<Page>
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: 811-07064
Exact name of registrant as specified in charter: The Target Portfolio
Trust
Address of principal executive offices: Gateway Center 3
100 Mulberry Street
Newark, New Jersey 07102
Name and address of agent for service: Lori E. Bostrom
Gateway Center 3
100 Mulberry Street
Newark, New Jersey 07102
Registrant's telephone number, including area code: 973-367-1495
Date of fiscal year end: December 31, 2003
Date of reporting period: June 30, 2003
<Page>
Item 1 -- Reports to Stockholders
The Target
Portfolio Trust(R)
Semiannual Report
June 30, 2003
Target
(GRAPHIC) A STRUCTURED
AND PERSONALIZED
INVESTMENT PROGRAM
PRUDENTIAL (LOGO)
Dear Target Shareholder: August 15, 2003
Stocks and bonds often move in opposite
directions. However, for a period during the
spring of 2003, both markets in the United
States rallied in tandem. Recently, signs of
stronger economic growth helped sustain the
rise in equities but weighed heavily on bonds.
Regardless of the direction of financial
markets, it is important to remember that a
wise investor plans today for tomorrow's needs.
Current market activity should have little
impact on planning for your long-term
investment goals. Target is a comprehensive
program that can help you tune out market
noise.
In the Target program, you construct a personal
plan together with a financial professional who
understands your reasons for investing, the
time you have to reach your goals, and the
amount of risk you are comfortable assuming.
Whether you are investing for your retirement,
your children's education, or some other need,
you can find the ingredients for your asset
allocation among the Target portfolios.
Our team of experienced analysts selects asset
management firms that are widely respected by
institutional and individual investors. These
firms have established track records in the
specific asset classes and management styles
they offer in the Target portfolios. Our
analysts continue to monitor their performance
and their adherence to the investment processes
that earned them their reputations.
I was named president of The Target Portfolio
Trust in March 2003. Thank you
for your continued confidence in us. We look
forward to serving your future investment
needs.
Sincerely,
Judy A. Rice, President
The Target Portfolio Trust
1
Equity Portfolios as of 6/30/03
Six-Month Average Annual Total Returns1
Total Return One Year Five Years Ten Years
Large Capitalization Growth Portfolio 16.95% -2.92% -2.29% 7.13%
S&P 500 Index4 11.75% 0.25% -1.61% 10.04%
Russell 1000 Growth Index4 13.09% 2.94% -22.76% 8.28%
Lipper Large-Cap Growth Funds Avg.5 12.25% -0.76% -19.13% 6.72%
Large Capitalization Value Portfolio 13.46% -0.12% -0.74% 7.66%
S&P 500 Index4 11.75% 0.25% -1.61% 10.04%
Russell 1000 Value Index4 11.57% -1.02% 1.05% 10.68%
Lipper Multi-Cap Value Funds Avg.5 12.33% -0.50% 1.64% 9.72%
Small Capitalization Growth Portfolio 13.90% -8.76% -7.07% 3.10%
Russell 2000 Index4 17.88% -1.64% 0.97% 8.24%
Russell 2000 Growth Index4 19.33% 0.69% -4.25% 4.35%
Lipper Small-Cap Growth Funds Avg.5 17.45% -1.29% 0.02% 7.48%
Small Capitalization Value Portfolio 14.51% 0.94% 5.55% 8.37%
Russell 2000 Index4 17.88% -1.64% 0.97% 8.24%
Russell 2000 Value Index4 16.49% -3.80% 4.98% 11.34%
Lipper Small-Cap Core Funds Avg.5 15.63% -2.07% 2.89% 8.90%
International Equity Portfolio 7.92% -5.84% -5.91% 3.95%
MSCI EAFE Index4 9.47% -6.46% -4.00% 2.78%
Lipper International Funds Avg.5 8.60% -7.98% -3.79% 4.17%
Fixed Income Portfolios as of 6/30/03
Six-Month Average Annual Total Returns1
Total Return One Year Five Years Ten Years
International Bond Portfolio2 5.99% 13.37% 2.69% 2.54% (2.49)3
Citigroup Non-U.S. WGBI-Hedged4 2.65% 7.69% 6.79% 8.83%
Citigroup Non-U.S. WGBI-Unhedged4 8.09% 17.90% 6.29% 6.20%
Lipper International Income Funds Avg.5 8.24% 16.52% 6.10% 6.81%
Total Return Bond Portfolio 5.05% 10.71% 6.41% 6.32% (6.30)3
Lehman Brothers Aggregate Bond Index4 3.93% 10.40% 7.55% 7.21%
Lehman Brothers Govt/Credit Bond Index4 5.23% 13.15% 7.84% 7.35%
Lipper Corporate Debt BBB-Rated Funds Avg.5 6.78% 12.89% 6.14% 6.92%
Intermediate-Term Bond Portfolio 4.34% 9.11% 6.21% 5.98%
Lehman Brothers Int.Govt/Credit Bond Index4 4.27% 10.84% 7.65% 6.88%
Lipper Int. Inv. Grade Debt Funds Avg.5 4.31% 9.99% 6.48% 6.42%
Mortgage Backed Securities Portfolio 1.44% 4.51% 5.37% 5.63% (5.61)3
Lehman Brothers Mort.-Backed Securities Index4 1.60% 5.72% 6.97% 6.94%
Citigroup Mortgage Backed Securities Index4 1.59% 5.79% 7.01% 6.95%
Lipper U.S. Mortgage Funds Avg.5 1.56% 5.48% 6.17% 6.01%
Money Market Portfolio as of 6/30/03
Six-Month One Year Net Asset 7-Day
Total Return Total Return Value (NAV) Current Yield
U.S. Government Money Market Portfolio6 0.40% 1.08% $1.00 0.60%
Lipper U.S. Government Money Market Funds Avg.5 0.28% 0.76% N/A N/A
2
Past performance is not indicative of future
results. Principal value and investment return
will fluctuate so that an investor's shares,
when redeemed, may be worth more or less than
their original cost. 1Source: Prudential
Investments LLC and Lipper Inc. Total returns
assume the reinvestment of all dividends and
distributions, and take into account all
charges and expenses applicable to an
investment in each portfolio. The six-month
total returns do not take into account the
annual Target advisory fee. The average annual
total returns for the Target Portfolios assume
the imposition of the maximum Target annual
advisory fee of 1.5% for stock portfolios and
1.0% for the bond portfolios for retail
investors. Returns for retirement accounts will
differ. The maximum advisory fees for these
accounts are 1.25% and 1.35%, of equity
portfolio and bond portfolio assets,
respectively. The returns in the table do not
reflect the deduction of taxes that a
shareholder would pay on fund distributions or
following the redemption of fund shares. 2The
inception date for the International Bond
Portfolio is 5/17/94. Performance for this
portfolio is for the six-month, one-year, five-
year, and since inception periods. The
benchmark data is for the six-month, one-year,
five-year, and closest month-end to inception
(5/31/94) periods. 3Without waiver of fees
and/or expense subsidization, the portfolios'
returns would have been lower, as indicated in
parentheses. 4Investors cannot invest directly
in an index. The returns for the benchmark
indexes would be lower if they included the
effects of sales charges, operating expenses of
a mutual fund, or taxes. The Standard & Poor's
Composite Stock Price Index (S&P 500 Index) is
an unmanaged index of 500 stocks of large U.S.
companies. It gives a broad look at how stock
prices have performed. The Russell 1000 Growth
Index contains those securities in the Russell
1000 Index with an above-average growth
orientation. Companies in this index tend to
exhibit higher price-to-book and price-to-
earnings ratios, lower dividend yields, and
higher forecasted growth rates. The Russell
1000 Value Index contains those securities in
the Russell 1000 Index with a below-average
growth orientation. Companies in this index
generally have low price-to-book and price-to-
earnings ratios, higher dividend yields, and
lower forecasted growth values. The Russell
2000 Index is an unmanaged index of the stocks
of the 2,000 smallest U.S. companies included
in the Russell 3000 Index. It gives a broad
look at how the stock prices of smaller
companies have performed. The Russell 2000
Growth Index contains those securities in the
Russell 2000 Index with an above-average growth
orientation. Companies in this index generally
have higher price-to-book and price-to-earnings
ratios. The Russell 2000 Value Index contains
those securities in the Russell 2000 Index with
a below-average growth orientation. Companies
in this index generally have low price-to-
earnings ratios, higher dividend yields, and
lower forecasted growth values. The Morgan
Stanley Capital International Europe
Australasia, and Far East Index (MSCI EAFE
Index) is an unmanaged, weighted index that
reflects stock price movements in Europe,
Australasia, and the Far East. It gives a broad
look at how foreign stocks have performed. The
Citigroup (formerly Salomon Smith Barney) Non-
U.S. World Government Bond Index (WGBI)-Hedged
is an unmanaged index of approximately 600
high-quality bonds with foreign currency
exposure translated to the U.S. dollar. It
gives a broad look at how foreign bonds have
performed. The Citigroup (formerly Salomon
Smith Barney) Non-U.S. World Government Bond
Index (WGBI)-Unhedged is an unmanaged index of
approximately 600 high-quality bonds issued in
several different currencies. It gives a broad
look at how foreign bonds have performed. The
Lehman Brothers Aggregate Bond Index is an
unmanaged index of investment-grade securities
issued by the U.S. government and its agencies
and by corporations with between 1 and 10 years
remaining to maturity. It gives a broad look at
how bond prices of short and intermediate-term
bonds have performed. The Lehman Brothers
Government/Credit Bond Index (formerly Lehman
Brothers Government/Corporate Bond Index) is an
unmanaged index of publicly traded
intermediate- and long-term government and
corporate debt with an average maturity of 10
years. It gives a broad look at how bonds have
performed. The Lehman Brothers Intermediate
Government/Credit Bond Index (formerly Lehman
Brothers Intermediate Government/Corporate
Bond Index) is an unmanaged index of publicly
traded U.S. government bonds and investment-
grade corporate bonds with maturities of up to
10 years. It gives a broad look at how
intermediate-term bonds have performed. The
Lehman Brothers Mortgage-Backed Securities
Index is a market capitalization-weighted index
of 15- and 30-year fixed-rate securities backed
by GNMA, FNMA, and FHLMC mortgage pools, and
balloon mortgages with fixed-rate coupons. The
Citigroup (formerly Salomon Smith Barney)
Mortgage-Backed Securities Index is an
unmanaged index of 15- and 30-year mortgage
related securities issued by U.S. government
agencies. Each of them gives a broad look at
how mortgage-backed securities have performed.
5The Lipper averages represent returns based on
an average of all funds in the respective
Lipper categories for the periods noted. The
returns for the Lipper averages would be lower
if they included the effects of sales charges.
Large-Cap Growth funds invest at least 75% of
their equity assets in companies with market
capitalizations (on a three-year weighted
basis) greater than 300% of the dollar-weighted
median market capitalization of the middle
1,000 securities of the S&P SuperComposite 1500
Index. Large-Cap Growth funds typically have an
above-average price-to-earnings ratio, and
three-year sales-per-share growth value,
compared with the S&P 500 Index. Multi-Cap
Value funds invest in a variety of market
capitalization ranges without concentrating 75%
of their equity assets in any one market
capitalization range over an extended period of
time. Multi-cap funds typically have between
25% to 75% of their assets invested in
companies with market capitalizations (on a
three-year
3
weighted basis) above 300% of the dollar-
weighted median market capitalization of the
middle 1,000 securities of the S&P
SuperComposite 1500 Index. Multi-Cap Value
funds typically have a below-average price-to-
earnings ratio, and three-year sales-per-share
growth value, compared with the S&P 500 Index.
Small-Cap Growth funds invest at least 75% of
their equity assets in companies with market
capitalizations (on a three-year weighted
basis) less than 250% of the dollar-weighted
median of the smallest 500 of the middle 1,000
securities of the S&P SuperComposite 1500
Index. Small-cap growth funds typically have an
above-average price-to-earnings ratio, and
three-year sales-per-share growth value,
compared with the S&P SmallCap 600 Index.
Small-Cap Core funds invest at least 75% of
their equity assets in companies with market
capitalizations (on a three-year weighted
basis) less than 250% of the dollar-weighted
median of the smallest 500 of the middle 1,000
securities of the S&P SuperComposite 1500
Index. Small-cap core funds have more latitude
in the companies in which they invest. These
funds typically have an average price-to-
earnings ratio, and three-year sales-per-share
growth value, compared with the S&P SmallCap
600 Index. International funds invest their
assets in securities with primary trading
markets outside of the United States.
International Income funds invest primarily in
U.S. dollar and non-U.S. dollar debt securities
of issuers located in at least three countries,
excluding the United States, except in periods
of market weakness. Corporate Debt BBB-Rated
funds invest primarily in corporate and
government debt issues rated in the top four
grades. Intermediate Investment Grade Debt
funds invest primarily in investment-grade debt
issues (rated in the top four grades) with
dollar-weighted average maturities of 5 to 10
years. U.S. Mortgage funds invest primarily in
mortgages/securities issued or guaranteed as to
principal and interest by the U.S. government
or certain federal agencies. U.S. Government
Money Market funds invest principally in
financial instruments issued or guaranteed by
the U.S. government, its agencies or its
instrumentalities, with dollar-weighted average
maturities of less than 90 days. These funds
intend to keep a constant net asset value. 6An
investment in the U.S. Government Money Market
Portfolio is not insured or guaranteed by the
Federal Deposit Insurance Corporation or any
other government agency. Although this
Portfolio seeks to preserve the value of your
investment at $1.00 per share, it is possible
to lose money by investing in this Portfolio.
4
<Page>
Portfolio of Investments Large Capitalization Growth Portfolio
June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
LONG-TERM INVESTMENTS--97.2%
Common Stocks
Aerospace/Defense--0.9%
56,000 Lockheed Martin Corp. $ 2,663,920
------------
Airlines--0.8%
133,500 Southwest Airlines Co. 2,296,200
------------
Building & Construction--0.8%
73,500 Home Depot, Inc. (The) 2,434,320
------------
Business Services--0.5%
35,500 First Data Corp. 1,471,120
------------
Computer Software & Services--12.7%
180,000 Advent Software, Inc.(a) 3,043,800
642,000 EMC Corp.(a) 6,721,740
417,500 Microsoft Corp. 10,692,175
240,000 Oracle Corp.(a) 2,884,800
405,000 VERITAS Software Corp.(a) 11,611,350
45,800 Yahoo!, Inc.(a) 1,500,408
------------
36,454,273
------------
Computers & Business Equipment--10.7%
340,000 Brocade Communications Systems, Inc.(a) 2,002,600
1,337,900 Cisco Systems, Inc.(a) 22,329,551
136,500 Dell Computer Corp.(a) 4,362,540
27,000 International Business Machines Corp. 2,227,500
------------
30,922,191
------------
Cosmetics & Toiletries--1.5%
61,500 Estee Lauder Cos., Inc. (Class A shares) 2,062,095
67,500 Gillette Co. 2,150,550
------------
4,212,645
------------
Drugs & Health Care--14.9%
69,000 Amgen, Inc.(a) 4,584,360
52,000 Boston Scientific Corp.(a) 3,177,200
92,500 Cardinal Health, Inc. 5,947,750
77,500 Caremark Rx, Inc.(a) 1,990,200
48,000 Gilead Sciences, Inc.(a) 2,667,840
205,200 Medtronic, Inc. 9,843,444
301,300 Pfizer, Inc. 10,289,395
35,000 Teva Pharmaceutical Industries Ltd., ADR (Israel) 1,992,550
54,500 Wyeth 2,482,475
------------
42,975,214
------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 5
<Page>
Large Capitalization Growth Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Education--0.8%
39,000 Apollo Group, Inc. (Class A shares)(a) $ 2,408,640
--------------
Electronic Components--3.4%
620,000 Applied Materials, Inc.(a) 9,833,200
--------------
Financial Services--16.0%
50,000 Bank of America Corp. 3,951,500
94,500 Capital One Financial Corp. 4,647,510
304,000 Citigroup, Inc. 13,011,200
79,500 J.P. Morgan Chase & Co. 2,717,310
468,150 MBNA Corp. 9,756,246
194,600 Morgan Stanley Dean Witter & Co. 8,319,150
90,000 SLM Corp. 3,525,300
--------------
45,928,216
--------------
Food & Beverages--2.2%
40,500 Anheuser-Busch Cos., Inc. 2,067,525
31,100 General Mills, Inc. 1,474,451
--------------
3,541,976
--------------
Hotels & Restaurants--0.8%
60,500 Brinker International, Inc.(a) 2,179,210
133,000 McDonald's Corp. 2,933,980
--------------
5,113,190
--------------
Household Appliances & Home Furnishings--0.8%
80,500 Newell Rubbermaid, Inc. 2,254,000
--------------
Insurance--3.7%
59,500 Aetna, Inc. 3,581,900
126,000 American International Group, Inc. 6,952,680
--------------
10,534,580
--------------
Internet--2.1%
110,000 Amazon.com, Inc.(a) 4,013,900
163,300 Juniper Networks, Inc.(a) 2,020,021
--------------
6,033,921
--------------
Media--2.7%
146,000 AOL Time Warner, Inc.(a) 2,349,140
99,999 Comcast Corp.(Class A shares)(a) 3,017,970
71,500 EchoStar Communications Corp. (Class A shares)(a) 2,475,330
--------------
7,842,440
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
6 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Oil Field/Equipment & Services--2.0%
45,200 Apache Corp. $ 2,940,712
77,000 BJ Services Co.(a) 2,876,720
--------------
5,817,432
--------------
Paper--1.0%
77,000 International Paper Co. 2,751,210
--------------
Retail Trade--4.2%
60,000 Costco Wholesale Corp.(a) 2,196,000
175,000 Gap, Inc. (The) 3,283,000
204,000 Staples, Inc.(a) 3,743,400
54,000 Wal-Mart Stores, Inc. 2,898,180
--------------
12,120,580
--------------
Semiconductors & Equipment--12.3%
149,000 Intel Corp. 3,096,816
325,000 Linear Technology Corp. 10,468,250
300,000 Maxim Integrated Products, Inc. 10,257,000
453,000 Xilinx, Inc.(a) 11,465,430
--------------
35,287,496
--------------
Telecommunication--2.4%
289,000 AT&T Wireless Services, Inc.(a) 2,372,690
160,000 Nokia Oyj ADR (Finland) 2,628,800
51,800 UTStarcom, Inc.(a) 1,842,526
--------------
6,844,016
--------------
Total long-term investments 279,740,780
(cost $222,293,498)
--------------
SHORT-TERM INVESTMENTS--3.1%
Mutual Fund
8,822,637 Prudential Core Investment Fund--Taxable Money Market 8,822,637
Series
(cost $8,822,637; Note 3)
--------------
Total Investments--100.3% 288,563,417
(cost $231,116,135; Note 5)
Liabilities in excess of other assets--(0.3%) (902,399)
--------------
Net Assets--100% $ 287,661,018
--------------
--------------
</Table>
- ------------------------------
(a) Non-income producing security.
ADR--American Depository Receipt.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 7
<Page>
Large Capitalization Value Portfolio Portfolio of Investments
June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
LONG-TERM INVESTMENTS--98.5%
Common Stocks
Aerospace/Defense--1.5%
4,200 Boeing Co. $ 144,144
400 Goodrich Corp. 8,400
25,700 Honeywell International, Inc. 690,045
6,400 Lockheed Martin Corp. 304,448
4,500 Northrop Grumman Corp. 388,305
37,100 Raytheon Co. 1,218,364
13,600 United Technologies Corp. 963,288
------------
3,716,994
------------
Aluminum--2.3%
233,976 Alcoa, Inc. 5,966,388
------------
Apparel--0.6%
14,500 Jones Apparel Group, Inc.(a) 424,270
18,000 Nike, Inc. (Class B shares) 962,820
------------
1,387,090
------------
Automobiles--0.8%
154,119 Ford Motor Co. 1,693,768
4,500 General Motors Corp. 162,000
2,200 Harley-Davidson, Inc. 87,692
------------
1,943,460
------------
Automotive Parts--0.7%
158,962 Delphi Corp. 1,371,842
6,800 Lear Corp.(a) 312,936
------------
1,684,778
------------
Banks--7.0%
12,300 AmSouth Bancorporation 268,632
7,300 Astoria Financial Corp. 203,889
24,600 Bank of America Corp. 1,944,138
18,600 Bank One Corp. 691,548
4,200 City National Corp. 187,152
4,900 Compass Bancshares, Inc. 171,157
7,300 First Tennessee National Corp. 320,543
4,800 FirstMerit Corp. 109,728
10,000 FleetBoston Financial Corp. 297,100
14,200 GreenPoint Financial Corp. 723,348
13,500 Hibernia Corp. (Class A shares) 245,160
72,500 KeyCorp 1,832,075
10,200 Marshall & Ilsley Corp. 311,916
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
8 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Banks (cont'd.)
12,500 MBNA Corp. $ 260,500
16,700 Mellon Financial Corp. 463,425
10,500 National Commerce Financial Co. 232,995
16,300 North Fork Bancorporation, Inc. 555,178
11,300 PNC Financial Services Group 551,553
22,000 SouthTrust Corp. 598,400
19,000 SunTrust Banks, Inc. 1,127,460
92,800 U.S. Bancorp 2,273,600
33,900 UnionBanCal Corp. 1,402,443
50,400 Wachovia Corp. 2,013,984
20,700 Wells Fargo & Co. 1,043,280
--------------
17,829,204
--------------
Building & Construction--1.6%
300 American Standard Companies, Inc.(a) 22,179
45,900 Lennar Corp. (Class A shares) 3,281,850
4,590 Lennar Corp. (Class B shares) 315,333
14,700 Masco Corp. 350,595
--------------
3,969,957
--------------
Business Services--1.4%
1,700 BearingPoint, Inc.(a) 16,405
190,600 Cendant Corp.(a) 3,491,792
--------------
3,508,197
--------------
Cable TV--0.4%
2,000 Comcast Corp. (Class A shares)(a) 60,360
34,700 Comcast Corp. (Special Class A shares)(a) 1,000,401
--------------
1,060,761
--------------
Chemicals--2.2%
16,600 Air Products & Chemicals, Inc. 690,560
64,771 Dow Chemical Co. 2,005,310
27,500 Eastman Chemical Co. 870,925
29,600 Monsanto Co. 640,544
7,500 PPG Industries, Inc. 380,550
14,000 Praxair, Inc. 841,400
8,200 Rohm & Haas Co. 254,446
--------------
5,683,735
--------------
Computer Software & Services--1.8%
6,000 Computer Sciences Corp.(a) 228,720
184,500 Electronic Data Systems Corp. 3,957,525
10,200 EMC Corp.(a) 106,794
89,300 Sun Microsystems, Inc.(a) 410,780
--------------
4,703,819
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 9
<Page>
Large Capitalization Value Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Computers & Business Equipment--2.3%
38,700 Cisco Systems, Inc.(a) $ 645,903
7,800 Dell, Inc.(a) 249,288
525,100 Gateway, Inc.(a) 1,916,615
50,300 Hewlett-Packard Co. 1,071,390
21,900 International Business Machines Corp. 1,806,750
9,100 NCR Corp.(a) 233,142
--------------
5,923,088
--------------
Conglomerates--2.0%
1,900 ITT Industries, Inc. 124,374
263,300 Tyco International Ltd. (Bermuda) 4,997,434
--------------
5,121,808
--------------
Consumer Products--2.8%
103,400 Eastman Kodak Co. 2,827,990
46,100 Fortune Brands, Inc. 2,406,420
1,500 Newell Rubbermaid, Inc. 42,000
20,200 Procter & Gamble Co. 1,801,436
--------------
7,077,846
--------------
Cosmetics & Toiletries--0.2%
15,800 Gillette Co. 503,388
--------------
Data Processing Systems--0.1%
7,300 First Data Corp. 302,512
--------------
Diversified Manufacturing
1,900 SPX Corp.(a) 83,714
--------------
Domestic Oil--0.4%
23,500 Anadarko Petroleum Corp. 1,045,045
--------------
Drugs & Health Care--3.2%
56,100 Bausch & Lomb, Inc. 2,103,750
35,700 Bristol-Myers Squibb Co. 969,255
1,200 Eli Lilly & Co. 82,764
3,400 Forest Laboratories, Inc.(a) 186,150
1,500 Gilead Sciences, Inc.(a) 83,370
5,800 Guidant Corp.(a) 257,462
6,000 Human Genome Sciences, Inc.(a) 76,320
2,600 MedImmune, Inc.(a) 94,562
23,100 Merck & Co. Inc. 1,398,705
19,200 Schering-Plough Corp. 357,120
181,500 Tenet Healthcare Corp.(a) 2,114,475
3,200 Watson Pharmaceuticals(a) 129,184
4,200 Wyeth 191,310
--------------
8,044,427
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
10 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Electric Utilities--8.2%
4,500 Ameren Corp. $ 198,450
164,520 American Electric Power Co., Inc. 4,907,632
16,200 Cinergy Corp. 595,998
9,800 Constellation Energy Group, Inc. 336,140
10,900 Dominion Resources, Inc./VA 700,543
70,500 DTE Energy Co. 2,724,120
29,700 Edison International(a) 487,971
33,700 Entergy Corp. 1,778,686
32,500 Exelon Corp. 1,943,825
35,396 FirstEnergy Corp. 1,360,976
8,900 NiSource Inc. 169,100
33,800 OGE Energy Corp. 722,306
8,500 Pepco Holdings, Inc. 162,860
33,000 PG&E Corp.(a) 697,950
16,900 Pinnacle West Capital Corp. 632,905
21,535 PPL Corp. 926,005
5,300 Progress Energy, Inc. 232,670
39,700 Public Service Enterprise Group, Inc. 1,677,325
3,201 SCANA Corp. 109,730
500 TXU Corp. 11,225
37,600 Xcel Energy, Inc. 565,504
--------------
20,941,921
--------------
Electrical Equipment--0.5%
6,900 Cooper Industries Ltd. (Class A shares) 284,970
8,600 Johnson Controls, Inc. 736,160
3,400 W.W. Grainger, Inc. 158,984
--------------
1,180,114
--------------
Electronics--0.3%
21,000 Altera Corp.(a) 344,400
23,800 Motorola, Inc. 224,434
2,500 QLogic Corp.(a) 120,825
2,500 Xilinx, Inc.(a) 63,275
--------------
752,934
--------------
Exchange Traded Funds--0.5%
26,760 iShares Russell 1000 Value Index Fund 1,353,253
--------------
Financial Services--10.4%
19,900 Capital One Financial Corp. 978,682
201,800 CIT Group, Inc. 4,974,370
125,000 Citigroup, Inc. 5,350,000
19,400 Countrywide Credit Industries, Inc. 1,349,658
29,700 E*Trade Group, Inc.(a) 252,450
200 Fannie Mae 13,488
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 11
<Page>
Large Capitalization Value Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Financial Services (cont'd.)
