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 811-02594
MFS SERIES TRUST IV
(Exact name of registrant as specified in charter)
111 Huntington Avenue, Boston, Massachusetts 02199 (Address of principal executive offices) (Zip code)
Christopher R. Bohane
Massachusetts Financial Services Company
111Huntington Avenue Boston, Massachusetts 02199
(Name and address of agents for service)
Registrant's telephone number, including area code: (617) 954-5000
Date of fiscal year end: August 31
Date of reporting period: February 29, 2024
ITEM 1. REPORTS TO STOCKHOLDERS.
Item 1(a):
Semiannual Report
February 29, 2024
MFS® Blended Research® Emerging Markets
Equity Fund
MFS® Blended Research® Emerging Markets
Equity Fund
| 1
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| 5
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| 12
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| 14
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| 15
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| 16
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| 25
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| 36
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| 36
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| 36
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| 36
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| 36
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The report is prepared for the
general information of shareholders. It is authorized for distribution to prospective investors only when preceded or accompanied by a current prospectus.
NOT FDIC INSURED
• MAY LOSE VALUE • NO BANK GUARANTEE
Portfolio structure
Top ten holdings
Taiwan Semiconductor Manufacturing
Co. Ltd.
| 8.8%
|
| Samsung Electronics Co. Ltd.
| 4.7%
|
| Tencent Holdings Ltd.
| 3.9%
|
| Alibaba Group Holding Ltd.
| 2.0%
|
| Hon Hai Precision Industry Co. Ltd.
| 1.8%
|
| KB Financial Group, Inc.
| 1.8%
|
| Tata Consultancy Services Ltd.
| 1.8%
|
| Petrobras
| 1.7%
|
| Kia Corp.
| 1.5%
|
| Samsung Fire & Marine Insurance Co. Ltd.
| 1.5%
|
GICS equity sectors (g)
| Information Technology
| 23.0%
|
| Financials
| 21.9%
|
| Consumer Discretionary
| 12.1%
|
| Communication Services
| 9.5%
|
| Materials
| 7.6%
|
| Consumer Staples
| 6.3%
|
| Industrials
| 5.9%
|
| Energy
| 4.8%
|
| Health Care
| 4.5%
|
| Utilities
| 2.0%
|
| Real Estate
| 1.5%
|
Issuer country weightings (x)
| China
| 26.3%
|
| India
| 15.8%
|
| South Korea
| 14.4%
|
| Taiwan
| 14.1%
|
| Brazil
| 6.5%
|
| Indonesia
| 4.0%
|
| South Africa
| 2.4%
|
| Mexico
| 2.3%
|
| Greece
| 2.2%
|
| Other Countries
| 12.0%
|
Currency exposure weightings (y)
| Hong Kong Dollar
| 19.3%
|
| Indian Rupee
| 15.2%
|
| South Korean Won
| 14.4%
|
| Taiwan Dollar
| 14.1%
|
| Chinese Renminbi
| 6.7%
|
| Brazilian Real
| 6.5%
|
| Indonesian Rupiah
| 4.0%
|
| United States Dollar
| 3.3%
|
| South African Rand
| 2.4%
|
| Other Currencies
| 14.1%
|
Portfolio Composition - continued
| (g)
| The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and S&P Global Market Intelligence Inc. (“S&P Global Market
Intelligence”). GICS is a service mark of MSCI and S&P Global Market Intelligence and has been licensed for use by MFS. MFS has applied its own internal sector/industry classification methodology for equity
securities and non-equity securities that are unclassified by GICS.
|
| (x)
| Represents the portfolio’s exposure to issuer countries as a percentage of a portfolio’s net assets. For purposes of this presentation, United States (included in Other
Countries) includes Cash & Cash Equivalents.
|
| (y)
| Represents the portfolio’s exposure to a particular currency as a percentage of a portfolio's net assets. For purposes of this presentation, United States Dollar includes Cash
& Cash Equivalents.
|
Cash & Cash Equivalents includes
any cash, investments in money market funds, short-term securities, and other assets less liabilities. Please see the Statement of Assets and Liabilities for additional information related to the fund’s cash
position and other assets and liabilities.
Percentages are based on net assets
as of February 29, 2024.
The portfolio is actively managed
and current holdings may be different.
Expense Table
Fund expenses borne by the
shareholders during the period,
September 1, 2023 through February 29, 2024
As a shareholder of the fund, you
incur two types of costs: (1) transaction costs, including sales charges (loads) on certain purchase or redemption payments, and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and
other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an
investment of $1,000 invested at the beginning of the period and held for the entire period September 1, 2023 through February 29, 2024.
Actual Expenses
The first line for each share class
in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over
the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled
“Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for
Comparison Purposes
The second line for each share class
in the following table provides information about hypothetical account values and hypothetical expenses based on the fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses,
which is not the fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information
to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown
in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line for each share class in the table is useful in
comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Expense Table - continued
Share
Class
|
| Annualized
Expense
Ratio
| Beginning
Account Value
9/01/23
| Ending
Account Value
2/29/24
| Expenses
Paid During
Period (p)
9/01/23-2/29/24
|
| A
| Actual
| 1.24%
| $1,000.00
| $1,056.63
| $6.34
|
| Hypothetical (h)
| 1.24%
| $1,000.00
| $1,018.70
| $6.22
|
| B
| Actual
| 1.99%
| $1,000.00
| $1,051.80
| $10.15
|
| Hypothetical (h)
| 1.99%
| $1,000.00
| $1,014.97
| $9.97
|
| C
| Actual
| 1.99%
| $1,000.00
| $1,052.01
| $10.15
|
| Hypothetical (h)
| 1.99%
| $1,000.00
| $1,014.97
| $9.97
|
| I
| Actual
| 0.99%
| $1,000.00
| $1,057.49
| $5.06
|
| Hypothetical (h)
| 0.99%
| $1,000.00
| $1,019.94
| $4.97
|
| R1
| Actual
| 1.24%
| $1,000.00
| $1,056.69
| $6.34
|
| Hypothetical (h)
| 1.24%
| $1,000.00
| $1,018.70
| $6.22
|
| R2
| Actual
| 1.49%
| $1,000.00
| $1,055.39
| $7.61
|
| Hypothetical (h)
| 1.49%
| $1,000.00
| $1,017.45
| $7.47
|
| R3
| Actual
| 1.24%
| $1,000.00
| $1,056.91
| $6.34
|
| Hypothetical (h)
| 1.24%
| $1,000.00
| $1,018.70
| $6.22
|
| R4
| Actual
| 0.99%
| $1,000.00
| $1,057.88
| $5.07
|
| Hypothetical (h)
| 0.99%
| $1,000.00
| $1,019.94
| $4.97
|
| R6
| Actual
| 0.90%
| $1,000.00
| $1,058.07
| $4.61
|
| Hypothetical (h)
| 0.90%
| $1,000.00
| $1,020.39
| $4.52
|
| (h)
| 5% class return per year before expenses.
|
| (p)
| “Expenses Paid During Period” are equal to each class’s annualized expense ratio, as shown above, multiplied by the average account value over the period, multiplied
by 182/366 (to reflect the one-half year period). Expenses paid do not include any applicable sales charges (loads). If these transaction costs had been included, your costs would have been higher.
|
Notes to Expense Table
For the period from September 1,
2023 through February 29, 2024, the distribution fee for Class R1 was not imposed. Had the distribution fee been imposed throughout the entire six month period, the annualized expense ratio, the actual expenses paid
during the period, and the hypothetical expenses paid during the period would have been approximately 1.99%, $10.18, and $9.97 for Class R1. See Note 3 in the Notes to Financial Statements for additional
information.
Portfolio of Investments
2/29/24 (unaudited)
The Portfolio of Investments is a
complete list of all securities owned by your fund. It is categorized by broad-based asset classes.
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – 97.5%
|
| Airlines – 0.7%
|
|
| Catrion Catering Holding Co.
|
| 3,643
| $129,777
|
| Copa Holdings S.A., “A”
|
| 3,510
| 342,120
|
|
|
|
|
| $471,897
|
| Alcoholic Beverages – 1.2%
|
|
| Ambev S.A.
|
| 150,500
| $380,859
|
| Kweichow Moutai Co. Ltd., “A”
|
| 1,000
| 235,638
|
| Wuliangye Yibin Co. Ltd., “A”
|
| 6,300
| 124,585
|
|
|
|
|
| $741,082
|
| Apparel Manufacturers – 0.1%
|
|
| Pou Chen Corp.
|
| 78,000
| $75,262
|
| Automotive – 5.1%
|
|
| BYD Co. Ltd.
|
| 22,500
| $555,495
|
| Kia Corp.
|
| 10,118
| 945,998
|
| Mahindra & Mahindra Ltd.
|
| 38,605
| 899,707
|
| Maruti Suzuki India Ltd.
|
| 3,110
| 423,400
|
| Yutong Bus Co. Ltd., “A”
|
| 164,600
| 427,218
|
|
|
|
|
| $3,251,818
|
| Biotechnology – 0.7%
|
|
| Hugel, Inc. (a)
|
| 3,330
| $459,888
|
| Brokerage & Asset Managers – 0.4%
|
|
| B3 S.A. - Brasil Bolsa Balcao
|
| 101,000
| $260,673
|
| Moscow Exchange MICEX-RTS PJSC (a)(u)
|
| 57,902
| 0
|
|
|
|
|
| $260,673
|
| Business Services – 4.4%
|
|
| Chinasoft International Ltd.
|
| 120,000
| $78,166
|
| HCL Technologies Ltd.
|
| 25,461
| 510,916
|
| Infosys Ltd.
|
| 27,472
| 554,600
|
| JOYY, Inc., ADR
|
| 6,392
| 201,348
|
| Tata Consultancy Services Ltd.
|
| 23,097
| 1,140,724
|
| WNS (Holdings) Ltd., ADR (a)
|
| 5,614
| 323,928
|
|
|
|
|
| $2,809,682
|
| Chemicals – 0.3%
|
|
| UPL Ltd.
|
| 37,685
| $213,476
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Computer Software – 1.0%
|
|
| Elm Co.
