recognition software),
2002; Senior Executive at the November 2001 until 2002; Director,
Charles Schwab Corporation E-Finance Corporation (credit
from 1983 to 1999, including decisioning services), 1999-2003;
Chief Executive Officer, Director, Save-Daily.com (micro
Charles Schwab Investment investing services), 1999-2003;
Management, Inc. and Trustee, Director, Offroad Capital Inc.
Schwab Family of Funds and (pre-public internet commerce
Schwab Investments from 1997 company).
to 1998 and Executive Vice
President--Retail Brokerage,
Charles Schwab Investment
Management from 1994
to 1997.
Candace L. Straight (56) Trustee since Private investor and consultant 38 Director, The Proformance Insurance
1999 specializing in the insurance Company (personal lines property
industry; Formerly, Advisory and casualty insurance company)
Director, Securitas Capital LLC since March 2004; Director,
(a global private equity Providence Washington (property
investment firm dedicated to and casualty insurance company),
making investments in the since December 1998; Director,
insurance sector), 1998 until Summit Global Partners (insurance
December 2002. brokerage firm) since October 2000.
Peter P. Trapp (59) Trustee since Regional Manager for Atlanta 38 None.
1984 Region, Ford Motor Credit
Company since August 1997;
Formerly, President, Ford
Life Insurance Company, April
1995 until August 1997.
22
Trustees and Officers (Unaudited) cont'd
Number of
Portfolios in
Trustees who are Position and Fund Complex
"Interested Persons" Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
Edward I. OBrien* (75) Trustee since Formerly, Member, Investment 38 Director, Legg Mason, Inc. (financial
2000 Policy Committee, Edward services holding company) since
Jones, 1993-2001; President, 1993; formerly, Director, Boston
Securities Industry Association Financial Group (real estate and tax
("SIA") (securities industry's shelters) 1993-1999.
representative in government
relations and regulatory matters
at the federal and state levels)
1974-1992; Adviser to SIA,
November 1992-November 1993.
Jack L. Rivkin* (63) President and Executive Vice President and 38 Director, Dale Carnegie and
Trustee since Chief Investment Officer, Associates, Inc. (private company)
December Neuberger Berman Inc. since 1998; Director, Emagin Corp.
2002 (holding company) since 2002 (public company) since 1997;
and 2003, respectively; Director, Solbright, Inc. (private
Executive Vice President and company) since 1998; Director,
Chief Investment Officer, Infogate, Inc. (private company)
Neuberger Berman since 2002 since 1997.
and 2003, respectively; Director
and Chairman, NB
Management since December
2002; Formerly, Executive Vice
President, Citigroup
Investments, Inc. from
September 1995 to February
2002; Executive Vice President,
Citigroup Inc. from September
1995 to February 2002.
Peter E. Sundman* (45) Chairman of Executive Vice President, 38 Director, Neuberger Berman Inc.
the Board, Neuberger Berman Inc. (holding company) from 1999
Chief (holding company) since 1999; through March 2003; President and
Executive Head of Neuberger Berman Director, NB Management since
Officer and Inc.'s Mutual Funds and 1999; Director and Vice President,
Trustee since Institutional Business since Neuberger Berman Agency, Inc.
2000; 1999; Executive Vice President, since 2000.
President and Neuberger Berman since 1999;
Chief Principal, Neuberger Berman
Executive from 1997 until 1999; Senior
Officer from Vice President, NB
1998 to 2000 Management from 1996
until 1999.
23
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the Trust's Trust Instrument, each Trustee shall hold office
for life or until his or her successor is elected or the Trust terminates;
except that (a) any Trustee may resign by delivering a written resignation;
(b) any Trustee may be removed with or without cause at any time by a
written instrument signed by at least two-thirds of the other Trustees; (c)
any Trustee who requests to be retired, or who has become unable to serve,
may be retired by a written instrument signed by a majority of the other
Trustees; and (d) any Trustee may be removed at any shareholder meeting by
a vote of at least two-thirds of the outstanding shares.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
* Indicates a Trustee who is an "interested person" within the meaning of the
1940 Act. Mr. Sundman and Mr. Rivkin are interested persons of the Trust by
virtue of the fact that they are officers and/or directors of NB Management
and Executive Vice Presidents of Neuberger Berman. Mr. O'Brien is an
interested person of the Trust by virtue of the fact that he is a director
of Legg Mason, Inc., a wholly owned subsidiary of which, from time to time,
serves as a broker or dealer to the Funds and other funds for which NB
Management serves as investment manager.
24
Information about the Officers of the Trust
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- ------------------------------------------------------------------------------------------------------------------------------------
Claudia A. Brandon (47) Secretary since 1985 Vice President--Mutual Fund Board Relations, NB Management since 2000;
Vice President, Neuberger Berman since 2002 and employee since 1999;
Vice President, NB Management from 1986 to 1999; Secretary, eleven
registered investment companies for which NB Management acts as
investment manager and administrator (four since 2002, three since
2003, and one since 2004).
Robert Conti (48) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice President,
Neuberger Berman from 1999 until 2003; Senior Vice President, NB
Management since 2000; Controller, NB Management until 1996;
Treasurer, NB Management from 1996 until 1999; Vice President, eleven
registered investment companies for which NB Management acts as
investment manager and administrator (three since 2000, four since
2002, three since 2003, and one since 2004).
Brian P. Gaffney (50) Vice President since 2000 Managing Director, Neuberger Berman since 1999; Senior Vice President,
NB Management since 2000; Vice President, NB Management from 1997
until 1999; Vice President, eleven registered investment companies for
which NB Management acts as investment manager and administrator
(three since 2000, four since 2002, three since 2003, and one since
2004).
Sheila R. James (39) Assistant Secretary since 2002 Employee, Neuberger Berman since 1999; Employee, NB Management from
1991 to 1999; Assistant Secretary, eleven registered investment
companies for which NB Management acts as investment manager and
administrator (seven since 2002, three since 2003 and one since 2004).
Kevin Lyons (49) Assistant Secretary since 2003 Employee, Neuberger Berman since 1999; Employee, NB Management from
1993 to 1999; Assistant Secretary, eleven registered investment
companies for which NB Management acts as investment manager and
administrator (Ten since 2003 and one since 2004).
25
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- ------------------------------------------------------------------------------------------------------------------------------------
John M. McGovern (34) Assistant Treasurer since 2002 Vice President, Neuberger Berman since 2004; Employee, NB
Management since 1993; Assistant Treasurer, eleven registered
investment companies for which NB Management acts as investment
manager and administrator (seven since 2002, three since 2003, and
one since 2004).
Barbara Muinos (45) Treasurer and Principal Financial Vice President, Neuberger Berman since 1999; Assistant Vice
and Accounting Officer since 2002; President, NB Management from 1993 to 1999; Treasurer and
prior thereto, Assistant Treasurer Principal Financial and Accounting Officer, eleven registered
since 1996 investment companies for which NB Management acts as investment
manager and administrator (seven since 2002, three since 2003, and
one since 2004); Assistant Treasurer, three registered investment
companies for which NB Management acts as investment manager and
administrator from 1996 until 2002.
Frederic B. Soule (58) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President; Neuberger Berman from 1999 until 2003; Vice President,
NB Management from 1995 until 1999; Vice President, eleven
registered investment companies for which NB Management acts as
investment manager and administrator (three since 2000, four since
2002, three since 2003, and one since 2004).
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the By-Laws of the Trust, each officer elected by the Trustees
shall hold office until his or her successor shall have been elected and
qualified or until his or her earlier death, inability to serve, or
resignation. Officers serve at the pleasure of the Trustees and may be
removed at any time with or without cause.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
26
Proxy Voting Policies and Procedures
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to portfolio securities is available, without
charge, by calling 1-800-877-9700 (toll-free) and on the website of the
Securities and Exchange Commission, at www.sec.gov. Beginning September 2004,
information regarding how the Fund voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 will also be
available without charge, by calling 1-800-877-9700 (toll-free), on the website
of the Securities and Exchange Commission, at www.sec.gov, and on the Fund's
website at www.nb.com (http://www.nb.com).
27
Semi-Annual Report
June 30, 2004
C0244 08/04
[LOGO]
Neuberger Berman
Advisers
Management
Trust
Regency
Portfolio
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Regency Portfolio Manager's Commentary
We are pleased to report that the Regency Portfolio outperformed its benchmark,
the Russell Midcap Value Index, during the first half of 2004.(2)
Despite concern over rising interest rates, high oil prices, Iraq, and global
terrorism, mid-cap stocks made solid progress in the first half of 2004. On a
relative return basis, mid-cap value stocks excelled, with the Russell Midcap
Value Index posting the second best performance of Russell's 21 stock market
indices.
Our investments in the financial, healthcare, and energy sectors had the most
favorable impact on returns. Charter One (acquired by Bank of Scotland's
American subsidiary Citizens Bank) and PMI Group were our best performers in the
financials sector. HMOs Oxford Health Plans (acquired by UnitedHealth) and
Anthem, and hospital company Triad Hospitals were the most notable gainers in
the healthcare category. XTO Energy (the portfolio's largest holding as of June
30, 2004) and Sunoco were our most rewarding investments in the energy sector.
In our opinion, fundamentals and valuations in these three industry groups
remain compelling. The conventional wisdom is that rising interest rates hurt
all financial companies. We believe this simply isn't true. Higher rates don't
necessarily hurt many regional banks. In fact, with most commercial and home
equity loans tied to the prime rate and adjusted monthly, the value of regional
banks' assets can increase as interest rates trend higher. Mortgage insurer PMI
Group, one of our top performers in the first half of 2004, provides another
example of how rising interest rates can help financial companies. Rising home
prices and a boom in mortgage refinance led many of its customers to cancel
their mortgage insurance, or at best created additional costs as new policies
were issued just to keep the same revenue. With mortgage rates moving higher and
the refinance boom ending, PMI's margins and earnings are improving.
Our healthcare sector investments performed quite well in the first half of
2004, but in general, healthcare stocks lagged as investors remained infatuated
with cyclical companies. As the pace of economic growth slows in the quarters
ahead and cyclical companies' earnings growth moderates, we believe investors
will come back to more stable growth sectors such as healthcare. Our healthcare
sector assets are concentrated in hospital companies and HMOs with healthy
balance sheets, stable cash flows, high returns on equity, and realistic
prospects for consistent double-digit earnings growth in the years ahead.
Although energy was the top performing sector in the first half, we think
valuations for selected energy companies remain attractive. While we doubt
$35-plus oil is sustainable, we do believe long-term supply/demand dynamics will
support oil prices in the mid-20s. Some energy stock valuations now reflect this
long-term view, and we took profits as several holdings reached our price
targets. However, we believe our remaining positions still have excellent upside
potential.
We were substantially underweighted in technology and our tech sector
investments declined versus a gain for the tech component of our benchmark. Hard
drive maker Western Digital, which sold off as its two biggest competitors
reported disappointing earnings, was the primary culprit. Over the last five
years, consolidation in the
1
disk drive business has diminished pricing pressure and restored profit margins.
Although this is no longer an explosive growth business, we think a
well-managed, financially strong competitor such as Western Digital can grow
annualized earnings by 10-15% going forward. Adjusted for the $1.40 per share in
net cash on the balance sheet, Western Digital is trading around 7.5 times
trailing earnings. In our view, a high quality company trading at a multiple
discount to its earnings growth rate is a legitimate bargain.
We think that the economy is out of the recovery mode and into a slower growth
expansion phase. This could be bad news for companies whose valuations reflect
rather lofty earnings expectations. We note that several such companies
reporting second quarter earnings in early July sold off because earnings simply
met rather than exceeded published forecasts. However, we think this is a good
environment for value stocks, which by definition don't carry the heavy burden
of optimistic earnings expectations. We are really looking forward to the
upcoming second and third quarter earnings reporting seasons. It will not only
give investors obsessing over macroeconomic issues something more concrete to
think about, but also should call attention to what we believe are the strong
fundamentals of the stocks in our portfolio.
Sincerely,
/s/ Andrew Wellington
---------------------
ANDREW WELLINGTON
PORTFOLIO MANAGER
1. 30.92% and 9.80% were the average annual total returns for the 1-year and
since inception (08/22/01) periods ended June 30, 2004. Neuberger Berman
Management Inc. ("NBMI") has agreed to absorb certain expenses of the AMT
Portfolios. Without this arrangement, which is subject to change, the total
returns of the Portfolios would be less. Total return includes reinvestment of
dividends and capital gain distributions. Performance data quoted represent past
performance and the investment return and principal value of an investment will
fluctuate so that the shares, when redeemed, may be worth more or less than
original cost. Current performance may be lower or higher than the performance
data quoted. For performance data current to the most recent month end, please
visit www.nb.com/amtperformance. The performance information does not reflect
fees and expenses of the variable annuity and variable life insurance policies
or the pension plans whose proceeds are invested in the portfolio.
2. The Russell Midcap[RegTM] Value Index measures the performance of those
Russell Midcap[RegTM] Index companies with lower price-to-book ratios and lower
forecasted growth values. The Russell Midcap Index measures the performance of
the 800 smallest companies in the Russell 1000[RegTM] Index, which represents
approximately 27% of the total market capitalization of the Russell 1000 Index
(which, in turn, consists of the 1,000 largest U.S. companies, based on market
capitalization). Please note that indices do not take into account any fees and
expenses of investing in the individual securities that they track, and that
individuals cannot invest directly in any index. Data about the performance of
these indices are prepared or obtained by NBMI and include reinvestment of all
dividends and capital gain distributions. The Portfolio may invest in many
securities not included in the above-described indices.