18,200 Freddie Mac $ 924,014
16,600 Goldman Sachs Group, Inc. 1,390,250
13,700 MBIA, Inc. 667,875
20,300 Merrill Lynch & Co., Inc. 947,604
47,300 Morgan Stanley 2,022,075
132,800 Principal Financial Group, Inc. (The) 4,282,800
83,900 Washington Mutual, Inc. 3,465,070
--------------
26,618,336
--------------
Food & Beverages--1.7%
28,900 Albertson's, Inc. 554,880
14,800 Archer-Daniels-Midland Co. 190,476
32,800 Coca-Cola Co. 1,522,248
1,200 H.J. Heinz Co. 39,576
200 Hershey Foods Corp. 13,932
9,100 Kellogg Co. 312,767
12,400 Kraft Foods, Inc. (Class A shares) 403,620
16,000 Kroger Co.(a) 266,880
48,300 Sara Lee Corp. 908,523
4,800 Sysco Corp. 144,192
--------------
4,357,094
--------------
Forest Products--0.9%
9,600 Georgia-Pacific Corp. 181,920
40,720 Weyerhaeuser Co. 2,198,880
--------------
2,380,800
--------------
Gas & Pipeline Utilities--0.2%
18,900 EL Paso Corp. 152,712
7,000 Valero Energy Corp. 254,310
--------------
407,022
--------------
Hotels & Restaurants--3.6%
2,600 Harrah's Entertainment, Inc.(a) 104,624
72,600 Mandalay Resort Group(a) 2,312,310
300 Marriott International, Inc. 11,526
21,200 McDonald's Corp. 467,672
92,900 Park Place Entertainment Corp.(a) 844,461
2,200 Wendy's International, Inc. 63,734
184,700 Yum! Brands, Inc.(a) 5,459,732
--------------
9,264,059
--------------
Household Appliances & Home Furnishings
1,600 Black & Decker Corp. 69,520
--------------
Industrial Machinery--0.4%
5,400 Deere & Co. 246,780
3,700 Eaton Corp. 290,857
7,400 Ingersoll-Rand Co. (Class A shares) 350,168
--------------
887,805
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
12 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Insurance--11.6%
106,200 Aetna, Inc. $ 6,393,240
70,300 Allmerica Financial Corp.(a) 1,264,697
136,700 Allstate Corp. (The) 4,873,355
12,700 Ambac Financial Group, Inc. 841,375
6,900 American International Group, Inc. 380,742
2,200 Anthem,
Inc.(a) 169,730
25,700 Aon Corp. 618,856
19,500 CIGNA Corp. 915,330
7,000 Hartford Financial Services Group, Inc.(The) 352,520
4,000 John Hancock Financial Services, Inc. 122,920
19,300 Lincoln National Corp. 687,659
228,570 MetLife, Inc. 6,473,102
7,300 Protective Life Corp. 195,275
2,700 SAFECO Corp. 95,256
132,700 St. Paul Cos., Inc. 4,844,877
9,500 Torchmark Corp. 353,875
46,300 Travelers Property Casualty Corp. (Class A shares)(a) 736,170
6,900 Travelers Property Casualty Corp. (Class B shares)(a) 108,813
11,900 UnumProvident Corp. 159,579
--------------
29,587,371
--------------
International Oil--2.6%
24,700 ChevronTexaco Corp. 1,783,340
134,800 Exxon Mobil Corp. 4,840,668
--------------
6,624,008
--------------
Media--2.3%
96,700 AOL Time Warner, Inc.(a) 1,555,903
3,600 Cox Communications, Inc. (Class A shares)(a) 114,840
3,000 E.W. Scripps Co. (Class A shares) 266,160
7,400 Fox Entertainment Group, Inc. (Class A shares)(a) 212,972
3,000 Gannett Co., Inc. 230,430
1,300 Knight-Ridder, Inc. 89,609
48,800 Liberty Media Corp. (Class A shares)(a) 564,128
400 McGraw-Hill Companies, Inc. (The) 24,800
10,700 Tribune Co. 516,810
35,500 Viacom, Inc. (Class B shares) 1,549,930
30,400 Walt Disney Co. 600,400
--------------
5,725,982
--------------
Metals--0.1%
12,900 United States Steel Corp. 211,173
--------------
Networking Products
7,100 Juniper Networks, Inc.(a) 87,827
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 13
<Page>
Large Capitalization Value Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Office Equipment & Supplies
2,500 Pitney Bowes, Inc. $ 96,025
--------------
Oil Field/Equipment & Services--3.2%
300 Apache Corp. 19,518
31,600 ConocoPhillips 1,731,680
4,800 Cooper Cameron Corp.(a) 241,824
18,100 Devon Energy Corp. 966,540
2,800 Diamond Offshore Drilling, Inc. 58,772
39,000 Dynegy, Inc. (Class A shares) 163,800
200 ENSCO International, Inc. 5,380
40,700 Occidental Petroleum Corp. 1,365,485
11,000 Rowan Companies, Inc.(a) 246,400
44,228 Sunoco, Inc. 1,669,165
37,100 Teekay Shipping Corp. 1,591,590
4,700 Transocean, Inc. 103,259
--------------
8,163,413
--------------
Paper--0.2%
9,300 Bowater, Inc. 348,285
3,200 Smurfit-Stone Container Corp.(a) 41,696
3,000 Temple-Inland, Inc. 128,730
--------------
518,711
--------------
Pollution Control--2.0%
207,500 Waste Management, Inc. 4,998,675
--------------
Railroads & Equipment--0.4%
11,100 Burlington Northern Santa Fe Corp. 315,684
5,700 CSX Corp. 171,513
8,200 Norfolk Southern Corp. 157,440
6,400 Union Pacific Corp. 371,328
--------------
1,015,965
--------------
Real Estate Investment Trusts--1.3%
3,300 Archstone-Smith Trust 79,200
2,900 Arden Realty, Inc. 75,255
2,100 Camden Property Trust 73,395
4,700 CarrAmerica Realty Corp. 130,707
1,600 Chelsea Property Group, Inc. 64,496
4,500 Developers Diversified Realty Corp. 127,980
8,400 Duke Realty Corp. 231,420
29,400 Equity Office Properties Trust 794,094
7,100 Equity Residential 184,245
4,600 General Growth Properties, Inc. 287,224
2,500 Highwoods Properties, Inc. 55,750
25,585 Plum Creek Timber Co., Inc. 663,931
10,800 ProLogis Trust 294,840
5,200 Rouse Co. (The) 198,120
5,900 United Dominion Realty Trust, Inc. 101,598
--------------
3,362,255
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
14 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Retailing--5.6%
12,900 Abercrombie & Fitch Co. (Class A shares)(a) $ 366,489
30,500 CVS Corp. 854,915
2,200 Family Dollar Stores, Inc. 83,930
3,200 Federated Department Stores, Inc.(a) 117,920
11,200 Home Depot, Inc. (The) 370,944
200,800 J.C. Penney Co., Inc. 3,383,480
5,200 Kohl's Corp.(a) 267,176
78,300 May Department Stores Co. (The) 1,742,958
211,900 Sears, Roebuck & Co. 7,128,316
--------------
14,316,128
--------------
Software--2.7%
287,700 Computer Associates International, Inc. 6,409,956
3,300 Electronic Arts, Inc.(a) 244,167
6,100 Microsoft Corp.(a) 156,221
16,000 Siebel Systems, Inc.(a) 152,640
--------------
6,962,984
--------------
Supplier & Networking Equipment--0.1%
93,600 Lucent Technologies, Inc.(a) 190,008
4,400 Tellabs, Inc.(a) 28,908
--------------
218,916
--------------
Telecommunications--4.5%
29,000 ALLTEL Corp. 1,398,380
18,820 AT&T Corp. 362,285
46,029 AT&T Wireless Services, Inc.(a) 377,898
40,500 BellSouth Corp. 1,078,515
11,700 General Motors Corp. (Class H)(a) 149,877
1,600 QUALCOMM, Inc. 57,200
11,000 Qwest Communications International, Inc.(a) 52,580
122,492 SBC Communications, Inc. 3,129,671
23,000 Sprint Corp. (FON Group) 331,200
15,600 Sprint Corp. (PCS Group)(a) 89,700
115,360 Verizon Communications, Inc. 4,550,952
--------------
11,578,258
--------------
Tobacco--3.6%
204,500 Altria Group, Inc. 9,292,480
--------------
Toys & Amusements--0.2%
6,600 Hasbro, Inc. 115,434
14,100 Mattel, Inc. 266,772
--------------
382,206
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 15
<Page>
Large Capitalization Value Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Trucking & Freight Forwarding--0.1%
4,600 FedEx Corp. $ 285,338
--------------
Total long-term investments 251,196,784
(cost $224,475,946)
--------------
SHORT-TERM INVESTMENT--1.2%
Mutual Fund
3,078,615 Prudential Core Investment Fund--Taxable Money Market 3,078,615
Series
(cost $3,078,615; Note 3)
--------------
Total Investments--99.7% 254,275,399
(cost $227,554,561; Note 5)
Other assets in excess of liabilities--0.3% 866,571
--------------
Net Assets--100% $ 255,141,970
--------------
--------------
</Table>
- ------------------------------
(a) Non-income producing security.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
16 THE TARGET PORTFOLIO TRUST
<Page>
Portfolio of Investments Small Capitalization Growth Portfolio
June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
</Table>
<Table>
LONG-TERM INVESTMENTS--96.5%
Common Stocks
Apparel--2.4%
29,900 K-Swiss, Inc. (Class A shares) $ 1,032,148
29,500 Kellwood Co. 933,085
49,700 Quiksilver, Inc.(a) 819,553
------------
2,784,786
------------
Banks--4.3%
28,480 CVB Financial Corp. 555,930
16,450 East West Bancorp, Inc. 594,503
12,300 Flagstar Bancorp, Inc. 300,735
22,800 Hudson United Bancorp 778,620
16,900 Southwest Bancorporation of Texas, Inc.(a) 549,419
23,142 Texas Regional Bancshares, Inc. (Class A shares) 803,027
51,400 UCBH Holdings, Inc. 1,474,152
------------
5,056,386
------------
Business Services--4.3%
62,685 CSG Systems International, Inc.(a) 885,739
40,400 Digital Insight Corp.(a) 769,620
10,000 Fair Isaac Corp. 514,500
41,200 Kroll, Inc.(a) 1,114,872
63,501 Pegasus Solutions, Inc.(a) 1,031,891
19,000 Ritchie Bros. Auctioneers, Inc.(a) 731,690
------------
5,048,312
------------
Commercial Services--1.4%
35,500 Alliance Data Systems Corp.(a) 830,700
20,560 Iron Mountain, Inc.(a) 762,570
------------
1,593,270
------------
Computer Services--0.7%
16,950 Fidelity National Information Solutions, Inc.(a) 442,056
9,900 SRA International, Inc. (Class A shares)(a) 316,800
------------
758,856
------------
Computers & Business Equipment--1.2%
29,300 Hutchinson Technology, Inc.(a) 963,677
65,200 Maxtor Corp.(a) 489,652
------------
1,453,329
------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 17
<Page>
Small Capitalization Growth Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Consumer Products--1.3%
23,400 Jarden Corp.(a) $ 647,478
26,200 LeapFrog Enterprises, Inc.(a) 833,422
--------------
1,480,900
--------------
Distribution/Wholesale--3.0%
18,900 Arrow Electronics, Inc.(a) 288,036
20,340 CDW Corp.(a) 931,572
7,050 Flowers Foods, Inc. 139,308
25,600 Performance Food Group Co.(a) 947,200
42,310 Tech Data Corp.(a) 1,130,100
--------------
3,436,216
--------------
Diversified Manufacturing--0.7%
45,000 Maverick Tube Corp.(a) 861,750
--------------
Drugs & Health Care--12.9%
25,500 aaiPharma, Inc.(a) 506,940
51,920 Abgenix, Inc.(a) 544,641
47,800 Alpharma, Inc. (Class A shares) 1,032,480
27,100 AMERIGROUP Corp.(a) 1,008,120
14,100 Centene Corp.(a) 548,490
21,950 Cooper Cos., Inc. 763,201
44,900 Covance, Inc.(a) 812,690
58,800 Endo Pharmaceuticals Holdings, Inc.(a) 994,896
14,800 Eon Labs, Inc.(a) 520,220
21,700 IDEXX Laboratories, Inc.(a) 727,818
46,700 Kos Pharmaceuticals, Inc.(a) 1,096,049
5,300 Mid Atlantic Medical Services, Inc.(a) 277,190
49,210 Myriad Genetics, Inc.(a) 669,748
47,250 NDCHealth Corp. 867,038
21,900 Odyssey Healthcare, Inc.(a) 810,300
54,000 Perrigo Co. 844,560
12,100 Pharmaceutical Product Development, Inc.(a) 347,633
24,700 Sierra Health Services, Inc.(a) 494,000
45,200 United Surgical Partners International, Inc.(a) 1,021,068
52,415 Vertex Pharmaceuticals, Inc.(a) 765,259
14,700 Vistacare, Inc. (Class A shares)(a) 357,357
--------------
15,009,698
--------------
Educational Services--2.3%
20,700 Corinthian Colleges, Inc.(a) 1,005,399
23,300 ITT Educational Services, Inc.(a) 681,525
40,765 Sylvan Learning Systems, Inc.(a) 931,073
--------------
2,617,997
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
18 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Electronics--5.2%
11,800 Dionex Corp.(a) $ 469,050
48,965 Electronics for Imaging, Inc.(a) 993,500
26,150 Engineered Support Systems, Inc. 1,094,377
21,400 FLIR Systems, Inc.(a) 645,210
17,100 Gen-Probe, Inc.(a) 698,877
25,860 Mettler-Toledo International, Inc.(a) 947,769
24,840 Technitrol, Inc.(a) 373,842
38,500 Trimble Navigation Ltd.(a) 882,805
--------------
6,105,430
--------------
Environmental Services--0.5%
31,300 Tetra Tech, Inc.(a) 536,169
--------------
Financial Services--2.5%
11,000 Affiliated Managers Group, Inc.(a) 670,450
72,500 Interactive Data Corp.(a) 1,225,250
5,700 New Century Financial Corp. 248,805
24,600 Portfolio Recovery Associates, Inc.(a) 767,274
--------------
2,911,779
--------------
Home Appliances & Furnishings--0.4%
14,150 Ethan Allen Interiors, Inc. 497,514
--------------
Hotels & Restaurants--2.0%
27,300 Applebee's International, Inc. 858,039
11,400 CBRL Group, Inc. 443,004
43,950 Ruby Tuesday, Inc. 1,086,884
--------------
2,387,927
--------------
Insurance--3.4%
24,650 Cobalt Corp.(a) 506,558
34,100 Hilb, Rogal & Hamilton Co. 1,160,764
24,600 Odyssey Re Holdings Corp. 519,060
63,600 ProAssurance Corp.(a) 1,716,564
--------------
3,902,946
--------------
Internet--4.4%
60,270 CheckFree Corp.(a) 1,677,917
30,900 Digital River, Inc.(a) 596,370
33,500 DoubleClick, Inc.(a) 309,875
304,125 Hollywood Media Corp.(a) 395,363
26,470 Packeteer, Inc.(a) 412,138
69,850 United Online, Inc.(a) 1,769,998
--------------
5,161,661
--------------
Leisure Time--2.4%
53,200 Alliance Gaming Corp.(a) 1,006,012
33,900 GTECH Holdings Corp. 1,276,335
20,500 Station Casinos, Inc.(a) 517,625
--------------
2,799,972
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 19
<Page>
Small Capitalization Growth Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Manufacturing--0.5%
21,150 Applied Films Corp.(a) $ 547,362
--------------
Media--3.3%
95,850 Gray Television, Inc. 1,188,539
52,390 Information Holdings, Inc.(a) 956,118
82,200 Mediacom Communications Corp.(a) 811,314
44,050 Salem Communications Corp. (Class A shares)(a) 881,485
--------------
3,837,456
--------------
Medical & Dental Supplies--5.8%
20,600 Advanced Neuromodulation Systems, Inc.(a) 1,066,462
25,100 Cyberonics, Inc.(a) 539,901
4,700 INAMED Corp.(a) 252,343
8,500 Integra LifeSciences Holdings(a) 224,230
52,515 STAAR Surgical Co.(a) 609,174
59,500 Thoratec Corp.(a) 886,550
72,100 VCA Antech, Inc.(a) 1,410,997
27,965 Ventana Medical Systems, Inc.(a) 760,089
54,600 Wright Medical Group, Inc.(a) 1,037,400
--------------
6,787,146
--------------
Metals & Mining--0.2%
12,450 Arch Coal, Inc. 286,101
--------------
Office Furnishings--1.5%
59,900 Falcon Products, Inc.(a) 253,377
62,500 Global Imaging Systems, Inc.(a) 1,447,500
--------------
1,700,877
--------------
Oil & Gas Exploration/Production--3.1%
29,000 Cimarex Energy Co.(a) 688,750
10,800 Comstock Resources, Inc.(a) 147,744
29,700 Energen Corp. 989,010
15,160 Newfield Exploration Co.(a) 569,258
18,700 Southwestern Energy Company(a) 280,687
33,700 St. Mary Land & Exploration Co. 920,010
--------------
3,595,459
--------------
Oil Field/Equipment & Services--4.0%
22,400 Evergreen Resources, Inc.(a) 1,216,544
48,750 Key Energy Services, Inc.(a) 522,600
38,250 Patina Oil & Gas Corp. 1,229,737
45,350 Unit Corp.(a) 948,269
33,950 Universal Compression Holdings, Inc.(a) 708,197
--------------
4,625,347
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
20 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Real Estate Investment Trust--1.0%
46,700 American Financial Realty Trust $ 696,297
11,700 Chelsea Property Group, Inc. 471,627
--------------
1,167,924
--------------
Retail Apparel--3.5%
15,450 AnnTaylor Stores Corp.(a) 447,278
6,800 Brown Shoe Co., Inc. 202,640
56,450 Finish Line, Inc. (The) (Class A shares)(a) 1,253,754
21,450 Men's Wearhouse, Inc. (The)(a) 468,683
51,700 Pacific Sunwear of California, Inc.(a) 1,245,453
13,900 Urban Outfitters, Inc.(a) 499,010
--------------
4,116,818
--------------
Retail Trade--4.2%
39,100 Claire's Stores, Inc. 991,576
60,900 Guitar Center, Inc.(a) 1,766,100
37,900 PETCO Animal Supplies, Inc.(a) 823,946
11,000 Tractor Supply Co.(a) 525,250
27,720 Tuesday Morning Corp.(a) 729,036
--------------
4,835,908
--------------
Semiconductors & Equipment--3.1%
20,400 Cree, Inc.(a) 332,112
17,000 Entegris, Inc.(a) 228,480
5,291 FormFactor, Inc.(a) 93,651
51,150 GlobespanVirata, Inc.(a) 421,988
14,900 InterDigital Communications Corp.(a) 348,213
11,100 International Rectifier Corp.(a) 297,702
17,250 OmniVision Technologies, Inc.(a) 538,200
40,800 Photronics, Inc.(a) 711,959
24,700 Power Integrations, Inc.(a) 600,704
--------------
3,573,009
--------------
Software--6.6%
15,100 Altiris, Inc.(a) 302,755
9,600 Avid Technology, Inc.(a) 336,672
11,000 Hyperion Solutions Corp.(a) 371,360
115,250 Lawson Software, Inc.(a) 895,493
30,750 National Instruments Corp.(a) 1,161,734
27,500 NetScreen Technologies, Inc.(a) 620,125
9,200 Open Text Corp.(a) 259,900
64,050 Pinnacle Systems, Inc.(a) 685,335
14,600 Progress Software Corp.(a) 302,658
54,050 SERENA Software, Inc.(a) 1,128,564
26,700 Verint Systems, Inc.(a) 678,447
22,800 Verity, Inc.(a) 288,648
118,504 Witness Systems, Inc.(a) 612,666
--------------
7,644,357
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 21
<Page>
Small Capitalization Growth Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Telecommunications--2.8%
23,100 Boston Communications Group, Inc.(a) $ 395,703
178,970 Enterasys Networks, Inc.(a) 542,279
154,646 LCC International, Inc. (Class A shares)(a) 423,730
85,600 Nextel Partners, Inc. (Class A shares)(a) 624,880
48,960 Tekelec(a) 553,248
27,500 West Corp.(a) 732,875
--------------
3,272,715
--------------
Transportation--1.6%
26,750 Knight Transportation, Inc.(a) 666,075
16,000 Pacer International, Inc.(a) 301,760
29,000 UTI Worldwide, Inc. 904,510
--------------
1,872,345
--------------
Total long-term investments 112,267,722
(cost $100,355,458)
--------------
SHORT-TERM INVESTMENT--3.7%
Mutual Fund
4,271,447 Prudential Core Investment Fund -- Taxable Money Market 4,271,447
Series
(cost $4,271,447; Note 3)
--------------
Total Investments--100.2% 116,539,169
(cost $104,626,905; Note 5)
Liabilities in excess of other assets--(0.2%) (221,245)
--------------
Net Assets--100.0% $ 116,317,924
--------------
--------------
</Table>
- ------------------------------
(a) Non-income producing security.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
22 THE TARGET PORTFOLIO TRUST
<Page>
Portfolio of Investments Small Capitalization Value Portfolio
June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
LONG-TERM INVESTMENTS--100.0%
Common Stocks
Aerospace/Defense--0.8%
27,500 Moog, Inc. (Class A shares)(a) $ 955,625
13,765 United Defense Industries, Inc.(a) 357,064
------------
1,312,689
------------
Airlines--0.1%
16,630 Northwest Airlines Corp.(a) 187,753
------------
Apparel--0.8%
93,400 Phillips-Van Heusen Corp. 1,273,042
------------
Auto Related--3.5%
20,630 ArvinMeritor, Inc. 416,313
6,035 BorgWarner, Inc. 388,654
149,790 CSK Auto Corp.(a) 2,164,466
11,341 Lear Corp.(a) 521,913
29,275 Navistar International Corp.(a) 955,243
14,500 Snap-On, Inc. 420,935
17,500 Winnebago Industries, Inc. 663,250
------------
5,530,774
------------
Banks--4.8%
30,000 Astoria Financial Corp. 837,900
92,600 BankUnited Financial Corp. (Class A shares)(a) 1,865,889
15,500 Commerce Bancorp, Inc. 575,050
21,815 First Federal Capital Corp. 433,028
34,287 Fulton Financial Corp. 681,283
21,200 Hibernia Corp. (Class A shares) 384,992
10,446 MAF Bancorp, Inc. 387,233
21,423 Provident Financial Group, Inc. 549,071
30,391 Sky Financial Group, Inc. 660,093
23,365 Trustmark Corp. 595,107
18,771 Whitney Holding Corp. 600,109
------------
7,569,755
------------
Building & Construction--0.3%
13,865 Lafarge North America, Inc. 428,429
------------
Business Services--6.7%
266,400 Administaff, Inc.(a) 2,743,920
135,800 Allied Waste Industries, Inc.(a) 1,364,790
52,320 Aspen Technologies, Inc.(a) 251,136
43,365 BearingPoint, Inc.(a) 418,472
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 23
<Page>
Small Capitalization Value Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Business Services (cont'd.)
23,920 CDI Corp.(a) $ 620,963
42,700 Kelly Services, Inc. (Class A shares) 1,001,315
112,700 Labor Ready, Inc.(a) 808,059
36,860 Moore Wallace, Inc.(Canada) (a) 541,105
108,900 MPS Group, Inc.(a) 749,232
56,600 NDCHealth Corp. 1,038,610
43,000 Republic Services, Inc.(a) 974,810
--------------
10,512,412
--------------
Chemicals--4.0%
29,725 Albemarle Corp. 831,408
23,510 Ferro Corp. 529,680
18,875 Georgia Gulf Corp. 373,725
47,432 Hercules, Inc.(a) 469,577
27,600 Millennium Chemicals, Inc. 262,476
40,880 Olin Corp. 699,048
41,690 RPM International, Inc. 573,238
29,400 Scotts Co. (The) (Class A shares)(a) 1,455,300
16,600 Spartech Corp. 352,086
18,400 Valspar Corp. (The) 776,848
--------------
6,323,386
--------------
Containers & Packaging--0.5%
40,290 Packaging Corp. of America(a) 742,545
--------------
Cosmetics & Toiletries--0.5%
40,400 Chattem, Inc.(a) 759,520
--------------
Diversified Manufacturing--1.0%
128,390 GrafTech International, Ltd.(a) 699,725
9,055 Kaydon Corp. 188,344
19,485 Maverick Tube Corp.(a) 373,138
21,670 NN, Inc. 274,342
--------------
1,535,549
--------------
Drugs & Healthcare--12.2%
24,901 Advanced Medical Optics, Inc.(a) 424,562
17,698 Alpharma, Inc. (Class A shares) 382,277
15,885 AMERIGROUP Corp.(a) 590,922
23,550 Barr Laboratories, Inc.(a) 1,542,525
74,360 Cooper Companies, Inc. (The) 2,585,496
67,300 Covance, Inc.(a) 1,218,130
50,300 Diagnostic Products Corp. 2,064,815
15,280 Health Net, Inc.(a) 503,476
15,700 Invitrogen Corp.(a) 602,409
77,700 K-V Pharmaceutical Co.(a) 2,198,910
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
24 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Drugs & Healthcare (cont'd.)