|
| 1,177
| $331,730
|
| Kingsoft Corp.
|
| 107,200
| 299,166
|
|
|
|
|
| $630,896
|
| Computer Software - Systems – 7.5%
|
|
| Asustek Computer, Inc.
|
| 19,000
| $273,494
|
| Hon Hai Precision Industry Co. Ltd.
|
| 355,000
| 1,156,773
|
| Lenovo Group Ltd.
|
| 254,000
| 281,267
|
| Samsung Electronics Co. Ltd.
|
| 53,950
| 2,973,813
|
| Wistron Corp.
|
| 23,000
| 84,041
|
|
|
|
|
| $4,769,388
|
| Construction – 4.3%
|
|
| Anhui Conch Cement Co. Ltd.
|
| 156,500
| $342,203
|
| Beijing New Building Materials PLC, “A”
|
| 50,300
| 196,424
|
| Beijing Roborock Technology Co. Ltd., “A”
|
| 2,200
| 99,634
|
| CEMEX S.A.B. de C.V. (a)
|
| 651,625
| 498,155
|
| Midea Group Co. Ltd., “A”
|
| 40,800
| 355,236
|
| Techtronic Industries Co. Ltd.
|
| 15,000
| 162,367
|
| Ultratech Cement Ltd.
|
| 4,827
| 575,890
|
| Zhejiang Supor Co. Ltd., “A”
|
| 63,700
| 489,533
|
|
|
|
|
| $2,719,442
|
| Consumer Products – 0.5%
|
|
| AmorePacific Corp.
|
| 3,683
| $330,795
|
| Consumer Services – 0.1%
|
|
| KE Holdings, Inc., ADR
|
| 6,760
| $91,868
|
| Electrical Equipment – 0.3%
|
|
| Voltronic Power Technology Corp.
|
| 4,000
| $203,104
|
| Electronics – 11.1%
|
|
| MediaTek, Inc.
|
| 15,000
| $540,977
|
| Novatek Microelectronics Corp.
|
| 27,000
| 513,358
|
| Realtek Semiconductor Corp.
|
| 11,000
| 198,010
|
| Taiwan Semiconductor Manufacturing Co. Ltd.
|
| 257,000
| 5,610,022
|
| Tripod Technology Corp.
|
| 38,000
| 250,052
|
|
|
|
|
| $7,112,419
|
| Energy - Independent – 0.9%
|
|
| Hindustan Petroleum Corp. Ltd.
|
| 50,471
| $310,071
|
| Reliance Industries Ltd.
|
| 6,946
| 244,746
|
|
|
|
|
| $554,817
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Energy - Integrated – 4.3%
|
|
| LUKOIL PJSC (a)(u)
|
| 9,157
| $0
|
| MOL Hungarian Oil & Gas PLC
|
| 28,240
| 224,690
|
| Oil & Natural Gas Corp. Ltd.
|
| 108,625
| 346,641
|
| Petrobras
|
| 134,800
| 1,117,752
|
| PetroChina Co. Ltd.
|
| 1,058,000
| 833,752
|
| Sasol Ltd.
|
| 26,678
| 201,309
|
|
|
|
|
| $2,724,144
|
| Energy - Renewables – 0.3%
|
|
| Mytilineos S.A.
|
| 4,818
| $187,463
|
| Engineering - Construction – 1.3%
|
|
| Budimex S.A.
|
| 1,964
| $359,049
|
| Doosan Bobcat, Inc.
|
| 13,385
| 471,933
|
|
|
|
|
| $830,982
|
| Food & Beverages – 2.7%
|
|
| AVI Ltd.
|
| 75,717
| $353,004
|
| Gruma S.A.B. de C.V.
|
| 15,557
| 277,045
|
| Inner Mongolia Yili Industrial Group Co. Ltd., “A”
|
| 163,864
| 645,820
|
| Orion Corp.
|
| 4,575
| 319,178
|
| PT Indofood Sukses Makmur Tbk
|
| 288,400
| 121,581
|
|
|
|
|
| $1,716,628
|
| Food & Drug Stores – 0.6%
|
|
| BGF Retail Co., Ltd.
|
| 1,414
| $140,275
|
| BIM Birlesik Magazalar A.S.
|
| 18,048
| 224,361
|
|
|
|
|
| $364,636
|
| Forest & Paper Products – 0.3%
|
|
| PT Indah Kiat Pulp & Paper Tbk
|
| 395,100
| $219,360
|
| Gaming & Lodging – 0.2%
|
|
| OPAP S.A.
|
| 8,645
| $157,625
|
| Insurance – 3.9%
|
|
| China Pacific Insurance Co. Ltd.
|
| 180,400
| $344,233
|
| DB Insurance Co. Ltd.
|
| 8,751
| 649,293
|
| Ping An Insurance Co. of China Ltd., “H”
|
| 130,000
| 582,796
|
| Samsung Fire & Marine Insurance Co. Ltd.
|
| 4,152
| 929,180
|
|
|
|
|
| $2,505,502
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Internet – 6.1%
|
|
| MakeMyTrip Ltd. (a)
|
| 5,682
| $350,523
|
| NetEase, Inc.
|
| 29,700
| 668,387
|
| NetEase, Inc., ADR
|
| 3,749
| 404,592
|
| Tencent Holdings Ltd.
|
| 70,000
| 2,478,319
|
|
|
|
|
| $3,901,821
|
| Major Banks – 2.6%
|
|
| Bandhan Bank Ltd.
|
| 153,234
| $361,480
|
| Bank of China Ltd.
|
| 764,000
| 300,545
|
| National Bank of Greece S.A (a)
|
| 47,066
| 368,495
|
| Nedbank Group Ltd.
|
| 52,753
| 602,864
|
|
|
|
|
| $1,633,384
|
| Medical & Health Technology & Services – 0.4%
|
|
| OdontoPrev S.A.
|
| 112,700
| $273,186
|
| Medical Equipment – 0.3%
|
|
| Shenzhen Mindray Bio-Medical Electronics Co. Ltd., “A”
|
| 4,300
| $172,867
|
| Metals & Mining – 4.4%
|
|
| African Rainbow Minerals Ltd.
|
| 11,527
| $101,471
|
| Alrosa PJSC (a)(u)
|
| 143,843
| 0
|
| Aluminum Corp. of China Ltd.
|
| 422,000
| 211,283
|
| Hindalco Industries Ltd.
|
| 38,433
| 233,543
|
| Industries Qatar Q.P.S.C.
|
| 175,727
| 622,598
|
| Jiangxi Copper Co. Ltd., “H”
|
| 228,700
| 340,589
|
| Kumba Iron Ore Ltd.
|
| 9,393
| 262,960
|
| POSCO Holdings, Inc.
|
| 477
| 154,570
|
| Vale S.A.
|
| 63,500
| 855,719
|
|
|
|
|
| $2,782,733
|
| Natural Gas - Distribution – 0.5%
|
|
| China Resources Gas Group Ltd.
|
| 102,600
| $310,572
|
| Other Banks & Diversified Financials – 15.0%
|
|
| Akbank T.A.S.
|
| 65,010
| $86,551
|
| Bangkok Bank Public Co. Ltd.
|
| 132,000
| 522,627
|
| Bank Negara Indonesia PT
|
| 1,246,500
| 475,915
|
| Bank of Communications Co. Ltd.
|
| 147,000
| 96,504
|
| BNK Financial Group, Inc.
|
| 43,365
| 244,246
|
| China Construction Bank Corp.
|
| 1,050,000
| 654,448
|
| China Merchants Bank Co. Ltd.
|
| 153,000
| 596,992
|
| Credicorp Ltd.
|
| 2,851
| 487,179
|
| Emirates NBD Bank PJSC
|
| 147,539
| 735,094
|
| Hana Financial Group, Inc.
|
| 6,288
| 267,273
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Other Banks & Diversified Financials – continued
|
|
| HDFC Bank Ltd.
|
| 34,230
| $579,360
|
| HDFC Bank Ltd., ADR
|
| 1,507
| 80,624
|
| IndusInd Bank Ltd.
|
| 27,157
| 483,064
|
| KB Financial Group, Inc.
|
| 23,945
| 1,141,865
|
| Kotak Mahindra Bank Ltd.
|
| 22,896
| 466,515
|
| Krung Thai Bank PCL
|
| 223,400
| 100,286
|
| Power Finance Corp. Ltd.
|
| 70,278
| 339,625
|
| PT Bank Central Asia Tbk
|
| 612,000
| 384,569
|
| PT Bank Mandiri Tbk
|
| 1,488,200
| 662,895
|
| Sberbank of Russia PJSC (a)(u)
|
| 177,552
| 0
|
| Shriram Transport Finance Co. Ltd.
|
| 20,196
| 593,972
|
| Tisco Financial Group PCL
|
| 124,300
| 348,310
|
| Yapi Kredi
|
| 320,600
| 237,128
|
|
|
|
|
| $9,585,042
|
| Pharmaceuticals – 3.1%
|
|
| China Medical System Holdings Ltd.
|
| 77,000
| $126,473
|
| China Resources Pharmaceutical Group Ltd.
|
| 154,000
| 104,247
|
| Dr. Reddy's Laboratories Ltd.
|
| 2,598
| 201,290
|
| Gedeon Richter PLC
|
| 6,816
| 181,459
|
| Guangzhou Baiyunshan Pharmaceutical Holdings Co. Ltd., “A”
|
| 62,200
| 255,778
|
| Shanghai Pharmaceuticals Holding Co. Ltd., “H”
|
| 57,300
| 92,213
|
| Sinopharm Group Co. Ltd., “H”
|
| 94,400
| 264,650
|
| Sun Pharmaceutical Industries Ltd.
|
| 40,396
| 768,762
|
|
|
|
|
| $1,994,872
|
| Railroad & Shipping – 0.5%
|
|
| Evergreen Marine Corp. (Taiwan) Ltd.
|
| 25,000
| $130,894
|
| Rumo S.A.
|
| 45,100
| 206,126
|
|
|
|
|
| $337,020
|
| Real Estate – 1.0%
|
|
| Aldar Properties PJSC
|
| 130,171
| $195,986
|
| Emaar Properties PJSC
|
| 199,317
| 440,641
|
|
|
|
|
| $636,627
|
| Restaurants – 0.7%
|
|
| Jollibee Foods Corp.