2
Any ratios or other measurements using a factor of forecasted earnings of a
company discussed herein are based on consensus estimates, not Neuberger
Berman's own projections, and they may or may not be realized. In addition, any
revision to a forecast could affect the market price of a security. By quoting
them herein, Neuberger Berman does not offer an opinion as to the accuracy of
and does not guarantee these forecasted numbers.
The investments for the Portfolio are managed by the same portfolio manager(s)
who manage one or more other mutual funds that have similar names, investment
objectives and investment styles as the Portfolio. You should be aware that the
Portfolio is likely to differ from the other mutual funds in size, cash flow
pattern and tax matters. Accordingly, the holdings and performance of the
Portfolio can be expected to vary from those of the other mutual funds.
The composition, industries and holdings of the Portfolio are subject to change.
Shares of the separate Portfolios of Neuberger Berman Advisers Management Trust
are sold only through the currently effective prospectus and are not available
to the general public. Shares of this Portfolio may be purchased only by life
insurance companies to be used with their separate accounts that fund variable
annuity and variable life insurance policies and by qualified pension and
retirement plans.
(C) 2004 Neuberger Berman Management Inc., distributor. All rights reserved.
3
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Regency Portfolio
Number of Shares Market Value+
Common Stocks (97.1%)
Auto Related (9.3%)
38,900 AutoNation, Inc. $ 665,190*\P
24,300 AutoZone, Inc. 1,946,430*\P
41,500 Borg-Warner Automotive 1,816,455
32,200 Johnson Controls 1,718,836
33,800 Lear Corp. 1,993,862
------------
8,140,773
Banking & Financial (8.1%)
48,600 First Horizon National 2,209,842
62,300 IndyMac Bancorp 1,968,680
33,700 North Fork Bancorp 1,282,285\P
28,700 TCF Financial 1,666,035\P
------------
7,126,842
Business Services (2.2%)
37,200 Manpower Inc. 1,888,644
Consumer Cyclicals (6.6%)
29,500 Black & Decker 1,832,835\P
24,300 Mohawk Industries 1,781,919*
31,400 Whirlpool Corp. 2,154,040\P
------------
5,768,794
Financial Services (13.0%)
30,400 Ambac Financial Group 2,232,576\P
26,300 Bear Stearns 2,217,353\P
49,800 CIT Group 1,906,842
42,450 GreenPoint Financial 1,685,265
47,100 Radian Group 2,256,090
49,700 Waddell & Reed Financial 1,098,867
------------
11,396,993
Food & Beverage (5.9%)
62,700 Constellation Brands 2,328,051*
126,400 Del Monte Foods 1,284,224*
63,200 Fresh Del Monte Produce 1,597,064\P
------------
5,209,339
Health Care (14.0%)
22,100 Anthem, Inc. 1,979,276*\P
42,000 Coventry Health Care 2,053,800*
43,150 Davita, Inc. 1,330,314*
9,700 Laboratory Corp. of
America Holdings 385,090*
20,900 Omnicare, Inc. 894,729
14,000 Oxford Health Plans 770,560
52,300 Triad Hospitals 1,947,129*
31,700 Universal Health Services
Class B 1,454,713
34,000 WellChoice Inc. 1,407,600*
------------
12,223,211
Insurance (8.0%)
21,800 Arch Capital Group 869,384*
13,600 Endurance Specialty
Holdings 473,280
4
Number of Shares Market Value+
28,100 PartnerRe Ltd. $ 1,594,113
44,900 PMI Group 1,954,048
39,900 RenaissanceRe Holdings 2,152,605
------------
7,043,430
Manufacturing (2.7%)
50,000 SPX Corp. 2,322,000
Oil & Gas (8.2%)
8,000 Equitable Resources 413,680
65,600 Pioneer Natural Resources 2,301,248\P
31,600 Sunoco, Inc. 2,010,392
83,057 XTO Energy 2,474,268
------------
7,199,588
Restaurants (2.0%)
83,600 Darden Restaurants 1,717,980
Retail (9.9%)
74,900 Foot Locker 1,823,066
43,300 Liz Claiborne 1,557,934
102,700 Pier 1 Imports 1,816,763
47,900 Reebok International 1,723,442\P
36,400 V. F. Corp. 1,772,680
------------
8,693,885
Technology (4.2%)
56,400 Computer Associates 1,582,584
245,800 Western Digital 2,128,628*
------------
3,711,212
Transportation (2.6%)
31,650 Canadian National Railway 1,379,624
21,500 CNF Inc. 893,540
------------
2,273,164
Utilities, Electric & Gas (0.4%)
7,700 PPL Corp. 353,430
Total Common Stocks
(Cost $75,565,876)
85,069,285
------------
Principal Amount
Short-Term Investments (26.1%)
$18,178,200 N&B Securities Lending
Quality Fund, LLC 18,178,200++
4,671,478 Neuberger Berman
Institutional Cash Fund
Trust Class 4,671,478@
------------
Total Short-Term Investments
(Cost $22,849,678)
22,849,678#
------------
Total Investments (123.2%)
(Cost $98,415,554)
107,918,963##
Liabilities, less cash, receivables and
other assets [(23.2%)]
(20,339,041)
------------
Total Net Assets (100.0%)
$ 87,579,922
------------
See Notes to Schedule of Investments 5
Notes to Schedule of Investments Regency Portfolio
+ Investments in equity securities by the Fund are valued at the latest sales
price where that price is readily available; securities for which no sales
were reported, unless otherwise noted, are valued at the mean between the
closing bid and asked prices. Securities traded primarily on the NASDAQ Stock
Market are normally valued by the Fund at the NASDAQ Official Closing Price
("NOCP") provided by NASDAQ each business day. The NOCP is the most recently
reported price as of 4:00:02 p.m., Eastern time, unless that price is outside
the range of the "inside" bid and asked prices (i.e., the bid and asked
prices that dealers quote to each other when trading for their own accounts);
in that case, NASDAQ will adjust the price to equal the inside bid or asked
price, whichever is closer. Because of delays in reporting trades, the NOCP
may not be based on the price of the last trade to occur before the market
closes. The Fund values all other securities by a method the Board of
Trustees of Neuberger Berman Advisers Management Trust (the "Board") believes
accurately reflects fair value. Numerous factors may be considered when
determining the fair value of a security, including available analyst, media
or other reports, trading in futures or ADRs and whether the issuer of the
security being fair valued has other securities outstanding. Foreign security
prices are furnished by independent quotation services expressed in local
currency values. Foreign security prices are translated from the local
currency into U.S. dollars using the exchange rate as of 12:00 p.m., Eastern
time. The Board has approved the use of FT Interactive Data Corporation ("FT
Interactive") to assist in determining the fair value of the Fund's foreign
equity securities in the wake of certain significant events. Specifically,
when changes in the value of a certain index suggest that the closing prices
on the foreign exchanges no longer represent the amount that the Fund could
expect to receive for those securities, FT Interactive will provide adjusted
prices for certain foreign equity securities based on an analysis showing
historical correlations between the prices of those securities and changes in
the index. In the absence of precise information about the market values of
these foreign securities as of the close of the New York Stock Exchange, the
Board has determined on the basis of available data that prices adjusted in
this way are likely to be closer to the prices the Fund could realize on a
current sale than are the prices of those securities established at the close
of the foreign markets in which the securities primarily trade. However, fair
value prices are necessarily estimates, and there is no assurance that such a
price will be at or close to the price at which the security next trades.
Short-term debt securities with less than 60 days until maturity may be
valued at cost which, when combined with interest earned, approximates market
value.
# At cost, which approximates market value.
## At June 30, 2004, the cost of investments for U.S. Federal income tax
purposes was $98,415,554. Gross unrealized appreciation of investments was
$10,450,313 and gross unrealized depreciation of investments was $946,904,
resulting in net unrealized appreciation of $9,503,409, based on cost for
U.S. Federal income tax purposes.
* Non-income producing security.
\P All or a portion of this security is on loan (see Note A of Notes to
Financial Statements).
@ Neuberger Berman Institutional Cash Fund is also managed by Neuberger Berman
Management Inc. (see Note A of Notes to Financial Statements).
++ Affiliated issuer (see Note A of Notes to Financial Statements).
See Notes to Financial Statements 6
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Assets and Liabilities
Regency
Neuberger Berman Advisers Management Trust Portfolio
Assets
Investments in securities, at market value*+ (Note A)-see Schedule of Investments:
===================================================================================================
Unaffiliated issuers $ 85,069,285
- ---------------------------------------------------------------------------------------------------
Affiliated issuers 22,849,678
- ---------------------------------------------------------------------------------------------------
107,918,963
- ---------------------------------------------------------------------------------------------------
Dividends and interest receivable 51,557
===================================================================================================
Receivable for Fund shares sold 37,095
- ---------------------------------------------------------------------------------------------------
Prepaid expenses and other assets 1,618
- ---------------------------------------------------------------------------------------------------
Total Assets 108,009,233
- ---------------------------------------------------------------------------------------------------
Liabilities
Payable for collateral on securities loaned (Note A) 18,178,200
===================================================================================================
Payable for securities purchased 2,181,127
- ---------------------------------------------------------------------------------------------------
Payable to investment manager-net (Note B) 36,275
===================================================================================================
Payable to administrator (Note B) 19,939
- ---------------------------------------------------------------------------------------------------
Accrued expenses and other payables 13,770
- ---------------------------------------------------------------------------------------------------
Total Liabilities 20,429,311
- ---------------------------------------------------------------------------------------------------
Net Assets at value $ 87,579,922
- ---------------------------------------------------------------------------------------------------
Net Assets consist of:
Paid-in capital $ 72,625,173
===================================================================================================
Undistributed net investment income (loss) 132,360
- ---------------------------------------------------------------------------------------------------
Accumulated net realized gains (losses) on investments 5,318,968
===================================================================================================
Net unrealized appreciation (depreciation) in value of investments 9,503,421
- ---------------------------------------------------------------------------------------------------
Net Assets at value $ 87,579,922
- ---------------------------------------------------------------------------------------------------
Shares Outstanding ($.001 par value; unlimited shares authorized) 6,714,726
- ---------------------------------------------------------------------------------------------------
Net Asset Value, offering and redemption price per share $ 13.04
- ---------------------------------------------------------------------------------------------------
+Securities on loan, at market value:
Unaffiliated issuers $ 17,668,938
===================================================================================================
*Cost of investments:
Unaffiliated issuers $ 75,565,876
===================================================================================================
Affiliated issuers 22,849,678
- ---------------------------------------------------------------------------------------------------
Total cost of investments $ 98,415,554
- ---------------------------------------------------------------------------------------------------
See Notes to Financial Statements 7
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST FOR THE SIX MONTHS ENDED JUNE 30, 2004 (UNAUDITED)
Statement of Operations
Regency
Neuberger Berman Advisers Management Trust Portfolio
Investment Income
Income:
Dividend income-unaffiliated issuers $ 455,749
========================================================================================================
Interest income (Note A) 468
- --------------------------------------------------------------------------------------------------------
Income from securities loaned-net (Note A) 3,007
========================================================================================================
Income from investments in affiliated issuers (Note A) 12,641
- --------------------------------------------------------------------------------------------------------
Foreign taxes withheld (Note A) (1,102)
- --------------------------------------------------------------------------------------------------------
Total income 470,763
- --------------------------------------------------------------------------------------------------------
Expenses:
Investment management fee (Notes A & B) 202,058
========================================================================================================
Administration fee (Note B) 110,213
- --------------------------------------------------------------------------------------------------------
Audit fees 12,975
========================================================================================================
Custodian fees (Note B) 25,841
- --------------------------------------------------------------------------------------------------------
Insurance expense 428
========================================================================================================
Legal fees 4,261
- --------------------------------------------------------------------------------------------------------
Shareholder reports 5,353
========================================================================================================
Trustees' fees and expenses 13,453
- --------------------------------------------------------------------------------------------------------
Miscellaneous 1,033
- --------------------------------------------------------------------------------------------------------
Total expenses 375,615
Investment management fee waived (Note A) (1,597)
Expenses reduced by custodian fee expense offset and commission recapture arrangements (8,607)
(Note B)
- --------------------------------------------------------------------------------------------------------
Total net expenses 365,411
- --------------------------------------------------------------------------------------------------------
Net investment income (loss) 105,352
- --------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss) on Investments (Note A)
Net realized gain (loss) on:
Investment securities sold in unaffiliated issuers 5,500,326
========================================================================================================
Foreign currency (84)
- --------------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) in value of:
Investment securities in unaffiliated issuers (231,847)
========================================================================================================
Foreign currency (5)
- --------------------------------------------------------------------------------------------------------
Net gain (loss) on investments 5,268,390
- --------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations $5,373,742
- --------------------------------------------------------------------------------------------------------
See Notes to Financial Statements 8
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Changes in Net Assets
Neuberger Berman Advisers Management Trust
Regency Portfolio
----------------------------
Six Months
Ended Year
June 30, Ended
2004 December 31,
(Unaudited) 2003
Increase (Decrease) in Net Assets:
From Operations:
Net investment income (loss) $ 105,352 $ 27,008
=====================================================================================================
Net realized gain (loss) on investments 5,500,242 1,919,313
- -----------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of investments (231,852) 10,999,097
- -----------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from operations 5,373,742 12,945,418
- -----------------------------------------------------------------------------------------------------
From Fund Share Transactions (Note D):
Proceeds from shares sold 28,728,439 19,790,809
=====================================================================================================
Payments for shares redeemed (6,379,065) (1,956,147)
- -----------------------------------------------------------------------------------------------------
Net increase (decrease) from Fund share transactions 22,349,374 17,834,662
- -----------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets 27,723,116 30,780,080
Net Assets:
Beginning of period 59,856,806 29,076,726
- -----------------------------------------------------------------------------------------------------
End of period $87,579,922 $59,856,806
- -----------------------------------------------------------------------------------------------------
Undistributed net investment income (loss) at end of period $ 132,360 $ 27,008
- -----------------------------------------------------------------------------------------------------
See Notes to Financial Statements 9
Notes to Financial Statements Regency Portfolio
Note A--Summary of Significant Accounting Policies:
1 General: Regency Portfolio (the "Fund") is a separate operating series of
Neuberger Berman Advisers Management Trust (the "Trust"), a Delaware statutory
trust organized pursuant to a Trust Instrument dated May 23, 1994. The Trust is
currently comprised of ten separate operating series (each a "Series,"
collectively, the "Funds") each of which (except Focus Portfolio) is
diversified. The Trust is registered as an open-end management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act"),
and its shares are registered under the Securities Act of 1933, as amended. The
Fund currently offers only Class I shares. The Board of Trustees of the Trust
may establish additional series or classes of shares without the approval of
shareholders.