38,500 Lincare Holdings, Inc.(a) $ 1,213,135
52,000 Pediatrix Medical Group, Inc.(a) 1,853,800
82,100 Pharmaceutical Product Development, Inc.(a) 2,358,733
39,600 Quintiles Transnational Corp.(a) 561,924
75,900 Serologicals Corp.(a) 1,034,517
--------------
19,135,631
--------------
Electric Utilities--2.0%
22,586 ALLETE, Inc. 599,658
6,330 Hawaiian Electric Industries, Inc. 290,231
55,300 PNM Resources, Inc. 1,479,274
34,265 Puget Energy, Inc. 817,906
--------------
3,187,069
--------------
Electrical Components & Equipment--1.0%
17,475 Anixter International, Inc.(a) 409,439
33,375 Asyst Technologies, Inc.(a) 223,279
30,935 Avnet, Inc.(a) 392,256
48,373 Brooks Automation, Inc.(a) 548,550
--------------
1,573,524
--------------
Electronics--2.6%
14,353 Andrew Corp.(a) 132,048
68,219 Arris Group, Inc.(a) 338,366
74,200 FLIR Systems, Inc.(a) 2,237,130
31,980 Pioneer Standard Electronics, Inc. 271,190
177,600 Sanmina-SCI Corp.(a) 1,120,656
--------------
4,099,390
--------------
Financial Services--6.2%
13,799 Affiliated Managers Group, Inc.(a) 841,049
148,000 AmeriCredit Corp.(a) 1,265,400
36,200 Eaton Vance Corp. 1,143,920
38,100 Global Payments, Inc. 1,352,550
35,700 Jefferies Group, Inc. 1,777,503
7,590 NCO Group, Inc.(a) 135,937
49,195 Raymond James Financial, Inc. 1,625,895
7,600 Student Loan Corp. (The) 957,600
15,761 Triad Guaranty, Inc.(a) 598,130
--------------
9,697,984
--------------
Foods--0.9%
11,505 Performance Food Group Co.(a) 425,685
40,720 Smithfield Foods, Inc.(a) 933,302
--------------
1,358,987
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 25
<Page>
Small Capitalization Value Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Gas & Pipeline Utilities--3.1%
26,511 AGL Resources, Inc. $ 674,440
25,375 Equitable Resources, Inc. 1,033,778
106,055 ONEOK, Inc. 2,081,859
15,546 UGI Corp. 492,808
20,755 Vectren Corp. 519,913
--------------
4,802,798
--------------
Health Care Facilities--0.7%
16,405 Coventry Health Care, Inc. (a) 757,255
25,135 Province Healthcare Co.(a) 278,244
--------------
1,035,499
--------------
Home Appliances & Furnishings--0.4%
31,141 Haverty Furniture Co., Inc. 544,968
--------------
Home Builder--3.8%
77,000 D.R. Horton, Inc. 2,163,700
65,000 Hovnanian Enterprises, Inc. (Class A shares)(a) 3,831,750
--------------
5,995,450
--------------
Hotels & Restaurants--2.5%
42,500 Brinker International, Inc.(a) 1,530,850
10,105 CBRL Group, Inc. 392,680
12,710 RARE Hospitality International, Inc.(a) 415,363
21,611 Ruby Tuesday, Inc. 534,440
42,400 Sonic Corp.(a) 1,078,232
--------------
3,951,565
--------------
Industrial Machinery--0.7%
66,000 Watsco, Inc. 1,092,960
--------------
Insurance--6.3%
20,594 AmerUs Group Co. 580,545
37,800 Commerce Group, Inc. (The) 1,368,359
19,300 Delphi Financial Group, Inc. (Class A shares) 903,240
5,947 Everest Re Group, Ltd. (Barbados) 454,946
19,737 Harleysville Group, Inc. 454,346
20,076 Odyssey Re Holdings Corp. 423,604
56,800 Philadelphia Consolidated Holding Corp.(a) 2,294,719
104,890 Phoenix Companies, Inc.(The) 947,157
22,000 Protective Life Corp. 588,500
7,590 Reinsurance Group of America, Inc. 243,639
8,159 RenaissanceRe Holdings, Ltd.(Bermuda) 371,398
11,650 Scottish Annuity & Life Holdings, Ltd.(Cayman Islands) 235,447
17,670 W.R. Berkley Corp. 931,209
--------------
9,797,109
--------------
Integrated Oil & Gas--0.5%
47,365 Key Energy Services, Inc.(a) 507,753
9,955 Premcor, Inc.(a) 214,530
--------------
722,283
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
26 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Leisure Related--1.9%
24,185 Brunswick Corp. $ 605,109
26,600 CEC Entertainment, Inc.(a) 982,338
33,645 MTR Gaming Group, Inc.(a) 259,739
71,600 WMS Industries, Inc.(a) 1,116,244
--------------
2,963,430
--------------
Machinery--2.3%
33,628 CNH Global NV (Netherlands) 320,811
25,016 Cummins, Inc. 897,824
48,520 Joy Global, Inc.(a) 716,640
10,020 Tecumseh Products Co. (Class A shares) 383,866
68,920 Wabtec Corp. 958,678
16,315 York International Corp. 381,771
--------------
3,659,590
--------------
Medical & Dental Supplies--0.4%
24,890 Owens & Minor, Inc. 556,292
--------------
Mining--0.1%
7,290 CONSOL Energy, Inc. 165,775
--------------
Multimedia--4.5%
40,365 Belo Corp. (Class A shares) 902,561
37,500 Harman International Industries, Inc. 2,967,750
39,900 Scholastic Corp.(a) 1,188,222
165,000 Sinclair Broadcast Group, Inc. (Class A shares)(a) 1,915,650
--------------
6,974,183
--------------
Oil & Gas Exploration/Production--3.9%
77,665 Chesapeake Energy Corp. 784,417
20,112 Cimarex Energy Co.(a) 477,660
13,035 Frontier Oil Corp. 198,132
22,366 Newfield Exploration Co.(a) 839,843
58,100 Swift Energy Co.(a) 639,100
58,100 Westport Resources Corp.(a) 1,321,775
92,933 XTO Energy, Inc. 1,868,882
--------------
6,129,809
--------------
Paper & Paper Products--1.0%
28,541 Kadant, Inc.(a) 535,144
25,900 Pope & Talbot, Inc. 286,195
23,146 Rayonier, Inc. 763,818
--------------
1,585,157
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 27
<Page>
Small Capitalization Value Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Real Estate Investment Trusts--4.7%
34,540 Alexandria Real Estate Equities, Inc. $ 1,554,299
48,341 Corporate Office Properties Trust 818,413
20,965 Developers Diversified Realty Corp. 596,245
22,400 Entertainment Properties Trust 644,000
16,150 Forest City Enterprises, Inc., (Class A shares) 669,418
28,160 Heritage Property Investment Trust 762,573
33,440 Highwoods Properties, Inc. 745,712
20,040 Ramco-Gershenson Properties Trust 466,932
23,000 SL Green Realty Corp. 802,470
16,610 Summit Properties, Inc. 342,997
--------------
7,403,059
--------------
Retail--Apparel 3.1%
22,970 AnnTaylor Stores Corp.(a) 664,982
9,725 Brown Shoe Co., Inc. 289,805
74,500 Fred's, Inc. 2,769,909
15,436 Reebok International, Ltd.(a) 519,113
29,555 Wolverine World Wide, Inc. 569,229
--------------
4,813,038
--------------
Semiconductors & Equipment--3.0%
50,646 ChipPAC, Inc. (Class A shares)(a) 388,455
34,961 Entegris, Inc.(a) 469,876
43,370 Fairchild Semiconductor International, Inc. (Class A 554,702
shares)(a)
99,689 Mykrolis Corp.(a) 1,011,844
43,218 Photronics, Inc.(a) 754,154
7,700 SPSS, Inc. 128,898
45,860 Standard Microsystems Corp.(a) 695,696
33,300 Ultratech Stepper, Inc.(a) 615,717
--------------
4,619,342
--------------
Software--3.7%
31,684 Activision, Inc.(a) 409,357
72,985 Compuware Corp.(a) 421,123
52,204 FileNET Corp.(a) 941,760
19,768 Hyperion Solutions Corp.(a) 667,368
66,310 Keane, Inc.(a) 903,805
52,279 MRO Software, Inc.(a) 451,168
44,734 Retek, Inc.(a) 286,298
8,670 Take-Two Interactive Software, Inc.(a) 245,708
110,200 Verity, Inc.(a) 1,395,132
--------------
5,721,719
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
28 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
SHARES DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Specialty Retail--1.5%
16,765 Fisher Scientific International, Inc.(a) $ 585,099
25,785 Linens 'n Things, Inc.(a) 608,784
38,300 Movie Gallery, Inc.(a) 706,634
24,950 Gymboree Corp. (The)(a) 418,661
--------------
2,319,178
--------------
Telecommunications--2.0%
301,800 American Tower Corp. (Class A shares)(a) 2,670,930
16,811 Harris Corp. 505,171
--------------
3,176,101
--------------
Trucking & Freight Forwarding--1.6%
15,012 Arkansas Best Corp. 357,135
25,495 Pacer International, Inc.(a) 480,836
19,325 Ryder System, Inc. 495,107
24,280 Swift Transportation Co., Inc.(a) 452,094
8,185 USF Corp. 220,749
23,300 Yellow Corp.(a) 539,395
--------------
2,545,316
--------------
Waste Management--0.4%
76,280 Casella Waste Systems, Inc. (Class A shares)(a) 688,808
--------------
Total long-term investments 156,491,868
(cost $139,860,848)
--------------
SHORT-TERM INVESTMENT--1.5%
Mutual Fund
2,320,520 Prudential Core Investment Fund--Taxable Money Market 2,320,520
Series
(cost $2,320,520; Note 3)
--------------
Total Investments--101.5% 158,812,388
(cost $142,181,368; Note 5)
Liabilities in excess of other assets--(1.5%) (2,319,387)
--------------
Net Assets--100% $ 156,493,001
--------------
--------------
</Table>
- ------------------------------
(a) Non-income producing security.
ADR--American Depository Receipt.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 29
<Page>
International Equity Portfolio Portfolio of Investments
June 30, 2003 (Unaudited)
<Table>
<Caption>
US$
VALUE
SHARES DESCRIPTION (NOTE 1)
- ----------------------------------------------------------------------------------------------
LONG-TERM INVESTMENTS--96.4%
Common Stocks
Australia--2.1%
562,381 BHP Billiton, Ltd. $ 3,258,671
------------
Belgium--1.2%
106,300 Fortis 1,845,702
------------
Denmark--1.2%
54,100 Novo Nordisk A/S (Class B shares) 1,893,889
------------
Finland--2.6%
243,200 Nokia Oyj 4,004,878
------------
France--8.5%
45,020 BNP Paribas SA 2,287,680
29,900 Carrefour SA 1,465,454
74,700 Credit Agricole SA 1,419,695
41,000 Lagardere SCA 1,782,077
27,200 Schneider Electric SA 1,278,773
31,385 Total SA 4,743,016
------------
12,976,695
------------
Germany--1.9%
23,000 Bayerische Motoren Werke (BMW) AG 883,488
52,000 Deutsche Telekom AG(a) 791,815
23,300 Siemens AG 1,141,173
------------
2,816,476
------------
Hong Kong--1.4%
332,500 CLP Holdings, Ltd. 1,453,967
537,000 Hong Kong & China Gas Co., Ltd 678,295
------------
2,132,262
------------
Ireland--4.0%
111,226 Allied Irish Banks PLC 1,671,451
209,700 Bank of Ireland 2,537,296
116,051 CRH PLC 1,819,107
------------
6,027,854
------------
Italy--6.8%
156,290 Alleanza Assicurazioni SpA 1,486,066
173,600 ENI SpA 2,625,501
399,700 Snam Rete Gas SpA 1,569,773
515,800 Telecom Italia SpA 4,667,498
------------
10,348,838
------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
30 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
US$
VALUE
SHARES DESCRIPTION (NOTE 1)
- ----------------------------------------------------------------------------------------------
Japan--13.8%
40,800 Acom Co., Ltd. $ 1,474,679
67,000 Canon, Inc. 3,074,495
344 East Japan Railway Co. 1,529,844
20,400 Fanuc, Ltd. 1,010,868
18,200 Honda Motor Co., Ltd. 689,652
118,000 Kao Corp. 2,196,377
424,000 Nissan Motor Co., Ltd. 4,053,733
1,420 NTT DoCoMo, Inc. 3,074,745
75,300 Takeda Chemical Industries, Ltd. 2,778,089
400,000 Tokyo Gas Co., Ltd. 1,149,282
------------
21,031,764
------------
Netherlands--9.1%
129,400 ABN AMRO Holding NV 2,474,145
63,617 Heineken NV 2,257,398
269,000 Koninklijke KPN NV(a) 1,905,961
99,519 Philips Electronics NV 1,892,531
114,000 Royal Dutch Petroleum Co. 5,291,487
------------
13,821,522
------------
Norway--0.5%
92,600 Statoil ASA 788,942
------------
Singapore--1.6%
205,850 Oversea-Chinese Banking Corp., Ltd. 1,168,938
179,328 United Overseas Bank, Ltd. 1,262,730
------------
2,431,668
------------
Spain--3.2%
92,400 Altadis, SA 2,368,333
150,400 Endesa, SA 2,518,152
------------
4,886,485
------------
Sweden--1.1%
60,800 Sandvik AB 1,591,215
------------
Switzerland--7.4%
119,700 Compagnie Financiere Richemont AG 1,935,277
112,100 Credit Suisse Group 2,950,327
52,100 Novartis AG 2,061,615
8,700 Roche Holding AG 682,422
66,300 UBS AG 3,688,092
------------
11,317,733
------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 31
<Page>
International Equity Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
US$
VALUE
SHARES DESCRIPTION (NOTE 1)
- ----------------------------------------------------------------------------------------------
United Kingdom--30.0%
559,800 Barclays PLC $ 4,156,862
320,700 Boots PLC 3,439,795
472,700 BP PLC 3,278,035
98,620 BT Group PLC 331,576
257,212 Cadbury Schweppes PLC 1,519,478
297,599 Diageo PLC 3,177,284
275,300 GlaxoSmithKline PLC 5,555,880
509,405 HSBC Holdings PLC 6,018,613
160,460 Imperial Tobacco Group PLC 2,870,227
616,200 Kingfisher PLC 2,819,119
117,000 Royal Bank of Scotland Group PLC 3,282,124
484,100 Tesco PLC 1,751,439
237,600 Unilever PLC 1,899,592
2,867,700 Vodafone Group PLC 5,607,539
------------
45,707,563
------------
Total long-term investments 146,882,157
(cost $135,570,583)
------------
<Caption>
Principal
Amount
(000) SHORT-TERM INVESTMENTS--2.7%
- ----------
U.S. Government Obligations
United States Treasury Bills,
$ 115 0.97%, 7/3/03 114,995
620 1.00%, 7/3/03 619,974
100 1.00%, 7/3/03 99,996
725 1.01%, 7/3/03 724,970
1,235 1.03%, 7/3/03 1,234,948
90 1.06%, 7/3/03 89,996
45 1.07%, 7/3/03 44,998
205 1.08%, 7/3/03 204,991
300 1.11%, 7/3/03 299,988
595 0.82%, 9/4/03 594,092
45 0.87%, 9/4/03 44,931
------------
Total short-term investments 4,073,879
(cost $4,073,853)
------------
Total Investments--99.1% 150,956,036
(cost $139,644,436; Note 5)
Other assets in excess of Liabilities--0.9% 1,327,850
------------
Net Assets--100% $152,328,886
------------
------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
32 THE TARGET PORTFOLIO TRUST
<Page>
(a) Non-income producing security
The industry classification of portfolio holdings shown as a percentage of net
assets as of June 30, 2003 was
as follows:
Banks................................................................. 21.6%
Telecommunication..................................................... 13.4
Oil & Gas............................................................. 12.0
Pharmaceuticals....................................................... 8.5
Food & Beverage....................................................... 5.5
Utilities............................................................. 5.3
Electronics........................................................... 4.0
Automotive............................................................ 3.7
Diversified Industries................................................ 3.6
Tobacco............................................................... 3.4
Retail................................................................ 3.4
Consumer Goods........................................................ 2.7
U.S. Government Securities............................................ 2.7
Insurance............................................................. 2.2
Mining................................................................ 2.1
Financial Services.................................................... 1.9
Building & Construction............................................... 1.9
Multimedia............................................................ 1.2
-----
99.1
Other assets in excess of liabilities................................. 0.9
-----
100.0%
-----
-----
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 33
<Page>
International Bond Portfolio Portfolio of Investments
June 30, 2003 (Unaudited)
<Table>
<Caption>
US$
PRINCIPAL VALUE
AMOUNT (000) DESCRIPTION (NOTE 1)
- ----------------------------------------------------------------------------------------------
LONG-TERM INVESTMENTS--90.4%
Canada--10.3%
Canadian Gov't. Bonds,
CAD 2,800 5.00%, 12/01/03 $ 2,076,729
1,300 3.50%, 6/01/04 961,402
30 5.25%, 6/01/13 23,333
470 5.75%, 6/01/29 379,286
------------
3,440,750
------------
Denmark--0.6%
Danish Gov't. Bonds,
DKK 1,100 6.00%, 11/15/11 196,705
------------
Eurobonds--49.5%
Allied Irish Banks PLC,
EUR 70 7.50%, 2/29/20(c) 94,483
Austrian Gov't. Bonds,
1,000 7.25%, 5/03/07 679,152
300 5.50%, 10/20/07 381,210
Bank of Scotland PLC,
40 6.125%, 2/05/13 52,560
Bayerische Hypo-und Vereinsbank AG,
400 4.75%, 9/19/07 489,200
Belgian Gov't. Bonds,
2,030 5.75%, 3/28/08 2,616,600
500 8.00%, 3/28/15 784,061
300 5.50%, 3/28/28 383,970
British Telecommunications PLC,
250 6.875%, 2/15/11 334,947
Credit Suisse Group Capital Guernsey V Ltd.,
180 6.905%, 11/7/11(c) 226,730
DEPFA Deutsche Pfandbriefbank AG,
200 5.00%, 2/03/05 239,662
Deutsche Genossenschafts Hypothekebank,
300 5.75%, 1/22/07 378,062
Deutsche Telekom International Finance BV,
110 7.50%, 1/24/33 148,994
Eurohypo AG,
400 5.75%, 7/05/10 518,781
Ford Motor Credit Co.,
100 6.75%, 1/14/08 119,023
French Gov't Bonds,
1,030 5.75%, 10/25/32 1,374,533
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
34 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
US$
PRINCIPAL VALUE
AMOUNT (000) DESCRIPTION (NOTE 1)
- ----------------------------------------------------------------------------------------------
Eurobonds (cont'd.)
France Telecom S.A.,
EUR 90 8.125%, 1/28/33 $ 130,740
Goldman Sachs Group Inc.
210 5.125%, 4/24/13 251,926
Hellenic Republic Government Bonds,
460 5.90%, 10/22/22 611,524
Hilton Group Finance PLC,
150 6.50%, 7/17/09 191,702
HSBC Capital Funding L.P. (Channel Islands),
140 8.03%, 6/30/12(c) 201,025
Inter-American Development Bank,
900 5.50%, 3/30/10 1,157,873
IntesaBci Capital Trust,
100 6.988%, 7/12/11(c) 127,726
Italy Buoni Poliennali de Tesoro,
280 5.75%, 2/01/33 368,750
MDP Acquisitions PLC,
25 10.125%, 10/01/12 31,006
MunichRe Finance BV,
80 6.75%, 6/21/23 99,137
Petronas Capital Ltd.,
100 6.375%, 5/22/09 126,434
Portuguese Gov't. Bonds,
250 3.00%, 7/17/06 291,294
930 4.875%, 8/17/07 1,151,914
1,950 5.375%, 6/23/08 2,485,348
RBS Capital Trust, Class A,
130 6.467%, 6/30/12(c) 168,083
SanPaolo IMI Capital,
120 8.126%, 11/10/10(c) 167,063
Tyco International Group S.A.,
150 4.375%, 11/19/04 171,392
------------
16,554,905
------------
Japan--12.5%
Japanese Gov't. Bonds,
JPY 452,000 1.50%, 12/20/11 4,003,216
18,000 1.90%, 9/20/22 168,749
------------
4,171,965
------------
Sweden--4.9%
Swedish Gov't. Bonds,
SEK 1,450 8.00%, 8/15/07 212,276
10,790 5.00%, 1/28/09 1,430,948
------------
1,643,224
------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 35
<Page>
International Bond Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
US$
PRINCIPAL VALUE
AMOUNT (000) DESCRIPTION (NOTE 1)
- ----------------------------------------------------------------------------------------------
United Kingdom--9.5%
European Investment Bank,
GBP 465 7.625%, 12/07/06 $ 858,279
United Kingdom Treasury Stocks,
1,120 5.00%, 3/07/08 1,942,965
220 5.00%, 3/07/12 385,373
------------
3,186,617
------------
United States--3.1%
DaimlerChrysler Master Owner Trust,
Ser. 2002-B, Class A,
USD 400 1.215%, 11/15/07 400,057
EQCC Trust,
Ser. 2002-1, Class 2A
250 1.335%, 11/25/3(d) 250,048
Superior Wholesale Inventory Financing Trust,
Ser. 2001-A7, Class A,
400 1.27%, 3/15/06 400,010
------------
1,050,115
------------
Total long-term investments 30,244,281
(cost US$27,978,963)
------------
SHORT-TERM INVESTMENTS--1.0%
United States Government Obligation--0.4%
United States Treasury Bills,
150 1.16%(a), 7/24/03(b) 149,924
------------
<Caption>
Shares
- ------------
Mutual Fund--0.6%
190,365 Prudential Core Investment Fund--Taxable Money Market 190,365
Series (Note 3)
------------
Total short-term investments 340,289
(cost US$340,253)
------------
Total Investments--91.4% 30,584,570
(cost US$28,319,216; Note 5)
Other assets in excess of liabilities--8.6% 2,873,607
------------
Net Assets--100% $ 33,458,177
------------
------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
36 THE TARGET PORTFOLIO TRUST
<Page>
Portfolio securities are classified according to the securities' currency
denomination.
CAD--Canadian Dollar.
DKK--Danish Krone.
EUR--Euro.
GBP--British Pound.
JPY--Japanese Yen.
SEK--Swedish Krona.
USD--United States Dollar.
(a) Rate quoted represents yield-to-maturity as of purchase date.
(b) Security pledged as initial margin for financial futures contracts.
(c) Variable rate instruments without fixed maturity date. Maturity date shown
is the next callable date for the instrument.
(d) Variable rate instrument. The maturity date presented for these instruments
is the later of the next date on which the security can be redeemed or the
next date on which the rate of interest is adjusted.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 37
<Page>
Total Return Bond Portfolio Portfolio of Investments
June 30, 2003 (Unaudited)
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
LONG-TERM INVESTMENTS--103.9%
Corporate Bonds--7.6%
Airlines--0.3%
Embarcadero Aircraft Securitization Trust, Class
A-1,
Ba2 $ 700 1.66%, 8/15/25(b) $ 278,893
United Airlines, Inc.,
Caa1 1,000 10.85%, 2/19/15(d) 250,000
------------
528,893
------------
Financial Services--4.4%
ALLETE, Inc.,
Baa1 700 2.18%, 10/20/03, MTN(b) 700,056
CIT Group, Inc.,
A2 500 2.78%, 3/1/04, MTN(b) 504,062
Ford Motor Credit Co.,
A3 1,200 5.75%, 2/23/04 1,225,049
General Motors Acceptance Corp.,
A3 1,500 6.875%, 9/15/11 1,505,005
A3 1,500 8.00%, 11/1/31 1,471,747
PEMEX Project Funding Master Trust,
Baa1 500 8.00%, 11/15/11 572,500
Baa1 250 9.125%, 10/13/10 303,125
PP&L Capital Funding, Inc.,
Baa3 600 7.75%, 4/15/05 657,691
------------
6,939,235
------------
Oil & Gas-Production/Pipeline--1.0%
El Paso Corp.,
Caa1 750 7.75%, 1/15/32, MTN 631,875
Caa1 500 7.80%, 8/1/31, MTN 421,250
Williams Companies, Inc.,
B3 500 7.50%, 1/15/31 472,500
------------
1,525,625
------------
Telecommunications--1.4%
AT&T Corp.,
Baa2 300 7.30%, 11/15/11 342,934
Baa2 900 8.00%, 11/15/31 1,020,500
Qwest Corp.,
Ba3 250 7.50%, 6/15/23 240,000
Ba3 550 8.875%, 3/15/12 614,625
------------
2,218,059
------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
38 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
Utility--Gas and Electric--0.5%
Entergy Gulf States,
Baa3 $ 800 1.96%, 6/18/07 $ 799,042
--------------
Total corporate bonds
(cost $12,649,090) 12,010,854
--------------
U.S. Government Agency Mortgage Backed Securities--53.1%
Federal Home Loan Mortgage Corp.,
159 4.28%, 1/1/24(b) 164,594
388 5.50%, 4/1/29 - 6/1/29 401,522
105 6.50%, 12/15/21, IO 1,396
12,001 6.50%, 8/1/32 12,488,633
311 7.50%, 9/1/16 - 7/1/17 332,979
3 9.25%, 1/1/10 3,364
Federal National Mortgage Assn.,
411 3.66%, 1/1/20(b) 420,190
15,500 4.00%, TBA(a) 15,500,000
295 4.18%, 5/1/36(b) 302,165
1,500 4.50%, TBA(a) 1,530,000
2,000 5.00%, TBA(a) 2,015,624
1,142 5.00%, 4/1/14 1,181,350
3,000 5.50%, 8/1/30 3,090,936
22,506 6.00%, 1/1/11 - 3/1/18 23,475,626
13,500 6.50%, TBA(a) 14,077,962
4,500 6.50%, 5/1/32 - 8/1/32 4,692,256
Government National Mortgage Assn.,
452 4.375%, 2/20/17 - 2/20/26(b) 466,220
270 5.00%, 11/20/29 279,653
100 5.375%, 6/20/23(b) 103,478
453 5.625%, 10/20/26 - 10/20/27(b) 465,738
344 5.75%, 7/20/22 - 9/20/25(b) 354,792
1,250 6.00%, TBA(a) 1,307,813
463 6.50%, 8/15/32 485,743
543 8.50%, 6/15/30 - 8/20/30 584,096
--------------
Total U.S. Government agency mortgage backed
securities
(cost $83,525,476) 83,726,130
--------------
Foreign Corporate Bonds--0.6%
Hellenic Finance, SCA,
2.00%, 7/15/03
A1 700 (cost $737,625) 840,023
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 39
<Page>
Total Return Bond Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
Collateralized Mortgage Obligations--4.2%
American Housing Trust 1, Series 1-5, Class A,
Aaa $ 6 8.625%, 8/25/18 $ 6,394
Bear Stearns ARM Trust, Series 2001-9,
763 5.66%, 2/25/33(b) 776,594
Aaa 311 6.16%, 1/25/32(b) 312,508
Federal Home Loan Mortgage Corp.,
35 1.31%, 9/15/26(b) 35,357
1,344 5.00%, 9/15/16 1,387,420
Aaa 92 6.50%, 5/15/25 92,543
1,214 8.00%, 9/15/29 1,366,926
Federal National Mortgage Assn.,
Aaa 1,095 5.50%, 7/25/29 1,104,754
Indymac ARM Trust, Series 2001, Class A,
Aaa 124 6.60%, 1/25/32(b) 127,031
J.P. Morgan Commercial Mortgage Finance Corp.,
Series 2000,
Class A,
Aaa 59 1.46%, 4/15/10 58,885
AAA(c) 211 6.50%, 9/25/14 215,981
Residential Asset Securitization Trust, Series,
1999-A8, Class NB1,
AAA(c) 118 7.875%, 1/25/30 120,405
Residential Funding Mortgage Securities I, Inc.,
Series 2003-S9, Class A1,
Aaa 772 6.50%, 3/25/32 795,646
Structured Asset Securities Corp., Series 2000-5,
Class 2A1,
AAA(c) 47 1.635%, 11/25/30(b) 46,788
Washington Mutual Mortgage Loan, Trust 2001,
Class A,
Aaa 129 3.96%, 1/25/41(b) 130,134
--------------
Total collateralized mortgage obligations
(cost $6,385,018) 6,577,366
--------------
Municipals--4.3%
California State Rev., Antic Wts
MIG1 1,300 2.00%, 6/16/04 1,310,738
Du Page County Illinois, Limited Tax,
Aaa 500 5.00%, 1/1/31 514,375
Georgia State Road & Thruway Authority Rev.,
Governors Transportation Choices,
Aaa 500 5.00%, 3/1/21 532,875
Golden State Tob. Securitization Corp.,
California State Tob. Settlement Rev., Series
2003, Class A-1
Baa2 500 6.25%, 6/1/33 449,225
Massachusetts State Water Resources Authority,
Series J,
Aaa 750 5.00%, 8/1/32 783,923
New York City Trust Cultural Resources, Museum of
Modern Art, Series 2001, Class D,
Aaa 1,500 5.125%, 7/1/31 1,590,000
South Carolina State Highway, Series B,
Aaa 1,100 5.00%, 4/1/17 1,197,537
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
40 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
Municipals (cont'd.)