|
| 39,210
| $190,976
|
| Yum China Holdings, Inc.
|
| 6,750
| 289,507
|
|
|
|
|
| $480,483
|
| Specialty Chemicals – 0.2%
|
|
| Saudi Aramco Base Oil Co.
|
| 3,085
| $138,197
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Specialty Stores – 6.3%
|
|
| Alibaba Group Holding Ltd.
|
| 134,600
| $1,253,252
|
| Alibaba Group Holding Ltd., ADR
|
| 975
| 72,179
|
| Cencosud S.A.
|
| 90,783
| 163,042
|
| JD.com, Inc., “A”
|
| 9,678
| 110,074
|
| Meituan, “B” (a)
|
| 44,260
| 451,108
|
| Multiplan Empreendimentos Imobiliarios S.A.
|
| 43,475
| 230,970
|
| PDD Holdings, Inc., ADR (a)
|
| 6,363
| 792,448
|
| Vipshop Holdings Ltd., ADR (a)
|
| 12,942
| 249,134
|
| Walmart de Mexico S.A.B. de C.V.
|
| 171,298
| 685,926
|
|
|
|
|
| $4,008,133
|
| Telecommunications - Wireless – 2.0%
|
|
| Etihad Etisalat Co.
|
| 20,517
| $302,533
|
| Ooredoo Q.P.S.C.
|
| 37,715
| 117,775
|
| PT Telekom Indonesia
|
| 2,792,100
| 710,684
|
| Turkcell Iletisim Hizmetleri A.S.
|
| 70,834
| 151,845
|
|
|
|
|
| $1,282,837
|
| Telephone Services – 1.1%
|
|
| Hellenic Telecommunications Organization S.A.
|
| 47,198
| $712,122
|
| Utilities - Electric Power – 1.1%
|
|
| CEZ A.S. (Czech Republic)
|
| 8,352
| $285,345
|
| China Resources Power Holdings Co. Ltd.
|
| 150,000
| 323,776
|
| Power Grid Corp. of India Ltd.
|
| 25,472
| 86,892
|
|
|
|
|
| $696,013
|
| Total Common Stocks (Identified Cost, $54,648,948)
|
| $62,348,756
|
| Preferred Stocks – 1.6%
|
| Computer Software - Systems – 0.3%
|
|
|
|
|
| Samsung Electronics Co. Ltd.
|
| 4,156
| $198,499
|
| Metals & Mining – 0.8%
|
|
|
|
|
| Gerdau S.A.
|
| 119,310
| $516,016
|
| Utilities - Electric Power – 0.5%
|
|
|
|
|
| Companhia Energetica de Minas Gerais
|
| 116,400
| $280,282
|
| Total Preferred Stocks (Identified Cost, $987,111)
|
| $994,797
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Investment Companies (h) – 1.3%
|
| Money Market Funds – 1.3%
|
|
| MFS Institutional Money Market Portfolio, 5.37% (v) (Identified Cost, $813,327)
|
|
| 813,327
| $813,327
|
|
|
|
|
| Other Assets, Less Liabilities – (0.4)%
|
| (240,746)
|
| Net Assets – 100.0%
| $63,916,134
|
| (a)
| Non-income producing security.
|
|
|
|
| (h)
| An affiliated issuer, which may be considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common
control. At period end, the aggregate values of the fund's investments in affiliated issuers and in unaffiliated issuers were $813,327 and $63,343,553, respectively.
|
|
|
|
| (u)
| The security was valued using significant unobservable inputs and is considered level 3 under the fair value hierarchy. For further information about the
fund’s level 3 holdings, please see Note 2 in the Notes to Financial Statements.
|
|
|
|
| (v)
| Affiliated issuer that is available only to investment companies managed by MFS. The rate quoted for the MFS Institutional Money Market Portfolio is the annualized
seven-day yield of the fund at period end.
|
|
|
|
| The following abbreviations are used in this report and are defined:
|
| ADR
| American Depositary Receipt
|
| PCL
| Public Company Limited
|
See Notes to Financial Statements
Financial Statements
Statement of Assets and
Liabilities
At 2/29/24 (unaudited)
This statement represents your
fund’s balance sheet, which details the assets and liabilities comprising the total value of the fund.
| Assets
|
|
| Investments in unaffiliated issuers, at value (identified cost, $55,636,059)
| $63,343,553
|
| Investments in affiliated issuers, at value (identified cost, $813,327)
| 813,327
|
| Foreign currency, at value (identified cost, $14,605)
| 14,605
|
| Receivables for
|
|
| Fund shares sold
| 6,335
|
| Dividends
| 120,869
|
| Receivable from investment adviser
| 33,166
|
| Other assets
| 314
|
| Total assets
| $64,332,169
|
| Liabilities
|
|
| Payables for
|
|
| Fund shares reacquired
| $11,507
|
| Payable to affiliates
|
|
| Administrative services fee
| 107
|
| Shareholder servicing costs
| 10,783
|
| Distribution and service fees
| 83
|
| Payable for independent Trustees' compensation
| 500
|
| Deferred foreign capital gains tax expense payable
| 190,016
|
| Payable for custodian fee
| 100,319
|
| Payable for audit and tax fees
| 73,006
|
| Accrued expenses and other liabilities
| 29,714
|
| Total liabilities
| $416,035
|
| Net assets
| $63,916,134
|
| Net assets consist of
|
|
| Paid-in capital
| $61,206,990
|
| Total distributable earnings (loss)
| 2,709,144
|
| Net assets
| $63,916,134
|
| Shares of beneficial interest outstanding
| 5,061,071
|
Statement of Assets and Liabilities (unaudited) – continued
|
| Net assets
| Shares
outstanding
| Net asset value
per share (a)
|
| Class A
| $3,982,055
| 315,423
| $12.62
|
| Class B
| 260,672
| 20,847
| 12.50
|
| Class C
| 170,096
| 13,571
| 12.53
|
| Class I
| 33,743,219
| 2,675,273
| 12.61
|
| Class R1
| 75,902
| 6,064
| 12.52
|
| Class R2
| 77,420
| 6,146
| 12.60
|
| Class R3
| 123,141
| 9,759
| 12.62
|
| Class R4
| 117,498
| 9,294
| 12.64
|
| Class R6
| 25,366,131
| 2,004,694
| 12.65
|
| (a)
| Maximum offering price per share was equal to the net asset value per share for all share classes, except for Class A, for which the maximum offering price per share was $13.39 [100 /
94.25 x $12.62]. On sales of $50,000 or more, the maximum offering price of Class A shares is reduced. A contingent deferred sales charge may be imposed on redemptions of Class A, Class B, and Class C shares.
Redemption price per share was equal to the net asset value per share for Classes I, R1, R2, R3, R4, and R6.
|
See Notes to Financial Statements
Financial Statements
Statement of Operations
Six months ended 2/29/24
(unaudited)
This statement describes how much
your fund earned in investment income and accrued in expenses. It also describes any gains and/or losses generated by fund operations.
| Net investment income (loss)
|
|
| Income
|
|
| Dividends
| $558,020
|
| Dividends from affiliated issuers
| 21,661
|
| Other
| 5,242
|
| Foreign taxes withheld
| (71,723)
|
| Total investment income
| $513,200
|
| Expenses
|
|
| Management fee
| $202,273
|
| Distribution and service fees
| 7,452
|
| Shareholder servicing costs
| 18,835
|
| Administrative services fee
| 9,093
|
| Independent Trustees' compensation
| 1,530
|
| Custodian fee
| 99,109
|
| Shareholder communications
| 4,957
|
| Audit and tax fees
| 66,559
|
| Legal fees
| 126
|
| Registration fees
| 61,981
|
| Miscellaneous
| 15,518
|
| Total expenses
| $487,433
|
| Reduction of expenses by investment adviser
| (223,283)
|
| Net expenses
| $264,150
|
| Net investment income (loss)
| $249,050
|
| Realized and unrealized gain (loss)
|
| Realized gain (loss) (identified cost basis)
|
|
| Unaffiliated issuers (includes $44,618 foreign capital gains tax)
| $(876,692)
|
| Affiliated issuers
| (189)
|
| Foreign currency
| (14,814)
|
| Net realized gain (loss)
| $(891,695)
|
| Change in unrealized appreciation or depreciation
|
|
| Unaffiliated issuers (includes $129,929 increase in deferred foreign capital gains tax)
| $4,180,975
|
| Affiliated issuers
| (52)
|
| Translation of assets and liabilities in foreign currencies
| (1,137)
|
| Net unrealized gain (loss)
| $4,179,786
|
| Net realized and unrealized gain (loss)
| $3,288,091
|
| Change in net assets from operations
| $3,537,141
|
See Notes to Financial Statements
Financial Statements
Statements of Changes in Net
Assets
These statements describe the
increases and/or decreases in net assets resulting from operations, any distributions, and any shareholder transactions.
|
| Six months ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
|
| Change in net assets
|
|
|
| From operations
|
|
|
| Net investment income (loss)
| $249,050
| $1,339,722
|
| Net realized gain (loss)
| (891,695)
| (2,169,465)
|
| Net unrealized gain (loss)
| 4,179,786
| 3,203,116
|
| Change in net assets from operations
| $3,537,141
| $2,373,373
|
| Total distributions to shareholders
| $(1,650,757)
| $(1,376,015)
|
| Change in net assets from fund share transactions
| $13,732,333
| $7,306,790
|
| Total change in net assets
| $15,618,717
| $8,304,148
|
| Net assets
|
|
|
| At beginning of period
| 48,297,417
| 39,993,269
|
| At end of period
| $63,916,134
| $48,297,417
|
See Notes to Financial Statements
Financial Statements
Financial Highlights
The financial highlights table is
intended to help you understand the fund's financial performance for the semiannual period and the past 5 fiscal years. Certain information reflects financial results for a single fund share. The total returns in the
table represent the rate that an investor would have earned (or lost) on an investment in the fund share class (assuming reinvestment of all distributions) held for the entire period.