The assets of each Series belong only to that Series, and the liabilities of
each Series are borne solely by that Series and no other.
The preparation of financial statements in accordance with accounting principles
generally accepted in the United States requires Neuberger Berman Management
Inc. ("Management") to make estimates and assumptions at the date of the
financial statements. Actual results could differ from those estimates.
2 Portfolio valuation: Investment securities are valued as indicated in the
notes following the Schedule of Investments.
3 Foreign currency translation: The accounting records of the Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars using the exchange rate as of 12:00 p.m., Eastern time, to determine the
value of investments, other assets and liabilities. Purchase and sale prices of
securities, and income and expenses, are translated into U.S. dollars at the
prevailing rate of exchange on the respective dates of such transactions. Net
unrealized foreign currency gain (loss) arises from changes in the value of
assets and liabilities, other than investments in securities, as a result of
changes in exchange rates and is stated separately in the Statement of
Operations.
4 Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the ex-dividend
date or, for certain foreign dividends, as soon as the Fund becomes aware of the
dividends. Non-cash dividends included in dividend income, if any, are recorded
at the fair market value of the securities received. Interest income, including
accretion of original issue discount, where applicable, and accretion of
discount on short-term investments, is recorded on the accrual basis. Realized
gains and losses from securities transactions and foreign currency transactions
are recorded on the basis of identified cost and stated separately in the
Statement of Operations.
5 Federal income taxes: The Funds are treated as separate entities for U.S.
Federal income tax purposes. It is the policy of the Fund to continue to qualify
as a regulated investment company by complying with the provisions available to
certain investment companies, as defined in applicable sections of the Internal
Revenue Code, and to make distributions of investment company taxable income and
net capital gains (after reduction for any amounts available for U.S. Federal
income tax purposes as capital loss
10
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
carryforwards) sufficient to relieve it from all, or substantially all, U.S.
Federal income taxes. Accordingly, the Fund paid no U.S. Federal income taxes
and no provision for U.S. Federal income taxes was required.
6 Dividends and distributions to shareholders: The Fund may earn income, net of
expenses, daily on its investments. Income dividends and distributions from net
realized capital gains, if any, generally are distributed in October. Income
dividends and capital gain distributions to shareholders are recorded on the
ex-dividend date. To the extent the Fund's net realized capital gains, if any,
can be offset by capital loss carryforwards ($65,315 expiring in 2010,
determined as of December 31, 2003), it is the policy of the Fund not to
distribute such gains.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a tax return of capital.
Differences in the recognition or classification of income between the financial
statements and tax earnings and profits which result in temporary
over-distributions for financial statement purposes are classified as
distributions in excess of net investment income or accumulated net realized
gains in the components of net assets on the Statement of Assets and
Liabilities.
The tax character of distributions paid during the years ended December 31, 2003
and 2002 was as follows:
Distributions Paid From:
Tax Return
Ordinary Income of Capital Total
2003 2002 2003 2002 2003 2002
$ -- $24,825 $ -- $24,550 $ -- $49,375
As of December 31, 2003, the components of distributable earnings (accumulated
losses) on a U.S. Federal income tax basis were as follows:
Undistributed Unrealized Loss
Ordinary Appreciation Carryforwards
Income (Depreciation) and Deferrals Total
$27,008 $9,619,314 $(65,315) $9,581,007
The difference between book basis and tax basis is attributable primarily to the
tax deferral of losses on wash sales.
7 Foreign taxes: Foreign taxes withheld represent amounts withheld by foreign
tax authorities, net of refunds recoverable.
8 Expense allocation: Certain expenses are applicable to multiple funds.
Expenses directly attributable to a Series are charged to that Series. Expenses
of the Trust that are not directly attributed to a Series are allocated among
the Funds, on the basis of relative net assets, except where a more appropriate
allocation of expenses to each of the Funds can otherwise be made fairly.
Expenses borne by the complex of related investment companies, which includes
open-end and closed-end investment companies for which Management serves as
investment manager, that are not directly attributed to a Series or the Trust,
are allocated among the Fund and the other investment companies in the complex
or series thereof, on the basis of relative net assets, except where a more
appropriate allocation of expenses to each investment company in the complex or
series thereof can otherwise be made fairly.
11
Notes to Financial Statements Regency Portfolio cont'd
9 Security lending: Pursuant to an Exemptive Order issued by the Securities and
Exchange Commission, the Fund entered into a Securities Lending Agreement
("Agreement") with Neuberger Berman, LLC ("Neuberger") on April 17, 2003.
Securities loans involve certain risks in the event a borrower should fail
financially, including delays or inability to recover the lent securities or
foreclose against the collateral. The investment manager, under the general
supervision of the Trust's Board of Trustees, monitors the creditworthiness of
the parties to whom the Fund makes security loans. The Fund will not lend
securities on which covered call options have been written, or lend securities
on terms which would prevent the Fund from qualifying as a regulated investment
company. The Fund receives cash collateral equal to at least 102% of the current
market value of the loaned securities. The Fund invests the cash collateral in
the N&B Securities Lending Quality Fund, LLC, which is managed by State Street
Bank and Trust Company ("State Street") pursuant to guidelines approved by the
Trust's investment manager. Neuberger guaranteed minimum revenue to the Fund
under the Agreement, and received a portion of any revenue earned in excess of
the guaranteed amount as a lending agency fee.
The Agreement has been renewed and approved by the Board of Trustees as of July
1, 2004 with substantially the same terms. Under this current Agreement,
Neuberger guarantees minimum revenue to the Fund and receives any revenue earned
in excess of the guaranteed amount as a lending agency fee.
At June 30, 2004, the Fund paid Neuberger $1,085 under the Agreement.
Income earned on the securities loaned, if any, is reflected in the Statement of
Operations under the caption Income from securities loaned-net.
10 Repurchase agreements: The Fund may enter into repurchase agreements with
institutions that the Fund's investment manager has determined are creditworthy.
Each repurchase agreement is recorded at cost. The Fund requires that the
securities purchased in a repurchase agreement be transferred to the custodian
in a manner sufficient to enable the Fund to assert a perfected security
interest in those securities in the event of a default under the repurchase
agreement. The Fund monitors, on a daily basis, the value of the securities
transferred to ensure that their value, including accrued interest, is greater
than amounts owed to the Fund under each such repurchase agreement.
11 Transactions with other funds managed by Neuberger Berman Management Inc.:
Pursuant to an Exemptive Order issued by the Securities and Exchange Commission,
the Fund may invest in the Neuberger Berman Institutional Cash Fund (the "Cash
Fund"), a fund managed by Management and having the same Board members as the
Fund. The Cash Fund seeks to provide as high a level of current income as is
consistent with the preservation of capital and the maintenance of liquidity.
For any cash that the Fund invests in the Cash Fund, Management waives a portion
of its management fee equal to the management fee it receives from the Cash Fund
on those assets. For the six months ended June 30, 2004, such waived fees
amounted to $1,597. For the six months ended June 30, 2004, income earned on
this investment amounted to $12,641 and is reflected in the Statement of
Operations under the caption Income from investments in affiliated issuers.
12
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Note B--Management Fees, Administration Fees, Distribution Arrangements, and
Other Transactions With Affiliates:
Fund shares are issued and redeemed in connection with investments in and
payments under certain variable annuity contracts and variable life insurance
policies issued through separate accounts of life insurance companies and are
also offered directly to qualified pension and retirement plans.
The Fund retains Management as its investment manager under a Management
Agreement. For such investment management services, the Fund pays Management a
fee at the annual rate of 0.55% of the first $250 million of the Fund's average
daily net assets, 0.525% of the next $250 million, 0.50% of the next $250
million, 0.475% of the next $250 million, 0.45% of the next $500 million, 0.425%
of the next $2.5 billion, and 0.40% of average daily net assets in excess of $4
billion.
The Fund retains Management as its administrator under an Administration
Agreement. The Fund pays Management an administration fee at the annual rate of
0.30% of its average daily net assets under this agreement. Additionally,
Management retains State Street as its sub-administrator under a
Sub-Administration Agreement. Management pays State Street a fee for all
services received under the agreement.
The Trustees of the Trust adopted a non-fee distribution plan for the Fund.
Management has contractually undertaken through December 31, 2007 to reimburse
the Fund for its operating expenses (including the fees payable to Management
but excluding interest, taxes, brokerage commissions, extraordinary expenses,
and transaction costs) ("Operating Expenses") which exceed, in the aggregate,
1.50% per annum of its average daily net assets (the "Expense Limitation"). For
the six months ended June 30, 2004, no reimbursement to the Fund was required.
The Fund has agreed to repay Management through December 31, 2010 for its excess
Operating Expenses previously reimbursed by Management, so long as its annual
Operating Expenses during that period do not exceed its Expense Limitation, and
the repayment is made within three years after the year in which Management
issued the reimbursement. During the six months ended June 30, 2004, there was
no reimbursement to Management. At June 30, 2004, the Fund has no contingent
liability to Management under the agreement.
On October 31, 2003, Management and Neuberger, a member firm of the New York
Stock Exchange and sub-adviser to the Fund, became indirect wholly-owned
subsidiaries of Lehman Brothers Holdings Inc. ("Lehman"), a publicly-owned
holding company. Neuberger is retained by Management to furnish it with
investment recommendations and research information without added cost to the
Fund. Several individuals who are officers and/or Trustees of the Trust are also
employees of Neuberger and/or Management.
On July 1, 2003, the Fund entered into a commission recapture program, which
enables it to pay some of its operational expenses by recouping a portion of the
commissions it pays to a broker that is not a related party of the Fund.
Expenses paid through this program may include costs of custodial, transfer
agency or
13
Notes to Financial Statements Regency Portfolio cont'd
accounting services. For the six months ended June 30, 2004, the impact of this
arrangement was a reduction of $8,581.
The Fund has an expense offset arrangement in connection with its custodian
contract. The impact of this arrangement, reflected in the Statement of
Operations under the caption Custodian fees, was a reduction of $26.
Note C--Securities Transactions:
During the six months ended June 30, 2004, there were purchase and sale
transactions (excluding short-term securities) of $49,120,497 and $26,567,389,
respectively.
During the six months ended June 30, 2004, brokerage commissions on securities
transactions amounted to $102,687, of which Neuberger received $81, Lehman
received $22,890, and other brokers received $79,716.
Note D--Fund Share Transactions:
Share activity for the six months ended June 30, 2004 and for the year ended
December 31, 2003 was as follows:
For the For the
Six Months Ended Year Ended
June 30, December 31,
2004 2003
Shares Sold 2,278,380 1,897,693
Shares Redeemed (514,344) (214,566)
--------- ---------
Total 1,764,036 1,683,127
--------- ---------
Note E--Line of Credit:
At June 30, 2004, the Fund was a participant in a single committed, unsecured
$150,000,000 line of credit with State Street, to be used only for temporary or
emergency purposes. Interest is charged on borrowings under this agreement at
the overnight Federal Funds Rate plus 0.50% per annum. A facility fee of 0.10%
per annum of the available line of credit is charged, of which the Fund has
agreed to pay its pro rata share, based on the ratio of its individual net
assets to the net assets of all participants at the time the fee is due and
payable. The fee is paid quarterly in arrears. No compensating balance is
required. Other investment companies managed by Management also participate in
this line of credit on the same terms. Because several investment companies
participate, there is no assurance that the Fund will have access to the entire
$150,000,000 at any particular time. The Fund had no loans outstanding pursuant
to this line of credit at June 30, 2004, nor had the Fund utilized this line of
credit at any time prior to that date.
Note F--Unaudited Financial Information:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent auditors. Annual reports
contain audited financial statements.