Tobacco Settlement Financing Corp., New Jersey
State
Baa2 $ 500 6.375%, 6/1/32 $ 453,940
--------------
Total municipals
(cost $6,577,623) 6,832,613
--------------
U.S. Government Securities--21.7%
United States Treasury Bonds,
1,024 3.625%, 4/15/28, TIPS 1,248,875
560 3.875%, 4/15/29, TIPS 714,469
2,200 6.25%, 8/15/23 2,694,828
1,900 6.75%, 8/15/26 2,475,863
2,550 7.50%, 11/15/16 3,461,526
260 8.125%, 8/15/19 376,035
3,200 8.875%, 8/15/17 4,840,998
1,500 10.625%, 8/15/15 2,488,476
United States Treasury Notes,
3,719 3.375%, 1/15/07, TIPS 4,083,865
1,042 3.50%, 1/15/11, TIPS 1,183,120
6,268 3.625%, 1/15/08, TIPS 7,032,490
United States Treasury Strips,
8,400 Zero Coupon, 5/15/16 - 2/15/22 3,543,370
--------------
Total U.S. Government securities
(cost $32,397,111) 34,143,915
--------------
Foreign Government Securities--12.4%
Canadian Government,
AAA(c) 2,900 4.50%, 9/1/07 2,206,881
Aaa 2,100 6.00%, 6/1/08 1,697,310
Federal Republic of Brazil,
B1 1,478 8.00%, 4/15/14 1,289,286
Federal Republic of Germany,
Aaa 1,500 5.25%, 1/4/11 1,916,672
Aaa 2,100 5.375%, 1/4/10 2,690,082
Aaa 1,700 6.50%, 10/14/05 - 6/1/08 2,270,841
Republic of Panama,
Ba1 300 8.875%, 9/30/27 327,750
BB(c) 450 9.375%, 7/23/12 522,000
Republic of Peru,
Ba3 500 9.125%, 1/15/08 542,500
United Kingdom Treasury Notes,
Aaa 3,000 6.50%, 12/7/03 5,012,789
United Mexican States,
Baa2 1,000 6.375%, 1/16/13 1,060,000
--------------
Total foreign government securities
(cost $19,006,153) 19,536,111
--------------
Total long-term investments
(cost $161,278,096) 163,667,012
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 41
<Page>
Total Return Bond Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS--29.2%
Commercial Paper--10.5%
Danske Corp.,
P-1 $ 200 1.20%, 8/13/03 $ 199,713
P-1 100 1.23%, 7/28/03 99,908
General Electric Capital Corp.,
P-1 1,500 1.20%, 8/21/03 1,497,450
HBOS Treasury Services PLC,
P-1 300 1.20%, 8/7/03 299,630
P-1 800 1.21%, 7/10/03 799,758
P-1 3,000 1.25%, 7/16/03 2,998,438
Kraft Foods, Inc.
P-1 1,100 2.08%, 2/27/04 1,100,015
Royal Bank of Scotland PLC,
P-1 300 1.21%, 7/8/03 299,929
Shell Finance UK PLC,
P-1 4,700 1.12%, 7/10/03 4,698,684
UBS Finance, LLC,
P-1 500 0.92%, 9/24/03 498,914
Westpac Capital,
P-1 4,000 1.20%, 7/9/03 3,998,933
--------------
Total commercial paper
(cost $16,491,357) 16,491,372
--------------
U.S. Government Agency Mortgage Backed Securities--18.1%
Federal Home Loan Mortgage Corp.,
1,000 Zero Coupon, 7/9/03 999,796
1,900 1.14%, 10/30/03(f) 1,892,752
1,300 1.16%, 9/30/03(f) 1,296,845
1,500 1.17%, 8/1/03(f) 1,498,495
5,400 1.17%, 8/25/03(f) 5,389,821
Federal National Mortgage Assn.,
12,300 1.17%, 7/23/03(f) 12,291,243
1,500 1.17%, 7/31/03(f) 1,498,513
3,600 1.18%, 8/28/03(f) 3,593,510
--------------
Total U.S. Government agency mortgage backed
securities
(cost $28,460,280) 28,460,975
--------------
U.S. Government Securities--0.6%
United States Treasury Bills,
120 1.09%, 8/7/03(e) 119,902
70 1.09%, 8/7/03(e) 69,943
205 1.11%, 8/7/03(e) 204,833
110 1.02%, 8/14/03(e) 109,893
530 1.07%, 8/14/03(e) 529,486
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
42 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
CONTRACTS DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
Total U.S. Government securities
(cost $1,033,725) $ 1,034,057
--------------
Total short-term investments
(cost $45,985,362) 45,986,404
--------------
Options Purchased(a)
Put Options
United States Treasury Notes 10year Futures,
expiring
170 8/23/03 @$104 2,656
EURO, expiring
90 9/13/04 @$93.75 1,125
EURO, expiring
60 3/15/04 @$96.25 375
Euribor Future, expiring
20 12/15/03 @$93.50 287
Euribor Future, expiring
68 3/15/04 @$96.625 976
<Caption>
Notional
Amount (000)
------------
Interest Rate Swaps,
6 month LIBOR over 0.76%,
$ 185,000 expiring 5/31/05 32,663
6 month LIBOR over 0.76%,
185,000 expiring 5/31/05 32,663
--------------
Total options purchased
(cost $26,777) 70,745
--------------
Total Investments Before Outstanding Options
Written and Investments Sold Short--133.1%
(cost $207,290,235; Note 5) 209,724,161
--------------
<Caption>
Contracts OUTSTANDING OPTIONS WRITTEN(a)--(0.2%)
------------
Put Options
United States Treasury Bills,
10year Futures, expiring
31 8/23/03 @$108 (2,906)
--------------
<Caption>
Notional
Amount (000)
------------
Call Options
Interest Rate Swaps,
3 month LIBOR over 3.0%,
$ 4,000 expiring 11/12/03 (54,184)
3 month LIBOR over 6.0%,
1,200 expiring 10/7/04 (15,342)
3 month LIBOR over 5.5%,
4,100 expiring 12/17/03 (3,419)
3 month LIBOR over 4.0%,
1,200 expiring 10/7/04 (30,976)
3 month LIBOR over 4.0%,
600 expiring 7/22/03 (500)
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 43
<Page>
Total Return Bond Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
CONTRACTS DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
Call Options (cont'd.)
Japanese Yen
4 expiring 8/29/03 @$145 $ (666)
United States Treasury Notes
5yr Futures, expiring
11 8/23/03 @$117 (2,063)
United States Treasury Bills Futures,
62 expiring 8/23/03 @$115 (178,250)
--------------
(285,400)
--------------
Total outstanding options written
(premiums received $332,987) (288,306)
--------------
Principal
Amount (000) INVESTMENTS SOLD SHORT--(4.8%)
------------
United States Treasury Notes,
$ 1,750 4.375%, 5/15/07 (1,901,210)
2,000 4.875%, 2/15/12 (2,223,124)
3,000 5.50%, 5/15/09 (3,455,391)
--------------
Total investments sold short
(proceeds received $7,521,473) (7,579,725)
--------------
Total Investments, Net of Outstanding Options
Written and Investments Sold Short--128.1%
(cost $199,435,775) 201,856,130
Liabilities in excess of other assets--(28.1%) (44,262,822)
--------------
Net Assets--100% $ 157,593,308
--------------
--------------
</Table>
- ------------------------------
(a) Non-income producing security.
(b) Variable rate instrument. The maturity date presented for these instruments
is the later of the next date on which the security can be redeemed at par
or of the next date on which the rate of interest is adjusted.
(c) Standard & Poor's rating.
(d) Issuer in bankruptcy.
(e) Rate quoted represents yield-to-maturity as of purchase date.
(f) Discount rate at time of purchase for United States Government Agencies and
Obligations.
ARM--Adjustable Rate Mortgage.
IO--Interest only.
MTN--Medium Term Note.
TBA--To be announced. Securities purchased on a forward commitment basis.
TIPS--Treasury Inflation Protection Security.
NR--Not Rated by Moody's or Standard & Poor's.
The Fund's current Prospectus contains a description of Moody's and Standard &
Poor's ratings.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
44 THE TARGET PORTFOLIO TRUST
<Page>
Portfolio of Investments Intermediate-Term Bond Portfolio
June 30, 2003 (Unaudited)
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
LONG-TERM INVESTMENTS--77.3%
Asset Backed Securities--1.3%
Bayview Financial Acquisition Trust,
Aaa $ 366 1.4125%, 2/25/30(a) $ 366,678
Aaa 440 1.415%, 7/25/30(a) 439,953
Conseco Finance Securitizations Corp.,
Aa3 1,925 7.47%, 5/1/32 1,957,662
Metropolitan Asset Funding, Inc.,
AAA(d) 248 1.495%, 4/25/29(a) 248,402
Premium Asset Trust
A3 1,500 1.605%, 11/27/04(a) 1,504,559
------------
Total asset backed securities
(cost $4,479,391) 4,517,254
------------
Corporate Bonds--16.9%
Airlines--0.6%
American Airlines, Inc.,
Baa2 1,500 7.86%, 10/1/11 1,474,102
United Air Lines,
B3 1,700 6.83%, 9/1/08(g) 255,602
Caa1 1,500 10.85%, 2/19/15(b)(c)(g) 375,000
------------
2,104,704
------------
Auto & Truck--0.4%
DaimlerChrysler NA Holding Corp.,
A3 1,500 6.40%, 5/15/06 1,638,056
------------
Banking--1.8%
Export-Import Bank of Korea,
A3 300 6.50%, 11/15/06 332,762
J P Morgan Chase & Co.,
A1 3,500 5.625%, 8/15/06 3,844,215
Wachovia Corp.,
Aa3 2,000 4.95%, 11/1/06 2,177,634
------------
6,354,611
------------
Cable--0.5%
Cox Communications, Inc.,
Baa2 300 6.153%, 8/1/03(a) 300,200
Baa2 1,500 7.50%, 8/15/04 1,592,022
------------
1,892,222
------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 45
<Page>
Intermediate-Term Bond Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
Electrical Power--2.9%
AEP Texas Central Co.,
Baa2 $ 3,000 2.54%, 2/15/05(a) $ 3,001,977
Pacific Gas & Electric Co.,
D(d) 2,500 7.958%, 10/31/49(a)(c) 2,537,500
Progress Energy, Inc.,
Baa2 2,000 7.00%, 10/30/31 2,207,176
Virginia Electric & Power Co.,
A3 2,500 4.75%, 3/1/13 2,592,678
--------------
10,339,331
--------------
Entertainment--0.6%
International Game Technology,
Baa3 200 7.875%, 5/15/04 210,277
Walt Disney Co.,
Baa1 1,800 3.90%, 9/15/03 1,808,566
--------------
2,018,843
--------------
Financial Services--6.0%
Bear Stearns Cos., Inc.,
A2 1,200 1.81%, 11/30/04(a) 1,205,498
Ford Motor Credit Co.,
A3 2,300 1.55%, 6/30/05(a) 2,224,891
A3 2,600 7.60%, 8/1/05 2,791,589
General Motors Acceptance Corp.,
A3 700 2.05%, 1/20/04(a) 699,201
A3 2,500 6.875%, 8/28/12 2,494,140
A3 1,200 7.625%, 6/15/04 1,258,744
A3 700 8.00%, 11/1/31 686,816
Golden West Financial Corp.,
A1 1,500 5.50%, 8/8/06 1,653,879
Heller Financial, Inc.,
Aaa 500 6.375%, 03/15/06 557,645
Morgan Stanley,
Aa3 2,300 1.54%, 8/7/03(a) 2,301,060
Aa3 3,500 3.625%, 4/1/08 3,586,839
Unilever Capital Corp.,
A1 1,750 6.875%, 11/1/05 1,953,390
--------------
21,413,692
--------------
Health Care Services--0.1%
HCA, Inc.,
Ba1 300 6.91%, 6/15/05 318,267
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
46 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
Media--0.6%
Time Warner, Inc.,
Baa1 $ 2,000 7.75%, 6/15/05 $ 2,195,934
--------------
Telecommunications--3.4%
British Telecom PLC,
Baa1 1,500 2.41%, 12/15/03(b) 1,504,857
Deutsche Telekom International Finance BV,
Baa3 2,300 8.25%, 6/15/05 2,564,794
Baa3 1,400 8.75%, 6/15/30 1,783,726
France Telecom SA,
Baa3 2,000 8.50%, 3/1/31 2,767,470
Sprint Capital Corp.,
Baa3 2,000 6.00%, 1/15/07 2,149,304
Baa3 1,000 8.375%, 3/15/12 1,197,317
Worldcom, Inc.,
NR 1,000 7.375%, 1/15/49(b)(c)(g) 295,000
--------------
12,262,468
--------------
Total corporate bonds
(cost $61,168,095) 60,538,128
--------------
U.S. Government Agency Mortgage Pass-Through Obligations--38.5%
Federal Home Loan Mortgage Corp.,
4,400 5.50%, 8/13/33 4,526,500
16 9.25%, 1/1/10 16,986
Federal National Mortgage Association,
356 3.52%, 7/1/25(a) 362,795
268 4.75%, 8/1/24(a) 273,633
67,500 5.00%, 7/1/18 TBA 69,714,810
41 5.22%, 12/1/30(a) 42,684
40,792 6.00%, 11/1/12--8/1/32 42,495,418
226 6.50%, 9/1/05 231,830
30 7.00%, 8/1/04 30,569
Government National Mortgage Association,
2,266 4.25%, 3/20/30(a) 2,342,091
1,287 4.50%, 7/20/30(a) 1,334,412
747 4.375%, 1/20/24--2/20/26(a) 772,819
495 5.375%, 5/20/23--6/20/23(a) 512,649
695 5.375%, 6/20/27(a) 719,953
157 5.625%, 12/20/26(a) 161,037
173 5.625%, 10/20/24 178,323
601 5.75%, 8/20/26(a) 620,060
2,514 6.00%, 1/15/29--7/15/29 2,639,021
6,942 6.50%, 10/15/25--6/15/32 7,290,906
874 8.00%, 9/20/30--7/20/31 934,601
--------------
Total U.S. Government agency mortgage
pass-through obligations
(cost $134,909,054) 135,201,097
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 47
<Page>
Intermediate-Term Bond Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
Collateralized Mortgage Obligations--11.0%
Bank of America Mortgage Securities, Inc.,
AAA(d) $ 2,944 5.77%, 10/20/32 $ 3,038,895
Bear Stearns ARM Trust,
Aaa 592 6.16%, 1/25/32(a) 595,253
Aaa 877 6.27%, 9/25/31(a) 879,119
Aaa 510 6.59%, 9/25/31(a) 511,807
Citicorp Mortgage Securities, Inc.,
AAA(d) 247 4.15%, 12/25/31 247,929
Credit-Based Asset Servicing and Securitization
Aaa 1,182 1.375%, 8/25/29(a) 1,182,690
Countrywide Home Loans,
Aaa 2,482 4.86%, 9/19/32 2,517,934
Aaa 1,080 5.52%, 3/19/32 1,096,943
Federal Home Loan Mortgage Corp.,
Aaa 3,312 6.00%, 3/15/30 3,351,097
Aaa 2,744 6.50%, 9/25/22 2,780,230
Aaa 175 6.50%, 12/15/21, I/O 2,327
G-Wing Limited,
BBB(d) 1,441 3.96%, 11/6/11(a) 1,414,322
Government National Mortgage Association,
AAA(d) 744 1.68%, 2/16/30(a) 748,005
Aaa 646 1.78%, 2/16/30(a) 649,666
Aaa 2,100 7.50%, 2/20/30 2,259,238
Aaa 418 8.50%, 2/20/25 442,708
GS Mortgage Securities Corp. II,
Aa1 866 6.04%, 8/15/18 956,854
Norwest Asset Securities Corp.,
AAA(d) 791 6.5%, 1/25/29 798,603
Residential Asset Securitization Trust,
AAA(d) 50 8.0%, 2/25/30 50,454
Residential Funding Mortgage Securities, Inc.,
AAA(d) 127 7.5%, 12/25/30 127,067
Superannuation Members Home Loans Global Fund,
Aaa 589 1.37%, 6/15/26(a) 589,275
Salomon Brothers Mortgage Securities VII,
Aaa 5,000 7.17%, 3/25/25 5,452,493
Sequoia Mortgage Trust,
Aaa 5,713 1.48%, 10/20/27(a) 5,731,164
Structured Asset Securities Corp.,
Aaa 2,390 6.25%, 1/25/32 2,467,151
United Mortgage Securities Corp.,
Aaa 1,125 4.38%, 6/25/32(a) 1,140,843
Washington Mutual,
AAA(d) 245 6.29%, 10/19/39(a) 247,735
--------------
Total collateralized mortgage obligations
(cost $39,140,860) 39,279,802
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
48 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
Municipal Bonds--0.2%
Honolulu Hawaii City & County,
4.75%, 7/1/28
Aaa $ 1,000 (cost $829,641) $ 1,016,250
--------------
Foreign Bonds--5.4%
Federal Republic of Brazil,
B2 1,231 8.00%, 4/15/14 1,085,242
B2 2,000 11.50%, 3/12/08 2,100,000
Republic of Colombia,
Ba2 1,000 10.75%, 1/15/13 1,172,500
Republic of Panama,
Ba1 1,500 9.375%, 4/1/29 1,710,000
Republic of Peru,
Ba3 750 9.125%, 1/15/08 813,750
Ba3 3,000 9.125%, 2/21/12 3,205,500
Republic of South Africa,
Baa2 750 9.125%, 5/19/09 931,875
United Mexican States,
Baa2 1,500 6.375%, 1/16/13 1,590,000
Baa2 3,000 8.00%, 9/24/22 3,360,000
Baa2 3,000 8.30%, 8/15/31 3,462,000
--------------
Total foreign bonds
(cost $17,821,673) 19,430,867
--------------
United States Government and Agency Securities--4.0%
Federal Farm Credit Bank,
2,300 5.45%, 1/19/05 2,449,339
United States Treasury Notes, TIPS
2,789 3.375%, 1/15/07(f) 3,062,899
3,647 3.625%, 1/15/08 4,091,631
6,175 3.875%, 1/15/09 7,072,382
--------------
Total United States Government and agency
securities
(cost $15,373,238) 16,676,251
--------------
<Caption>
Shares
------------
Warrants(b)
Mexico Value, Ser. B, expiring
2,500,000 6/30/04 26,250
Mexico Value, Ser. C, expiring
2,500,000 6/30/05 7,500
Mexico Value, Ser. D, expiring
2,500,000 6/30/06 2,125
Mexico Value, Ser. E, expiring
2,500,000 6/30/07 1,500
--------------
Total warrants
(cost $6,814) 37,375
--------------
Total long-term investments
(cost $273,728,766) 276,697,024
--------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 49
<Page>
Intermediate-Term Bond Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS--46.8%
U.S. Government and Agency Securities--34.6%
Federal Home Loan Bank,
$ 20,000 0.95%, 7/1/03(e) $ 20,000,000
4,000 0.97%, 7/25/03(e) 3,997,468
11,200 1.17%, 8/1/03(e) 11,188,764
6,500 1.18%, 7/11/03(e) 6,497,869
Federal Home Loan Mortgage Corp.,
9,100 1.08%, 10/30/03(e) 9,067,120
1,900 1.17%, 7/10/03(e) 1,899,444
12,700 1.19%, 9/3/03(e) 12,673,245
3,900 1.19%, 9/12/03(e) 3,892,407
Federal National Mortgage Association,
13,500 0.89%, 9/24/03(e) 13,466,250
3,500 0.89%, 10/15/03(e) 3,491,250
9,800 0.95%, 9/10/03(e) 9,775,500
11,400 1.16%, 7/30/03(e) 11,391,279
14,500 1.17%, 7/23/03(e) 14,489,677
800 1.24%, 7/01/03(e) 800,000
United States Treasury Bills,
1,055 0.79%, 8/7/03(e)(f) 1,054,138
--------------
Total U.S. Government and agency securities
(cost $123,691,447) 123,684,411
--------------
Commercial Paper--11.8%
ANZ (Delaware) Inc.,
P-1 300 1.23% 7/22/03 299,785
Danske Corp.,
P-1 2,100 1.23%, 7/7/03 2,099,570
P-1 3,500 1.23%, 7/28/03 3,496,771
EI Dupont de Nemours,
P-1 2,600 1.07%, 8/28/2003 2,595,518
General Electric Capital Corp.,
P-1 1,900 1.03%, 7/23/03 1,898,804
P-1 1,200 1.05%, 8/7/2003 1,198,705
P-1 1,400 1.20%, 8/21/2003 1,397,620
HBOS Treasury Services,
P-1 2,500 1.20%, 8/07/03 2,496,917
P-1 1,200 1.21%, 7/10/03 1,199,637
P-1 5,100 1.25%, 7/16/03 5,097,344
Royal Bank of Scotland PLC,
P-1 400 1.23%, 7/15/03 399,809
P-1 600 1.25%, 7/3/03 599,959
Shell Finance UK PLC,
P-1 500 1.12%, 7/10/2003 499,860
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
50 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
MOODY'S PRINCIPAL
RATING AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- -----------------------------------------------------------------------------------------------
Commercial Paper (cont'd.)
UBS Finance (DE) LLC,
P-1 $ 5,400 0.92%, 9/24/2003 $ 5,388,270
P-1 200 1.03%, 8/29/2003 199,662
Westpac Trust,
P-1 3,000 1.20%, 7/9/2003 2,999,200
P-1 400 1.20%, 7/29/2003 399,627
World Bank Discount Note,
P-1 10,000 0.99%, 7/21/03 9,994,500
--------------
Total commercial paper
(cost $42,261,558) 42,261,558
--------------
Foreign Bond--0.4%
Hellenic Finance SCA,
2.00%, 7/15/03
A1 EUR 1,200 (cost $1,022,040) 1,440,039
--------------
Total short-term investments
(cost $166,975,045) 167,386,008
--------------
Total Investments--124.1%
(cost $440,703,811) 444,083,032
Liabilities in excess of other assets--(24.1%) (86,288,439)
--------------
Net Assets--100.0% $ 357,794,593
--------------
--------------
</Table>
- ------------------------------
(a) Rate shown reflects current rate on variable rate instruments.
(b )Non-income producing security.
(c) Represents issuer in default on interest payments.
(d) Standard & Poor's rating.
(e) Rate shown reflects yield to maturity on date of purchase.
(f) Portion of security pledged as initial margin for financial futures
contracts.
(g) Issuer in bankruptcy.
ARM--Adjustable Rate Mortgage.
I/O--Interest Only Security.
NR--Not Rated by Moody's or Standard & Poor's.
TBA--To be announced. Securities purchased on a forward commitment basis.
TIPS--Treasury Inflation Protection Security.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 51
<Page>
Mortgage Backed Securities Portfolio Portfolio of Investments
June 30, 2003 (Unaudited)
<Table>
<Caption>
PRINCIPAL
AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
LONG-TERM INVESTMENTS--96.6%
Collateralized Mortgage Obligation--12.0%
Bear Stearns Commercial Mortgage Securities Corp.,
$ 750 7.32%, 10/15/32 $ 909,333
Chase Commercial Mortgage Securities Corp.,
300 6.56%, 5/18/30 343,979
Federal Home Loan Mortgage Corp.,
26 9.00%, 10/15/20 25,721
48 5.50%, 8/15/21, PAC 48,769
3,050 6.00%, 5/15/08 - 9/15/30, PAC 3,145,112
1,060 6.50%, 11/15/22, PAC 1,081,601
359 7.00%, 3/15/23, PAC 377,539
766 8.00%, 12/15/06 - 7/15/21, PAC 793,335
Federal National Mortgage Assn.,
21 3.13%, 1/25/09(a) 20,948
59 6.00%, 4/01/19 60,629
89 6.50%, 4/25/22 94,180
315 6.527%, 5/25/30 355,888
397 7.50%, 5/25/07 - 7/25/22 421,352
88 8.50%, 6/25/21 97,077
241 6.00%, 4/25/08 - 5/25/10, PAC 247,249
394 6.50%, 12/25/23, PAC 400,678
72 7.00%, 9/25/20, PAC 77,476
446 8.00%, 12/25/21 - 5/25/24, PAC 496,319
82 8.50%, 7/25/18 - 2/25/20, PAC 90,704
970 7.00%, 3/25/23, PAC I/O 90,077
573 6.00%, 9/25/22 - 10/25/22, TAC 603,633
CS First Boston Mortgage Securities Corp.,
25 7.15%, 6/20/29 25,854
191 8.985%, 4/25/17, I/O 30,058
178 Zero Coupon, 4/25/17, P/O 163,698
Morgan Stanley Dean Witter Commercial Mortgage,
1,000 6.39%, 7/15/33 1,162,628
807 6.66%, 2/15/33 949,508
750 7.20%, 10/15/33 905,563
Nomura Asset Commercial Mortgage,
1,000 6.69%, 3/15/30 1,183,902
Salomon Brothers Mortgage Securities,
86 6.00%, 12/25/11 86,123
------------
Total collateralized mortgage obligation
(cost $13,089,507) 14,288,933
------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
52 THE TARGET PORTFOLIO TRUST
<Page>
<Table>
<Caption>
PRINCIPAL
AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
U.S. Government Agency Mortgage Pass-Through Obligations--84.2%
Federal Home Loan Mortgage Corp.,
$ 96 6.00%, 5/01/11 $ 100,196
1,091 6.50%, 2/01/04 - 6/01/22 1,141,769
246 7.50%, 3/01/08 - 6/01/28 261,804
12 8.25%, 12/01/05 - 5/01/08 12,911
55 8.50%, 12/01/07 - 7/01/21 59,621
41 8.75%, 12/01/08 44,786
174 9.00%, 10/01/05 - 3/01/11 186,387
1 10.00%, 1/01/04 1,363
32 11.50%, 3/01/16 35,713
17 13.25%, 5/01/13 19,364
4 14.00%, 6/01/11 4,415
Federal National Mortgage Assn.,
8,500 5.50%, 8/01/33 8,757,652
688 5.78%, 11/01/11(a) 778,580
2,079 6.00%, 8/01/11 - 3/01/23 2,168,557
1,475 6.009%, 11/01/11 1,684,209
79 6.048%, 3/01/12(a) 90,422
85 6.18%, 7/01/08 95,794
75 6.30%, 1/01/08 84,652
68 6.34%, 1/01/08 76,653
75 6.43%, 1/01/08 84,995
473 6.447%, 1/01/08 536,937
39 6.50%, 2/01/11 40,768
636 6.55%, 9/01/07 718,916
51 6.837%, 10/01/07 56,753
550 7.00%, 9/01/11 - 7/01/12 585,840
584 7.04%, 3/01/07 662,707
29 7.50%, 2/01/20 30,535
6 7.75%, 10/01/19 6,171
207 8.00%, 3/01/07 - 12/01/22 226,079
143 8.50%, 1/01/07 147,739
98 9.75%, 8/01/10 - 11/01/16 109,808
Government National Mortgage Assn.,
4,000 5.00%, 7/1/33 4,096,248
1,982 5.50%, 11/15/32 - 1/15/33 2,067,819
39,336 6.00%, 10/15/08 - 6/15/33 41,243,665
13,442 6.50%, 11/01/17 - 5/15/32 14,131,817
10,238 7.00%, 7/15/16 - 1/15/30 10,851,193
5,853 7.50%, 3/15/07 - 10/15/29 6,252,512
1,507 8.00%, 1/15/08 - 11/15/30 1,629,876
215 8.25%, 6/20/17 - 7/20/17 234,532
74 8.50%, 3/15/05 - 4/20/17 80,451
314 9.00%, 7/20/04 - 1/15/20 346,678
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 53
<Page>
Mortgage Backed Securities Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
PRINCIPAL
AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
U.S. Government Agency Mortgage Pass-Through Obligations (cont'd.)