| Class A
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $12.24
| $12.11
| $15.96
| $12.97
| $12.12
| $13.66
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.04
| $0.32
| $0.37
| $0.23
| $0.24
| $0.25
|
| Net realized and unrealized gain (loss)
| 0.64
| 0.12
| (3.70)
| 2.96
| 0.81
| (1.20)
|
| Total from investment operations
| $0.68
| $0.44
| $(3.33)
| $3.19
| $1.05
| $(0.95)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.30)
| $(0.31)
| $(0.25)
| $(0.20)
| $(0.20)
| $(0.22)
|
| From net realized gain
| —
| —
| (0.27)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.30)
| $(0.31)
| $(0.52)
| $(0.20)
| $(0.20)
| $(0.59)
|
| Net asset value, end of period (x)
| $12.62
| $12.24
| $12.11
| $15.96
| $12.97
| $12.12
|
| Total return (%) (r)(s)(t)(x)
| 5.66(n)
| 3.79
| (21.42)
| 24.78
| 8.63
| (6.77)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 2.08(a)
| 2.44
| 1.94
| 1.82
| 2.39
| 2.95
|
| Expenses after expense reductions
| 1.24(a)
| 1.24
| 1.24
| 1.24
| 1.24
| 1.24
|
| Net investment income (loss)
| 0.71(a)(l)
| 2.69
| 2.62
| 1.50
| 1.98
| 2.01
|
| Portfolio turnover
| 26(n)
| 63
| 58
| 60
| 63
| 64
|
| Net assets at end of period (000 omitted)
| $3,982
| $4,331
| $4,797
| $7,869
| $5,702
| $5,174
|
See Notes to Financial Statements
Financial Highlights – continued
| Class B
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $12.09
| $11.96
| $15.75
| $12.81
| $11.99
| $13.54
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.00)(w)
| $0.23
| $0.28
| $0.11
| $0.15
| $0.21
|
| Net realized and unrealized gain (loss)
| 0.62
| 0.13
| (3.67)
| 2.93
| 0.80
| (1.25)
|
| Total from investment operations
| $0.62
| $0.36
| $(3.39)
| $3.04
| $0.95
| $(1.04)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.21)
| $(0.23)
| $(0.13)
| $(0.10)
| $(0.13)
| $(0.14)
|
| From net realized gain
| —
| —
| (0.27)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.21)
| $(0.23)
| $(0.40)
| $(0.10)
| $(0.13)
| $(0.51)
|
| Net asset value, end of period (x)
| $12.50
| $12.09
| $11.96
| $15.75
| $12.81
| $11.99
|
| Total return (%) (r)(s)(t)(x)
| 5.18(n)
| 3.07
| (21.98)
| 23.77
| 7.88
| (7.51)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 2.83(a)
| 3.18
| 2.71
| 2.58
| 3.19
| 3.70
|
| Expenses after expense reductions
| 1.99(a)
| 1.99
| 1.99
| 1.99
| 1.99
| 1.99
|
| Net investment income (loss)
| (0.04)(a)(l)
| 1.96
| 2.02
| 0.72
| 1.22
| 1.63
|
| Portfolio turnover
| 26(n)
| 63
| 58
| 60
| 63
| 64
|
| Net assets at end of period (000 omitted)
| $261
| $256
| $276
| $403
| $312
| $391
|
See Notes to Financial Statements
Financial Highlights – continued
| Class C
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $12.11
| $11.95
| $15.72
| $12.78
| $11.95
| $13.50
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.00)(w)
| $0.23
| $0.26
| $0.11
| $0.15
| $0.16
|
| Net realized and unrealized gain (loss)
| 0.62
| 0.13
| (3.65)
| 2.93
| 0.78
| (1.19)
|
| Total from investment operations
| $0.62
| $0.36
| $(3.39)
| $3.04
| $0.93
| $(1.03)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.20)
| $(0.20)
| $(0.11)
| $(0.10)
| $(0.10)
| $(0.15)
|
| From net realized gain
| —
| —
| (0.27)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.20)
| $(0.20)
| $(0.38)
| $(0.10)
| $(0.10)
| $(0.52)
|
| Net asset value, end of period (x)
| $12.53
| $12.11
| $11.95
| $15.72
| $12.78
| $11.95
|
| Total return (%) (r)(s)(t)(x)
| 5.20(n)
| 3.08
| (22.02)
| 23.87
| 7.78
| (7.51)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 2.84(a)
| 3.18
| 2.69
| 2.58
| 3.19
| 3.70
|
| Expenses after expense reductions
| 1.99(a)
| 1.99
| 1.99
| 1.99
| 1.99
| 1.99
|
| Net investment income (loss)
| (0.03)(a)(l)
| 1.95
| 1.85
| 0.72
| 1.22
| 1.31
|
| Portfolio turnover
| 26(n)
| 63
| 58
| 60
| 63
| 64
|
| Net assets at end of period (000 omitted)
| $170
| $177
| $224
| $410
| $344
| $420
|
See Notes to Financial Statements
Financial Highlights – continued
| Class I
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $12.26
| $12.14
| $16.00
| $13.00
| $12.16
| $13.71
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.05
| $0.36
| $0.39
| $0.28
| $0.29
| $0.29
|
| Net realized and unrealized gain (loss)
| 0.64
| 0.12
| (3.69)
| 2.96
| 0.80
| (1.22)
|
| Total from investment operations
| $0.69
| $0.48
| $(3.30)
| $3.24
| $1.09
| $(0.93)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.34)
| $(0.36)
| $(0.29)
| $(0.24)
| $(0.25)
| $(0.25)
|
| From net realized gain
| —
| —
| (0.27)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.34)
| $(0.36)
| $(0.56)
| $(0.24)
| $(0.25)
| $(0.62)
|
| Net asset value, end of period (x)
| $12.61
| $12.26
| $12.14
| $16.00
| $13.00
| $12.16
|
| Total return (%) (r)(s)(t)(x)
| 5.75(n)
| 4.06
| (21.21)
| 25.10
| 8.89
| (6.55)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.80(a)
| 2.19
| 1.67
| 1.57
| 1.91
| 2.70
|
| Expenses after expense reductions
| 0.99(a)
| 0.99
| 0.99
| 0.99
| 0.99
| 0.99
|
| Net investment income (loss)
| 0.87(a)(l)
| 2.98
| 2.77
| 1.83
| 2.46
| 2.26
|
| Portfolio turnover
| 26(n)
| 63
| 58
| 60
| 63
| 64
|
| Net assets at end of period (000 omitted)
| $33,743
| $20,793
| $17,811
| $33,247
| $21,273
| $1,811
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R1
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $12.15
| $12.03
| $15.84
| $12.84
| $12.01
| $13.57
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.04
| $0.32
| $0.39
| $0.17
| $0.15
| $0.17
|
| Net realized and unrealized gain (loss)
| 0.64
| 0.12
| (3.70)
| 2.94
| 0.80
| (1.20)
|
| Total from investment operations
| $0.68
| $0.44
| $(3.31)
| $3.11
| $0.95
| $(1.03)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.31)
| $(0.32)
| $(0.23)
| $(0.11)
| $(0.12)
| $(0.16)
|
| From net realized gain
| —
| —
| (0.27)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.31)
| $(0.32)
| $(0.50)
| $(0.11)
| $(0.12)
| $(0.53)
|
| Net asset value, end of period (x)
| $12.52
| $12.15
| $12.03
| $15.84
| $12.84
| $12.01
|
| Total return (%) (r)(s)(t)(x)
| 5.67(n)
| 3.82
| (21.43)
| 24.32
| 7.84
| (7.47)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 2.08(a)
| 2.44
| 1.96
| 2.18
| 3.14
| 3.70
|
| Expenses after expense reductions
| 1.24(a)
| 1.24
| 1.24
| 1.59
| 1.99
| 1.99
|
| Net investment income (loss)
| 0.70(a)(l)
| 2.72
| 2.82
| 1.11
| 1.25
| 1.32
|
| Portfolio turnover
| 26(n)
| 63
| 58
| 60
| 63
| 64
|
| Net assets at end of period (000 omitted)
| $76
| $72
| $69
| $88
| $71
| $66
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R2
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $12.21
| $12.08
| $15.93
| $12.95
| $12.11
| $13.66
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.03
| $0.30
| $0.36
| $0.18
| $0.21
| $0.23
|
| Net realized and unrealized gain (loss)
| 0.63
| 0.12
| (3.73)
| 2.97
| 0.81
| (1.20)
|
| Total from investment operations
| $0.66
| $0.42
| $(3.37)
| $3.15
| $1.02
| $(0.97)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.27)
| $(0.29)
| $(0.21)
| $(0.17)
| $(0.18)
| $(0.21)
|
| From net realized gain
| —
| —
| (0.27)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.27)
| $(0.29)
| $(0.48)
| $(0.17)
| $(0.18)
| $(0.58)
|
| Net asset value, end of period (x)
| $12.60
| $12.21
| $12.08
| $15.93
| $12.95
| $12.11
|
| Total return (%) (r)(s)(t)(x)
| 5.54(n)
| 3.61
| (21.67)
| 24.47
| 8.35
| (6.97)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 2.33(a)
| 2.69
| 2.22
| 2.08
| 2.64
| 3.20
|
| Expenses after expense reductions
| 1.49(a)
| 1.49
| 1.49
| 1.49
| 1.49
| 1.49
|
| Net investment income (loss)
| 0.46(a)(l)
| 2.48
| 2.57
| 1.21
| 1.75
| 1.82
|
| Portfolio turnover
| 26(n)
| 63
| 58
| 60
| 63
| 64
|
| Net assets at end of period (000 omitted)
| $77
| $73
| $71
| $90
| $73
| $67
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R3
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $12.24
| $12.12
| $15.98
| $12.98
| $12.14
| $13.69
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.04
| $0.32
| $0.41
| $0.23
| $0.21
| $0.24
|
| Net realized and unrealized gain (loss)
| 0.64
| 0.13
| (3.75)
| 2.97
| 0.83
| (1.19)
|
| Total from investment operations
| $0.68
| $0.45
| $(3.34)
| $3.20
| $1.04
| $(0.95)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.30)
| $(0.33)
| $(0.25)
| $(0.20)
| $(0.20)
| $(0.23)
|
| From net realized gain
| —
| —
| (0.27)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.30)
| $(0.33)
| $(0.52)
| $(0.20)
| $(0.20)
| $(0.60)
|
| Net asset value, end of period (x)
| $12.62
| $12.24
| $12.12
| $15.98
| $12.98
| $12.14
|
| Total return (%) (r)(s)(t)(x)
| 5.69(n)
| 3.83
| (21.45)
| 24.80
| 8.52
| (6.75)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 2.08(a)
| 2.43
| 1.99
| 1.82
| 2.43
| 2.95
|
| Expenses after expense reductions
| 1.24(a)
| 1.24
| 1.24
| 1.24
| 1.24
| 1.24
|
| Net investment income (loss)
| 0.70(a)(l)
| 2.68
| 2.96
| 1.50
| 1.71
| 1.89
|
| Portfolio turnover
| 26(n)
| 63
| 58
| 60
| 63
| 64
|
| Net assets at end of period (000 omitted)
| $123
| $119
| $118
| $107
| $81
| $71
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R4
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $12.28
| $12.16
| $16.03
| $13.02
| $12.17
| $13.72
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.06
| $0.36
| $0.43
| $0.26
| $0.28
| $0.30
|
| Net realized and unrealized gain (loss)
| 0.64
| 0.12
| (3.74)
| 2.98
| 0.81
| (1.23)
|
| Total from investment operations
| $0.70
| $0.48
| $(3.31)
| $3.24
| $1.09
| $(0.93)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.34)
| $(0.36)
| $(0.29)
| $(0.23)
| $(0.24)
| $(0.25)
|
| From net realized gain
| —
| —
| (0.27)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.34)
| $(0.36)
| $(0.56)
| $(0.23)
| $(0.24)
| $(0.62)
|
| Net asset value, end of period (x)
| $12.64
| $12.28
| $12.16
| $16.03
| $13.02
| $12.17
|