14
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Financial Highlights Regency Portfolio
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements.++
Six Months Period from
Ended August 22, 2001^
June 30, Year Ended December 31, to December 31,
----------- ------------------------ ----------------
2004 2003 2002 2001
(Unaudited)
Net Asset Value, Beginning of Period $12.09 $ 8.90 $ 9.97 $10.00
------ ------ ------ ------
Income From Investment Operations:
Net Investment Income (Loss) .02 .01 (.00) .01
Net Gains or Losses on Securities
(both realized and unrealized) .93 3.18 ( 1.05) (.04)
------ ------ ------ ------
Total From Investment Operations .95 3.19 ( 1.05) (.03)
------ ------ ------ ------
Less Distributions From:
Net Investment Income -- -- (.01) --
Tax Return of Capital -- -- (.01) --
------ ------ ------ ------
Total Distributions -- -- (.02) --
------ ------ ------ ------
Net Asset Value, End of Period $13.04 $12.09 $ 8.90 $ 9.97
------ ------ ------ ------
Total Return++ +7.86%** +35.84% -10.56% -0.30%**
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $ 87.6 $ 59.9 $ 29.1 $ 23.8
Ratio of Gross Expenses to Average Net Assets# 1.02%* 1.16% 1.28% 1.50%*
Ratio of Net Expenses to Average Net Assets[sec] .99%* 1.16% 1.28% 1.50%*
Ratio of Net Investment Income (Loss) to Average Net Assets .29%* .07% (.02)% .36%*
Portfolio Turnover Rate 37% 55% 81% 71%
See Notes to Financial Highlights 15
Notes to Financial Highlights Regency Portfolio
++ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each
fiscal period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Current returns may be lower or higher than the performance data
quoted. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. Total return would
have been lower if Management had not reimbursed and/or waived certain
expenses. Total return would have been higher if Management had not
recouped previously reimbursed expenses. The total return information
shown does not reflect charges and other expenses that apply to the
separate account or the related insurance policies, and the inclusion of
these charges and other expenses would reduce the total return for all
fiscal periods shown. Performance data current to the most recent
month-end are available at www.nb.com.
# The Fund is required to calculate an expense ratio without taking into
consideration any expense reductions related to expense offset and
commission recapture arrangements.
[sec] After reimbursement of expenses by the investment manager. Had the
investment manager not undertaken such action, the annualized ratio of net
expenses to average daily net assets would have been:
Period from
August 22, 2001 to
December 31, 2001
1.69%
After reimbursement of expenses previously paid by the investment manager.
Had the investment manager not been reimbursed, the annualized ratio of
net expenses to average daily net assets would have been:
Year Ended
December 31, 2002
1.23%
After waiver of a portion of the investment management fee. Had the
investment manager not undertaken such action, the annualized ratios of
net expenses to average daily net assets would have been:
Six Months Ended Year Ended
June 30, December 31,
2004 2003
1.00% 1.17%
^ The date investment operations commenced.
++ The per share amounts which are shown have been computed based on the
average number of shares outstanding during each fiscal period.
* Annualized.
** Not annualized.
16
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Trustees and Officers (Unaudited)
The following tables set forth information concerning the trustees and officers
of the Trust. All persons named as trustees and officers also serve in similar
capacities for other funds administered or managed by NB Management and
Neuberger Berman. The Statement of Additional Information includes additional
information about fund trustees and is available upon request, without charge,
by calling (800) 877-9700.
Information about the Board of Trustees
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
John Cannon (74) Trustee since Consultant. Formerly, Chairman 38 Independent Trustee or Director of
2000 and Chief Investment Officer, three series of Oppenheimer Funds:
CDC Investment Advisors Limited Term New York Municipal
(registered investment adviser) Fund, Rochester Fund Municipals,
(1993-January 1999); prior and Oppenheimer Convertible
thereto, President and Chief Securities Fund since 1992.
Executive Officer, AMA
Investment Advisors, an affiliate
of the American Medical
Association.
- ------------------------------------------------------------------------------------------------------------------------------------
Faith Colish (68) Trustee since Counsel, Carter Ledyard & 38 Director, American Bar Retirement
1984 Milburn LLP (law firm) since Association (ABRA) since 1997
October 2002; Formerly, (not-for-profit membership
Attorney-at-Law and President, association).
Faith Colish, A Professional
Corporation, 1980 to 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Walter G. Ehlers (71) Trustee since Consultant; Retired President 38 None.
1989 and Trustee, Teachers
Insurance & Annuity (TIAA)
and College Retirement
Equities Fund (CREF).
- ------------------------------------------------------------------------------------------------------------------------------------
C. Anne Harvey (66) Trustee since Consultant, C. A. Harvey 38 President, Board of Associates to
1998 Associates, since June 2001; The National Rehabilitation
Formerly, Director, AARP, 1978 Hospital's Board of Directors since
to December 2001. 2002; Formerly, Member, Individual
Investors Advisory Committee to the
New York Stock Exchange Board of
Directors, 1998 to June 2002;
Member, American Savings
Education Council's Policy Board
(ASEC),1998-2000; Member,
Executive Committee, Crime
Prevention Coalition of America,
1997-2000.
- ------------------------------------------------------------------------------------------------------------------------------------
17
Trustees and Officers (Unaudited) cont'd
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Barry Hirsch (71) Trustee since Attorney-at-Law. Formerly, 38 None.
2000 Senior Counsel, Loews
Corporation (diversified
financial corporation) May
2002 until April 2003; formerly,
Senior Vice President, Secretary
and General Counsel, Loews
Corporation.
- ------------------------------------------------------------------------------------------------------------------------------------
Robert A. Kavesh (76) Trustee since Marcus Nadler Professor of 38 Director, DEL Laboratories, Inc.
2000 Finance and Economics (cosmetics and pharmaceuticals)
Emeritus, New York University, since 1978; The Caring Community
Stern School of Business. (not-for-profit).
- ------------------------------------------------------------------------------------------------------------------------------------
Howard A. Mileaf (67) Trustee since Retired. Formerly, Vice 38 Director, WHX Corporation
1999 President and Special Counsel, (holding company) since August
WHX Corporation (holding 2002; Director, WebFinancial
company), 1993-2001. Corporation (holding company)
since December 2002; Director, State
Theatre of New Jersey (not-for-
profit theater) since 2000; formerly,
Director, Kevlin Corporation
(manufacturer of microwave and
other products).
- ------------------------------------------------------------------------------------------------------------------------------------
William E. Rulon (71) Trustee since Retired. Senior Vice President, 38 Director, Pro-Kids Golf and
2000 Foodmaker, Inc. (operator and Learning Academy (teach golf and
franchiser of restaurants) until computer usage to "at risk" children)
January 1997. since 1998; Formerly, Director,
Prandium, Inc. (restaurants) from
March 2001 until
July 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Cornelius T. Ryan (72) Trustee since Founding General Partner, 38 Director, Capital Cash Management
2000 Oxford Partners and Oxford Trust (money market fund),
Bioscience Partners (venture Narragansett Insured Tax-Free
capital partnerships) and Income Fund, Rocky Mountain
President, Oxford Venture Equity Fund, Prime Cash Fund,
Corporation. several private companies and
QuadraMed Corporation
(NASDAQ).
- ------------------------------------------------------------------------------------------------------------------------------------
18
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Tom Decker Seip (54) Trustee since General Partner, Seip 38 Director, H&R Block, Inc. (financial
2000 Investments LP (a private services company) since May 2001;
investment partnership); Director, Forward Management, Inc.
formerly, President and CEO, (asset management) since 2001;
Westaff, Inc. (temporary Formerly, Director, General Magic
staffing), May 2001 to January (voice recognition software),
2002; Senior Executive at the November 2001 until 2002; Director,
Charles Schwab Corporation E-Finance Corporation (credit
from 1983 to 1999, including decisioning services), 1999-2003;
Chief Executive Officer, Director, Save-Daily.com (micro
Charles Schwab Investment investing services), 1999-2003;
Management, Inc. and Trustee, Director, Offroad Capital Inc.
Schwab Family of Funds and (pre-public internet commerce
Schwab Investments from 1997 company).
to 1998 and Executive Vice
President--Retail Brokerage,
Charles Schwab Investment
Management from 1994
to 1997.
- ------------------------------------------------------------------------------------------------------------------------------------
Candace L. Straight (56) Trustee since Private investor and consultant 38 Director, The Proformance Insurance
1999 specializing in the insurance Company (personal lines property
industry; Formerly, Advisory and casualty insurance company)
Director, Securitas Capital LLC since March 2004; Director,
(a global private equity Providence Washington (property
investment firm dedicated to and casualty insurance company),
making investments in the since December 1998; Director,
insurance sector), 1998 until Summit Global Partners (insurance
December 2002. brokerage firm) since October 2000.
- ------------------------------------------------------------------------------------------------------------------------------------
Peter P. Trapp (59) Trustee since Regional Manager for Atlanta 38 None.
1984 Region, Ford Motor Credit
Company since August 1997;
Formerly, President, Ford
Life Insurance Company, April
1995 until August 1997.
- ------------------------------------------------------------------------------------------------------------------------------------
19
Trustees and Officers (Unaudited) cont'd
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Trustees who are Position and Fund Complex
"Interested Persons" Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Edward I. OBrien* (75) Trustee since Formerly, Member, Investment 38 Director, Legg Mason, Inc. (financial
2000 Policy Committee, Edward services holding company) since
Jones, 1993-2001; President, 1993; formerly, Director, Boston
Securities Industry Association Financial Group (real estate and tax
("SIA") (securities industry's shelters) 1993-1999.
representative in government
relations and regulatory matters
at the federal and state levels)
1974-1992; Adviser to SIA,
November 1992-November 1993.
- ------------------------------------------------------------------------------------------------------------------------------------
Jack L. Rivkin* (63) President and Executive Vice President and 38 Director, Dale Carnegie and
Trustee since Chief Investment Officer, Associates, Inc. (private company)
December Neuberger Berman Inc. since 1998; Director, Emagin Corp.
2002 (holding company) since 2002 (public company) since 1997;
and 2003, respectively; Director, Solbright, Inc. (private
Executive Vice President and company) since 1998; Director,
Chief Investment Officer, Infogate, Inc. (private company)
Neuberger Berman since 2002 since 1997.
and 2003, respectively; Director
and Chairman, NB
Management since December
2002; Formerly, Executive Vice
President, Citigroup
Investments, Inc. from
September 1995 to February
2002; Executive Vice President,
Citigroup Inc. from September
1995 to February 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Peter E. Sundman* (45) Chairman of Executive Vice President, 38 Director, Neuberger Berman Inc.
the Board, Neuberger Berman Inc. (holding company) from 1999
Chief (holding company) since 1999; through March 2003; President and
Executive Head of Neuberger Berman Director, NB Management since
Officer and Inc.'s Mutual Funds and 1999; Director and Vice President,
Trustee since Institutional Business since Neuberger Berman Agency, Inc.
2000; 1999; Executive Vice President, since 2000.
President and Neuberger Berman since 1999;
Chief Principal, Neuberger Berman
Executive from 1997 until 1999; Senior
Officer from Vice President, NB
1998 to 2000 Management from 1996
until 1999.
- ------------------------------------------------------------------------------------------------------------------------------------
20
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the Trust's Trust Instrument, each Trustee shall hold office
for life or until his or her successor is elected or the Trust terminates;
except that (a) any Trustee may resign by delivering a written resignation;
(b) any Trustee may be removed with or without cause at any time by a
written instrument signed by at least two-thirds of the other Trustees; (c)
any Trustee who requests to be retired, or who has become unable to serve,
may be retired by a written instrument signed by a majority of the other
Trustees; and (d) any Trustee may be removed at any shareholder meeting by
a vote of at least two-thirds of the outstanding shares.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
* Indicates a Trustee who is an "interested person" within the meaning of the
1940 Act. Mr. Sundman and Mr. Rivkin are interested persons of the Trust by
virtue of the fact that they are officers and/or directors of NB Management
and Executive Vice Presidents of Neuberger Berman. Mr. O'Brien is an
interested person of the Trust by virtue of the fact that he is a director
of Legg Mason, Inc., a wholly owned subsidiary of which, from time to time,
serves as a broker or dealer to the Funds and other funds for which NB
Management serves as investment manager.
21
Information about the Officers of the Trust
- -------------------------------------------------------------------------------------------------------------------------------
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- -------------------------------------------------------------------------------------------------------------------------------
Claudia A. Brandon (47) Secretary since 1985 Vice President--Mutual Fund Board Relations, NB
Management since 2000; Vice President, Neuberger
Berman since 2002 and employee since 1999; Vice
President, NB Management from 1986 to 1999; Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(four since 2002, three since 2003, and one since 2004).
- -------------------------------------------------------------------------------------------------------------------------------
Robert Conti (48) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President, Neuberger Berman from 1999 until 2003; Senior
Vice President, NB Management since 2000; Controller,
NB Management until 1996; Treasurer, NB Management
from 1996 until 1999; Vice President, eleven registered
investment companies for which NB Management acts as
investment manager and administrator (three since 2000,
four since 2002, three since 2003, and one since 2004).
- -------------------------------------------------------------------------------------------------------------------------------
Brian P. Gaffney (50) Vice President since 2000 Managing Director, Neuberger Berman since 1999; Senior
Vice President, NB Management since 2000; Vice
President, NB Management from 1997 until 1999; Vice
President, eleven registered investment companies for which
NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three since
2003, and one since 2004).
- -------------------------------------------------------------------------------------------------------------------------------
Sheila R. James (39) Assistant Secretary since 2002 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1991 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(seven since 2002, three since 2003 and one since 2004).