$ 238 9.50%, 4/15/06 - 1/15/21 $ 264,919
35 13.50%, 6/15/10 - 5/15/11 41,202
38 14.00%, 6/15/11 46,216
19 16.00%, 5/15/12 23,546
--------------
Total U.S. Government agency mortgage pass-through 100,122,770
obligations
(cost $98,731,031)
--------------
U.S. Treasury Securities--0.4%
United States Treasury Notes,
500 2.00%, 11/30/04 505,937
(cost $499,845)
--------------
Total long-term investments 114,917,640
(cost $112,320,383)
--------------
SHORT-TERM INVESTMENTS--12.3%
Repurchase Agreements
6,100 Goldman Sachs Group, Inc., 1.21%, dated 6/30/03, due 6,100,000
7/01/03 in the amount of $6,100,205 (cost $6,100,000;
collateralized by $6,104,622 Federal National
Mortgage Assoc., Mortgage Pass-Through, 5.00%,
7/1/33; value of the collateral including accrued
interest was $6,222,000)
8,600 UBS Warburg, 1.21%, dated 6/30/03 due 7/01/03 in the 8,600,000
amount of $8,600,289 (cost $8,600,000; collateralized
by $8,602,818 Federal National Mortgage Assoc.,
5.16%, 11/29/17; value of the collateral including
interest is $8,774,874)
--------------
Total repurchase agreements 14,700,000
(cost $14,700,000)
--------------
Total Investments--108.9% 129,617,640
(cost $127,020,383; Note 5)
Liabilities in excess of other assets--(8.9%) (10,614,283)
--------------
Net Assets--100% $ 119,003,357
--------------
--------------
</Table>
- ------------------------------
(a)Variable rate instrument. The maturity date presented for these instruments
is the later of the next date on which the security can be redeemed at par or
the next date on which the rate of interest is adjusted.
I/O--Interest Only Security.
PAC--Planned Amortization Class.
P/O--Principal Only Security.
TAC--Target Amortization Class.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
54 THE TARGET PORTFOLIO TRUST
<Page>
Portfolio of Investments U.S. Government Money Market Portfolio
June 30, 2003 (Unaudited)
<Table>
<Caption>
PRINCIPAL
AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Federal Farm Credit Bank--4.0%
$ 4,000 1.09%, 7/21/03(a) $ 3,997,578
------------
Federal Home Loan Bank--13.6%
1,000 1.12%, 10/17/03(a) 996,640
6,000 1.24%, 10/22/03(a) 5,976,647
2,000 6.375%, 11/14/03 2,037,389
3,000 3.75%, 2/13/04 3,043,465
1,500 3.75%, 4/15/04 1,529,129
------------
13,583,270
------------
Federal Home Loan Mortgage Corp.--29.7%
1,202 1.20%, 7/17/03(a) 1,201,359
3,083 1.13%, 8/25/03(a) 3,077,678
5,000 1.08%, 9/11/03(a) 4,989,200
4,000 1.735%, 10/9/03(a) 3,980,722
3,000 1.10%, 11/7/03(a) 2,988,175
3,750 1.31%, 12/4/03(a) 3,728,712
2,000 1.33%, 1/29/04(a) 1,984,336
2,160 5.25%, 2/15/04 2,212,907
3,000 1.17%, 2/17/04(a) 2,977,477
750 0.93%, 2/26/04(a) 744,407
1,000 1.26%, 2/26/04(a) 992,543
750 5.00%, 5/15/04 774,376
------------
29,651,892
------------
Federal National Mortgage Association--15.2%
5,000 0.91%, 8/27/03(a) 4,992,796
2,000 1.55%, 9/19/03(a) 1,993,111
1,500 1.545%, 11/14/03(a) 1,491,245
1,500 4.75%, 11/14/03 1,520,216
2,000 1.37%, 12/12/03(a) 1,987,518
1,500 1.24%, 2/6/04(a) 1,488,438
1,699 1.28%, 2/6/04(a) 1,685,905
------------
15,159,229
------------
Repurchase Agreements--37.9%
9,500 ABN AMRO, 1.18%, dated 6/30/03, due 7/01/03 in the
amount of $9,500,311 (cost $9,500,000; collateralized
by $7,846,000 Federal National Mortgage Assoc. Notes,
7.125%, 6/15/2010; value of the collateral including
accrued interest was $9,691,040) 9,500,000
12,000 Deutsche Bank, 1.18%, dated 6/30/03, due 7/01/03 in the
amount of $12,000,393 (cost $12,000,000;
collateralized by $12,195,000 Federal Home Loan Bank
Bonds, 1.25%, 4/15/2004; value of the collateral
including accrued interest was $12,242,002) 12,000,000
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 55
<Page>
U.S. Government Money Market Portfolio Portfolio of Investments
(cont'd) June 30, 2003 (Unaudited)
<Table>
<Caption>
PRINCIPAL
AMOUNT (000) DESCRIPTION VALUE (NOTE 1)
- ---------------------------------------------------------------------------------------------
Repurchase Agreements (cont'd.)
$ 9,600 Goldman Sachs, 1.21%, dated 6/30/03, due 7/01/03 in the $ 9,600,000
amount of $9,600,323 (cost $9,600,000; collateralized
by $9,607,274 Federal National Mortgage Assoc.,
Mortgage Pass-Through, 6.00%, 7/1/2033; value of the
collateral including accrued interest was $9,792,001)
6,800 UBS Warburg Dillon Read, 1.21%, dated 6/30/03, due 6,800,000
7/01/03 in the amount of $6,800,229 (cost $6,800,000;
collateralized by $6,883,745 Federal National
Mortgage Assoc., 5.30%, 10/28/08; value of collateral
including accrued interest was $6,939,698)
--------------
37,900,000
--------------
Total Investments--100.4% 100,291,969
(amortized cost $100,291,969)(b)
Liabilities in excess of other assets--(0.4%) (382,625)
--------------
Net Assets--100% $ 99,909,344
--------------
--------------
</Table>
- ------------------------------
(a) Rate quoted represents yield-to-maturity as of purchase date.
(b) Federal income tax basis of portfolio securities is the same as for
financial reporting purposes.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
56 THE TARGET PORTFOLIO TRUST
<Page>
Statements of Assets and Liabilities June 30, 2003 (Unaudited)
- --------------------------------------------------------------------------------
<Table>
<Caption>
LARGE LARGE SMALL
CAPITALIZATION CAPITALIZATION CAPITALIZATION
GROWTH VALUE GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO
- ---------------------------------------------------------------------------------
ASSETS
- ---------------------------------------------------------------------------------
Investments, at value* $ 288,563,417 $ 254,275,399 $ 116,539,169
- ---------------------------------------------------------------------------------
Receivable for Portfolio
shares sold 2,292,127 1,942,883 811,112
- ---------------------------------------------------------------------------------
Dividends and interest
receivable 49,529 628,541 17,529
- ---------------------------------------------------------------------------------
Prepaid expenses and other
assets 2,648 2,636 1,876
- ---------------------------------------------------------------------------------
Receivable for investments
sold 565,433 5,990,051 3,458,165
- ---------------------------------------------------------------------------------
Total assets 291,473,154 262,839,510 120,827,851
LIABILITIES
- ---------------------------------------------------------------------------------
Payable for Portfolio shares
reacquired 1,441,006 1,608,010 937,864
- ---------------------------------------------------------------------------------
Payable for investments
purchased 2,006,740 5,723,823 3,254,564
- ---------------------------------------------------------------------------------
Accrued expenses and other
liabilities 207,348 223,964 210,015
- ---------------------------------------------------------------------------------
Management fee payable 143,999 127,055 57,713
- ---------------------------------------------------------------------------------
Deferred Trustees' fees 12,896 14,688 12,873
- ---------------------------------------------------------------------------------
Payable to custodian 147 -- 36,898
- ---------------------------------------------------------------------------------
Total liabilities 3,812,136 7,697,540 4,509,927
- ---------------------------------------------------------------------------------
NET ASSETS $ 287,661,018 $ 255,141,970 $ 116,317,924
- ---------------------------------------------------------------------------------
Net assets were comprised of:
Shares of beneficial
interest, at par $ 22,292 $ 21,434 $ 14,479
- ---------------------------------------------------------------------------------
Paid-in capital, in excess
of par 293,635,745 245,341,654 179,790,088
- ---------------------------------------------------------------------------------
293,658,037 245,363,088 179,804,567
Accumulated net investment
income (loss) (171,791) 1,863,731 (449,700)
- ---------------------------------------------------------------------------------
Accumulated net realized
losses (63,272,510) (18,805,687) (74,949,207)
- ---------------------------------------------------------------------------------
Net unrealized appreciation 57,447,282 26,720,838 11,912,264
- ---------------------------------------------------------------------------------
Net assets, June 30, 2003 $ 287,661,018 $ 255,141,970 $ 116,317,924
- ---------------------------------------------------------------------------------
Shares of beneficial
interest issued and
outstanding 22,291,713 21,433,511 14,479,232
- ---------------------------------------------------------------------------------
Net asset value, offering
price and redemption
price per share $12.90 $11.90 $8.03
- ---------------------------------------------------------------------------------
*Identified cost of total
investments $ 231,116,135 $ 227,554,561 $ 104,626,905
- ---------------------------------------------------------------------------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 57
<Page>
Statements of Assets and Liabilities June 30, 2003 (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
SMALL
CAPITALIZATION INTERNATIONAL INTERNATIONAL TOTAL RETURN
VALUE EQUITY BOND BOND
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- -------------------------------------------------------------------------------------------------
ASSETS
- -------------------------------------------------------------------------------------
Investments, at value* $ 158,812,388 $ 150,956,036 $ 30,584,570 $ 209,724,161
- -------------------------------------------------------------------------------------
Cash 50,759 5,619 -- 577,864
- -------------------------------------------------------------------------------------
Foreign currency, at value** -- 1,485,146 72,641 692,328
- -------------------------------------------------------------------------------------
Receivable for Portfolio
shares sold 425,867 1,509,200 257,163 2,387,981
- -------------------------------------------------------------------------------------
Dividends and interest
receivable 128,881 294,453 473,678 1,234,972
- -------------------------------------------------------------------------------------
Prepaid expenses and other
assets 1,490 2,947 102,228 679
- -------------------------------------------------------------------------------------
Receivable for investments
sold 582,218 751,741 5,128,872 56,593,629
- -------------------------------------------------------------------------------------
Receivable for foreign tax
reclaim -- 308,209 -- --
- -------------------------------------------------------------------------------------
Due from broker for
variation margin -- -- 8,498 161,750
- -------------------------------------------------------------------------------------
Premium for swaps purchased -- -- -- 45,284
- -------------------------------------------------------------------------------------
Unrealized appreciation on
swaps -- -- -- 461,892
- -------------------------------------------------------------------------------------
Unrealized appreciation on
forward currency contracts -- -- 624,396 13,326
- -------------------------------------------------------------------------------------
Total assets 160,001,603 155,313,351 37,252,046 271,893,866
LIABILITIES
- -----------------------------------------------------------------------------------
Payable for Portfolio shares
reacquired 1,149,789 602,748 121,668 1,033,465
- -------------------------------------------------------------------------------------
Payable for investments
purchased 2,049,033 2,074,412 2,473,323 105,034,936
- -------------------------------------------------------------------------------------
Accrued expenses and other
liabilities 218,384 205,607 82,225 84,209
- -------------------------------------------------------------------------------------
Management fee payable 78,614 88,606 13,734 58,219
- -------------------------------------------------------------------------------------
Deferred Trustees' fees 12,782 13,092 9,113 11,766
- -------------------------------------------------------------------------------------
Payable to custodian -- -- 2,632 --
- -------------------------------------------------------------------------------------
Dividends payable -- -- -- 101,778
- -------------------------------------------------------------------------------------
Outstanding options
written*** -- -- -- 288,306
- -------------------------------------------------------------------------------------
Premium for swaps written -- -- -- 103,262
- -------------------------------------------------------------------------------------
Unrealized depreciation on
swaps -- -- -- 4,892
- -------------------------------------------------------------------------------------
Unrealized depreciation on
forward currency contracts -- -- 1,091,174 --
- -------------------------------------------------------------------------------------
Investments sold short, at
value**** -- -- -- 7.579,725
- -------------------------------------------------------------------------------------
Total liabilities 3,508,602 2,984,465 3,793,869 114,300,558
- -------------------------------------------------------------------------------------
NET ASSETS $ 156,493,001 $ 152,328,886 $ 33,458,177 $ 157,593,308
- -------------------------------------------------------------------------------------
Net assets were comprised of:
Shares of beneficial
interest, at par $ 10,329 $ 15,662 $ 3,610 $ 14,287
- -------------------------------------------------------------------------------------
Paid-in capital, in excess
of par 149,126,035 194,591,352 30,228,475 149,774,136
- -------------------------------------------------------------------------------------
149,136,364 194,607,014 30,232,085 149,788,423
Accumulated net investment
income (loss) 90,953 1,916,985 149,402 (66,095)
- -------------------------------------------------------------------------------------
Accumulated net realized
gains (losses) (9,365,336) (55,537,570) 1,227,186 4,808,649
- -------------------------------------------------------------------------------------
Net unrealized appreciation 16,631,020 11,342,457 1,849,504 3,062,331
- -------------------------------------------------------------------------------------
Net assets, June 30, 2003 $ 156,493,001 $ 152,328,886 $ 33,458,177 $ 157,593,308
- -------------------------------------------------------------------------------------
Shares of beneficial
interest issued and
outstanding 10,329,046 15,661,586 3,609,802 14,287,221
- -------------------------------------------------------------------------------------
Net asset value, offering
price and redemption
price per share $15.15 $ 9.73 $ 9.27 $ 11.03
- -------------------------------------------------------------------------------------
*Identified cost of total
investments $ 142,181,368 $ 139,644,436 $ 28,319,216 $ 207,290,235
- -------------------------------------------------------------------------------------
**Identified cost of
currency $ -- 1,517,264 74,938 694,773
- -------------------------------------------------------------------------------------
***Premiums received from
options written $ -- -- -- 332,987
- -------------------------------------------------------------------------------------
****Proceeds received from
short sales $ -- -- -- 7,521,473
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
58 THE TARGET PORTFOLIO TRUST
<Page>
Statements of Assets and Liabilities June 30, 2003 (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
U.S.
INTERMEDIATE- MORTGAGE GOVERNMENT
TERM BACKED MONEY
BOND SECURITIES MARKET
PORTFOLIO PORTFOLIO PORTFOLIO
- ---------------------------------------------------------------------------------
ASSETS
- ---------------------------------------------------------------------------------
Investments, at value* $ 444,083,032 $ 114,917,640 $ 62,391,969
- ---------------------------------------------------------------------------------
Repurchase Agreement* -- 14,700,000 37,900,000
- ---------------------------------------------------------------------------------
Cash 314,293 86,398 82,132
- ---------------------------------------------------------------------------------
Foreign currency, at value** 4,757,691 -- --
- ---------------------------------------------------------------------------------
Receivable for Portfolio
shares sold 2,873,778 3,880,796 1,284,116
- ---------------------------------------------------------------------------------
Dividends and interest
receivable 2,067,273 431,384 128,296
- ---------------------------------------------------------------------------------
Prepaid expenses and other
assets 1,353 1,651 411
- ---------------------------------------------------------------------------------
Receivable for investments
sold 24,858,469 2,075,632 --
- ---------------------------------------------------------------------------------
Due from broker for
variation margin 337,660 -- --
- ---------------------------------------------------------------------------------
Premium for swaps purchased 141,076 -- --
- ---------------------------------------------------------------------------------
Unrealized appreciation on
swaps 385,504 -- --
- ---------------------------------------------------------------------------------
Unrealized appreciation on
forward currency contracts 25,597 -- --
- ---------------------------------------------------------------------------------
Total assets 479,845,726 136,093,501 101,786,924
LIABILITIES
- ---------------------------------------------------------------------------------
Payable for Portfolio shares
reacquired 2,075,165 1,913,180 1,745,120
- ---------------------------------------------------------------------------------
Payable for investments
purchased 119,548,227 14,993,594 --
- ---------------------------------------------------------------------------------
Accrued expenses and other
liabilities 91,307 38,947 95,646
- ---------------------------------------------------------------------------------
Management fee payable 133,925 44,151 21,640
- ---------------------------------------------------------------------------------
Deferred Trustees' fees 12,789 11,669 13,127
- ---------------------------------------------------------------------------------
Dividends payable 189,720 88,603 2,047
- ---------------------------------------------------------------------------------
Total liabilities 122,051,133 17,090,144 1,877,580
- ---------------------------------------------------------------------------------
NET ASSETS $ 357,794,593 $ 119,003,357 $ 99,909,344
- ---------------------------------------------------------------------------------
Net assets were comprised of:
Shares of beneficial
interest, at par $ 33,314 $ 11,223 $ 99,909
- ---------------------------------------------------------------------------------
Paid-in capital, in excess
of par 345,035,861 116,786,392 99,809,435
- ---------------------------------------------------------------------------------
345,069,175 116,797,615 99,909,344
Accumulated net investment
income (loss) (569,988) 120,842 --
- ---------------------------------------------------------------------------------
Accumulated net realized
gains (losses) 9,684,449 (512,357) --
- ---------------------------------------------------------------------------------
Net unrealized appreciation 3,610,957 2,597,257 --
- ---------------------------------------------------------------------------------
Net assets, June 30, 2003 $ 357,794,593 $ 119,003,357 $ 99,909,344
- ---------------------------------------------------------------------------------
Shares of beneficial
interest issued and
outstanding 33,313,989 11,223,019 99,909,344
- ---------------------------------------------------------------------------------
Net asset value, offering
price and redemption
price per share $ 10.74 $ 10.60 $ 1.00
- ---------------------------------------------------------------------------------
*Identified cost of total
investments $ 440,703,811 $ 127,020,383 $ 100,291,969
- ---------------------------------------------------------------------------------
**Identified cost of
currency 4,775,402 -- --
- ---------------------------------------------------------------------------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 59
<Page>
Statements of Operations
For The Six Months Ended June 30, 2003 (Unaudited)
- --------------------------------------------------------------------------------
<Table>
<Caption>
LARGE LARGE SMALL
CAPITALIZATION CAPITALIZATION CAPITALIZATION
GROWTH VALUE GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO
- ------------------------------------------------------------------------------------
NET INVESTMENT INCOME (LOSS)
- ------------------------------------------------------------------------------------
Income
Dividends 970,067 2,835,526 122,188
- ------------------------------------------------------------------------------------
Less: Foreign withholding
taxes (7,431) (44) --
- ------------------------------------------------------------------------------------
Total income 962,636 2,835,482 122,188
- ------------------------------------------------------------------------------------
Expenses
Management fee 777,115 685,550 307,684
- ------------------------------------------------------------------------------------
Transfer agent's fees and
expenses 174,000 128,000 118,000
- ------------------------------------------------------------------------------------
Custodian's fees and
expenses 45,600 63,000 57,000
- ------------------------------------------------------------------------------------
Reports to shareholders 78,000 38,000 47,000
- ------------------------------------------------------------------------------------
Registration fees 18,000 17,000 13,000
- ------------------------------------------------------------------------------------
Legal fees and expenses 15,000 14,000 11,000
- ------------------------------------------------------------------------------------
Trustees' fees 12,000 10,000 7,000
- ------------------------------------------------------------------------------------
Audit fees 9,000 8,000 8,000
- ------------------------------------------------------------------------------------
Miscellaneous 5,712 7,042 3,204
- ------------------------------------------------------------------------------------
Total expenses 1,134,427 970,592 571,888
- ------------------------------------------------------------------------------------
Net investment income (loss) (171,791) 1,864,890 (449,700)
- ------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN
CURRENCY TRANSACTIONS
- ------------------------------------------------------------------------------------
Net realized loss on:
Investment transactions (3,125,499) (5,789,827) (17,335,795)
- ------------------------------------------------------------------------------------
Total net realized loss (3,125,499) (5,789,827) (17,335,795)
- ------------------------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments 44,466,949 33,993,549 32,080,697
- ------------------------------------------------------------------------------------
Net change in unrealized
appreciation 44,466,949 33,993,549 32,080,697
- ------------------------------------------------------------------------------------
Net gain 41,341,450 28,203,722 14,744,902
- ------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $ 41,169,659 $ 30,068,612 $ 14,295,202
- ------------------------------------------------------------------------------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
60 THE TARGET PORTFOLIO TRUST
<Page>
Statements of Operations
For The Six Months Ended June 30, 2003 (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
SMALL
CAPITALIZATION INTERNATIONAL INTERNATIONAL TOTAL RETURN
VALUE EQUITY BOND BOND
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- -------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME
- -------------------------------------------------------------------------------------
Income
Interest $ -- $ 5,789 $ 564,216 $ 2,721,975
- -------------------------------------------------------------------------------------
Dividends 795,688 3,145,557 16,456 --
- -------------------------------------------------------------------------------------
Less: Foreign withholding
taxes (2,252) (404,368) (27,524) --
- -------------------------------------------------------------------------------------
Total income 793,436 2,746,978 553,148 2,721,975
- -------------------------------------------------------------------------------------
Expenses
Management fee 428,358 485,983 75,965 336,384
- -------------------------------------------------------------------------------------
Transfer agent's fees and
expenses 123,000 105,000 36,000 89,000
- -------------------------------------------------------------------------------------
Custodian's fees and
expenses 58,000 123,000 62,000 61,000
- -------------------------------------------------------------------------------------
Reports to shareholders 48,000 37,000 9,000 14,000
- -------------------------------------------------------------------------------------
Registration fees 13,000 11,000 9,000 15,000
- -------------------------------------------------------------------------------------
Legal fees and expenses 11,000 11,000 11,000 13,000
- -------------------------------------------------------------------------------------
Trustees' fees 8,000 7,000 4,000 7,000
- -------------------------------------------------------------------------------------
Audit fees 8,000 12,000 9,000 8,000
- -------------------------------------------------------------------------------------
Miscellaneous 5,125 4,869 1,022 6,909
- -------------------------------------------------------------------------------------
Total expenses 702,483 796,852 216,987 550,293
- -------------------------------------------------------------------------------------
Net investment income 90,953 1,950,126 336,161 2,171,682
- -------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN
CURRENCY TRANSACTIONS
- -------------------------------------------------------------------------------------
Net realized gain (loss) on:
Investment transactions (4,925,645) (3,134,009) 2,069,765 3,888,065
- -------------------------------------------------------------------------------------
Financial futures contracts -- -- (31,071) 3,543,256
- -------------------------------------------------------------------------------------
Foreign currency
transactions -- (158,435) (332,944) (2,129,881)
- -------------------------------------------------------------------------------------
Options written -- -- -- 168,753
- -------------------------------------------------------------------------------------
Total net realized gain
(loss) (4,925,645) (3,292,444) 1,705,750 5,470,193
- -------------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on:
Investments 24,782,237 12,375,639 282,431 (1,500,404)
- -------------------------------------------------------------------------------------
Financial futures contracts -- -- 14,319 (1,005,069)
- -------------------------------------------------------------------------------------
Foreign currencies -- (7,847) (583,894) 1,044,345
- -------------------------------------------------------------------------------------
Options written -- -- -- 70,473
- -------------------------------------------------------------------------------------
Swaps -- -- -- 1,311,962
- -------------------------------------------------------------------------------------
Short sales -- -- -- 63,174
- -------------------------------------------------------------------------------------
Net change in unrealized
appreciation (depreciation) 24,782,237 12,367,792 (287,144) (15,519)
- -------------------------------------------------------------------------------------
Net gain 19,856,592 9,075,348 1,418,606 5,454,674
- -------------------------------------------------------------------------------------
NET INCREASE IN NET
ASSETS RESULTING FROM
OPERATIONS $ 19,947,545 $ 11,025,474 $ 1,754,767 $ 7,626,356
- -------------------------------------------------------------------------------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 61
<Page>
Statements of Operations
For The Six Months Ended June 30, 2003 (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
U.S.