| Total return (%) (r)(s)(t)(x)
| 5.79(n)
| 4.05
| (21.24)
| 25.10
| 8.90
| (6.55)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.83(a)
| 2.19
| 1.72
| 1.58
| 2.14
| 2.70
|
| Expenses after expense reductions
| 0.99(a)
| 0.99
| 0.99
| 0.99
| 0.99
| 0.99
|
| Net investment income (loss)
| 0.96(a)(l)
| 2.97
| 3.12
| 1.70
| 2.25
| 2.36
|
| Portfolio turnover
| 26(n)
| 63
| 58
| 60
| 63
| 64
|
| Net assets at end of period (000 omitted)
| $117
| $113
| $104
| $118
| $97
| $85
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R6
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $12.30
| $12.17
| $16.04
| $13.03
| $12.19
| $13.73
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.06
| $0.37
| $0.45
| $0.27
| $0.29
| $0.31
|
| Net realized and unrealized gain (loss)
| 0.64
| 0.13
| (3.75)
| 2.98
| 0.81
| (1.22)
|
| Total from investment operations
| $0.70
| $0.50
| $(3.30)
| $3.25
| $1.10
| $(0.91)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.35)
| $(0.37)
| $(0.30)
| $(0.24)
| $(0.26)
| $(0.26)
|
| From net realized gain
| —
| —
| (0.27)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.35)
| $(0.37)
| $(0.57)
| $(0.24)
| $(0.26)
| $(0.63)
|
| Net asset value, end of period (x)
| $12.65
| $12.30
| $12.17
| $16.04
| $13.03
| $12.19
|
| Total return (%) (r)(s)(t)(x)
| 5.81(n)
| 4.24
| (21.18)
| 25.17
| 8.91
| (6.40)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.74(a)
| 2.08
| 1.64
| 1.51
| 2.05
| 2.58
|
| Expenses after expense reductions
| 0.90(a)
| 0.88
| 0.90
| 0.93
| 0.92
| 0.87
|
| Net investment income (loss)
| 1.04(a)(l)
| 3.08
| 3.23
| 1.79
| 2.36
| 2.44
|
| Portfolio turnover
| 26(n)
| 63
| 58
| 60
| 63
| 64
|
| Net assets at end of period (000 omitted)
| $25,366
| $22,363
| $16,523
| $17,855
| $14,422
| $12,590
|
| (a)
| Annualized.
|
| (d)
| Per share data is based on average shares outstanding.
|
| (l)
| Recognition of net investment income by the fund may be affected by the timing of the declaration of dividends by companies in which the fund invests and the actual annual net investment income ratio
may differ.
|
| (n)
| Not annualized.
|
| (r)
| Certain expenses have been reduced without which performance would have been lower.
|
| (s)
| From time to time the fund may receive proceeds from litigation settlements, without which performance would be lower.
|
| (t)
| Total returns do not include any applicable sales charges.
|
| (w)
| Per share amount was less than $0.01.
|
| (x)
| The net asset values and total returns have been calculated on net assets which include adjustments made in accordance with U.S. generally accepted accounting principles required at
period end for financial reporting purposes.
|
See Notes to Financial Statements
Notes to Financial Statements
(unaudited)
(1) Business and
Organization
MFS Blended Research Emerging
Markets Equity Fund (the fund) is a diversified series of MFS Series Trust IV (the trust). The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940,
as amended, as an open-end management investment company.
The fund is an investment company
and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services - Investment
Companies.
(2) Significant Accounting
Policies
General — The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations
during the reporting period. Actual results could differ from those estimates. In the preparation of these financial statements, management has evaluated subsequent events occurring after the date of the fund’s
Statement of Assets and Liabilities through the date that the financial statements were issued. The fund invests in foreign securities, including securities of emerging market issuers. Investments in foreign securities are vulnerable to the effects of changes in the relative values
of the local currency and the U.S. dollar and to the effects of changes in each country’s market, economic, industrial, political, regulatory, geopolitical, environmental, public health, and other conditions.
Investments in emerging markets can involve additional and greater risks than the risks associated with investments in developed foreign markets. Emerging markets can have less developed markets, greater custody and
operational risk, less developed legal, regulatory, accounting, and auditing systems, greater government involvement in the economy, greater risk of new or inconsistent government treatment of or restrictions on
issuers and instruments, and greater political, social, and economic instability than developed markets.
Balance Sheet Offsetting — The fund's accounting policy with respect to balance sheet offsetting is that, absent an event of default by the counterparty or a termination of the agreement, the International
Swaps and Derivatives Association (ISDA) Master Agreement, or similar agreement, does not result in an offset of reported amounts of financial assets and financial liabilities in the Statement of Assets and
Liabilities across transactions between the fund and the applicable counterparty. The fund's right to setoff may be restricted or prohibited by the bankruptcy or insolvency laws of the particular jurisdiction to which
a specific master netting agreement counterparty is subject. Balance sheet offsetting disclosures, to the extent applicable to the fund, have been included in the fund’s Significant Accounting Policies note
under the captions for each of the fund’s in-scope financial instruments and transactions.
Investment Valuations — Subject to its oversight, the fund's Board of Trustees has delegated primary responsibility for determining or causing to be determined the value of the fund’s investments to MFS as
the fund's adviser, pursuant to the fund’s valuation policy and procedures which have been adopted by the adviser and approved by the Board. In accordance with Rule 2a-5 under the Investment Company Act of
1940, the
Notes to Financial
Statements (unaudited) - continued
Board of Trustees designated the adviser as the
“valuation designee” of the fund. If the adviser, as valuation designee, determines that reliable market quotations are not readily available for an investment, the investment is valued at fair value as
determined in good faith by the adviser in accordance with the adviser’s fair valuation policy and procedures.
Under the fund's valuation policy
and procedures, equity securities, including restricted equity securities, are generally valued at the last sale or official closing price on their primary market or exchange as provided by a third-party pricing
service. Equity securities, for which there were no sales reported that day, are generally valued at the last quoted daily bid quotation on their primary market or exchange as provided by a third-party pricing
service. Short-term instruments with a maturity at issuance of 60 days or less may be valued at amortized cost, which approximates market value.
Open-end investment companies are generally valued
at net asset value per share. The values of foreign securities and other assets and liabilities expressed in foreign currencies are converted to U.S. dollars using the mean of bid and asked prices for rates provided
by a third-party pricing service.
Under the fund’s valuation
policy and procedures, market quotations are not considered to be readily available for debt instruments, floating rate loans, and many types of derivatives. These investments are generally valued at fair value based
on information from third-party pricing services or otherwise determined by the adviser in accordance with the adviser’s fair valuation policy and procedures. Securities and other assets generally valued on the
basis of information from a third-party pricing service may also be valued at a broker/dealer bid quotation. In determining values, third-party pricing services can utilize both transaction data and market information
such as yield, quality, coupon rate, maturity, type of issue, trading characteristics, spreads and other market data. An investment may also be valued at fair value if the adviser determines that the
investment’s value has been materially affected by events occurring after the close of the exchange or market on which the investment is principally traded (such as foreign exchange or market) and prior to the
determination of the fund’s net asset value, or after the halt of trading of a specific security where trading does not resume prior to the close of the exchange or market on which the security is principally
traded. Events that occur after foreign markets close (such as developments in foreign markets and significant movements in the U.S. markets) and prior to the determination of the fund’s net asset value may be
deemed to have a material effect on the value of securities traded in foreign markets. Accordingly, the fund’s foreign equity securities may often be valued at fair value. The adviser generally relies on
third-party pricing services or other information (such as the correlation with price movements of similar securities in the same or other markets; the type, cost and investment characteristics of the security; the
business and financial condition of the issuer; and trading and other market data) to assist in determining whether to fair value and at what value to fair value an investment. The value of an investment for purposes
of calculating the fund’s net asset value can differ depending on the source and method used to determine value. When fair valuation is used, the value of an investment used to determine the fund’s net
asset value may differ from quoted or published prices for the same investment. There can be no assurance that the fund could obtain the fair value assigned to an investment if it were to sell the investment at the
same time at which the fund determines its net asset value per share.