- -------------------------------------------------------------------------------------------------------------------------------
Kevin Lyons (49) Assistant Secretary since 2003 Employee, Neuberger Berman since 1999; Employee, NB
Management from 1993 to 1999; Assistant Secretary,
eleven registered investment companies for which NB
Management acts as investment manager and administrator
(Ten since 2003 and one since 2004).
- -------------------------------------------------------------------------------------------------------------------------------
22
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
- -------------------------------------------------------------------------------------------------------------------------------
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- -------------------------------------------------------------------------------------------------------------------------------
John M. McGovern (34) Assistant Treasurer since 2002 Vice President, Neuberger Berman since 2004; Employee,
NB Management since 1993; Assistant Treasurer, eleven
registered investment companies for which NB
Management acts as investment manager and
administrator (seven since 2002, three since 2003, and one
since 2004).
- -------------------------------------------------------------------------------------------------------------------------------
Barbara Muinos (45) Treasurer and Principal Financial Vice President, Neuberger Berman since 1999; Assistant
and Accounting Officer since 2002; Vice President, NB Management from 1993 to 1999;
prior thereto, Assistant Treasurer Treasurer and Principal Financial and Accounting Officer,
since 1996 eleven registered investment companies for which NB
Management acts as investment manager and
administrator (seven since 2002, three since 2003, and one
since 2004); Assistant Treasurer, three registered
investment companies for which NB Management acts as
investment manager and administrator from 1996 until
2002.
- -------------------------------------------------------------------------------------------------------------------------------
Frederic B. Soule (58) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President; Neuberger Berman from 1999 until 2003; Vice
President, NB Management from 1995 until 1999; Vice
President, eleven registered investment companies for
which NB Management acts as investment manager and
administrator (three since 2000, four since 2002, three
since 2003, and one since 2004).
- -------------------------------------------------------------------------------------------------------------------------------
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the By-Laws of the Trust, each officer elected by the Trustees
shall hold office until his or her successor shall have been elected and
qualified or until his or her earlier death, inability to serve, or
resignation. Officers serve at the pleasure of the Trustees and may be
removed at any time with or without cause.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
23
Proxy Voting Policies and Procedures
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to portfolio securities is available, without
charge, by calling 1-800-877-9700 (toll-free) and on the website of the
Securities and Exchange Commission, at www.sec.gov. Beginning September 2004,
information regarding how the Fund voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 will also be
available without charge, by calling 1-800-877-9700 (toll-free), on the website
of the Securities and Exchange Commission, at www.sec.gov, and on the Fund's
website at www.nb.com http://www.nb.com.
24
Semi-Annual Report [NEUBERGER BERMAN LOGO]
June 30, 2004
Neuberger Berman
Advisers
Management
Trust
Socially
Responsive
Portfolio[RegTM]
B0738 08/04
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Socially Responsive Portfolio Managers' Commentary
- --------------------------------------------------
In the first six months of 2004, the Socially Responsive Portfolio posted a
positive return, but underperformed its Standard & Poor's 500 Index and Russell
1000 Value Index benchmarks.(2)
During this reporting period, investors seemed to focus on the negatives--the
increased probability of Federal Reserve rate hikes, high oil prices, Iraq, and
the threat of terrorism--instead of the positives--consistently good economic
data and strong corporate earnings growth. Although the leading market indices
stayed in a tight trading range, there was significant volatility within and
across market sectors, creating a difficult environment for investors.
Energy sector investments had the most positive impact on our total returns,
with Newfield Exploration, and Cimarex Energy finishing on our top-ten
performance list. We began accumulating energy stocks when our research
indicated that global demand was outpacing supply, creating an imbalance that
would likely result in higher energy prices and better earnings for energy
companies. That is precisely what happened and we were rewarded for our
commitment to energy stocks. Despite good gains over the last year, we think
selected energy stocks still offer value. The world has been waiting for oil
prices to come down from current levels. Although OPEC has been doing its best
to bring prices down, strikes by oil field workers in Norway and Nigeria, and
pipeline sabotage in Iraq has crimped supply and energy inventories remain low.
With energy demand usually strongest in the second half of the year, we doubt
inventories can be increased sufficiently to bring prices down any time soon.
Healthcare sector investments also contributed to returns, with Millipore,
Quest Diagnostics, and long-standing holding UnitedHealth Group making our
top-ten performance list. UnitedHealth Group, one of our most consistent and
best performers in recent years, is reshaping the healthcare maintenance
organization (HMO) business through innovative, cost effective,
customer-friendly services. For the past five years, UnitedHealth has been
ranked among the highest in its industry for customer satisfaction. The company
provides a personalized approach to healthcare and offers its plan members
comprehensive online medical resources, including the best available disease
management practices, treatments, and alternative care. UnitedHealth has been
able to grow internally by gaining market share from competitors. In addition,
this year it has made two major acquisitions, Mid Atlantic Medical, which
closed in the first quarter, and Oxford Health, which is scheduled to close in
the third quarter. We are confident that UnitedHealth's strong management team
will be able to successfully integrate these acquisitions, enhancing future
growth. Through technological innovation and strategic management decisions,
UnitedHealth is committed to lowering healthcare costs while providing superior
healthcare services supported by evidence-based medicine. As a result, we
believe that UnitedHealth will be part of the solution to addressing our
country's larger healthcare problems.
Our consumer discretionary investments disappointed, with UnitedGlobalCom,
Liberty Media Group, and Comcast retreating. Several factors combined to
pressure Comcast stock. First, investors were discomforted by Comcast's
unsolicited bid for Disney. Then investors became concerned when the Regional
Bell Operating Companies (RBOCs) began discussing new fiber strategies that
could facilitate competing broadband video services. Finally, shareholders
became disappointed when advertising spending failed to rebound along with the
economy. We doubt Comcast will make another run at Disney or try to buy another
"content" company. Although the RBOCs appear serious about competing with cable
companies by offering video services, it will take a lot of time and money for
them to improve their broadband infrastructure to make this possible. Over the
next few years, we believe cable television companies including Comcast will
have more success capturing telephony business from the telephone companies
than the telcos will have winning over cable television subscribers. As a
whole, advertising
1
spending has disappointed. However, due to giant Comcast's (20 million homes
served) interconnection agreements with other large cable television operators,
CATV is now getting a bigger and more profitable share of the advertising
dollar. Gone are the days when cable television advertising was primarily low
cost spots for local businesses. Now they are selling higher cost ads to
national advertisers. This should improve Comcast's and other CATV operators
advertising profits.
The economy appears to be moving from the robust recovery stage to a slower
growth expansion phase. This is an economic environment in which good companies
should be able to distinguish themselves. In 2003's "rising tide lifts all
boats" market, virtually every stock moved higher. Over the last six months,
negative investor sentiment restrained market performance. Barring any
unforeseen event that derails the economy, we believe investor sentiment will
improve and investors will reward companies that execute on their business plans
and deliver solid earnings growth. Put another way, stock selection will be even
more critical in delivering returns. We believe this presents an opportunity for
us to demonstrate the effectiveness of our independent, research driven,
value-oriented discipline, applied in a socially responsive manner.
Sincerely,
/s/ Arthur Moretti
------------------
/s/ Ingrid Dyott
----------------
ARTHUR MORETTI AND INGRID DYOTT
PORTFOLIO CO-MANAGERS
1. 17.44%, 2.14% and 4.68% were the average annual total returns for the
1-year, 5-year and since inception (02/18/99) periods ended June 30, 2004.
Neuberger Berman Management Inc. ("NBMI") has agreed to absorb certain expenses
of the AMT Portfolios. Without this arrangement, which is subject to change,
the total returns of the Portfolios would be less. Total return includes
reinvestment of dividends and capital gain distributions. Performance data
quoted represent past performance and the investment return and principal value
of an investment will fluctuate so that the shares, when redeemed, may be worth
more or less than original cost. Current performance may be lower or higher
than the performance data quoted. For performance data current to the most
recent month end, please visit www.nb.com/amtperformance. The performance
information does not reflect fees and expenses of the variable annuity and
variable life insurance policies or the pension plans whose proceeds are
invested in the portfolio.
2. The S&P 500 Index is widely regarded as the standard for measuring large-cap
U.S. stock market performance and includes a representative sample of leading
companies in leading industries. The Russell 1000[RegTM]Index measures the
performance of the 1,000 largest companies in the Russell 3000[RegTM] Index
(which measures the performance of the 3,000 largest U.S. companies based on
total market capitalization). The Russell 1000 Index represents approximately
92% of the total market capitalization of the Russell 3000 Index. The Russell
1000 Value Index measures the performance of those Russell 1000 companies with
lower price-to-book ratios and lower forecasted growth values. Please note that
indices do not take into account any fees and expenses of investing in the
individual securities that they track, and that individuals cannot invest
directly in any index. Data about the performance of these indices are prepared
or obtained by NBMI and include reinvestment of all dividends and capital gain
distributions. The Portfolio may invest in many securities not included in the
above-described indices.
2
Any ratios or other measurements using a factor of forecasted earnings of a
company discussed herein are based on consensus estimates, not Neuberger
Berman's own projections, and they may or may not be realized. In addition, any
revision to a forecast could affect the market price of a security. By quoting
them herein, Neuberger Berman does not offer an opinion as to the accuracy of
and does not guarantee these forecasted numbers.
The composition, industries and holdings of the Portfolio are subject to change.
The investments for the Portfolio are managed by the same portfolio manager(s)
who manage one or more other mutual funds that have similar names, investment
objectives and investment styles as the Portfolio. You should be aware that the
Portfolio is likely to differ from the other mutual funds in size, cash flow
pattern and tax matters. Accordingly, the holdings and performance of the
Portfolio can be expected to vary from those of the other mutual funds.
Shares of the separate Portfolios of Neuberger Berman Advisers Management Trust
are sold only through the currently effective prospectus and are not available
to the general public. Shares of this Portfolio may be purchased only by life
insurance companies to be used with their separate accounts that fund variable
annuity and variable life insurance policies and by qualified pension and
retirement plans.
(C) 2004 Neuberger Berman Management Inc., distributor. All rights reserved.
3
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Schedule of Investments Socially Responsive Portfolio
- -----------------------------------------------------
Number of Shares Market Value+
Common Stocks (95.6%)
Banking & Financial (6.8%)
6,825 Fifth Third Bancorp $ 367,048
9,400 State Street 460,976
-----------
828,024
Business Services (3.6%)
8,635 Manpower Inc. 438,399
Consumer Cyclicals (3.1%)
8,975 Target Corp. 381,168
Diversified (3.7%)
8,550 Danaher Corp. 443,318
Energy (2.5%)
5,660 BP PLC ADR 303,206
Financial Services (6.6%)
3,225 Ambac Financial Group 236,844
5,385 Citigroup Inc. 250,402
3,300 Goldman Sachs 310,728
-----------
797,974
Health Products & Services (6.6%)
4,925 Quest Diagnostics 418,379
6,245 UnitedHealth Group 388,751
-----------
807,130
Industrial Gases (3.7%)
11,200 Praxair, Inc. 446,992
Insurance (6.4%)
1,330 Progressive Corp. 113,449
4,450 RenaissanceRe Holdings 240,078
11,425 Willis Group Holdings 427,866
-----------
781,393
Media (8.9%)
11,025 Comcast Corp. Class A
Special 304,400*
53,662 Liberty Media 482,422*
3,373 Liberty Media International
Class A 125,138*
23,243 UnitedGlobalCom 168,744*
-----------
1,080,704
Oil & Gas (7.9%)
12,050 Cimarex Energy 364,272*
10,765 Newfield Exploration 600,041*
-----------
964,313
Oil Services (1.7%)
7,800 Helmerich & Payne 203,970
Pharmaceutical (4.6%)
3,400 Millipore Corp. 191,658*
8,175 Novartis AG ADR 363,787
-----------
555,445
4
Number of Shares Market Value+
Real Estate (5.4%)
7,375 AMB Property $ 255,396
13,325 Equity Residential 396,152
-----------
651,548
Technology (9.1%)
10,050 Dell Inc. 359,991*
11,787 National Instruments 361,272
16,650 Teradyne, Inc. 377,955*
-----------
1,099,218
Technology--Semiconductor (5.0%)
17,700 Altera Corp. 393,294*
8,850 Texas Instruments 213,993
-----------
607,287
Telecommunications (3.3%)
18,300 Vodafone Group ADR 404,430
Transportation (3.9%)
10,737 Canadian National Railway 468,026
Utilities (2.8%)
2,300 National Grid Transco 90,091\P
32,500 National Grid Transco ADR 250,702
-----------
340,793
Total Common Stocks
(Cost $10,102,070) 11,603,338
-----------
Principal Amount
Repurchase Agreements (5.3%)
$646,000 State Street Bank and
Trust Co., Repurchase
Agreement, 1.15%, due
7/1/04, dated
6/30/04, Maturity
Value $646,021,
Collateralized by
$500,000 U.S. Treasury
Bonds, 8.13%, due
8/15/19 (Collateral
Value $666,585)
(Cost $646,000) 646,000#
-----------
Short-Term Investments (0.7%)
80,000 N&B Securities Lending
Quality Fund, LLC
(Cost $80,000) 80,000++#
-----------
Total Investments (101.6%)
(Cost $10,828,070) 12,329,338##
Liabilities, less cash, receivables and other
assets [(1.6%)] (193,213)
-----------
Total Net Assets (100.0%) $12,136,125
-----------
See Notes to Schedule of Investments 5
Notes to Schedule of Investments Socially Responsive Portfolio
- --------------------------------------------------------------
+ Investments in equity securities by the Fund are valued at the latest sales
price where that price is readily available; securities for which no sales
were reported, unless otherwise noted, are valued at the mean between the
closing bid and asked prices. Securities traded primarily on the NASDAQ
Stock Market are normally valued by the Fund at the NASDAQ Official Closing
Price ("NOCP") provided by NASDAQ each business day. The NOCP is the most
recently reported price as of 4:00:02 p.m., Eastern time, unless that price
is outside the range of the "inside" bid and asked prices (i.e., the bid
and asked prices that dealers quote to each other when trading for their
own accounts); in that case, NASDAQ will adjust the price to equal the
inside bid or asked price, whichever is closer. Because of delays in
reporting trades, the NOCP may not be based on the price of the last trade
to occur before the market closes. The Fund values all other securities by
a method the Board of Trustees of Neuberger Berman Advisers Management
Trust (the "Board") believes accurately reflects fair value. Numerous
factors may be considered when determining the fair value of a security,
including available analyst, media or other reports, trading in futures or
ADRs and whether the issuer of the security being fair valued has other
securities outstanding. Foreign security prices are furnished by
independent quotation services expressed in local currency values. Foreign
security prices are translated from the local currency into U.S. dollars
using the exchange rate as of 12:00 p.m., Eastern time. The Board has
approved the use of FT Interactive Data Corporation ("FT Interactive") to
assist in determining the fair value of the Fund's foreign equity
securities in the wake of certain significant events. Specifically, when
changes in the value of a certain index suggest that the closing prices on
the foreign exchanges no longer represent the amount that the Fund could
expect to receive for those securities, FT Interactive will provide
adjusted prices for certain foreign equity securities based on an analysis
showing historical correlations between the prices of those securities and
changes in the index. In the absence of precise information about the
market values of these foreign securities as of the close of the New York
Stock Exchange, the Board has determined on the basis of available data
that prices adjusted in this way are likely to be closer to the prices the
Fund could realize on a current sale than are the prices of those
securities established at the close of the foreign markets in which the
securities primarily trade. However, fair value prices are necessarily
estimates, and there is no assurance that such a price will be at or close
to the price at which the security next trades. Short-term debt securities
with less than 60 days until maturity may be valued at cost which, when
combined with interest earned, approximates market value.