INTERMEDIATE- MORTGAGE GOVERNMENT
TERM BACKED MONEY
BOND SECURITIES MARKET
PORTFOLIO PORTFOLIO PORTFOLIO
- ---------------------------------------------------------------------------------
NET INVESTMENT INCOME
- ---------------------------------------------------------------------------------
Income
Interest $ 5,358,466 $ 3,075,754 $ 787,942
- ---------------------------------------------------------------------------------
Total income 5,358,466 3,075,754 787,942
- ---------------------------------------------------------------------------------
Expenses
Management fee 780,242 262,470 149,796
- ---------------------------------------------------------------------------------
Transfer agent's fees and
expenses 161,000 71,000 64,000
- ---------------------------------------------------------------------------------
Custodian's fees and
expenses 67,000 73,000 28,000
- ---------------------------------------------------------------------------------
Reports to shareholders 66,000 15,000 18,000
- ---------------------------------------------------------------------------------
Registration fees 14,000 11,000 9,000
- ---------------------------------------------------------------------------------
Legal fees and expenses 13,000 9,000 9,000
- ---------------------------------------------------------------------------------
Trustees' fees 9,000 4,000 7,000
- ---------------------------------------------------------------------------------
Audit fees 8,000 8,000 7,000
- ---------------------------------------------------------------------------------
Miscellaneous 770 972 636
- ---------------------------------------------------------------------------------
Total expenses 1,119,012 454,442 292,432
- ---------------------------------------------------------------------------------
Net investment income 4,239,454 2,621,312 495,510
- ---------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN
CURRENCY TRANSACTIONS
- ---------------------------------------------------------------------------------
Net realized gain (loss) on:
Investment transactions 5,791,677 (50,991) 3,059
- ---------------------------------------------------------------------------------
Financial futures contracts 5,828,876 (12,483) --
- ---------------------------------------------------------------------------------
Foreign currency
transactions (516,360) -- --
- ---------------------------------------------------------------------------------
Total net realized gain
(loss) 11,104,193 (63,474) 3,059
- ---------------------------------------------------------------------------------
Net change in unrealized appreciation
(depreciation) on:
Investments 1,756,938 (902,003) --
- ---------------------------------------------------------------------------------
Financial futures contracts (2,380,601) -- --
- ---------------------------------------------------------------------------------
Foreign currencies (818,420) -- --
- ---------------------------------------------------------------------------------
Options written 9,933 -- --
- ---------------------------------------------------------------------------------
Swaps 1,240,466 -- --
- ---------------------------------------------------------------------------------
Net change in unrealized
appreciation (depreciation) (191,684) (902,003) --
- ---------------------------------------------------------------------------------
Net gain (loss) 9,926,443 (965,477) 3,059
- ---------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS
RESULTING FROM OPERATIONS $ 15,151,963 $ 1,655,835 $ 498,569
- ---------------------------------------------------------------------------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
62 THE TARGET PORTFOLIO TRUST
<Page>
Statements of Changes in Net Assets (Unaudited)
- --------------------------------------------------------------------------------
<Table>
<Caption>
LARGE CAPITALIZATION LARGE CAPITALIZATION
GROWTH PORTFOLIO VALUE PORTFOLIO
----------------------------- -----------------------------
Six Months Year Six Months Year
Ended Ended Ended Ended
June 30, December 31, June 30, December 31,
2003 2002 2003 2002
- ------------------------------------------------------------------------------------------------
INCREASE (DECREASE)
IN NET ASSETS
- -------------------------------------------------------------------------------------
Operations
Net investment income
(loss) $ (171,791) $ (324,006) $ 1,864,890 $ 3,778,751
- -------------------------------------------------------------------------------------
Net realized loss on
investment and
foreign currency
transactions (3,125,499) (45,534,696) (5,789,827) (11,726,166)
- -------------------------------------------------------------------------------------
Net change in
unrealized
appreciation
(depreciation) of
investments 44,466,949 (69,124,607) 33,993,549 (29,385,081)
- -------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
resulting from
operations 41,169,659 (114,983,309) 30,068,612 (37,332,496)
- -------------------------------------------------------------------------------------
Dividends and
Distributions
Dividends from net
investment income -- -- (32,216) (3,747,694)
- -------------------------------------------------------------------------------------
Distributions from net
realized gains -- -- -- (2,566,849)
- -------------------------------------------------------------------------------------
Total distributions -- -- (32,216) (6,314,543)
- -------------------------------------------------------------------------------------
Portfolio share
transactions
Net proceeds from
shares sold 44,400,397 111,519,886 29,788,264 67,172,023
- -------------------------------------------------------------------------------------
Net asset value of
shares issued in
reinvestment of
dividends and
distributions -- -- 31,448 6,162,451
- -------------------------------------------------------------------------------------
Cost of shares
reacquired (41,656,736) (111,218,343) (34,340,117) (75,269,496)
- -------------------------------------------------------------------------------------
Net increase (decrease)
in net assets from
Portfolio share
transactions 2,743,661 301,543 (4,520,405) (1,935,022)
- -------------------------------------------------------------------------------------
Total increase
(decrease) 43,913,320 (114,681,766) 25,515,991 (45,582,061)
NET ASSETS
- -------------------------------------------------------------------------------------
Beginning of period 243,747,698 358,429,464 229,625,979 275,208,040
- -------------------------------------------------------------------------------------
End of period(a) $287,661,018 $243,747,698 $255,141,970 $229,625,979
- -------------------------------------------------------------------------------------
(a) Includes
undistributed net
investment income of -- -- $ 1,863,731 $ 31,057
- -------------------------------------------------------------------------------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 63
<Page>
Statements of Changes in Net Assets (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
SMALL CAPITALIZATION SMALL CAPITALIZATION
GROWTH PORTFOLIO VALUE PORTFOLIO
----------------------------- -----------------------------
Six Months Year Six Months Year
Ended Ended Ended Ended
June 30, December 31, June 30, December 31,
2003 2002 2003 2002
- ------------------------------------------------------------------------------------------------------
INCREASE (DECREASE)
IN NET ASSETS
- -------------------------------------------------------------------------------------
Operations
Net investment income (loss) $ (449,700) $ (904,314) $ 90,953 $ 393,004
- -------------------------------------------------------------------------------------
Net realized gain (loss) on
investment and foreign
currency transactions (17,335,795) (34,839,123) (4,925,645) 17,971,053
- -------------------------------------------------------------------------------------
Net change in unrealized
appreciation
(depreciation) of
investments 32,080,697 (14,331,239) 24,782,237 (34,165,684)
- -------------------------------------------------------------------------------------
Net increase (decrease) in
net assets
resulting from operations 14,295,202 (50,074,676) 19,947,545 (15,801,627)
- -------------------------------------------------------------------------------------
Dividends and Distributions
Dividends from net investment
income -- -- -- (364,476)
- -------------------------------------------------------------------------------------
Distributions from net
realized gains -- -- -- (29,829,985)
- -------------------------------------------------------------------------------------
Total distributions -- -- -- (30,194,461)
- -------------------------------------------------------------------------------------
Portfolio share transactions
Net proceeds from shares sold 17,201,010 40,755,309 14,898,899 56,996,830
- -------------------------------------------------------------------------------------
Net asset value of shares
issued in reinvestment of
dividends and distributions -- -- -- 29,148,512
- -------------------------------------------------------------------------------------
Cost of shares reacquired (16,046,143) (35,366,709) (26,283,882) (69,306,479)
- -------------------------------------------------------------------------------------
Net increase (decrease) in
net assets from Portfolio
share transactions 1,154,867 5,388,600 (11,384,983) 16,838,863
- -------------------------------------------------------------------------------------
Total increase (decrease) 15,450,069 (44,686,076) 8,562,562 (29,157,225)
NET ASSETS
- -------------------------------------------------------------------------------------
Beginning of period 100,867,855 145,553,931 147,930,439 177,087,664
- -------------------------------------------------------------------------------------
End of period(a) $116,317,924 $100,867,855 $156,493,001 $147,930,439
- -------------------------------------------------------------------------------------
(a) Includes undistributed net
investment income of -- -- $ 90,953 --
- -------------------------------------------------------------------------------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
64 THE TARGET PORTFOLIO TRUST
<Page>
Statements of Changes in Net Assets (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
INTERNATIONAL INTERNATIONAL
EQUITY BOND
PORTFOLIO PORTFOLIO
----------------------------- -----------------------------
Six Months Year Six Months Year
Ended Ended Ended Ended
June 30, December 31, June 30, December 31,
2003 2002 2003 2002
- ------------------------------------------------------------------------------------------------------
INCREASE (DECREASE)
IN NET ASSETS
- -------------------------------------------------------------------------------------
Operations
Net investment income $ 1,950,126 $ 1,756,973 $ 336,161 $ 415,099
- -------------------------------------------------------------------------------------
Net realized gain (loss) on
investment and foreign
currency transactions (3,292,444) (20,325,523) 1,705,750 321,688
- -------------------------------------------------------------------------------------
Net change in unrealized
appreciation
(depreciation) of
investments 12,367,792 3,033,254 (287,144) 3,453,514
- -------------------------------------------------------------------------------------
Net increase (decrease) in
net assets
resulting from operations 11,025,474 (15,565,296) 1,754,767 4,190,301
- -------------------------------------------------------------------------------------
Dividends and Distributions
Dividends from net investment
income (865,536) (54,411) (350,062) (318,534)
- -------------------------------------------------------------------------------------
Portfolio share transactions
Net proceeds from shares sold 42,037,780 83,819,786 22,250,144 17,136,555
- -------------------------------------------------------------------------------------
Net asset value of shares
issued in reinvestment of
dividends and distributions 847,983 53,115 320,889 300,517
- -------------------------------------------------------------------------------------
Cost of shares reacquired (41,108,328) (86,168,186) (18,165,343) (12,298,060)
- -------------------------------------------------------------------------------------
Net increase (decrease) in
net assets from Portfolio
share transactions 1,777,435 (2,295,285) 4,405,690 5,139,012
- -------------------------------------------------------------------------------------
Total increase (decrease) 11,937,373 (17,914,992) 5,810,395 9,010,779
NET ASSETS
- -------------------------------------------------------------------------------------
Beginning of period 140,391,513 158,306,505 27,647,782 18,637,003
- -------------------------------------------------------------------------------------
End of period(a) $152,328,886 $140,391,513 $ 33,458,177 $ 27,647,782
- -------------------------------------------------------------------------------------
(a) Includes undistributed net
investment income of $ 1,916,985 $ 832,395 $ 149,402 $ 163,303
- -------------------------------------------------------------------------------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 65
<Page>
Statements of Changes in Net Assets (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
TOTAL RETURN INTERMEDIATE-TERM
BOND PORTFOLIO BOND PORTFOLIO
----------------------------- -----------------------------
Six Months Year Six Months Year
Ended Ended Ended Ended
June 30, December 31, June 30, December 31,
2003 2002 2003 2002
- ------------------------------------------------------------------------------------------------------
INCREASE (DECREASE)
IN NET ASSETS
- -------------------------------------------------------------------------------------
Operations
Net investment income $ 2,171,682 $ 4,776,954 $ 4,239,454 $ 9,236,024
- -------------------------------------------------------------------------------------
Net realized gain on
investment and foreign
currency transactions 5,470,193 3,631,105 11,104,193 9,388,877
- -------------------------------------------------------------------------------------
Net change in unrealized
appreciation
(depreciation) of
investments (15,519) 3,204,260 (191,684) 3,668,411
- -------------------------------------------------------------------------------------
Net increase in net assets
resulting from operations 7,626,356 11,612,319 15,151,963 22,293,312
- -------------------------------------------------------------------------------------
Dividends and Distributions
Dividends from net investment
income (2,266,991) (5,208,229) (4,732,487) (9,656,660)
- -------------------------------------------------------------------------------------
Distributions from net
realized gains (1,097,177) (2,779,487) (2,449,804) (5,735,921)
- -------------------------------------------------------------------------------------
Total distributions (3,364,168) (7,987,716) (7,182,291) (15,392,581)
- -------------------------------------------------------------------------------------
Portfolio share transactions
Net proceeds from shares sold 42,027,639 79,064,222 81,043,793 208,541,648
- -------------------------------------------------------------------------------------
Net asset value of shares
issued in reinvestment of
dividends and distributions 3,197,048 7,595,223 6,684,388 14,664,203
- -------------------------------------------------------------------------------------
Cost of shares reacquired (31,381,941) (56,881,456) (70,972,433) (92,270,589)
- -------------------------------------------------------------------------------------
Net increase in net assets
from Portfolio share
transactions 13,842,746 29,777,989 16,755,748 130,935,262
- -------------------------------------------------------------------------------------
Total increase (decrease) 18,104,934 33,402,592 24,725,420 137,835,993
NET ASSETS
- -------------------------------------------------------------------------------------
Beginning of period 139,488,374 106,085,782 333,069,173 195,233,180
- -------------------------------------------------------------------------------------
End of period(a) $157,593,308 $139,488,374 $357,794,593 $333,069,173
- -------------------------------------------------------------------------------------
(a) Includes undistributed net
investment income of $ -- $ 104,150 $ -- $ --
- -------------------------------------------------------------------------------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
66 THE TARGET PORTFOLIO TRUST
<Page>
Statements of Changes in Net Assets (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
U.S. GOVERNMENT
MORTGAGE BACKED MONEY
SECURITIES PORTFOLIO MARKET PORTFOLIO
----------------------------- -----------------------------
Six Months Year Six Months Year
Ended Ended Ended Ended
June 30, December 31, June 30, December 31,
2003 2002 2003 2002
- ------------------------------------------------------------------------------------------------------
INCREASE (DECREASE)
IN NET ASSETS
- -------------------------------------------------------------------------------------
Operations
Net investment income $ 2,621,312 $ 4,202,089 $ 495,510 $ 1,678,296
- -------------------------------------------------------------------------------------
Net realized gain (loss) on
investment and foreign
currency transactions (63,474) 1,127,459 3,059 (1,180)
- -------------------------------------------------------------------------------------
Net change in unrealized
appreciation
(depreciation) of
investments (902,003) 2,014,430 -- --
- -------------------------------------------------------------------------------------
Net increase in net assets
resulting from operations 1,655,835 7,343,978 498,569 1,677,116
- -------------------------------------------------------------------------------------
Dividends and Distributions
Dividends from net investment
income (2,621,312) (5,052,128) (498,569) (1,677,116)
- -------------------------------------------------------------------------------------
Portfolio share transactions(a)
Net proceeds from shares sold 30,648,981 72,556,734 118,363,694 574,524,433
- -------------------------------------------------------------------------------------
Net asset value of shares
issued in reinvestment of
dividends and distributions 2,402,452 4,443,190 466,449 1,417,564
- -------------------------------------------------------------------------------------
Cost of shares reacquired (28,628,305) (39,247,945) (146,062,177) (603,782,502)
- -------------------------------------------------------------------------------------
Net increase (decrease) in
net assets from Portfolio
share transactions 4,423,128 37,751,979 (27,232,034) (27,840,505)
- -------------------------------------------------------------------------------------
Total increase (decrease) 3,457,651 40,043,829 (27,232,034) (27,840,505)
NET ASSETS
- -------------------------------------------------------------------------------------
Beginning of period 115,545,706 75,501,877 127,141,378 154,981,883
- -------------------------------------------------------------------------------------
End of period(b) $119,003,357 $115,545,706 $ 99,909,344 $127,141,378
- -------------------------------------------------------------------------------------
(a) Fund share transactions are at $1 per share for the U.S. Government Money Market Portfolio.
(b) Includes undistributed net
investment income of $ 120,842 $ 120,842 -- --
- -------------------------------------------------------------------------------------
</Table>
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 67
<Page>
Financial Highlights (Unaudited)
- --------------------------------------------------------------------------------
<Table>
<Caption>
LARGE CAPITALIZATION
GROWTH PORTFOLIO
-------------------------------------------------------------------------------------------
Six Months
Ended Year Ended December 31,
June 30, ----------------------------------------------------------------------
2003 2002 2001 2000 1999 1998
- -----------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING
PERFORMANCE:
- -------------------------------------------------------------------------------------
Net asset value,
beginning of period $11.03 $16.15 $23.20 $25.68 $18.29 $13.58
- -------------------------------------------------------------------------------------
Income from investment
operations
Net investment income
(loss) (.01) (.01) .02 (.06) (.03) (.01)
- -------------------------------------------------------------------------------------
Net realized and
unrealized gains
(losses) on investment
transactions 1.88 (5.11) (7.05) (.68) 9.79 6.00
- -------------------------------------------------------------------------------------
Total from
investment
operations 1.87 (5.12) (7.03) (.74) 9.76 5.99
- -------------------------------------------------------------------------------------
Less distributions
Dividends from net
investment income -- -- (.02) -- -- --
- -------------------------------------------------------------------------------------
Distributions from net
realized gains -- -- -- (1.74) (2.37) (1.28)
- -------------------------------------------------------------------------------------
Total
distributions -- -- (.02) (1.74) (2.37) (1.28)
- -------------------------------------------------------------------------------------
Net asset value, end of
period $12.90 $11.03 $16.15 $23.20 $25.68 $18.29
- -------------------------------------------------------------------------------------
TOTAL RETURN(a) 16.95% (31.70)% (30.32)% (3.37)% 55.37% 44.22%
- -------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
- -------------------------------------------------------------------------------------
Net assets, end of
period (000) $287,661 $243,748 $358,429 $512,778 $515,470 $329,803
- -------------------------------------------------------------------------------------
Average net assets (000) $261,185 $297,189 $397,492 $581,198 $385,995 $277,794
- -------------------------------------------------------------------------------------
Ratios to average net
assets
Expenses .88%(b) .81% .75% .69% .68% .68%
- -------------------------------------------------------------------------------------
Net investment income
(loss) (.13)%(b) (.11)% .08% (.25)% (.16)% (.05)%
- -------------------------------------------------------------------------------------
Portfolio turnover rate 26%(c) 66% 68% 48% 50% 54%
- -------------------------------------------------------------------------------------
</Table>
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than one
full year are not annualized.
(b) Annualized.
(c) Not annualized.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
68 THE TARGET PORTFOLIO TRUST
<Page>
Financial Highlights (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
LARGE CAPITALIZATION
VALUE PORTFOLIO
-------------------------------------------------------------------------------------------
Six Months
Ended Year Ended December 31,
June 30, ----------------------------------------------------------------------
2003 2002 2001 2000 1999 1998(b)
- -----------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING
PERFORMANCE:
- -------------------------------------------------------------------------------------
Net asset value, beginning of
period $10.49 $12.45 $12.64 $13.01 $15.87 $16.21
- -------------------------------------------------------------------------------------
Income from investment
operations
Net investment income (loss) .09 .18 .19 .25 .27 .28
- -------------------------------------------------------------------------------------
Net realized and unrealized
gains (losses) on investment
transactions 1.32 (1.85) (.03) .72 (1.00) 1.34
- -------------------------------------------------------------------------------------
Total from investment
operations 1.41 (1.67) .16 .97 (.73) 1.62
- -------------------------------------------------------------------------------------
Less distributions
Dividends from net investment
income --(e) (.17) (.19) (.25) (.29) (.27)
- -------------------------------------------------------------------------------------
Distributions from net
realized gains -- (.12) (.16) (1.09) (1.84) (1.69)
- -------------------------------------------------------------------------------------
Total distributions --(e) (.29) (.35) (1.34) (2.13) (1.96)
- -------------------------------------------------------------------------------------
Net asset value, end of period $11.90 $10.49 $12.45 $12.64 $13.01 $15.87
- -------------------------------------------------------------------------------------
TOTAL RETURN(a) 13.46% (13.57)% 1.21% 8.22% (4.37)% 10.25%
- -------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
- -------------------------------------------------------------------------------------
Net assets, end of period
(000) $255,142 $229,626 $275,208 $268,802 $262,156 $283,488
- -------------------------------------------------------------------------------------
Average net assets (000) $230,410 $253,096 $275,773 $243,008 $279,900 $282,078
- -------------------------------------------------------------------------------------
Ratios to average net assets
Expenses .85%(c) .80% .76% .80% .73% .71%
- -------------------------------------------------------------------------------------
Net investment income (loss) 1.63%(c) 1.49% 1.51% 2.01% 1.74% 1.65%
- -------------------------------------------------------------------------------------
Portfolio turnover rate 23%(d) 56% 50% 80% 36% 24%
- -------------------------------------------------------------------------------------
</Table>
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than one
full year are not annualized.
(b) Calculated based upon average shares outstanding during the year.
(c) Annualized.
(d) Not annualized.
(e) Less than $.005 per share.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 69
<Page>
Financial Highlights (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
SMALL CAPITALIZATION
GROWTH PORTFOLIO
-------------------------------------------------------------------------------------------
Six Months
Ended Year Ended December 31,
June 30, ----------------------------------------------------------------------
2003 2002 2001 2000 1999 1998(b)
- -----------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING
PERFORMANCE:
- -------------------------------------------------------------------------------------
Net asset value, beginning of
period $7.05 $10.56 $13.09 $17.47 $15.35 $15.57
- -------------------------------------------------------------------------------------
Income from investment
operations
Net investment loss (.03) (.06) (.07) (.07) (.06) (.05)
- -------------------------------------------------------------------------------------
Net realized and unrealized
gains (losses) on investment
transactions 1.01 (3.45) (2.46) (.36) 4.35 .48
- -------------------------------------------------------------------------------------
Total from investment
operations .98 (3.51) (2.53) .29 4.29 .43
- -------------------------------------------------------------------------------------
Less distributions
Distributions from net
realized gains -- -- -- (4.67) (2.17) (.65)
- -------------------------------------------------------------------------------------
Total distributions -- -- -- (4.67) (2.17) (.65)
- -------------------------------------------------------------------------------------
Net asset value, end of period $8.03 $7.05 $10.56 $13.09 $17.47 $15.35
- -------------------------------------------------------------------------------------
TOTAL RETURN(a) 13.90% (33.24)% (19.33)% 1.83% 29.20% 2.55%
- -------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
- -------------------------------------------------------------------------------------
Net assets, end of period
(000) $116,318 $100,868 $145,554 $182,515 $186,603 $158,982
- -------------------------------------------------------------------------------------
Average net assets (000) $103,411 $122,299 $156,654 $197,168 $150,593 $162,654
- -------------------------------------------------------------------------------------
Ratios to average net assets
Expenses 1.12%(c) .99% .88% .79% .80% .77%
- -------------------------------------------------------------------------------------
Net investment loss (.88)%(c) (.74)% (.59)% (.49)% (.45)% (.35)%
- -------------------------------------------------------------------------------------
Portfolio turnover rate 87%(d) 153% 167% 165% 207% 69%
- -------------------------------------------------------------------------------------
</Table>
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than a
full year are not annualized.
(b) Calculated based upon average shares outstanding during the year.
(c) Annualized.
(d) Not annualized.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
70 THE TARGET PORTFOLIO TRUST
<Page>
Financial Highlights (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
SMALL CAPITALIZATION
VALUE PORTFOLIO
-------------------------------------------------------------------------------------------
Six Months
Ended Year Ended December 31,
June 30, ----------------------------------------------------------------------
2003 2002 2001 2000 1999 1998(b)
- -----------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING
PERFORMANCE:
- -------------------------------------------------------------------------------------
Net asset value, beginning of
period $13.23 $17.54 $16.88 $14.97 $14.98 $17.50
- -------------------------------------------------------------------------------------
Income from investment
operations
Net investment income .01 .04 .09 .11 .11 .08
- -------------------------------------------------------------------------------------
Net realized and unrealized
gains (losses) on investment
transactions 1.91 (1.41) 2.67 3.34 .10 (1.27)
- -------------------------------------------------------------------------------------
Total from investment
operations 1.92 (1.37) 2.76 3.45 .21 (1.19)
- -------------------------------------------------------------------------------------
Less distributions
Dividends from net investment
income -- (.04) (.19) (.02) (.12) (.07)
- -------------------------------------------------------------------------------------
Distributions from net
realized gains -- (2.90) (1.91) (1.52) (.10) (1.26)
- -------------------------------------------------------------------------------------
Total distributions $ -- (2.94) (2.10) (1.54) (.22) (1.33)
- -------------------------------------------------------------------------------------
Net asset value, end of period $15.15 $13.23 $17.54 $16.88 $14.97 $14.98
- -------------------------------------------------------------------------------------
TOTAL RETURN(a) 14.51% (8.48)% 17.23% 23.91% 1.39% (6.62)%
- -------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
- -------------------------------------------------------------------------------------
Net assets, end of period
(000) $156,493 $147,930 $177,088 $152,672 $127,010 $141,557
- -------------------------------------------------------------------------------------
Average net assets (000) $143,969 $167,945 $161,663 $130,303 $129,077 $153,756
- -------------------------------------------------------------------------------------
Ratios to average net assets
Expenses .98%(c) .88% .87% .85% .87% .79%
- -------------------------------------------------------------------------------------
Net investment income .13%(c) .23% .59% .75% .75% .48%
- -------------------------------------------------------------------------------------
Portfolio turnover rate 27%(d) 95% 114% 55% 42% 39%
- -------------------------------------------------------------------------------------
</Table>
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than one
full year are not annualized.
(b) Calculated based upon average shares outstanding during the year.
(c) Annualized.
(d) Not annualized.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 71
<Page>
Financial Highlights (Unaudited)
- --------------------------------------------------------------------------------
<Table>
<Caption>
INTERNATIONAL
EQUITY PORTFOLIO
-------------------------------------------------------------------------------------------
Six Months
Ended Year Ended December 31,
June 30, ----------------------------------------------------------------------
2003 2002 2001 2000 1999 1998
- -----------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING
PERFORMANCE:
- -------------------------------------------------------------------------------------
Net asset value,
beginning of period $9.07 $10.10 $13.52 $17.37 $15.54 $14.27
- -------------------------------------------------------------------------------------
Income from investment
operations
Net investment income
(loss) .13 .11 .09 .17 .23 .23
- -------------------------------------------------------------------------------------
Net realized and
unrealized gains
(losses) on investment
transactions .59 (1.14) (3.39) (1.87) 3.29 1.98
- -------------------------------------------------------------------------------------
Total from
investment
operations .72 (1.03) (3.30) (1.70) 3.52 2.21
- -------------------------------------------------------------------------------------
Less distributions
Dividends from net
investment income (.06) --(b) -- (.17) (.23) (.10)
- -------------------------------------------------------------------------------------
Distributions in excess
of net investment
income -- -- -- (.17) (.17) --
- -------------------------------------------------------------------------------------
Distributions from net
realized gains -- -- (.12) (1.81) (1.29) (.84)
- -------------------------------------------------------------------------------------
Total
distributions (.06) -- (.12) (2.15) (1.69) (.94)
- -------------------------------------------------------------------------------------
Net asset value, end of
period $9.73 $9.07 $10.10 $13.52 $17.37 $15.54
- -------------------------------------------------------------------------------------
TOTAL RETURN(a) 7.92% (10.17)% (24.56)% (9.42)% (23.30)% (15.49)%
- -------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
- -------------------------------------------------------------------------------------
Net assets, end of
period (000) $152,329 $140,392 $158,307 $227,028 $274,997 $244,291
- -------------------------------------------------------------------------------------
Average net assets (000) $140,009 $150,249 $190,106 $246,420 $246,148 $246,335
- -------------------------------------------------------------------------------------
Ratios to average net
assets
Expenses 1.15%(c) 1.09% 1.01% .93% .93% .91%
- -------------------------------------------------------------------------------------
Net investment income 2.81%(c) 1.17% .82% .85% 1.25% 1.42%
- -------------------------------------------------------------------------------------
Portfolio turnover rate 22%(d) 55% 65% 44% 35% 45%
- -------------------------------------------------------------------------------------
</Table>
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than one
year are not annualized.
(b) Less than $.005 per share.
(c) Annualized.
(d) Not annualized.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
72 THE TARGET PORTFOLIO TRUST
<Page>
Financial Highlights (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
INTERNATIONAL
BOND PORTFOLIO
-------------------------------------------------------------------------------------------
Six Months
Ended Year Ended December 31,
June 30, ----------------------------------------------------------------------
2003 2002 2001 2000 1999 1998
- -----------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING
PERFORMANCE:
- -------------------------------------------------------------------------------------
Net asset value, beginning of
period $8.83 $7.46 $8.08 $8.48 $9.52 $9.17
- -------------------------------------------------------------------------------------
Income from investment
operations
Net investment income .09 .15 .18 .32 .30 .31
- -------------------------------------------------------------------------------------
Net realized and unrealized
gains (losses) on investment
transactions .45 1.33 (.64) (.45) (.84) .45
- -------------------------------------------------------------------------------------
Total from investment
operations .54 1.48 (.46) (.13) (.54) .76
- -------------------------------------------------------------------------------------
Dividends and distributions
Dividends from net investment
income (.10) (.11) -- -- (.23) (.31)
- -------------------------------------------------------------------------------------
Distributions in excess of net
investment income -- -- -- -- -- (.06)
- -------------------------------------------------------------------------------------
Distributions from net
realized gains -- -- -- -- (.16) (.04)
- -------------------------------------------------------------------------------------
Tax return of capital
distributions -- -- (.16) (.27) (.11) --
- -------------------------------------------------------------------------------------
Total dividends and
distributions (.10) (.11) (.16) (.27) (.50) (.41)
- -------------------------------------------------------------------------------------
Net asset value, end of period $9.27 $8.83 $7.46 $8.08 $8.48 $9.52
- -------------------------------------------------------------------------------------
TOTAL RETURN(a) 5.99% 20.14% (5.73)% (1.34)% (5.88)% 8.55%
- -------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
- -------------------------------------------------------------------------------------
Net assets, end of period
(000) $33,458 $27,648 $18,637 $19,548 $26,492 $31,042
- -------------------------------------------------------------------------------------
Average net assets (000) $30,638 $22,022 $19,235 $20,809 $29,300 $30,720
- -------------------------------------------------------------------------------------
Ratios to average net assets
Expenses 1.43%(b) 1.69% 1.83% 1.47% 1.25% 1.54%
- -------------------------------------------------------------------------------------
Net investment income 2.21%(b) 1.88% 2.31% 4.16% 3.36% 3.38%
- -------------------------------------------------------------------------------------
Portfolio turnover rate 82%(c) 238% 251% 52% 132% 110%
- -------------------------------------------------------------------------------------
</Table>
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than a
full year are not annualized.