Notes to Financial
Statements (unaudited) - continued
Various inputs are used in
determining the value of the fund's assets or liabilities. These inputs are categorized into three broad levels. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value
hierarchy. In such cases, an investment's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fund's assessment of the significance of a
particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment. Level 1 includes unadjusted quoted prices in active markets for identical assets or
liabilities. Level 2 includes other significant observable market-based inputs (including quoted prices for similar securities, interest rates, prepayment speed, and credit risk). Level 3 includes significant
unobservable inputs, which may include the adviser's own assumptions in determining the fair value of investments. The following is a summary of the levels used as of February 29, 2024 in valuing the fund's assets and
liabilities:
| Financial Instruments
| Level 1
| Level 2
| Level 3
| Total
|
| Equity Securities:
|
|
|
|
|
| China
| $16,804,319
| $—
| $—
| $16,804,319
|
| India
| 10,089,749
| —
| —
| 10,089,749
|
| South Korea
| 9,226,806
| —
| —
| 9,226,806
|
| Taiwan
| 9,035,987
| —
| —
| 9,035,987
|
| Brazil
| 4,121,583
| —
| —
| 4,121,583
|
| Indonesia
| 2,575,004
| —
| —
| 2,575,004
|
| South Africa
| 1,521,608
| —
| —
| 1,521,608
|
| Mexico
| 1,461,126
| —
| —
| 1,461,126
|
| Greece
| 1,425,705
| —
| —
| 1,425,705
|
| Other Countries
| 6,633,070
| 448,596
| 0
| 7,081,666
|
| Mutual Funds
| 813,327
| —
| —
| 813,327
|
| Total
| $63,708,284
| $448,596
| $0
| $64,156,880
|
For further information regarding
security characteristics, see the Portfolio of Investments.
The following is a reconciliation of
level 3 assets for which significant unobservable inputs were used to determine fair value. The table presents the activity of level 3 securities held at the beginning and the end of the period.
|
| Equity
Securities
|
| Balance as of 8/31/23
| $0
|
| Realized gain (loss)
| (268,044)
|
| Change in unrealized appreciation or depreciation
| 398,197
|
| Sales
| (130,153)
|
| Balance as of 2/29/24
| $0
|
The net change in unrealized
appreciation or depreciation from investments held as level 3 at February 29, 2024 is $0. At February 29, 2024, the fund held four level 3 securities.
Foreign Currency Translation — Purchases and sales of foreign investments, income, and expenses are converted into U.S. dollars based upon currency exchange rates prevailing on the respective dates of such
transactions or on the reporting date for foreign denominated receivables and payables. Gains and losses attributable to foreign
Notes to Financial
Statements (unaudited) - continued
currency exchange rates on sales of securities are
recorded for financial statement purposes as net realized gains and losses on investments. Gains and losses attributable to foreign exchange rate movements on receivables, payables, income and expenses are recorded
for financial statement purposes as foreign currency transaction gains and losses. That portion of both realized and unrealized gains and losses on investments that results from fluctuations in foreign currency
exchange rates is not separately disclosed.
Indemnifications — Under the fund's organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to
the fund. Additionally, in the normal course of business, the fund enters into agreements with service providers that may contain indemnification clauses. The fund's maximum exposure under these agreements is unknown
as this would involve future claims that may be made against the fund that have not yet occurred.
Investment Transactions and
Income — Dividends received in cash are recorded on the ex-dividend date. Certain dividends from foreign securities will be recorded when the fund is informed of the dividend if such information is
obtained subsequent to the ex-dividend date. Dividend payments received in additional securities are recorded on the ex-dividend date in an amount equal to the value of the security on such date.
The fund may receive proceeds from
litigation settlements. Any proceeds received from litigation involving portfolio holdings are reflected in the Statement of Operations in realized gain/loss if the security has been disposed of by the fund or in
unrealized gain/loss if the security is still held by the fund. Any other proceeds from litigation not related to portfolio holdings are reflected as other income in the Statement of Operations.
Investment transactions are recorded
on the trade date. In determining the net gain or loss on securities sold, the cost of securities is determined on the identified cost basis.
Tax Matters and Distributions — The fund intends to qualify as a regulated investment company, as defined under Subchapter M of the Internal Revenue Code, and to distribute all of its taxable income, including
realized capital gains. As a result, no provision for federal income tax is required. The fund’s federal tax returns, when filed, will remain subject to examination by the Internal Revenue Service for a three
year period. Management has analyzed the fund’s tax positions taken on federal and state tax returns for all open tax years and does not believe that there are any uncertain tax positions that require
recognition of a tax liability. Foreign taxes, if any, have been accrued by the fund in the accompanying financial statements in accordance with the applicable foreign tax law. Foreign income taxes may be withheld by
certain countries in which the fund invests. Additionally, capital gains realized by the fund on securities issued in or by certain foreign countries may be subject to capital gains tax imposed by those
countries.
Distributions to shareholders are
recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from U.S. generally accepted accounting principles. Certain capital
accounts in the financial statements are periodically adjusted for permanent differences in order to reflect their tax character. These adjustments have no impact on net assets or net
Notes to Financial
Statements (unaudited) - continued
asset value per share. Temporary differences which
arise from recognizing certain items of income, expense, gain or loss in different periods for financial statement and tax purposes will reverse at some time in the future.
Book/tax differences primarily
relate to passive foreign investment companies and wash sale loss deferrals.
The tax character of distributions
made during the current period will be determined at fiscal year end. The tax character of distributions declared to shareholders for the last fiscal year is as follows:
|
| Year ended
8/31/23
|
| Ordinary income (including any short-term capital gains)
| $1,376,015
|
The federal tax cost and the tax
basis components of distributable earnings were as follows:
| As of 2/29/24
|
|
| Cost of investments
| $58,470,219
|
| Gross appreciation
| 9,438,347
|
| Gross depreciation
| (3,751,686)
|
| Net unrealized appreciation (depreciation)
| $5,686,661
|
| As of 8/31/23
|
|
| Undistributed ordinary income
| 1,258,969
|
| Capital loss carryforwards
| (1,751,070)
|
| Other temporary differences
| (60,944)
|
| Net unrealized appreciation (depreciation)
| 1,375,805
|
The aggregate cost above includes
prior fiscal year end tax adjustments, if applicable.
As of August 31, 2023, the fund had
capital loss carryforwards available to offset future realized gains. These net capital losses may be carried forward indefinitely and their character is retained as short-term and/or long-term losses. Such losses are
characterized as follows:
Multiple Classes of Shares of
Beneficial Interest — The fund offers multiple classes of shares, which differ in their respective distribution and service fees. The fund's income, realized and unrealized gain (loss), and common
expenses are allocated to shareholders based on the daily net assets of each class. Dividends are declared separately for each class. Differences in per share dividend rates are generally due to differences in
separate class expenses. Class B and Class C shares will convert to
Notes to Financial
Statements (unaudited) - continued
Class A shares approximately eight years after
purchase. The fund’s distributions declared to shareholders as reported in the Statements of Changes in Net Assets are presented by class as follows:
|
| Six months
ended
2/29/24
|
| Year
ended
8/31/23
|
| Class A
| $94,501
|
| $106,681
|
| Class B
| 4,264
|
| 5,263
|
| Class C
| 2,774
|
| 3,158
|
| Class I
| 884,602
|
| 588,416
|
| Class R1
| 1,808
|
| 1,867
|
| Class R2
| 1,652
|
| 1,716
|
| Class R3
| 2,831
|
| 3,244
|
| Class R4
| 3,131
|
| 3,041
|
| Class R6
| 655,194
|
| 662,629
|
| Total
| $1,650,757
|
| $1,376,015
|
(3) Transactions with
Affiliates
Investment Adviser — The fund has an investment advisory agreement with MFS to provide overall investment management and related administrative services and facilities to the fund. The management fee is computed daily and paid monthly at the following annual rates based on the fund's average daily net assets:
| Up to $1 billion
| 0.75%
|
| In excess of $1 billion and up to $2.5 billion
| 0.70%
|
| In excess of $2.5 billion
| 0.675%
|
MFS has agreed in writing to reduce
its management fee by a specified amount if certain MFS mutual fund assets exceed thresholds agreed to by MFS and the fund's Board of Trustees. MFS has also agreed in writing to waive at least 0.01% of its management
fee as part of this agreement. The agreement to waive at least 0.01% of the management fee will continue until modified by the fund's Board of Trustees, but such agreement will continue at least until December 31,
2024. For the six months ended February 29, 2024, this management fee reduction amounted to $3,477, which is included in the reduction of total expenses in the Statement of Operations. The management fee incurred for
the six months ended February 29, 2024 was equivalent to an annual effective rate of 0.74% of the fund's average daily net assets.
The investment adviser has agreed in
writing to pay a portion of the fund’s total annual operating expenses, excluding interest, taxes, extraordinary expenses, brokerage and transaction costs, certain tax reclaim recovery expenses (including
contingency fees and closing agreement expenses), and investment-related expenses, such that total fund operating expenses do not exceed the following rates annually of each class’s average daily net assets:
|
|
|
|
| Classes
|
|
|
|
|
| A
| B
| C
| I
| R1
| R2
| R3
| R4
| R6
|
| 1.24%
| 1.99%
| 1.99%
| 0.99%
| 1.99%
| 1.49%
| 1.24%
| 0.99%
| 0.95%
|
Notes to Financial
Statements (unaudited) - continued
This written agreement will continue
until modified by the fund’s Board of Trustees, but such agreement will continue at least until December 31, 2024. For the six months ended February 29, 2024, this reduction amounted to $219,806, which is
included in the reduction of total expenses in the Statement of Operations.
Distributor — MFS Fund Distributors, Inc. (MFD), a wholly-owned subsidiary of MFS, as distributor, received $306 for the six months ended February 29, 2024, as its portion of the initial sales
charge on sales of Class A shares of the fund.
The Board of Trustees has adopted a
distribution plan for certain share classes pursuant to Rule 12b-1 of the Investment Company Act of 1940.