# At cost, which approximates market value.
## At June 30, 2004, the cost of investments for U.S. Federal income tax
purposes was $10,828,070. Gross unrealized appreciation of investments was
$1,567,560 and gross unrealized depreciation of investments was $66,292,
resulting in net unrealized appreciation of $1,501,268, based on cost for
U.S. Federal income tax purposes.
* Non-income producing security.
\P All or a portion of this security is on loan (see Note A of Notes to
Financial Statements).
++ Affiliated issuer (see Note A of Notes to Financial Statements).
See Notes to Financial Statements 6
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Assets and Liabilities
- -----------------------------------
Socially
Responsive
Neuberger Berman Advisers Management Trust Portfolio
Assets
Investments in securities, at market value*+ (Note A)-see Schedule of Investments:
- -------------------------------------------------------------------------------------------------
Unaffiliated issuers $12,249,338
- -------------------------------------------------------------------------------------------------
Affiliated issuers 80,000
=================================================================================================
12,329,338
=================================================================================================
Cash 623
- -------------------------------------------------------------------------------------------------
Dividends and interest receivable 28,915
=================================================================================================
Receivable for securities sold 14,565
- -------------------------------------------------------------------------------------------------
Receivable for Fund shares sold 24,275
=================================================================================================
Receivable from administrator-net (Note B) 291
- -------------------------------------------------------------------------------------------------
Prepaid expenses and other assets 337
=================================================================================================
Total Assets 12,398,344
- -------------------------------------------------------------------------------------------------
Liabilities
Payable for collateral on securities loaned (Note A) 80,000
=================================================================================================
Payable for securities purchased 102,634
- -------------------------------------------------------------------------------------------------
Payable for Fund shares redeemed 56,459
=================================================================================================
Payable to investment manager (Note B) 5,118
- -------------------------------------------------------------------------------------------------
Accrued expenses and other payables 18,008
=================================================================================================
Total Liabilities 262,219
=================================================================================================
Net Assets at value $12,136,125
=================================================================================================
Net Assets consist of:
Paid-in capital $10,649,501
=================================================================================================
Undistributed net investment income (loss) 1,956
- -------------------------------------------------------------------------------------------------
Accumulated net realized gains (losses) on investments (16,503)
- -------------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) in value of investments 1,501,171
=================================================================================================
Net Assets at value $12,136,125
=================================================================================================
Shares Outstanding ($.001 par value; unlimited shares authorized) 964,093
=================================================================================================
Net Asset Value, offering and redemption price per share $ 12.59
=================================================================================================
+Securities on loan, at market value:
Unaffiliated issuers $ 78,340
===============================================================================================
*Cost of investments:
Unaffiliated issuers $10,748,070
===============================================================================================
Affiliated issuers 80,000
=================================================================================================
Total cost of investments $10,828,070
=================================================================================================
See Notes to Financial Statements 7
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST FOR THE SIX MONTHS ENDED JUNE 30, 2004 (UNAUDITED)
Statement of Operations
- -----------------------
Socially
Responsive
Neuberger Berman Advisers Management Trust Portfolio
Investment Income
Income:
Dividend income-unaffiliated issuers $ 66,336
=====================================================================================================
Interest income (Note A) 3,143
- -----------------------------------------------------------------------------------------------------
Income from securities loaned-net (Note A) 36
=====================================================================================================
Foreign taxes withheld (Note A) (2,844)
=====================================================================================================
Total income 66,671
=====================================================================================================
Expenses:
Investment management fee (Notes A & B) 27,366
=====================================================================================================
Administration fee (Note B) 14,926
- -----------------------------------------------------------------------------------------------------
Audit fees 12,975
=====================================================================================================
Custodian fees (Note B) 12,850
- -----------------------------------------------------------------------------------------------------
Insurance expense 55
=====================================================================================================
Legal fees 571
- -----------------------------------------------------------------------------------------------------
Shareholder reports 4,636
=====================================================================================================
Trustees' fees and expenses 13,453
- -----------------------------------------------------------------------------------------------------
Miscellaneous 1,009
=====================================================================================================
Total expenses 87,841
Expenses reimbursed by administrator (Note B) (22,544)
Expenses reduced by custodian fee expense offset and commission recapture arrangements (582)
(Note B)
=====================================================================================================
Total net expenses 64,715
=====================================================================================================
Net investment income (loss) 1,956
=====================================================================================================
Realized and Unrealized Gain (Loss) on Investments (Note A)
Net realized gain (loss) on:
Investment securities sold in unaffiliated issuers 184,030
==================================================================================================
Foreign currency 11
--------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) in value of:
Investment securities in unaffiliated issuers 9,599
--------------------------------------------------------------------------------------------------
Foreign currency (278)
--------------------------------------------------------------------------------------------------
Net gain (loss) on investments 193,362
=====================================================================================================
Net increase (decrease) in net assets resulting from operations $195,318
=====================================================================================================
See Notes to Financial Statements 8
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Statement of Changes in Net Assets
- ----------------------------------
Socially Responsive Portfolio
-----------------------------
Six Months
Ended Year
June 30, Ended
2004 December 31,
Neuberger Berman Advisers Management Trust (Unaudited) 2003
Increase (Decrease) in Net Assets:
From Operations:
Net investment income (loss) $ 1,956 $ (4,833)
====================================================================================================
Net realized gain (loss) on investments 184,041 75,287
- ----------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) of investments 9,321 1,736,081
====================================================================================================
Net increase (decrease) in net assets resulting from operations 195,318 1,806,535
====================================================================================================
From Fund Share Transactions (Note D):
Proceeds from shares sold 4,991,248 3,210,506
====================================================================================================
Payments for shares redeemed (792,527) (2,247,312)
====================================================================================================
Net increase (decrease) from Fund share transactions 4,198,721 963,194
====================================================================================================
Net Increase (Decrease) in Net Assets 4,394,039 2,769,729
Net Assets:
Beginning of period 7,742,086 4,972,357
====================================================================================================
End of period $12,136,125 $ 7,742,086
====================================================================================================
Undistributed net investment income (loss) at end of period $ 1,956 $ --
====================================================================================================
See Notes to Financial Statements 9
Notes to Financial Statements Socially Responsive Portfolio
- -----------------------------------------------------------
Note A--Summary of Significant Accounting Policies:
1 General: Socially Responsive Portfolio (the "Fund") is a separate operating
series of Neuberger Berman Advisers Management Trust (the "Trust"), a
Delaware statutory trust organized pursuant to a Trust Instrument dated May
23, 1994. The Trust is currently comprised of ten separate operating series
(each a "Series," collectively, the "Funds") each of which (except Focus
Portfolio) is diversified. The Trust is registered as an open-end
management investment company under the Investment Company Act of 1940, as
amended (the "1940 Act"), and its shares are registered under the
Securities Act of 1933, as amended. The Fund currently offers only Class I
shares. The Board of Trustees of the Trust may establish additional series
or classes of shares without the approval of shareholders.
The assets of each Series belong only to that Series, and the liabilities
of each Series are borne solely by that Series and no other.
The preparation of financial statements in accordance with accounting
principles generally accepted in the United States requires Neuberger
Berman Management Inc. ("Management") to make estimates and assumptions at
the date of the financial statements. Actual results could differ from
those estimates.
2 Portfolio valuation: Investment securities are valued as indicated in the
notes following the Schedule of Investments.
3 Foreign currency translation: The accounting records of the Fund are
maintained in U.S. dollars. Foreign currency amounts are translated into
U.S. dollars using the exchange rate as of 12:00 p.m., Eastern time, to
determine the value of investments, other assets and liabilities. Purchase
and sale prices of securities, and income and expenses, are translated into
U.S. dollars at the prevailing rate of exchange on the respective dates of
such transactions. Net unrealized foreign currency gain (loss) arises from
changes in the value of assets and liabilities, other than investments in
securities, as a result of changes in exchange rates and is stated
separately in the Statement of Operations.
4 Securities transactions and investment income: Securities transactions are
recorded on a trade date basis. Dividend income is recorded on the
ex-dividend date or, for certain foreign dividends, as soon as the Fund
becomes aware of the dividends. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, including accretion of original issue discount,
where applicable, and accretion of discount on short-term investments, is
recorded on the accrual basis. Realized gains and losses from securities
transactions and foreign currency transactions are recorded on the basis of
identified cost and stated separately in the Statement of Operations.
5 Federal income taxes: The Funds are treated as separate entities for U.S.
Federal income tax purposes. It is the policy of the Fund to continue to
qualify as a regulated investment company by complying with the provisions
available to certain investment companies, as defined in applicable
sections of the Internal Revenue Code, and to make distributions of
investment company taxable income and net capital gains (after reduction
for any amounts available for U.S. Federal income tax purposes as capital
loss
10
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
carryforwards) sufficient to relieve it from all, or substantially all,
U.S. Federal income taxes. Accordingly, the Fund paid no U.S. Federal
income taxes and no provision for U.S. Federal income taxes was required.
6 Dividends and distributions to shareholders: The Fund may earn income, net
of expenses, daily on its investments. Income dividends and distributions
from net realized capital gains, if any, generally are distributed in
October. Income dividends and capital gain distributions to shareholders
are recorded on the ex-dividend date. To the extent the Fund's net realized
capital gains, if any, can be offset by capital loss carryforwards
($163,765 expiring in 2010, determined as of December 31, 2003), it is the
policy of the Fund not to distribute such gains.
The Fund distinguishes between dividends on a tax basis and a financial
reporting basis and only distributions in excess of tax basis earnings and
profits are reported in the financial statements as a tax return of
capital. Differences in the recognition or classification of income between
the financial statements and tax earnings and profits which result in
temporary over-distributions for financial statement purposes are
classified as distributions in excess of net investment income or
accumulated net realized gains in the components of net assets on the
Statement of Assets and Liabilities.
As of December 31, 2003, the components of distributable earnings
(accumulated losses) on a U.S. Federal income tax basis was as follows:
Unrealized Loss
Appreciation Carryforwards
(Depreciation) and Deferrals Total
$1,455,071 $(163,765) $1,291,306
The difference between book basis and tax basis is attributable primarily
to net operating losses, the tax deferral of losses on wash sales and the
recharacterization of income due to REIT holdings.
7 Expense allocation: Certain expenses are applicable to multiple funds.
Expenses directly attributable to a Series are charged to that Series.
Expenses of the Trust that are not directly attributed to a Series are
allocated among the Funds, on the basis of relative net assets, except
where a more appropriate allocation of expenses to each of the Funds can
otherwise be made fairly. Expenses borne by the complex of related
investment companies, which includes open-end and closed-end investment
companies for which Management serves as investment manager, that are not
directly attributed to a Series or the Trust, are allocated among the Fund
and the other investment companies in the complex or series thereof, on the
basis of relative net assets, except where a more appropriate allocation of
expenses to each investment company in the complex or series thereof can
otherwise be made fairly.