(b) Annualized.
(c) Not annualized.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 73
<Page>
Financial Highlights (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
TOTAL RETURN
BOND PORTFOLIO
-------------------------------------------------------------------------------------------
Six Months
Ended Year Ended December 31,
June 30, ----------------------------------------------------------------------
2003 2002 2001 2000 1999 1998
- -----------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING
PERFORMANCE:
- -------------------------------------------------------------------------------------
Net asset value, beginning of
period $10.73 $10.42 $10.27 $9.86 $10.49 $10.56
- -------------------------------------------------------------------------------------
Income from investment
operations
Net investment income .15 .41 .52 .66 .56 .58
- -------------------------------------------------------------------------------------
Net realized and unrealized
gains (losses) on investment
transactions .40 .57 .28 .42 (.63) .27
- -------------------------------------------------------------------------------------
Total from investment
operations .55 .98 .80 1.08 (.07) .85
- -------------------------------------------------------------------------------------
Less distributions
Dividends from net investment
income (.17) (.45) (.54) (.67) (.56) (.58)
- -------------------------------------------------------------------------------------
Distributions from net
realized gains (.08) (.22) (.11) -- -- (.34)
- -------------------------------------------------------------------------------------
Total distributions (.25) (.67) (.65) (.67) (.56) (.92)
- -------------------------------------------------------------------------------------
Net asset value, end of period $11.03 $10.73 $10.42 $10.27 $9.86 $10.49
- -------------------------------------------------------------------------------------
TOTAL RETURN(a) 5.05% 9.65% 7.97% 11.30% (.67)% 8.28%
- -------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
- -------------------------------------------------------------------------------------
Net assets, end of period
(000) $157,593 $139,488 $106,086 $74,003 $67,269 $67,078
- -------------------------------------------------------------------------------------
Average net assets (000) $150,743 $122,888 $90,698 $67,151 $65,911 $61,786
- -------------------------------------------------------------------------------------
Ratios to average net assets
Expenses .74%(b) .75% .78% .79% .82% .81%
- -------------------------------------------------------------------------------------
Net investment income 2.91%(b) 3.89% 4.83% 6.23% 5.54% 5.54%
- -------------------------------------------------------------------------------------
Portfolio turnover rate 239%(c) 429% 472% 483% 368% 327%
- -------------------------------------------------------------------------------------
</Table>
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than a
full year are not annualized.
(b) Annualized.
(c) Not annualized.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
74 THE TARGET PORTFOLIO TRUST
<Page>
Financial Highlights (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
INTERMEDIATE-TERM
BOND PORTFOLIO
-------------------------------------------------------------------------------------------
Six Months
Ended Year Ended December 31,
June 30, ----------------------------------------------------------------------
2003 2002 2001 2000 1999 1998
- -----------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING
PERFORMANCE:
- -------------------------------------------------------------------------------------
Net asset value, beginning of
period $10.50 $10.23 $10.23 $9.92 $10.36 $10.42
- -------------------------------------------------------------------------------------
Income from investment
operations
Net investment income .13 .38 .52 .63 .56 .63
- -------------------------------------------------------------------------------------
Net realized and unrealized
gains (losses) on investment
transactions .32 .47 .29 .34 (.43) .09
- -------------------------------------------------------------------------------------
Total from investment
operations .45 .85 .81 .97 .13 .72
- -------------------------------------------------------------------------------------
Less distributions
Dividends from net investment
income (.14) (.39) (.54) (.63) (.57) (.61)
- -------------------------------------------------------------------------------------
Distributions in excess of net
investment income -- -- -- (.03) -- --
- -------------------------------------------------------------------------------------
Distributions from net
realized gains (.07) (.19) (.27) -- -- (.17)
- -------------------------------------------------------------------------------------
Total distributions (.21) (.58) (.81) (.66) (.57) (.78)
- -------------------------------------------------------------------------------------
Net asset value, end of period $10.74 $10.50 $10.23 $10.23 $9.92 $10.36
- -------------------------------------------------------------------------------------
TOTAL RETURN(a) 4.34% 8.56% 8.19% 10.10% 1.30% 7.09%
- -------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
- -------------------------------------------------------------------------------------
Net assets, end of period
(000) $357,795 $333,069 $195,233 $130,715 $112,991 $105,283
- -------------------------------------------------------------------------------------
Average net assets (000) $349,648 $258,072 $167,039 $116,330 $108,243 $101,219
- -------------------------------------------------------------------------------------
Ratios to average net assets
Expenses .65%(b) .66% .66% .71% .67% .66%
- -------------------------------------------------------------------------------------
Net investment income 2.45%(b) 3.58% 4.91% 6.35% 5.63% 5.71%
- -------------------------------------------------------------------------------------
Portfolio turnover rate 222%(c) 377% 560% 423% 253% 249%
- -------------------------------------------------------------------------------------
</Table>
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than one
full year are not annualized.
(b) Annualized.
(c) Not annualized.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 75
<Page>
Financial Highlights (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
MORTGAGE BACKED
SECURITIES PORTFOLIO
-------------------------------------------------------------------------------------------
Six Months
Ended Year Ended December 31,
June 30, ----------------------------------------------------------------------
2003 2002 2001 2000 1999 1998
- -----------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING
PERFORMANCE:
- -------------------------------------------------------------------------------------
Net asset value, beginning of
period $10.70 $10.44 $10.31 $9.97 $10.47 $10.45
- -------------------------------------------------------------------------------------
Income from investment
operations
Net investment income .24 .56 .61 .65 .66 .64
- -------------------------------------------------------------------------------------
Net realized and unrealized
gains (losses) on investment
transactions (.10) .27 .17 .33 (.50) .01
- -------------------------------------------------------------------------------------
Total from investment
operations .14 .83 .78 .98 .16 .65
- -------------------------------------------------------------------------------------
Less distributions
Dividends from net investment
income (.24) (.57) (.65) (.64) (.66) (.63)
- -------------------------------------------------------------------------------------
Total distributions (.24) (.57) (.65) (.64) (.66) (.63)
- -------------------------------------------------------------------------------------
Net asset value, end of period $10.60 $10.70 $10.44 $10.31 $9.97 $10.47
- -------------------------------------------------------------------------------------
TOTAL RETURN(a) 1.44% 8.13% 7.79% 10.35% 1.54% 6.37%
- -------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
- -------------------------------------------------------------------------------------
Net assets, end of period
(000) $119,003 $115,546 $75,502 $63,234 $67,372 $72,870
- -------------------------------------------------------------------------------------
Average net assets (000) $117,620 $94,893 $69,767 $61,771 $70,244 $73,737
- -------------------------------------------------------------------------------------
Ratios to average net assets
Expenses .78%(b) .80% .84% .83% .80% .70%
- -------------------------------------------------------------------------------------
Net investment income 4.49%(b) 4.43% 5.74% 6.60% 6.31% 6.14%
- -------------------------------------------------------------------------------------
Portfolio turnover rate 183%(c) 184% 72% 74% 14% 24%
- -------------------------------------------------------------------------------------
</Table>
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than one
full year are not annualized.
(b) Annualized.
(c) Not annualized.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
76 THE TARGET PORTFOLIO TRUST
<Page>
Financial Highlights (Unaudited) (cont'd)
- --------------------------------------------------------------------------------
<Table>
<Caption>
U.S. GOVERNMENT
MONEY MARKET PORTFOLIO
-------------------------------------------------------------------------------------------
Six Months
Ended Year Ended December 31,
June 30, ----------------------------------------------------------------------
2003 2002 2001 2000 1999 1998
- -----------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING
PERFORMANCE:
- -------------------------------------------------------------------------------------
Net asset value, beginning of
period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- -------------------------------------------------------------------------------------
Net investment income and
realized gain on investment
transactions .004 .013 .037 .058 .045 .048
- -------------------------------------------------------------------------------------
Dividends and distributions (.004) (.013) (.037) (.058) (.045) (.048)
- -------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- -------------------------------------------------------------------------------------
TOTAL RETURN(a) 0.40% 1.31% 3.77% 5.87% 4.67% 4.88%
- -------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA:
- -------------------------------------------------------------------------------------
Net assets, end of period
(000) $99,909 $127,141 $154,982 $122,226 $85,722 $138,848
- -------------------------------------------------------------------------------------
Average net assets (000) $120,829 $128,550 $132,704 $93,985 $196,853 $106,500
- -------------------------------------------------------------------------------------
Ratios to average net assets
Expenses .49%(b) .45% .51% .56% .43% .55%
- -------------------------------------------------------------------------------------
Net investment income .83%(b) 1.31% 3.52% 5.76% 4.64% 4.85%
- -------------------------------------------------------------------------------------
</Table>
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes reinvestment
of dividends and distributions. Total returns for periods of less than one
full year are not annualized.
(b) Annualized.
See Notes to Financial Statements beginning on page 78
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 77
<Page>
Notes to Financial Statements (Unaudited)
- --------------------------------------------------------------------------------
The Target Portfolio Trust (the 'Fund') is an open-end management investment
company. The Fund was established as a Delaware business trust on July 29, 1992
and consists of ten separate portfolios (the 'Portfolio' or 'Portfolios'). All
the Portfolios are diversified, as defined under the Investment Company Act of
1940, except for the International Bond Portfolio. Investment operations
commenced on January 5, 1993, with the exception of the International Bond
Portfolio, which commenced on May 17, 1994.
The Portfolios and their investment objectives are as follows:
- - Large Capitalization Growth Portfolio -- long-term capital appreciation
through investment primarily in stocks of large corporations that, in the
investment adviser's opinion, should have earnings growth faster than that of
the S&P 500;
- - Large Capitalization Value Portfolio -- total return consisting of capital
appreciation and dividend income through investment primarily in stocks of
large corporations that, in the adviser's opinion, are undervalued;
- - Small Capitalization Growth Portfolio -- maximum capital appreciation through
investment primarily in small company common stocks that, in the investment
adviser's opinion, should have earnings growth faster than that of the U.S.
economy in general;
- - Small Capitalization Value Portfolio -- above average capital appreciation
through investment in small company common stocks that, in the adviser's
opinion, are undervalued or overlooked in the marketplace;
- - International Equity Portfolio -- capital appreciation through investment
primarily in stocks of companies domiciled outside the United States;
- - International Bond Portfolio -- high total return through investment primarily
in high-quality, foreign debt securities;
- - Total Return Bond Portfolio -- total return of current income and capital
appreciation through investment primarily in fixed-income securities of
varying maturities with a dollar-weighted average portfolio maturity of more
than four years but not more than fifteen years;
- - Intermediate-Term Bond Portfolio -- current income and reasonable stability of
principal through investment primarily in high quality fixed-income securities
of varying maturities with a dollar-weighted average portfolio maturity of
more than three years but not more than ten years;
- - Mortgage Backed Securities Portfolio -- high current income primarily and
capital appreciation secondarily each consistent with the protection of
capital through investment primarily in mortgage-related securities;
- - U.S. Government Money Market Portfolio -- maximum current income consistent
with maintenance of liquidity and preservation of capital through investment
exclusively in short-term securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.
The ability of issuers of debt securities (other than those issued or
guaranteed by the U.S. Government) held by the Portfolios to meet their
obligations may be affected by economic or political developments in a specific
industry, region or country.
- --------------------------------------------------------------------------------
78 THE TARGET PORTFOLIO TRUST
<Page>
- --------------------------------------------------------------------------------
Note 1. Accounting Policies
The following is a summary of significant accounting policies followed by the
Fund and the Portfolios in the preparation of its financial statements.
Securities Valuations: Securities listed on a securities exchange are valued
at the last sale price on such exchange on the day of valuation or, if there was
no sale on such day, at the mean between the last reported bid and ask prices,
or at the last bid price on such day in the absence of an asked price.
Securities traded via Nasdaq are valued at the official closing price provided
by Nasdaq. Securities that are actively traded in the over-the-counter market,
including listed securities for which the primary market is believed by
Prudential Investments LLC ('PI' or 'Manager'), in consultation with the
subadviser(s); to be over-the-counter, are valued by an independent pricing
agent or principal market maker. Options on securities and indices traded on an
exchange are valued at the mean between the most recently quoted bid and asked
prices on such exchange. Futures contracts and options thereon traded on a
commodities exchange or board of trade are valued at the last sale price at the
close of trading on such exchange or board of trade or, if there was no sale on
the applicable commodities exchange or board of trade on such day, at the mean
between the most recently quoted bid and asked prices on such exchange or board
of trade or at the last bid price in the absence of an asked price. Any security
for which a reliable market quotation is unavailable is valued at fair value by
a Valuation Committee appointed by the Fund's Board of Trustees.
Investments in mutual funds are valued at their net asset value as of the
close of the New York Stock Exchange on the date of the valuation.
U.S. Government securities for which market quotations are available are
valued at a price provided by an independent pricing agent or primary dealer (a
dealer that trades in U.S. Government securities with the Federal Reserve
System).
Securities held by the U.S. Government Money Market Portfolio are valued at
amortized cost, which approximates market value.
Short-term securities held by the other portfolios which mature in 60 days or
less are valued at amortized cost, which approximates market value. Short-term
securities held by the other portfolios which mature in more than 60 days are
valued at current market quotations.
Repurchase Agreements: In connection with transactions in repurchase
agreements with United States financial institutions, it is the Fund's policy
that its custodian or designated subcustodians under triparty repurchase
agreements, as the case may be, take possession of the underlying collateral
securities, the value of which exceeds the principal amount of the repurchase
transaction, including accrued interest. To the extent that any repurchase
transaction exceeds one business day, the value of the collateral is
marked-to-market on a daily basis to ensure the adequacy of the collateral. If
the seller defaults, and the value of the collateral declines or, if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited.
Financial Futures Contracts: A financial futures contract is an agreement to
purchase (long) or sell (short) an agreed amount of securities at a set price
for delivery on a future date. Upon entering into a financial futures contract,
the Portfolio is required to pledge to the broker an amount of cash and/or other
assets equal to a certain percentage of the contract amount. This amount is
known as the 'initial margin.' Subsequent payments, known as 'variation margin,'
are made or received by the Portfolio each day, depending on the daily
fluctuations in the value of the underlying security. Such variation margin is
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 79
<Page>
recorded for financial statement purposes on a daily basis as unrealized gain or
loss. When the contract expires or is closed, the gain or loss is realized and
is presented in the Statements of Operations as net realized gain or loss on
financial futures contracts.
The Portfolio invests in financial futures contracts in order to hedge its
existing portfolio securities, or securities the Portfolio intends to purchase,
against fluctuations in value caused by changes in prevailing interest rates or
market conditions. Should interest rates move unexpectedly, the Portfolio may
not achieve the anticipated benefits of the financial futures contracts and may
realize a loss. The use of futures transactions involves the risk of imperfect
correlation in movements in the price of futures contracts, interest rates and
the underlying hedged assets. The International Equity Portfolio, International
Bond Portfolio, Intermediate-Term Bond Portfolio, Mortgage-Backed Securities
Portfolio and Total Return Bond Portfolio are the only portfolios that may
invest in financial futures contracts.
Foreign Currency Translation: The books and records of the Portfolios are
maintained in U.S. dollars. Foreign currency amounts are translated into U.S.
dollars on the following basis:
(i) market value of investment securities, other assets and liabilities--at
the current rates of exchange;
(ii) purchases and sales of investment securities, income and expenses--at
the rates of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Portfolios are presented at the foreign
exchange rates and market values at the close of the fiscal period, the
Portfolios do not isolate that portion of the results of operations arising as a
result of changes in the foreign exchange rates from the fluctuations arising
from changes in the market prices of long-term securities held at the end of the
fiscal period. Similarly, the Portfolios do not isolate the effect of changes in
foreign exchange rates from the fluctuations arising from changes in the market
prices of long-term portfolio securities sold during the fiscal period.
Accordingly, realized foreign currency gains or losses are included in the
reported net realized gains or losses on investment transactions.
Net realized gains or losses on foreign currency transactions represent net
foreign exchange gains or losses from the holding of foreign currencies,
currency gains or losses realized between the trade date and settlement date on
securities transactions, and the difference between the amounts of dividends,
interest and foreign withholding taxes recorded on the Portfolios' books and the
U.S. dollar equivalent amounts actually received or paid. Net unrealized
currency gains or losses from valuing foreign currency denominated assets and
liabilities (other than investments) at period end exchange rates are reflected
as a component of net unrealized appreciation (depreciation) on investments and
foreign currencies.
Foreign security and currency transactions may involve certain considerations
and risks not typically associated with those of domestic origin as a result of,
among other factors, the possibility of political and economic instability or
the level of governmental supervision and regulation of foreign securities
markets.
Foreign Currency Forward Contracts: A foreign currency forward contract is a
commitment to purchase or sell a foreign currency at a future date at a
negotiated forward rate. The Portfolio enters into foreign currency forward
contracts in order to hedge its exposure to changes in foreign currency exchange
rates on its foreign portfolio holdings or on specific receivables and payables
denominated in a foreign currency. The contracts are valued daily at current
forward exchange rates and any unrealized gain or loss is included in net
unrealized appreciation or depreciation on foreign currency transactions. Gain
or loss is realized on the settlement date of the contract equal to the
difference between the settlement value of the original and renegotiated forward
contracts. This gain or loss, if any, is included in net realized gain or loss
on foreign currency transactions. Risks may arise upon entering into these
contracts from the potential
- --------------------------------------------------------------------------------
80 THE TARGET PORTFOLIO TRUST
<Page>
inability of the counterparties to meet the terms of their contracts. The
International Equity Portfolio, International Bond Portfolio, Intermediate-Term
Bond Portfolio and Total Return Bond Portfolio may enter into foreign currency
forward contracts in order to hedge their exposure to changes in foreign
currency exchange rates on their foreign portfolio holdings.
Options: Certain Portfolios may either purchase or write options in order to
hedge against adverse market movements or fluctuations in value caused by
changes in prevailing interest rates with respect to securities which a
Portfolio currently owns or intends to purchase. A Portfolio's principal reason
for writing options is to realize, through receipt of premiums, a greater
current return than would be realized on the underlying security alone. When a
Portfolio purchases an option, it pays a premium and an amount equal to that
premium is recorded as an asset. When a Portfolio writes an option, it receives
a premium and an amount equal to that premium is recorded as a liability. The
asset or liability is adjusted daily to reflect the current market value of the
option.
If an option expires unexercised, the Portfolio realizes a gain or loss to
the extent of the premium received or paid. If an option is exercised, the
premium received or paid is recorded as an adjustment to the proceeds from the
sale or the cost of the purchase in determining whether the Portfolio has
realized a gain or loss. The difference between the premium and the amount
received or paid on effecting a closing purchase or sale transaction is also
treated as a realized gain or loss. Gain or loss on purchased options is
included in net realized gain or loss on investment transactions. Gain or loss
on written options is presented separately as net realized gain or loss on
options written.
The Portfolio, as writer of an option, may have no control over whether the
underlying securities may be sold (called) or purchased (put). As a result, the
Portfolio bears the market risk of an unfavorable change in the price of the
security underlying the written option. The Portfolio, as purchaser of an
option, bears the risk of the potential inability of the counterparties to meet
the terms of their contracts. The International Equity Portfolio, the
International Bond Portfolio, the Intermediate-Term Bond Portfolio, the Total
Return Bond Portfolio and the Mortgage-Backed Securities Portfolio may either
purchase or write options.
Short Sales: Certain Portfolios of the Fund may make short sales of
securities as a method of hedging potential price declines in similar securities
owned. When a Portfolio makes a short sale, it will borrow the security sold
short and deliver it to the broker-dealer through which it made the short sale
as collateral for its obligation to deliver the security upon conclusion of the
sale. The Portfolio may have to pay a fee to borrow the particular securities
and may be obligated to return any interest or dividends received on such
borrowed securities. A gain, limited to the price at which the Portfolio sold
the security short, or a loss, unlimited as to dollar amount, will be recognized
upon the termination of a short sale if the market price is less or greater than
the proceeds originally received, respectively. The Total Return Bond Portfolio,
Intermediate-Term Bond Portfolio and Mortgage Backed Securities Portfolio may
enter into short sales.
Interest Rate Swaps: An interest rate swap agreement is an agreement between
two parties to exchange a series of cash flows at specified intervals. Based on
a notional amount, one party pays a fixed interest rate and one party pays a
floating interest rate. Net interest payments/receipts are included in interest
income in the Statements of Operations. The swaps are valued daily at current
market value and any unrealized gain or loss is included in the net unrealized
appreciation or depreciation on investments. Gain or loss is realized on the
termination date of the swap and is equal to the difference between the
Portfolio's basis in the swap and the proceeds of the closing transactions,
including fees. During the period that the swap agreement is open, the Portfolio
may be subject to risk from the potential inability of
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 81
<Page>
the counterparty to meet the terms of the agreement. The Total Return Bond
Portfolio, International Bond Portfolio, Mortgage Backed Securities Portfolio
and the Intermediate Term Bond Portfolio may enter into interest rate swaps.
Forward spread lock swap agreements involve commitments to pay or receive a
settlement amount calculated as the difference between the swap spread and a
fixed spread, multiplied by the notional amount times the duration of the swap.
The swap spread is the difference between the benchmark swap rate (market rate)
and the specific Treasury rate.
The use of derivative transactions may involve elements of both market and
credit risk in excess of the amounts reported in the Statements of Assets and
Liabilities.
When-Issued/Delayed Delivery Securities: Securities purchased or sold on a
when-issued or delayed-delivery basis may be settled a month or more after trade
date; interest income is not accrued until settlement date. At the time a
Portfolio enters into such transactions, it instructs the custodian to segregate
assets with a current value at least equal to the amount of its when-issued or
delayed-delivery purchase commitments.
Securities Transactions and Net Investment Income: Securities transactions
are recorded on the trade date. Realized gains (or losses) on sales of
securities are calculated on the identified cost basis. Dividend income is
recorded on the ex-dividend date. Interest income, including amortization of
premium and accretion of discount on debt securities, as required is recorded on
the accrual basis. Expenses are recorded on the accrual basis which may require
the use of certain estimates by management.
Dividends and Distributions: The Total Return Bond Portfolio,
Intermediate-Term Bond Portfolio and Mortgage Backed Securities Portfolio
declare dividends of their net investment income daily and pay such dividends
monthly. The U.S. Government Money Market Portfolio declares net investment
income and any net capital gain (or loss) daily and pays such dividends monthly.
Each other Portfolio declares and pays a dividend of its net investment income,
if any, at least annually. The International Bond Portfolio changed its dividend
policy from declaring daily to annually. Each Portfolio except for the U.S.
Government Money Market Portfolio declares and pays its net realized capital
gains, if any, at least annually. Dividends and distributions to shareholders,
which are determined in accordance with federal income tax regulations and which
may differ from generally accepted accounting principles. Permanent book/tax
differences relating to income and gains are reclassified to paid-in capital
when they arise.
Taxes: For federal income tax purposes, each Portfolio in the Fund is treated
as a separate tax-paying entity. It is each Portfolio's policy to continue to
meet the requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its taxable net income and capital
gains, if any, to its shareholders. Therefore, no federal income tax provision
is required.
Withholding taxes on foreign interest and dividends have been provided for in
accordance with the Portfolios' understanding of the applicable country's tax
rules and rates.
- --------------------------------------------------------------------------------
Note 2. Agreements
The Fund's manager is PI. PI manages the investment operations of the Fund,
administers the Fund's affairs and is responsible for the selection, subject to
review and approval of the Trustees, of the advisers. PI supervises the
advisers' performance of advisory services and makes recommendations to the
Trustees as to whether the advisers' contracts should be renewed, modified or
terminated. PI pays for the costs
- --------------------------------------------------------------------------------
82 THE TARGET PORTFOLIO TRUST
<Page>
pursuant to the advisory agreements, the cost of compensation of officers of the
Fund, occupancy and certain clerical and accounting costs of the Fund. The Fund
bears all other costs and expenses.
The advisers noted below each furnished investment advisory services in
connection with the management of the Portfolios. Each of the two advisers of
the domestic equity Portfolios--the Large Capitalization Growth Portfolio, Large
Capitalization Value Portfolio, Small Capitalization Growth Portfolio and Small
Capitalization Value Portfolio--manages approximately 50% of the assets of the
respective Portfolio. In general, in order to maintain an approximately equal
division of assets between the two advisers, all daily cash inflows (i.e.,
subscriptions and reinvested distributions) and outflows (i.e., redemptions and
expenses items) are divided between the two advisers as PI deems it appropriate.
In order to maintain an approximately equal allocation between the two
subadvisers, a periodic rebalancing of each subadviser's share of Portfolio
assets may occur to account for market fluctuations.
<Table>
<Caption>
Portfolio Adviser
- ------------------------- -------------------------------------------------------
Large Capitalization
Growth................. Oak Associates, Ltd. and Columbus Circle Investors
Large Capitalization
Value.................. J.P. Morgan Investment Management, Inc. and Hotchkis &
Wiley Capital Management Inc.
Small Capitalization
Growth(a).............. Sawgrass Asset Management, LLC (Sawgrass) and J.P.
Morgan Fleming Asset Management USA, Inc.
Small Capitalization
Value.................. National City Investment Company and EARNEST Partners,
LLC
International Equity..... Lazard Asset Management
International Bond....... Fischer, Francis, Trees & Watts, Inc.
Total Return Bond and
Intermediate-Term
Bond................... Pacific Investment Management Company
Mortgage Backed
Securities and U.S.
Government Money
Market................. Wellington Management Company, LLP
</Table>
- ------------------------------
(a) Effective as of the close of business on July 23, 2003, Westcap Investors,
LLC replaced Sawgrass as subadvisor for a portion of the Portfolio.
The management fee payable to PI is computed daily and paid monthly, at an
annual rate of the average daily net assets of the Portfolios specified below
and PI, in turn, pays each adviser a fee for its services.
Total
Portfolio Management Fee
- ----------------------------------------------------------- --------------
Large Capitalization Growth................................ 0.60%
Large Capitalization Value................................. 0.60%
Small Capitalization Growth................................ 0.60%
Small Capitalization Value................................. 0.60%
International Equity....................................... 0.70%
International Bond......................................... 0.50%
Total Return Bond.......................................... 0.45%
Intermediate-Term Bond..................................... 0.45%
Mortgage Backed Securities................................. 0.45%
U.S. Government Money Market............................... 0.25%
The Fund has a distribution agreement with Prudential Investment Management
Services LLC ('PIMS'). PIMS serves the Fund without compensation.
PI and PIMS are indirect, wholly-owned subsidiaries of Prudential Financial,
Inc. ('Prudential').