The fund's distribution plan
provides that the fund will pay MFD for services provided by MFD and financial intermediaries in connection with the distribution and servicing of certain share classes. One component of the plan is a distribution fee
paid to MFD and another component of the plan is a service fee paid to MFD. MFD may subsequently pay all, or a portion, of the distribution and/or service fees to financial intermediaries. The distribution and service
fees are computed daily and paid monthly.
Distribution Plan Fee Table:
|
| Distribution
Fee Rate (d)
| Service
Fee Rate (d)
| Total
Distribution
Plan (d)
| Annual
Effective
Rate (e)
| Distribution
and Service
Fee
|
| Class A
| —
| 0.25%
| 0.25%
| 0.25%
| $ 4,945
|
| Class B
| 0.75%
| 0.25%
| 1.00%
| 1.00%
| 1,238
|
| Class C
| 0.75%
| 0.25%
| 1.00%
| 1.00%
| 852
|
| Class R1
| 0.75%
| 0.25%
| 1.00%
| 0.25%
| 90
|
| Class R2
| 0.25%
| 0.25%
| 0.50%
| 0.50%
| 182
|
| Class R3
| —
| 0.25%
| 0.25%
| 0.25%
| 145
|
| Total Distribution and Service Fees
|
|
|
|
| $7,452
|
| (d)
| In accordance with the distribution plan for certain classes, the fund pays distribution and/or service fees equal to these annual percentage rates of each class’s average daily
net assets. The distribution and service fee rates disclosed by class represent the current rates in effect at the end of the reporting period. Any rate changes, if applicable, are detailed below.
|
| (e)
| The annual effective rates represent actual fees incurred under the distribution plan for the six months ended February 29, 2024 based on each class's average daily net assets. MFD
has voluntarily agreed to rebate a portion of each class's 0.25% service fee attributable to accounts for which there is no financial intermediary specified on the account except for accounts attributable to MFS or
its affiliates' seed money. There were no service fee rebates for the six months ended February 29, 2024. For the six months ended February 29, 2024, the 0.75% distribution fee was not imposed for Class R1 shares due
to the sales charge limitations contained in Financial Industry Regulatory Authority (“FINRA”) Rule 2341.
|
Certain Class A shares are
subject to a contingent deferred sales charge (CDSC) in the event of a shareholder redemption within 18 months of purchase. Class B shares are subject to a CDSC in the event of a shareholder redemption within six
years of
Notes to Financial
Statements (unaudited) - continued
purchase. Class C shares are subject to a CDSC in
the event of a shareholder redemption within 12 months of purchase. All contingent deferred sales charges are paid to MFD and during the six months ended February 29, 2024, were as follows:
|
| Amount
|
| Class A
| $4
|
| Class B
| 23
|
| Class C
| 9
|
Shareholder Servicing Agent — MFS Service Center, Inc. (MFSC), a wholly-owned subsidiary of MFS, receives a fee from the fund for its services as shareholder servicing agent calculated as a percentage of the
average daily net assets of the fund as determined periodically under the supervision of the fund's Board of Trustees. For the six months ended February 29, 2024, the fee was $2,263, which equated to 0.0084% annually
of the fund's average daily net assets. MFSC also receives reimbursement from the fund for out-of-pocket expenses, sub-accounting and other shareholder servicing costs which may be paid to affiliated and unaffiliated
service providers. Class R6 shares do not incur sub-accounting fees. For the six months ended February 29, 2024, these out-of-pocket expenses, sub-accounting and other shareholder servicing costs amounted to
$16,572.
Administrator — MFS provides certain financial, legal, shareholder communications, compliance, and other administrative services to the fund. Under an administrative services agreement, the
fund reimburses MFS the costs incurred to provide these services. The fund is charged an annual fixed amount of $17,500 plus a fee based on average daily net assets. The administrative services fee is
computed daily and paid monthly. The administrative services fee incurred for the six months ended February 29, 2024 was equivalent to an annual effective rate of 0.0337% of the fund's average daily net
assets.
Trustees’ and Officers’
Compensation — The fund pays compensation to independent Trustees in the form of a retainer, attendance fees, and additional compensation to Board and Committee chairpersons.
Independent Trustees’ compensation is accrued daily and paid subsequent to each Trustee Board meeting. The fund does not pay compensation directly to Trustees or officers of the fund who are also officers
of the investment adviser, all of whom receive remuneration from MFS for their services to the fund. Certain officers and Trustees of the fund are officers or directors of MFS, MFD, and MFSC.
Other — The fund invests in the MFS Institutional Money Market Portfolio which is managed by MFS and seeks current income consistent with preservation of capital and liquidity. This money
market fund does not pay a management fee to MFS but does incur investment and operating costs.
At February 29, 2024, MFS held
approximately 64% and 69% of the outstanding shares of Class R3 and Class R4, respectively, and 100% of the outstanding shares of Class R1 and Class R2.
The adviser has voluntarily
undertaken to reimburse the fund from its own resources on a quarterly basis for the cost of investment research embedded in the cost of the fund’s securities trades. This agreement may be rescinded at any time.
For the six months ended February 29, 2024, this reimbursement amounted to $5,190, which is included in “Other” income in the Statement of Operations.
Notes to Financial
Statements (unaudited) - continued
(4) Portfolio Securities
For the six months ended February
29, 2024, purchases and sales of investments, other than short-term obligations, aggregated $25,928,164 and $13,897,562, respectively.
(5) Shares of Beneficial
Interest
The fund's Declaration of Trust
permits the Trustees to issue an unlimited number of full and fractional shares of beneficial interest. Transactions in fund shares were as follows:
|
| Six months ended
2/29/24
|
| Year ended
8/31/23
|
|
| Shares
| Amount
|
| Shares
| Amount
|
| Shares sold
|
|
|
|
|
|
| Class A
| 218,227
| $2,678,509
|
| 254,491
| $2,936,773
|
| Class B
| —
| —
|
| 1
| 18
|
| Class C
| 289
| 3,482
|
| 278
| 3,296
|
| Class I
| 1,077,637
| 13,177,194
|
| 752,072
| 8,828,285
|
| Class R3
| 610
| 7,431
|
| 2,187
| 26,166
|
| Class R4
| 242
| 2,953
|
| 967
| 11,732
|
| Class R6
| 195,120
| 2,360,840
|
| 856,276
| 9,864,592
|
|
| 1,492,125
| $18,230,409
|
| 1,866,272
| $21,670,862
|
Shares issued to shareholders
in reinvestment of distributions
|
|
|
|
|
|
| Class A
| 7,797
| $94,501
|
| 9,110
| $106,681
|
| Class B
| 355
| 4,264
|
| 453
| 5,263
|
| Class C
| 230
| 2,774
|
| 271
| 3,158
|
| Class I
| 71,550
| 865,756
|
| 48,565
| 568,699
|
| Class R1
| 150
| 1,808
|
| 161
| 1,867
|
| Class R2
| 136
| 1,652
|
| 147
| 1,716
|
| Class R3
| 234
| 2,831
|
| 277
| 3,244
|
| Class R4
| 258
| 3,131
|
| 259
| 3,041
|
| Class R6
| 53,970
| 655,194
|
| 56,442
| 662,629
|
|
| 134,680
| $1,631,911
|
| 115,685
| $1,356,298
|
| Shares reacquired
|
|
|
|
|
|
| Class A
| (264,371)
| $(3,280,793)
|
| (305,998)
| $(3,486,786)
|
| Class B
| (703)
| (8,392)
|
| (2,332)
| (28,723)
|
| Class C
| (1,547)
| (18,561)
|
| (4,704)
| (53,640)
|
| Class I
| (169,740)
| (2,045,490)
|
| (572,358)
| (6,765,097)
|
| Class R3
| (832)
| (10,110)
|
| (2,475)
| (30,137)
|
| Class R4
| (401)
| (4,820)
|
| (602)
| (7,037)
|
| Class R6
| (62,243)
| (761,821)
|
| (451,996)
| (5,348,950)
|
|
| (499,837)
| $(6,129,987)
|
| (1,340,465)
| $(15,720,370)
|
Notes to Financial
Statements (unaudited) - continued
|
| Six months ended
2/29/24
|
| Year ended
8/31/23
|
|
| Shares
| Amount
|
| Shares
| Amount
|
| Net change
|
|
|
|
|
|
| Class A
| (38,347)
| $(507,783)
|
| (42,397)
| $(443,332)
|
| Class B
| (348)
| (4,128)
|
| (1,878)
| (23,442)
|
| Class C
| (1,028)
| (12,305)
|
| (4,155)
| (47,186)
|
| Class I
| 979,447
| 11,997,460
|
| 228,279
| 2,631,887
|
| Class R1
| 150
| 1,808
|
| 161
| 1,867
|
| Class R2
| 136
| 1,652
|
| 147
| 1,716
|
| Class R3
| 12
| 152
|
| (11)
| (727)
|
| Class R4
| 99
| 1,264
|
| 624
| 7,736
|
| Class R6
| 186,847
| 2,254,213
|
| 460,722
| 5,178,271
|
|
| 1,126,968
| $13,732,333
|
| 641,492
| $7,306,790
|
The fund is one of several mutual
funds in which certain MFS funds may invest. The MFS funds do not invest in the underlying funds for the purpose of exercising management or control. At the end of the period, the MFS Lifetime 2050 Fund, the MFS
Lifetime 2040 Fund, the MFS Lifetime 2045 Fund, the MFS Lifetime 2055 Fund, the MFS Lifetime 2060 Fund, and the MFS Lifetime 2035 Fund were the owners of record of approximately 8%, 7%, 7%, 5%, 3%, and 1%,
respectively, of the value of outstanding voting shares of the fund. In addition, the MFS Lifetime 2065 Fund was the owner of record of less than 1% of the value of outstanding voting shares of the fund.
Effective June 1, 2019, purchases of
the fund’s Class B shares were closed to new and existing investors subject to certain exceptions. Effective September 29, 2023, purchases of the fund's Class R1 and Class R2 shares were closed to new eligible
investors.