8 Security lending: Pursuant to an Exemptive Order issued by the Securities
and Exchange Commission, the Fund entered into a Securities Lending
Agreement ("Agreement") with Neuberger Berman, LLC ("Neuberger") on April
17, 2003. Securities loans involve certain risks in the event a borrower
should fail financially, including delays or inability to recover the lent
securities or foreclose against the collateral. The investment manager,
under the general supervision of the Trust's Board of Trustees, monitors
the creditworthiness of the parties to whom the Fund makes security loans.
The Fund will not lend securities on which covered call options have been
written, or lend securities on terms which would prevent the Fund from
qualifying as a regulated investment company. The Fund receives cash
collateral equal to at
11
Notes to Financial Statements Socially Responsive Portfolio cont'd
- ------------------------------------------------------------------
least 102% of the current market value of the loaned securities. The Fund
invests the cash collateral in the N&B Securities Lending Quality Fund,
LLC, which is managed by State Street Bank and Trust Company ("State
Street") pursuant to guidelines approved by the Trust's investment manager.
Neuberger guaranteed minimum revenue to the Fund under the Agreement, and
received a portion of any revenue earned in excess of the guaranteed amount
as a lending agency fee.
The Agreement has been renewed and approved by the Board of Trustees as of
July 1, 2004 with substantially the same terms. Under this current
Agreement, Neuberger guarantees minimum revenue to the Fund and receives
any revenue earned in excess of the guaranteed amount as a lending agency
fee.
At June 30, 2004, the Fund paid Neuberger $236 under the Agreement.
Income earned on the securities loaned, if any, is reflected in the
Statement of Operations under the caption Income from securities
loaned-net.
9 Repurchase agreements: The Fund may enter into repurchase agreements with
institutions that the Fund's investment manager has determined are
creditworthy. Each repurchase agreement is recorded at cost. The Fund
requires that the securities purchased in a repurchase agreement be
transferred to the custodian in a manner sufficient to enable the Fund to
assert a perfected security interest in those securities in the event of a
default under the repurchase agreement. The Fund monitors, on a daily
basis, the value of the securities transferred to ensure that their value,
including accrued interest, is greater than amounts owed to the Fund under
each such repurchase agreement.
10 Foreign taxes: Foreign taxes withheld represent amounts withheld by foreign
tax authorities, net of refunds recoverable.
Note B--Management Fees, Administration Fees, Distribution Arrangements,
and Other Transactions With Affiliates:
Fund shares are issued and redeemed in connection with investments in and
payments under certain variable annuity contracts and variable life
insurance policies issued through separate accounts of life insurance
companies and are also offered directly to qualified pension and retirement
plans.
The Fund retains Management as its investment manager under a Management
Agreement. For such investment management services, the Fund pays
Management a fee at the annual rate of 0.55% of the first $250 million of
the Fund's average daily net assets, 0.525% of the next $250 million, 0.50%
of the next $250 million, 0.475% of the next $250 million, 0.45% of the
next $500 million, 0.425% of the next $2.5 billion, and 0.40% of average
daily net assets in excess of $4 billion.
The Fund retains Management as its administrator under an Administration
Agreement. The Fund pays Management an administration fee at the annual
rate of 0.30% of its average daily net assets under this agreement.
Additionally, Management retains State Street as its sub-administrator
under a Sub-Administration Agreement. Management pays State Street a fee
for all services received under the agreement.
The Trustees of the Trust adopted a non-fee distribution plan for the Fund.
12
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Management has contractually undertaken through December 31, 2007 to
reimburse the Fund for its operating expenses (including the fees payable
to Management, but excluding interest, taxes, brokerage commissions,
extraordinary expenses, and transaction costs) ("Operating Expenses") which
exceed, in the aggregate, 1.50% per annum of its average daily net assets
(the "Expense Limitation"). Moreover, Management has voluntarily committed
to reimburse certain expenses, as stated above, for an additional 0.20% per
annum of the Fund's average daily net assets to maintain the Fund's
Operating Expenses at 1.30%. Management may, at its sole discretion,
terminate this additional voluntary reimbursement commitment without
notice. For the six months ended June 30, 2004, such excess expenses
amounted to $22,544. The Fund has agreed to repay Management through
December 31, 2010 for its excess Operating Expenses previously reimbursed
by Management, so long as its annual Operating Expenses during that period
do not exceed its Expense Limitation, and the repayment is made within
three years after the year in which Management issued the reimbursement.
During the six months ended June 30, 2004, there was no reimbursement to
Management. At June 30, 2004, the Fund has a contingent liability to
Management under this agreement of $194,675, not repaid through June 30,
2004.
On October 31, 2003, Management and Neuberger, a member firm of the New
York Stock Exchange and sub-adviser to the Fund, became indirect
wholly-owned subsidiaries of Lehman Brothers Holdings Inc. ("Lehman"), a
publicly-owned holding company. Neuberger is retained by Management to
furnish it with investment recommendations and research information without
added cost to the Fund. Several individuals who are officers and/or
Trustees of the Trust are also employees of Neuberger and/or Management.
On July 1, 2003, the Fund entered into a commission recapture program,
which enables it to pay some of its operational expenses by recouping a
portion of the commissions it pays to a broker that is not a related party
of the Fund. Expenses paid through this program may include costs of
custodial, transfer agency or accounting services. For the six months ended
June 30, 2004, the impact of this arrangement was a reduction of $566.
The Fund has an expense offset arrangement in connection with its custodian
contract. The impact of this arrangement, reflected in the Statement of
Operations under the caption Custodian fees, was a reduction of $16.
Note C--Securities Transactions:
During the six months ended June 30, 2004, there were purchase and sale
transactions (excluding short-term securities) of $5,384,632 and
$1,315,362, respectively.
During the six months ended June 30, 2004, brokerage commissions on
securities transactions amounted to $10,079, of which Neuberger received
$0, Lehman received $1,683, and other brokers received $8,396.
13
Notes to Financial Statements Socially Responsive Portfolio cont'd
------------------------------------------------------------------
Note D--Fund Share Transactions:
Share activity for the six months ended June 30, 2004 and for the year
ended December 31, 2003 was as follows:
For the For the
Six Months Ended Year Ended
June 30, December 31,
2004 2003
Shares Sold 400,658 298,458
Shares Redeemed (63,597) (212,199)
------- --------
Total 337,061 86,259
------- --------
Note E--Line of Credit:
At June 30, 2004, the Fund was a participant in a single committed,
unsecured $150,000,000 line of credit with State Street, to be used only
for temporary or emergency purposes. Interes t is charged on borrowings
under this agreement at the overnight Federal Funds Rate plus 0.50% per
annum. A facility fee of 0.10% per annum of the available line of credit is
charged, of which the Fund has agreed to pay its pro rata share, based on
the ratio of its individual net assets to the net assets of all
participants at the time the fee is due and payable. The fee is paid
quarterly in arrears. No compensating balance is required. Other investment
companies managed by Management also participate in this line of credit on
the same terms. Because several investment companies participate, there is
no assurance that the Fund will have access to the entire $150,000,000 at
any particular time. The Fund had no loans outstanding pursuant to this
line of credit at June 30, 2004, nor had the Fund utilized this line of
credit at any time prior to that date.
Note F--Unaudited Financial Information:
The financial information included in this interim report is taken from the
records of the Fund without audit by independent auditors. Annual reports
contain audited financial statements.
14
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Financial Highlights Socially Responsive Portfolio+
- ---------------------------------------------------
The following table includes selected data for a share outstanding throughout
each period and other performance information derived from the Financial
Statements.++
Six Months Period from
Ended February 18, 1999^
June 30, Year Ended December 31, to December 31,
----------- --------------------------------------------- ------------------
2004 2003 2002 2001 2000 1999
(Unaudited)
Net Asset Value, Beginning of Period $12.35 $ 9.19 $ 10.78 $11.17 $11.54 $10.00
------ ------ ------- ------ ------- ------
Income From Investment Operations:
Net Investment Income (Loss) .00 (.01) (.01) -- (.04) .03
Net Gains or Losses on Securities
(both realized and unrealized) .24 3.17 (1.58) (.39) (.17) 1.51
------ ------ ------- ------ ------ ------
Total From Investment Operations .24 3.16 (1.59) (.39) (.21) 1.54
------ ------ ------- ------ ------ ------
Less Distributions From:
Net Investment Income -- -- -- -- (.03) --
Net Capital Gains -- -- -- -- (.13) --
------ ------ ------- ------ ------ ------
Total Distributions -- -- -- -- (.16) --
------ ------ ------- ------ ------ ------
Net Asset Value, End of Period $12.59 $12.35 $ 9.19 $10.78 $11.17 $11.54
------ ------ ------- ------ ------ ------
Total Return++ +1.94%** +34.39% -14.75% -3.58% -1.61% +15.40%**
Ratios/Supplemental Data
Net Assets, End of Period (in millions) $ 12.1 $ 7.7 $ 5.0 $ 3.6 $ 2.2 $ 1.3
Ratio of Gross Expenses to Average Net Assets# 1.31%* 1.35% 1.52% 1.59% 1.68% 1.68%*
Ratio of Net Expenses to Average Net Assets[sec] 1.30%* 1.34% 1.51% 1.53% 1.54% 1.53%*
Ratio of Net Investment Income (Loss)
to Average Net Assets .04%* (.08)% (.07)% .04% (.33)% .35%*
Portfolio Turnover Rate 14% 45% 38% 277% 92% 72%
See Notes to Financial Highlights 15
Notes to Financial Highlights Socially Responsive Portfolio
- -----------------------------------------------------------
+ The per share amounts and ratios which are shown reflect income and
expenses, including the Fund's proportionate share of AMT Socially
Responsive Investment's income and expenses through April 30, 2000 under
the prior master/feeder fund structure.
++ Total return based on per share net asset value reflects the effects of
changes in net asset value on the performance of the Fund during each
fiscal period and assumes dividends and other distributions, if any, were
reinvested. Results represent past performance and do not guarantee future
results. Current returns may be lower or higher than the performance data
quoted. Investment returns and principal may fluctuate and shares when
redeemed may be worth more or less than original cost. Total return would
have been lower if Management had not reimbursed certain expenses. The
total return information shown does not reflect charges and other expenses
that apply to the separate account or the related insurance policies, and
the inclusion of these charges and other expenses would reduce the total
return for all fiscal periods shown. Performance data current to the most
recent month-end are available at www.nb.com.
# The Fund is required to calculate an expense ratio without taking into
consideration any expense reductions related to expense offset and
commission recapture arrangements.
[sec] After reimbursement of expenses by the investment manager. Had the
investment manager not undertaken such action, the annualized ratios of
net expenses to average daily net assets would have been:
Period from
Six Months February 18, 1999
Ended June 30, Year Ended December 31, to December 31,
2004 2003 2002 2001 2000 1999
1.75% 2.30% 2.87% 4.33% 2.40% 9.04%
^ The date investment operations commenced.
++ The per share amounts which are shown have been computed based on the
average number of shares outstanding during each fiscal period.
* Annualized.
** Not annualized.
16
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Trustees and Officers (Unaudited)
- ---------------------------------
The following tables set forth information concerning the trustees and officers
of the Trust. All persons named as trustees and officers also serve in similar
capacities for other funds administered or managed by NB Management and
Neuberger Berman. The Statement of Additional Information includes additional
information about fund trustees and is available upon request, without charge,
by calling (800) 877-9700.
Information about the Board of Trustees
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
John Cannon (74) Trustee since Consultant. Formerly, Chairman 38 Independent Trustee or Director of
2000 and Chief Investment Officer, three series of Oppenheimer Funds:
CDC Investment Advisors Limited Term New York Municipal Fund,
(registered investment adviser) Rochester Fund Municipals, and
(1993-January 1999); prior Oppenheimer Convertible Securities
thereto, President and Chief Fund since 1992.
Executive Officer, AMA
Investment Advisors, an
affiliate of the American
Medical Association.
- ------------------------------------------------------------------------------------------------------------------------------------
Faith Colish (68) Trustee since Counsel, Carter Ledyard & 38 Director, American Bar Retirement
1984 Milburn LLP (law firm) since Association (ABRA) since 1997
October 2002; Formerly, (not-for-profit membership
Attorney-at-Law and President, association).
Faith Colish, A Professional
Corporation, 1980 to 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Walter G. Ehlers (71) Trustee since Consultant; Retired President 38 None.
1989 and Trustee, Teachers
Insurance & Annuity (TIAA)
and College Retirement
Equities Fund (CREF).
- ------------------------------------------------------------------------------------------------------------------------------------
C. Anne Harvey (66) Trustee since Consultant, C. A. Harvey 38 President, Board of Associates to
1998 Associates, since June 2001; The National Rehabilitation
Formerly, Director, AARP, 1978 Hospital's Board of Directors since
to December 2001. 2002; Formerly, Member, Individual
Investors Advisory Committee to the
New York Stock Exchange Board of
Directors, 1998 to June 2002; Member,
American Savings Education Council's
Policy Boar (ASEC),1998-2000; Member,
Executive Committee, Crime Prevention
Coalition of America 1997-2000.
- ------------------------------------------------------------------------------------------------------------------------------------
17
Trustees and Officers (Unaudited) cont'd
- ----------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Barry Hirsch (71) Trustee since Attorney-at-Law. Formerly, 38 None.
2000 Senior Counsel, Loews
Corporation (diversified
financial corporation) May
2002 until April 2003; formerly,
Senior Vice President, Secretary
and General Counsel, Loews
Corporation.
- ------------------------------------------------------------------------------------------------------------------------------------
Robert A. Kavesh (76) Trustee since Marcus Nadler Professor of 38 Director, DEL Laboratories, Inc.