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 83
<Page>
The Fund (excluding the U.S. Government Money Market Portfolio), along with
other affiliated registered investment companies (the 'Funds'), entered into a
syndicate credit agreement ('SCA') with a group of banks. The SCA provides for a
commitment of $800 million and allows the Funds to increase the commitment to $1
billion, if necessary. Interest on any borrowings will be at market rates. The
Funds pay a commitment fee of .08 of 1% of the unused portion of the SCA. The
commitment fee is accrued and paid quarterly and is allocated to the Funds pro
rata based on net assets. The purpose of the SCA is to serve as an alternative
source of funding for capital share redemptions. The expiration date of the SCA
was May 2, 2003. On May 2, 2003, the SCA was renewed under the same terms and
conditions ('May 2003 renewal'). The expiration date of the May 2003 renewal is
April 30, 2004. The Fund did not borrow any amounts pursuant to the SCA during
the six months ended June 30, 2003.
- --------------------------------------------------------------------------------
Note 3. Other Transactions with Affiliates
Prudential Mutual Fund Services LLC ('PMFS'), an affiliate of PI and an
indirect, wholly-owned subsidiary of Prudential, serves as the Fund's transfer
agent. The following amounts represent the fees PMFS charged for the six months
ended June 30, 2003 as well as the fees due to PMFS as of June 30, 2003.
<Table>
<Caption>
Amount incurred for the
six months ended Amount due as of
Portfolio June 30, 2003 June 30, 2003
- ------------------------------------- ---------------------------------- ------------------
Large Capitalization Growth.......... $138,000 $ 23,000
Large Capitalization Value........... 95,900 15,900
Small Capitalization Growth.......... 92,300 15,400
Small Capitalization Value........... 98,700 16,400
International Equity................. 81,600 13,600
International Bond................... 28,200 5,000
Total Return Bond.................... 71,300 12,350
Intermediate-Term Bond............... 126,600 21,600
Mortgage Backed Securities........... 55,900 9,400
U.S. Government Money Market......... 49,700 8,100
</Table>
For the six months ended June 30, 2003, Prudential Securities Incorporated
('PSI'), earned approximately $5,900 in brokerage commissions on certain
portfolio transactions executed on behalf of the Large Capitalization Value
Portfolio.
Effective July 1, 2003, PSI became a division of Wachovia Securities LLC of
which Prudential holds a minority interest. Prior to July 1, 2003, PSI was an
indirect, wholly-owned subsidiary of Prudential.
The Fund pays networking fees to PSI. These networking fees are payments made
to PSI which clears mutual fund transactions through a national clearing system.
These amounts are included in transfer agent's fees and expenses in the
Statements of Operations. The Fund paid networking fees for the six months ended
June 30, 2003 as follows:
Total
Networking Fees Due to PSI as of
Portfolio Paid to PSI June 30, 2003
- ----------------------- --------------- ----------------
Large Capitalization Growth.......... $31,100 $6,200
Large Capitalization Value........... 26,000 4,300
Small Capitalization Growth.......... 25,000 4,200
- --------------------------------------------------------------------------------
84 THE TARGET PORTFOLIO TRUST
<Page>
Total
Networking Fees Due to PSI as of
Portfolio Paid to PSI June 30, 2003
- ----------------------- --------------- ----------------
Small Capitalization Value........... $24,400 $4,100
International Equity................. 22,000 3,700
International Bond................... 7,400 1,300
Total Return Bond.................... 18,100 3,100
Intermediate-Term Bond............... 34,100 5,800
Mortgage Backed Securities........... 15,000 2,500
U.S. Government Money Market......... 13,400 2,200
Certain Portfolios invest in the Taxable Money Market Series (the 'Series'),
a portfolio of Prudential Core Investment Fund, pursuant to an exemptive order
received from the Securities and Exchange Commission. The Series is a money
market mutual fund registered under the Investment Company Act of 1940, as
amended, and managed by PI. During the six months ended June 30, 2003, the
following Portfolios earned income from the Series by investing their excess
cash:
Excess Cash
Portfolio Investment
------------------------ ------------
Large Capitalization Growth................ $ 51,259
Large Capitalization Value................. 17,579
Small Capitalization Growth................ 25,359
Small Capitalization Value................. 18,851
International Bond......................... 16,456
- --------------------------------------------------------------------------------
Note 4. Portfolio Securities
Purchases and sales of portfolio securities, excluding short-term
investments, short sales and written options, for the six months ended June 30,
2003 were as follows:
Portfolio Purchases Sales
- --------- ------------ ------------
Large Capitalization Growth................... $ 68,423,920 $ 66,771,221
Large Capitalization Value.................... 52,558,308 55,413,917
Small Capitalization Growth................... 87,835,096 87,961,639
Small Capitalization Value.................... 38,483,068 45,704,021
International Equity.......................... 29,631,229 29,313,923
International Bond............................ 25,279,512 22,655,354
Total Return Bond............................. 336,427,454 309,661,108
Intermediate-Term Bond........................ 649,782,988 685,919,865
Mortgage Backed Securities.................... 213,148,101 210,663,140
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 85
<Page>
At June 30, 2003, the International Bond, Total Return Bond and the
Intermediate-Term Bond Portfolios had open financial futures contracts. The
unrealized appreciation (depreciation) on such contracts as of June 30, 2003
were as follows:
<Table>
<Caption>
International Bond Portfolio:
Unrealized
Number of Expiration Value at Value at Appreciation
Contracts Type Date June 30, 2003 Trade Date (Depreciation)
- ---------- ----------------------- ---------- ------------- ----------- ---------------
Short Position:
20 Euro-BOBL Sept. 2003 $ 2,603,094 $ 2,619,534 $ 16,440
Long Positions:
27 Euro-Schatz Sept. 2003 3,309,539 3,308,168 1,371
11 Euro-Bond Sept. 2003 1,475,787 1,477,004 (1,217)
---------------
$ 16,594
---------------
---------------
Total Return Bond Portfolio:
<Caption>
Unrealized
Number of Expiration Value at Value at Appreciation
Contracts Type Date June 30, 2003 Trade Date (Depreciation)
- ---------- ----------------------- ---------- ------------- ----------- ---------------
Long Positions:
10 Euro Bond Sept. 2003 $ 1,341,625 $ 1,359,250 $ (17,625)
14 90 Day Euro Dec. 2004 3,918,765 3,924,125 (5,360)
9 90 Day Euro Mar. 2004 1,792,916 1,789,611 3,305
25 90 Day Euro Mar. 2005 4,952,476 4,968,282 (15,806)
9 90 Day Euro Jun. 2004 1,790,688 1,786,318 4,370
1 90 Day Euro Sept. 2004 198,635 198,373 262
3 90 Day Euro Dec. 2004 594,978 596,886 (1,908)
2 90 Day Euro Jun. 2005 487,600 488,875 (1,275)
40 90 Day Euro Sept. 2004 9,833,500 9,775,000 58,500
396 10yr T-Note Sept. 2003 46,505,250 46,528,890 (23,640)
Short Position:
69 5yr T-Note Sept. 2003 7,943,625 8,006,695 63,070
---------------
$ 63,893
---------------
---------------
Intermediate-Term Bond Portfolio:
<Caption>
Unrealized
Number of Expiration Value at Value at Appreciation
Contracts Type Date June 30, 2003 Trade Date (Depreciation)
- ---------- ----------------------- ---------- ------------- ----------- ---------------
Long Positions:
406 10yr US T-Note Sept. 2003 $47,679,625 $48,041,219 $(361,594)
87 Eurodollar Mar. 2004 21,481,388 21,340,013 141,375
87 Eurodollar Jun. 2004 21,440,063 21,256,275 183,788
114 Euro Bond Sept. 2003 14,837,634 14,861,742 (24,108)
140 30yr US T-Note Sept. 2003 16,428,125 16,530,938 (102,813)
---------------
$(163,352)
---------------
---------------
</Table>
- --------------------------------------------------------------------------------
86 THE TARGET PORTFOLIO TRUST
<Page>
At June 30, 2003, the International Bond Portfolio had outstanding forward
currency contracts to sell and purchase foreign currencies, as follows:
<Table>
<Caption>
Unrealized
Value at Settlement Current Appreciation
Foreign Currency Purchase Contracts Date Payable Value (Depreciation)
- ----------------------------------------- ------------------- ----------- --------------
Australian Dollars,
expiring 8/19/03....................... $ 1,351,062 $ 1,394,892 $ 43,830
Canadian Dollars,
expiring 8/19/03....................... 2,310,000 2,408,568 98,568
Danish Krones,
expiring 8/19/03....................... 1,958,494 1,941,830 (16,664)
Euros,
expiring 8/19/03....................... 13,147,082 13,319,161 172,079
Japanese Yen,
expiring 8/19/03....................... 13,238,486 13,211,765 (26,721)
Pound Sterling,
expiring 8/19/03....................... 455,585 481,922 26,337
Swiss Francs,
expiring 8/19/03....................... 1,216,470 1,214,640 (1,830)
------------------- ----------- --------------
$33,677,179 $33,972,778 $ 295,599
------------------- ----------- --------------
------------------- ----------- --------------
</Table>
<Table>
<Caption>
Unrealized
Value at Settlement Current Appreciation
Foreign Currency Sale Contracts Date Receivable Value (Depreciation)
- ----------------------------------------- ------------------- ----------- --------------
Australian Dollars,
expiring 8/19/03....................... $ 600,489 $ 627,589 $ (27,100)
Australian Dollars for Japanese Yen,
expiring 8/19/03....................... 146,817 249,380 (102,563)
Canadian Dollars,
expiring 8/19/03....................... 4,935,781 5,237,978 (302,197)
Danish Krones,
expiring 8/19/03....................... 2,096,528 2,150,398 (53,870)
Euros,
expiring 8/19/03....................... 29,666,820 30,197,459 (530,639)
Euros for Japanese Yen,
expiring 8/19/03....................... 161,652 158,786 2,866
Japanese Yen,
expiring 8/19/03....................... 17,720,342 17,522,229 198,113
Pound Sterling,
expiring 8/19/03....................... 3,709,613 3,739,203 (29,590)
Swedish Krona,
expiring 8/19/03....................... 1,920,177 1,881,404 38,773
Swiss Francs,
expiring 8/19/03....................... 1,233,265 1,189,435 43,830
------------------- ----------- --------------
$62,191,484 $62,953,861 $ (762,377)
------------------- ----------- --------------
------------------- ----------- --------------
</Table>
At June 30, 2003, the Total Return Bond Portfolio had outstanding forward
currency contracts to sell currency, as follows:
<Table>
<Caption>
Value at Settlement Current Unrealized
Foreign Currency Sale Contracts Date Receivable Value Appreciation
- ----------------------------------------- ------------------- ----------- --------------
Euros,
expiring 7/30/03....................... $ 3,263,517 $ 3,250,191 $ 13,326
------------------- ----------- --------------
------------------- ----------- --------------
</Table>
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 87
<Page>
At June 30, 2003, the Intermediate-Term Bond Portfolio had outstanding
forward contracts to sell foreign currency, as follows:
<Table>
<Caption>
Value at Settlement Current Unrealized
Foreign Currency Sale Contracts Date Receivable Value Appreciation
- ----------------------------------------- ------------------- ----------- --------------
Euros,
expiring 7/30/03....................... $ 6,268,993 $ 6,243,396 $ 25,597
------------------- ----------- --------------
------------------- ----------- --------------
</Table>
Transactions in options written during the six months ended June 30, 2003,
were as follows:
<Table>
<Caption>
Number of Contracts/ Premiums
Total Return Bond Portfolio Notional Amount (000) Received
- ---------------------------------------------------- ----------------------- ---------
Options outstanding at December 31, 2002............ 14,468 $206,623
Options written..................................... 13,620 411,332
Options closed...................................... (11,544) (133,535)
Options expired..................................... (5,336) (151,433)
------ ---------
Options outstanding at June 30, 2003................ 11,208 $332,987
------ ---------
------ ---------
</Table>
<Table>
<Caption>
Premiums
Intermediate-Term Bond Portfolio Number of Contracts Received
- ----------------------------------------------------- --------------------- --------
Options outstanding at December 31, 2002............. 61 $10,543
Options expired...................................... (61) (10,543)
------ --------
Options outstanding at June 30, 2003................. -- $ --
------ --------
------ --------
</Table>
The Total Return Bond Portfolio entered into interest rate swap agreements
during the six months ended June 30, 2003. Details of the swap agreements
outstanding as of June 30, 2003 were as follows:
<Table>
<Caption>
Termination Notional Fixed Floating Unrealized
Counterparty Date Amount Rate Rate Appreciation
- ------------------------ ------------ ----------- ------- --------------- --------------
Merrill Lynch & Co.(c) 3/29/05 $12,400,000 1.50% Swiss LIBOR $ 13,223
Bank of America(a) 12/17/03 $16,400,000 4.00% 3 month LIBOR 128,150
JP Morgan(a) 12/17/03 $12,600,000 4.00% 3 month LIBOR 203,792
Morgan Stanley(b) 3/17/04 $ 2,900,000 4.25% 6 month LIBOR 34,374
--------------
$ 379,539
--------------
--------------
</Table>
- ------------------------------
(a) Fund pays the fixed rate and receives the floating rate.
(b) Fund pays the floating rate and receives the fixed rate.
(c) Fund receives the fixed rate.
The Total Return Bond Portfolio entered into a forward swap spread lock
agreement during the six months ended June 30, 2003. Details of the swap
agreement outstanding as of June 30, 2003 was as follows:
<Table>
<Caption>
Maturity Notional Spread Underlying Unrealized
Counterparty Date Amount Lock Bond Appreciation
- ------------------------ ------------ ----------- ------- --------------- --------------
Bank of America U.S. T-Bond,
Securities LLC(a) 8/13/03 $ 6,600,000 0.13875% 6.25%, 8/15/23 $ 25,332
--------------
--------------
</Table>
- ------------------------------
(a) Fund pays the fixed rate and receives the floating rate.
- --------------------------------------------------------------------------------
88 THE TARGET PORTFOLIO TRUST
<Page>
The Total Return Bond Portfolio entered into a credit default swap agreement
during the six months ended June 30, 2003. Details of the swap agreement
outstanding as of June 30, 2003 was as follows:
<Table>
<Caption>
Termination Notional Fixed Floating Unrealized
Counterparty Date Amount Rate Rate Appreciation
- ------------------------ ------------ ---------- ----- --------------- --------------
AOL Time Warner
Merrill Lynch & Co.(a) 12/6/04 $1,000,000 4.80 % Corporate Bond $ 52,129
------
------
</Table>
- ------------------------------
(a) Fund pays the floating rate and receives the fixed rate.
The Intermediate Term Bond Portfolio entered into interest rate swap
agreements during the six months ended June 30, 2003. Details of the swap
agreements outstanding as of June 30, 2003 were as follows:
<Table>
<Caption>
Termination Notional Fixed Floating Unrealized
Counterparty Date Amount Rate Rate Appreciation
- ------------------------ ------------ -------------- ------ -------------- --------------
UBS Warburg(a) 3/15/07 EUR17,800,000 4.00% 6 month LIBOR $239,547
Morgan Stanley(a) 3/17/05 GBP26,800,000 4.25% 6 month LIBOR 145,957
-------
$385,504
-------
-------
</Table>
- ------------------------------
(a) Fund pays the floating rate and receives the fixed rate.
- --------------------------------------------------------------------------------
Note 5. Tax Information
For federal income tax purposes, the following portfolios had post-October
losses deferred and capital loss carryforward as of December 31, 2002:
<Table>
<Caption>
Post-October Losses
-------------------------
Portfolio Currency Capital
- ------------------------------------------------------------- -------- ----------
Large Capitalization Growth Portfolio........................ -- $6,739,000
Large Capitalization Value Portfolio......................... -- 2,343,000
Small Capitalization Growth Portfolio........................ -- 6,747,000
Small Capitalization Value Portfolio......................... -- 3,207,000
International Equity Portfolio............................... $ 21,000 3,215,000
Total Return Bond Portfolio.................................. 307,000 --
Intermediate-Term Bond Portfolio............................. 143,000 --
Mortgage Backed Securities Portfolio......................... -- 128,000
</Table>
<Table>
<Caption>
Approximate Capital
Loss Carryforward*
--------------------
Large Capitalization Growth Portfolio.... $ 51,549,000 ($11,752,000 expiring in 2009;
$39,797,000 expiring in 2010)
Large Capitalization Value Portfolio..... 8,678,000 (expiring in 2010)
Small Capitalization Growth Portfolio.... 47,710,000 ($19,057,000 expiring in 2009;
$28,653,000 expiring in 2010)
International Equity Portfolio........... 47,386,000 ($23,151,000 expiring in 2009;
$24,235,000 expiring in 2010)
International Bond Portfolio............. 349,000 ($12,000 expiring in 2007;
$257,000 expiring in 2008;
$80,000 expiring in 2009)
Mortgage Backed Securities Portfolio..... 384,000 (expiring in 2008)
</Table>
- ------------------------------
* Accordingly, no capital distribution is expected to be paid to shareholders
until net gains have been realized in excess of such carryforwards.
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 89
<Page>
The United States federal income tax basis and unrealized appreciation
(depreciation) of the Portfolio's investments as of June 30, 2003 were as
follows:
<Table>
<Caption>
Net
Unrealized
Appreciation
Portfolio Tax Basis Appreciation Depreciation (Depreciation)
- ---------------------------------------- ------------ ------------ ------------- --------------
Large Capitalization Growth Portfolio... $233,042,206 $88,290,213 $ (32,769,002) $ 55,521,211
Large Capitalization Value Portfolio.... 232,721,732 42,882,063 (21,328,396) 21,553,667
Small Capitalization Growth Portfolio... 107,734,450 15,603,694 (6,798,975) 8,804,719
Small Capitalization Value Portfolio.... 143,869,964 24,578,477 (9,636,053) 14,942,424
International Equity Portfolio.......... 141,391,869 18,800,697 (9,236,530) 9,564,167
International Bond Portfolio............ 28,321,479 2,465,217 (202,126) 2,263,091
Total Return Bond Portfolio............. 207,290,235 4,568,270 (2,134,344) 2,433,926
Intermediate-Term Bond Portfolio........ 440,703,811 7,752,696 (4,373,475) 3,379,221
Mortgage Backed Securities Portfolio.... 127,020,383 2,962,662 (365,405) 2,597,257
</Table>
The differences between book basis and tax basis are primarily attributable
to deferred losses on wash sales.
- --------------------------------------------------------------------------------
Note 6. Capital
The Fund has authorized an unlimited number of shares of beneficial interest
at $.001 par value per share.
Transactions in shares of beneficial interest during the six months ended
June 30, 2003 were as follows:
<Table>
<Caption>
Shares
Issued in
Reinvestment Increase/
of Dividends (Decrease)
Shares and Shares in Shares
Portfolio Sold Distributions Reacquired Outstanding
- -------------------------------------- ------------- ------------ ---------- -----------
Large Capitalization Growth
Portfolio............................ 3,741,301 -- (3,554,746) 186,555
Large Capitalization Value
Portfolio............................ 2,812,159 2,793 (3,268,338) (453,386)
Small Capitalization Growth
Portfolio............................ 2,394,933 -- (2,232,478) 162,455
Small Capitalization Value
Portfolio............................ 1,103,867 -- (1,955,332) (851,465)
International Equity Portfolio........ 4,658,841 89,450 (4,566,781) 181,510
International Bond Portfolio.......... 2,430,233 34,356 (1,984,415) 480,174
Total Return Bond Portfolio........... 3,860,775 292,057 (2,868,100) 1,284,732
Intermediate-Term Bond Portfolio...... 7,618,002 625,946 (6,660,039) 1,583,909
Mortgage Backed Securities Portfolio.. 2,876,777 225,752 (2,673,959) 428,570
</Table>
- --------------------------------------------------------------------------------
90 THE TARGET PORTFOLIO TRUST
<Page>
Transactions in shares of beneficial interest during the fiscal year ended
December 31, 2002 were as follows:
<Table>
<Caption>
Shares
Issued in
Reinvestment Increase
of Dividends (Decrease)
Shares and Shares in Shares
Portfolio Sold Distributions Reacquired Outstanding
- -------------------------------------- ------------- ------------ ---------- -----------
Large Capitalization Growth
Portfolio............................ 8,398,367 -- (8,482,157) (83,790)
Large Capitalization Value
Portfolio............................ 5,841,891 543,508 (6,595,311) (209,912)
Small Capitalization Growth
Portfolio............................ 4,742,296 -- (4,214,900) 527,396
Small Capitalization Value
Portfolio............................ 3,492,647 2,033,553 (4,442,760) 1,083,440
International Equity Portfolio........ 8,916,721 5,001 (9,117,137) (195,415)
International Bond Portfolio.......... 2,122,894 37,026 (1,528,675) 631,245
Total Return Bond Portfolio........... 7,462,420 717,545 (5,362,611) 2,817,354
Intermediate-Term Bond Portfolio...... 20,128,098 1,417,532 (8,907,875) 12,637,755
Mortgage Backed Securities Portfolio.. 6,840,775 419,877 (3,698,849) 3,561,803
</Table>
- --------------------------------------------------------------------------------
THE TARGET PORTFOLIO TRUST 91
The Target
Portfolio Trus(R)
Trustees
David E.A. Carson
Robert F. Gunia
Robert E. La Blanc
Douglas H. McCorkindale
Stephen P. Munn
Richard A. Redeker
Judy A. Rice
Robin B. Smith
Stephen D. Stoneburn
Clay T. Whitehead
Officers
Judy A. Rice
President
Robert F. Gunia
Vice President
Grace C. Torres
Treasurer
Marguerite E.H. Morrison
Chief Legal Officer and Assistant Secretary
Lori E. Bostrom
Secretary
Maryanne Ryan
Anti-Money Laundering Compliance Officer
Manager
Prudential Investments LLC
Gateway Center Three
100 Mulberry Street
Newark, NJ 07102-4077
Investment Advisers
Columbus Circle Investors
Metro Center
One Station Plaza
Stamford, CT 06902
EARNEST Partners, LLC
75 14th Street, Suite 2300
Atlanta, GA 30309
Fischer Francis
Trees & Watts, Inc.
200 Park Avenue
New York, NY 10166
Hotchkis and Wiley
Capital Management LLC
725 S. Figueroa Street
Suite 3900
Los Angeles, CA 90017
J.P. Morgan Fleming Asset
Management (USA) Inc.
320 Park Avenue
New York, NY 10022
J.P. Morgan Investment
Management, Inc.
522 Fifth Avenue
New York, NY 10036
Lazard Asset Management
1 Rockefeller Plaza
New York, NY 10020
National City Investment
Management Company
1900 East Ninth Street
Cleveland, OH 44114-0756
Oak Associates, Ltd.
3875 Embassy Parkway
Suite 250
Akron, OH 44333
Pacific Investment
Management Company LLC
840 Newport Center Drive
Newport Beach, CA 92660
Sawgrass Asset Management, LLC
1579 The Greens Way, Suite 20
Jacksonville, FL 32250
Wellington Management
Company, LLP
75 State Street
Boston, MA 02109
Distributor
Prudential Investment
Management Services LLC
Gateway Center Three, 14th Fl.
100 Mulberry Street
Newark, NJ 07102-4077
Custodian
The Bank of New York
One Wall Street
New York, NY 10286
Transfer Agent
Prudential Mutual Fund
Services LLC
PO Box 8098
Philadelphia, PA 19101
Independent Auditors
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, NY 10036
Legal Counsel
Shearman & Sterling LLP
599 Lexington Avenue
New York, NY 10022-6069
The views expressed in this report and information about the Portfolios'
holdings are for the period covered by this report and are subject to change
thereafter. The accompanying financial statements as of June 30, 2003 were
not audited and accordingly, no auditor's opinion is expressed on them. This
report is not authorized for distribution to prospective investors unless
preceded or accompanied by a current prospectus.
Prudential Financial and the Rock logo are registered service marks of The
Prudential Insurance Company of America, Newark, NJ, and its affiliates.
Mutual Funds:
ARE NOT INSURED BY THE FDIC OR ANY FEDERAL
GOVERNMENT AGENCY
MAY LOSE VALUE
ARE NOT A DEPOSIT OF OR GUARANTEED BY ANY BANK OR
ANY BANK AFFILIATE
Fund Symbols Nasdaq CUSIP
Large Capitalization Growth TALGX 875921207
Small Capitalization Growth TASGX 875921405
International Equity TAIEX 875921504
Total Return Bond TATBX 875921884
Mortgage Backed Securities TGMBX 875921702
Fund Symbols Nasdaq CUSIP
Large Capitalization Value TALVX 875921108
Small Capitalization Value TASVX 875921306
International Bond TIBPX 875921876
Intermediate-Term Bond TAIBX 875921801
U.S. Government Money Market PUGXX 875921603
PRUDENTIAL (LOGO)
Fund Symbols Nasdaq CUSIP
Large Capitalization Growth TALGX 875921207
Small Capitalization Growth TASGX 875921405
International Equity TAIEX 875921504
Total Return Bond TATBX 875921884
Mortgage Backed Securities TGMBX 875921702
Fund Symbols Nasdaq CUSIP
Large Capitalization Value TALVX 875921108
Small Capitalization Value TASVX 875921306
International Bond TIBPX 875921876
Intermediate-Term Bond TAIBX 875921801
U.S. Government Money Market PUGXX 875921603
IFS-AO83224 TMF 158E2
<Page>
Item 2 -- Code of Ethics -- Not required in this filing
Item 3 -- Audit Committee Financial Expert -- Not required in this filing
Item 4 -- Principal Accountant Fees and Services -- Not required in this filing
Item 5 -- Reserved
Item 6 -- Reserved
Item 7 -- Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies -- Not required in this filing
Item 8 -- Reserved
Item 9 -- Controls and Procedures
(a) It is the conclusion of the registrant's principal executive
officer and principal financial officer that the effectiveness of
the registrant's current disclosure controls and procedures (such
disclosure controls and procedures having been evaluated within
90 days of the date of this filing) provide reasonable assurance
that the information required to be disclosed by the registrant
has been recorded, processed, summarized and reported within the
time period specified in the Commission's rules and forms and
that the information required to be disclosed by the registrant
has been accumulated and communicated to the registrant's
principal executive officer and principal financial officer in
order to allow timely decisions regarding required disclosure.
(b) There have been no significant changes in the registrant's
internal controls or in other factors that could significantly
affect these controls subsequent to the date of their evaluation,
including any corrective actions with regard to significant
deficiencies and material weaknesses.
Item 10 -- Exhibits
(a) Code of Ethics -- Not required in this filing
(b) Certifications pursuant to Sections 302 and 906 of the
Sarbanes-Oxley Act -- Attached hereto
<Page>
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.
The Target Portfolio Trust
By: /s/ Lori E. Bostrom
----------------------------------------------------------
Lori E. Bostrom
Secretary
Date: August 26, 2003
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/ Judy A. Rice
----------------------------------------------------------
Judy A. Rice
President and Principal Executive Officer
Date: August 26, 2003
By: /s/ Grace C. Torres
----------------------------------------------------------
Grace C. Torres
Treasurer and Principal Financial Officer
Date: August 26, 2003