2000 Finance and Economics (cosmetics and pharmaceuticals)
Emeritus, New York University, since 1978; The Caring Community
Stern School of Business. (not-for-profit).
- ------------------------------------------------------------------------------------------------------------------------------------
Howard A. Mileaf (67) Trustee since Retired. Formerly, Vice 38 Director, WHX Corporation (holding
1999 President and Special Counsel, company) since August 2002; Director,
WHX Corporation (holding WebFinancial Corporation (holding
company), 1993-2001. company) since December 2002;
Director, State Theatre of New
Jersey (not-for-profit theater) since
2000; formerly, Director, Kevlin
Corporation (manufacturer of
microwave and other products).
- ------------------------------------------------------------------------------------------------------------------------------------
William E. Rulon (71) Trustee since Retired. Senior Vice President, 38 Director, Pro-Kids Golf and Learning
2000 Foodmaker, Inc. (operator and Academy (teach golf and computer
franchiser of restaurants) until usage to "at risk" children)
January 1997. since 1998; Formerly, Director,
Prandium, Inc. (restaurants) from
March 2001 until July 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Cornelius T. Ryan (72) Trustee since Founding General Partner, 38 Director, Capital Cash Management
2000 Oxford Partners and Oxford Trust (money market fund),
Bioscience Partners (venture Narragansett Insured Tax-Free Income
capital partnerships) and Fund, Rocky Mountain Equity Fund,
President, Oxford Venture Prime Cash Fund, several private
Corporation. companies and QuadraMed Corporation
(NASDAQ).
18
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
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Number of
Portfolios in
Position and Fund Complex
Independent Trustees Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Tom Decker Seip (54) Trustee since General Partner, Seip 38 Director, H&R Block, Inc. (financial
2000 Investments LP (a private services company) since May 2001;
investment partnership); Director, Forward Management, Inc.
formerly, President and CEO, (asset management) since 2001;
Westaff, Inc. (temporary Formerly, Director, General Magic
staffing), May 2001 to January (voice recognition software),
2002; Senior Executive at the November 2001 until 2002; Director,
Charles Schwab Corporation E-Finance Corporation (credit
from 1983 to 1999, including decisioning services), 1999-2003;
Chief Executive Officer, Director, Save-Daily.com (micro
Charles Schwab Investment investing services), 1999-2003;
Management, Inc. and Trustee, Director, Offroad Capital Inc.
Schwab Family of Funds and (pre-public internet commerce
Schwab Investments from 1997 company).
to 1998 and Executive Vice
President--Retail Brokerage,
Charles Schwab Investment
Management from 1994 to 1997.
- ------------------------------------------------------------------------------------------------------------------------------------
Candace L. Straight (56) Trustee since Private investor and consultant 38 Director, The Proformance Insurance
1999 specializing in the insurance Company (personal lines property and
industry; Formerly, Advisory casualty insurance company) since
Director, Securitas Capital LLC March 2004; Director, Providence
(a global private equity Washington (property and casualty
investment firm dedicated to insurance company), since December
making investments in the 1998; Director, Summit Global
insurance sector), 1998 until Partners (insurance brokerage firm)
December 2002. since October 2000.
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Peter P. Trapp (59) Trustee since Regional Manager for Atlanta 38 None.
1984 Region, Ford Motor Credit
Company since August 1997;
Formerly, President, Ford
Life Insurance Company, April
1995 until August 1997.
19
Trustees and Officers (Unaudited) cont'd
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Number of
Portfolios in
Trustees who are Position and Fund Complex
"Interested Persons" Length of Time Overseen by Other Directorships Held Outside Fund
Name, Age, and Address (1) Served (2) Principal Occupation(s) (3) Trustee Complex by Trustee
- ------------------------------------------------------------------------------------------------------------------------------------
Edward I. OBrien* (75) Trustee since Formerly, Member, Investment 38 Director, Legg Mason, Inc. (financial
2000 Policy Committee, Edward services holding company) since 1993;
Jones, 1993-2001; President, formerly, Director, Boston Financial
Securities Industry Association Group (real estate and tax shelters)
("SIA") (securities industry's 1993-1999.
representative in government
relations and regulatory matters
at the federal and state levels)
1974-1992; Adviser to SIA,
November 1992-November 1993.
- ------------------------------------------------------------------------------------------------------------------------------------
Jack L. Rivkin* (63) President and Executive Vice President and 38 Director, Dale Carnegie and
Trustee since Chief Investment Officer, Associates, Inc. (private company)
December Neuberger Berman Inc. (holding since 1998; Director, Emagin Corp.
2002 company) since 2002 and 2003, (public company) since 1997;
respectively; Executive Vice Director, Solbright, Inc. (private
President and Chief Investment company) since 1998; Director,
Officer, Neuberger Berman since Infogate, Inc. (private company)
2002 and 2003, respectively; since 1997.
Director and Chairman, NB
Management since December 2002;
Formerly, Executive Vice
President, Citigroup Investments,
Inc. from September 1995 to
February 2002; Executive Vice
President, Citigroup Inc. from
September 1995 to February 2002.
- ------------------------------------------------------------------------------------------------------------------------------------
Peter E. Sundman* (45) Chairman of Executive Vice President, 38 Director, Neuberger Berman Inc.
the Board, Neuberger Berman Inc. (holding (holding company) from 1999 through
Chief company) since 1999; Head of March 2003; President and Director,
Executive Neuberger Berman Inc.'s Mutual NB Management since 1999; Director
Officer and Funds and Institutional Business and Vice President, Neuberger Berman
Trustee since since 1999; Executive Vice Agency, Inc. since 2000.
2000; President, Neuberger Berman since
President and 1999; Principal, Neuberger Berman
Chief from 1997 until 1999; Senior Vice
Executive President, NB Management from 1996
Officer from until 1999.
1998 to 2000
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20
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the Trust's Trust Instrument, each Trustee shall hold office
for life or until his or her successor is elected or the Trust terminates;
except that (a) any Trustee may resign by delivering a written resignation;
(b) any Trustee may be removed with or without cause at any time by a
written instrument signed by at least two-thirds of the other Trustees; (c)
any Trustee who requests to be retired, or who has become unable to serve,
may be retired by a written instrument signed by a majority of the other
Trustees; and (d) any Trustee may be removed at any shareholder meeting by
a vote of at least two-thirds of the outstanding shares.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
* Indicates a Trustee who is an "interested person" within the meaning of the
1940 Act. Mr. Sundman and Mr. Rivkin are interested persons of the Trust by
virtue of the fact that they are officers and/or directors of NB Management
and Executive Vice Presidents of Neuberger Berman. Mr. O'Brien is an
interested person of the Trust by virtue of the fact that he is a director
of Legg Mason, Inc., a wholly owned subsidiary of which, from time to time,
serves as a broker or dealer to the Funds and other funds for which NB
Management serves as investment manager.
21
Information about the Officers of the Trust
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- ------------------------------------------------------------------------------------------------------------------------------------
Claudia A. Brandon (47) Secretary since 1985 Vice President--Mutual Fund Board Relations, NB Management since 2000;
Vice President, Neuberger Berman since 2002 and employee since 1999;
Vice President, NB Management from 1986 to 1999; Secretary, eleven
registered investment companies for which NB Management acts as
investment manager and administrator (four since 2002, three since
2003, and one since 2004).
Robert Conti (48) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice President,
Neuberger Berman from 1999 until 2003; Senior Vice President, NB
Management since 2000; Controller, NB Management until 1996;
Treasurer, NB Management from 1996 until 1999; Vice President, eleven
registered investment companies for which NB Management acts as
investment manager and administrator (three since 2000, four since
2002, three since 2003, and one since 2004).
Brian P. Gaffney (50) Vice President since 2000 Managing Director, Neuberger Berman since 1999; Senior Vice President,
NB Management since 2000; Vice President, NB Management from 1997
until 1999; Vice President, eleven registered investment companies for
which NB Management acts as investment manager and administrator
(three since 2000, four since 2002, three since 2003, and one since
2004).
Sheila R. James (39) Assistant Secretary since 2002 Employee, Neuberger Berman since 1999; Employee, NB Management from
1991 to 1999; Assistant Secretary, eleven registered investment
companies for which NB Management acts as investment manager and
administrator (seven since 2002, three since 2003 and one since 2004).
Kevin Lyons (49) Assistant Secretary since 2003 Employee, Neuberger Berman since 1999; Employee, NB Management from
1993 to 1999; Assistant Secretary, eleven registered investment
companies for which NB Management acts as investment manager and
administrator (Ten since 2003 and one since 2004).
22
NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST JUNE 30, 2004 (UNAUDITED)
Position and
Name, Age, and Address (1) Length of Time Served (2) Principal Occupation(s) (3)
- ------------------------------------------------------------------------------------------------------------------------------------
John M. McGovern (34) Assistant Treasurer since 2002 Vice President, Neuberger Berman since 2004; Employee, NB
Management since 1993; Assistant Treasurer, eleven registered
investment companies for which NB Management acts as investment
manager and administrator (seven since 2002, three since 2003,
and one since 2004).
Barbara Muinos (45) Treasurer and Principal Financial Vice President, Neuberger Berman since 1999; Assistant Vice
and Accounting Officer since 2002; President, NB Management from 1993 to 1999; Treasurer and
prior thereto, Assistant Treasurer Principal Financial and Accounting Officer, eleven registered
since 1996 investment companies for which NB Management acts as investment
manager and administrator (seven since 2002, three since 2003, and
one since 2004); Assistant Treasurer, three registered investment
companies for which NB Management acts as investment manager and
administrator from 1996 until 2002.
Frederic B. Soule (58) Vice President since 2000 Senior Vice President, Neuberger Berman since 2003; Vice
President; Neuberger Berman from 1999 until 2003; Vice President,
NB Management from 1995 until 1999; Vice President, eleven
registered investment companies for which NB Management acts as
investment manager and administrator (three since 2000, four since
2002, three since 2003, and one since 2004).
(1) The business address of each listed person is 605 Third Avenue, New York,
New York 10158.
(2) Pursuant to the By-Laws of the Trust, each officer elected by the Trustees
shall hold office until his or her successor shall have been elected and
qualified or until his or her earlier death, inability to serve, or
resignation. Officers serve at the pleasure of the Trustees and may be
removed at any time with or without cause.
(3) Except as otherwise indicated, each individual has held the positions shown
for at least the last five years.
23
Proxy Voting Policies and Procedures
A description of the policies and procedures that the Fund uses to determine
how to vote proxies relating to portfolio securities is available, without
charge, by calling 1-800-877-9700 (toll-free) and on the website of the
Securities and Exchange Commission, at www.sec.gov. Beginning September 2004,
information regarding how the Fund voted proxies relating to portfolio
securities during the most recent 12-month period ended June 30 will also be
available without charge, by calling 1-800-877-9700 (toll-free), on the website
of the Securities and Exchange Commission, at www.sec.gov, and on the Fund's
website at www.nb.com.
24
ITEM 2. CODE OF ETHICS
Not applicable. Only required in an annual report.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
Not applicable. Only required in an annual report.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not applicable. Only required in an annual report.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not applicable to the Registrant.
ITEM 6. SCHEDULE OF INVESTMENTS.
Not yet applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the Registrant.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable to Registrant.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 10. CONTROLS AND PROCEDURES
(a) Based on an evaluation of the disclosure controls and procedures (as
defined in rule 30a-2(c) under the Act) as of a date within 90 days of
the filing date of this report, the Chief Executive Officer and
Treasurer of the Registrant have concluded that such disclosure
controls and procedures are effectively designed to ensure that
information required to be disclosed by the Registrant is accumulated
and communicated to the Registrant's management to allow timely
decisions regarding required disclosure.
(b) There were no significant changes in the Registrant's internal controls
over financial reporting (as defined in rule 30a-3(d) under the Act)
that occurred during the Registrant's last fiscal half-year that have
materially affected, or are reasonably likely to materially affect, the
Registrant's internal control over financial reporting.
ITEM 11. EXHIBITS
(a) (1) Not applicable. Only required in an annual report.
(2) The certifications required by Rule 30a-2(a) of the Investment Company
Act of 1940, as amended and Section 302 of the Sarbanes-Oxley Act of
2002 ("Sarbanes-Oxley Act") are attached hereto.
(3) Not applicable.
(b) The certification required by Rule 30a-2(b) of the Investment Company
Act of 1940, as amended, and Section 906 of the Sarbanes-Oxley Act are
attached hereto.
The certifications provided pursuant to Section 906 of the Sarbanes-Oxley Act
are not deemed "filed" for purposes of Section 18 of the Securities Exchange Act
of 1934 ("Exchange Act"), or otherwise subject to the liability of that section.
Such certifications will not be deemed to be incorporated by reference into any
filing under the Securities Act of 1933 or the Exchange Act, except to the
extent that the Registrant specifically incorporates them by reference.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Neuberger Berman Advisers Management Trust
By: /s/ Peter E. Sundman
-----------------------------------
Peter E. Sundman
Chief Executive Officer
Date: August 30, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the
dates indicated.
By: /s/ Peter E. Sundman
-----------------------------------
Peter E. Sundman
Chief Executive Officer
Date: August 30, 2004
By: /s/ Barbara Muinos
-----------------------------------
Barbara Muinos
Treasurer, Principal Financial
and Accounting Officer
Date: August 27, 2004