(6) Line of Credit
The fund and certain other funds
managed by MFS participate in a $1.45 billion unsecured committed line of credit of which $1.2 billion is reserved for use by the fund and certain other MFS U.S. funds. The line of credit is provided by a syndicate of
banks under a credit agreement. Borrowings may be made for temporary financing needs. Interest is charged to each fund, based on its borrowings, generally at a rate equal to the highest of 1) Daily Simple SOFR
(Secured Overnight Financing Rate) plus 0.10%, 2) the Federal Funds Effective Rate, or 3) the Overnight Bank Funding Rate, each plus an agreed upon spread. A commitment fee, based on the average daily unused portion
of the committed line of credit, is allocated among the participating funds. The line of credit expires on March 13, 2025 unless extended or renewed. In addition, the fund and other funds managed by MFS have
established unsecured uncommitted borrowing arrangements with certain banks for temporary financing needs. Interest is charged to each fund, based on its borrowings, at rates equal to customary reference rates plus an
agreed upon spread. For the six months ended February 29, 2024, the fund’s commitment fee and interest expense were $116 and $0, respectively, and are included in “Miscellaneous” expense in the
Statement of Operations.
Notes to Financial
Statements (unaudited) - continued
(7) Investments in Affiliated
Issuers
An affiliated issuer may be
considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common control. For the purposes of this report, the following were affiliated issuers:
| Affiliated Issuers
| Beginning
Value
| Purchases
| Sales
Proceeds
| Realized
Gain
(Loss)
| Change in
Unrealized
Appreciation or
Depreciation
| Ending
Value
|
| MFS Institutional Money Market Portfolio
| $519,794
| $19,480,356
| $19,186,582
| $(189)
| $(52)
| $813,327
|
| Affiliated Issuers
| Dividend
Income
| Capital Gain
Distributions
|
| MFS Institutional Money Market Portfolio
| $21,661
| $—
|
(8) Russia and Ukraine
Conflict
The fund invests in securities
and/or derivative instruments that are economically tied to Russia and/or Ukraine. Escalation of the conflict between Russia and Ukraine in late February 2022 caused market volatility and disruption in the tradability
of Russian securities, including closure of the local securities market, temporary restriction on securities sales by non-residents, and disruptions to clearance and payment systems. To the extent that the fund is
unable to sell securities, whether due to market constraints or to the sanctions imposed on Russia by the United States and other countries, those securities are considered illiquid and the value of those securities
reflects their illiquid classification. Management continues to monitor these events and to evaluate the related impacts on fund performance.
Proxy Voting Policies and
Information
MFS votes proxies on behalf of the
fund pursuant to proxy voting policies and procedures that are available without charge, upon request, by calling 1-800-225-2606, by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Information regarding how the fund
voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available by August 31 of each year without charge by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Quarterly Portfolio
Disclosure
The fund files a complete schedule
of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The fund's Form N-PORT reports are available on the SEC's Web site at http://www.sec.gov. A shareholder can obtain the portfolio holdings report for the first and third quarters of the fund's fiscal year at mfs.com/openendfunds by choosing the fund's name and then scrolling to the “Resources” section and clicking on the “Prospectus and Reports” tab.
Further Information
From time to time, MFS may post
important information about the fund or the MFS Funds on the MFS Web site (mfs.com). This information is available at https://www.mfs.com/announcements or at mfs.com/openendfunds by choosing the fund’s name and then scrolling to the “Resources” section and clicking on the “Announcements” tab, if any.
Information About Fund
Contracts and Legal Claims
The fund has entered into
contractual arrangements with an investment adviser, administrator, distributor, shareholder servicing agent, and custodian who each provide services to the fund. Unless expressly stated otherwise, shareholders are
not parties to, or intended beneficiaries of these contractual arrangements, and these contractual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek
any remedy under them against the service providers, either directly or on behalf of the fund.
Under the Trust’s By-Laws and
Declaration of Trust, any claims asserted against or on behalf of the MFS Funds, including claims against Trustees and Officers, must be brought in state and federal courts located within the Commonwealth of
Massachusetts.
Provision of Financial
Reports and Summary Prospectuses
The fund produces financial reports
every six months and updates its summary prospectus and prospectus annually. To avoid sending duplicate copies of materials to households, only one copy of the fund’s annual and semiannual report and summary
prospectus may be mailed to shareholders having the same last name and residential address on the fund’s records. However, any shareholder may contact MFSC (please see back cover for address and telephone
number) to request that copies of these reports and summary prospectuses be sent personally to that shareholder.
Save paper with eDelivery.
MFS® will send you prospectuses, reports, and proxies directly via e-mail so you will get information faster with less mailbox clutter.
To sign up:
1. Go to mfs.com.
2. Log in via MFS® Access.
3. Select eDelivery.
If you own your MFS fund shares
through a financial institution or a retirement plan, MFS® TALK, MFS® Access, or eDelivery may not be available to you.
CONTACT
WEB SITE
mfs.com
MFS TALK
1-800-637-8255
24 hours a day
ACCOUNT SERVICE AND LITERATURE
Shareholders
1-800-225-2606
Financial advisors
1-800-343-2829
Retirement plan services
1-800-637-1255
MAILING ADDRESS
MFS Service Center, Inc.
P.O. Box 219341
Kansas City, MO 64121-9341
OVERNIGHT MAIL
MFS Service Center, Inc.
Suite 219341
430 W 7th Street
Kansas City, MO 64105-1407
Semiannual Report
February 29, 2024
MFS® Blended Research®
International Equity Fund
MFS® Blended Research®
International Equity Fund
| 1
|
| 3
|
| 5
|
| 13
|
| 15
|
| 16
|
| 17
|
| 26
|
| 37
|
| 37
|
| 37
|
| 37
|
| 37
|
The report is prepared for the
general information of shareholders. It is authorized for distribution to prospective investors only when preceded or accompanied by a current prospectus.
NOT FDIC INSURED
• MAY LOSE VALUE • NO BANK GUARANTEE
Portfolio structure
Top ten holdings
| Taiwan Semiconductor Manufacturing Co. Ltd., ADR
| 2.4%
|
| ASML Holding N.V.
| 2.3%
|
| Roche Holding AG
| 1.7%
|
| KDDI Corp.
| 1.4%
|
| Volvo Group
| 1.4%
|
| Sanofi
| 1.4%
|
| Samsung Electronics Co. Ltd.
| 1.4%
|
| Schneider Electric SE
| 1.4%
|
| Eni S.p.A.
| 1.4%
|
| Manulife Financial Corp.
| 1.4%
|
GICS equity sectors (g)
| Financials
| 20.5%
|
| Industrials
| 14.9%
|
| Information Technology
| 13.6%
|
| Consumer Discretionary
| 11.6%
|
| Health Care
| 8.2%
|
| Materials
| 8.0%
|
| Consumer Staples
| 7.4%
|
| Communication Services
| 5.7%
|
| Energy
| 5.6%
|
| Utilities
| 2.3%
|
| Real Estate
| 1.1%
|
| Equity Warrants (o)
| 0.0%
|
Issuer country weightings (x)
| Japan
| 15.1%
|
| France
| 10.1%
|
| United Kingdom
| 9.6%
|
| Canada
| 8.3%
|
| China
| 7.5%
|
| South Korea
| 4.7%
|
| Netherlands
| 4.7%
|
| Switzerland
| 4.1%
|
| Australia
| 4.1%
|
| Other Countries
| 31.8%
|
Currency exposure weightings (y)
| Euro
| 24.1%
|
| Japanese Yen
| 15.1%
|
| British Pound Sterling
| 9.6%
|
| Canadian Dollar
| 8.3%
|
| Hong Kong Dollar
| 7.3%
|
| South Korean Won
| 4.7%
|
| United States Dollar
| 4.3%
|
| Swiss Franc
| 4.1%
|
| Taiwan Dollar
| 3.9%
|
| Other Currencies
| 18.6%
|
Portfolio Composition - continued
| (g)
| The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and S&P Global Market Intelligence Inc. (“S&P Global Market
Intelligence”). GICS is a service mark of MSCI and S&P Global Market Intelligence and has been licensed for use by MFS. MFS has applied its own internal sector/industry classification methodology for equity
securities and non-equity securities that are unclassified by GICS.
|
| (x)
| Represents the portfolio’s exposure to issuer countries as a percentage of a portfolio’s net assets. For purposes of this presentation, United States (included in Other
Countries) includes Cash & Cash Equivalents and Other.
|
| (y)
| Represents the portfolio’s exposure to a particular currency as a percentage of a portfolio's net assets. For purposes of this presentation, United States Dollar includes Cash
& Cash Equivalents.
|
Cash & Cash Equivalents includes
any cash, investments in money market funds, short-term securities, and other assets less liabilities. Please see the Statement of Assets and Liabilities for additional information related to the fund’s cash
position and other assets and liabilities.
Other includes equivalent exposure
from currency derivatives and/or any offsets to derivative positions and may be negative.
Percentages are based on net assets
as of February 29, 2024.
The portfolio is actively managed
and current holdings may be different.
Expense Table
Fund expenses borne by the
shareholders during the period,
September 1, 2023 through February 29, 2024
As a shareholder of the fund, you
incur two types of costs: (1) transaction costs, including sales charges (loads) on certain purchase or redemption payments, and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and
other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an
investment of $1,000 invested at the beginning of the period and held for the entire period September 1, 2023 through February 29, 2024.
Actual Expenses
The first line for each share class
in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over
the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled
“Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for
Comparison Purposes
The second line for each share class
in the following table provides information about hypothetical account values and hypothetical expenses based on the fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses,
which is not the fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information
to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown
in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line for each share class in the table is useful in
comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Expense Table - continued
Share
Class
|
| Annualized
Expense
Ratio
| Beginning
Account Value
9/01/23
| Ending
Account Value
2/29/24
| Expenses
Paid During
Period (p)
9/01/23-2/29/24
|
| A
| Actual
| 0.89%
| $1,000.00
| $1,071.29
| $4.58
|
| Hypothetical (h)
| 0.89%
| $1,000.00
| $1,020.44
| $4.47
|
| B
| Actual
| 1.64%
| $1,000.00
| $1,067.00
| $8.43
|
| Hypothetical (h)
| 1.64%
| $1,000.00
| $1,016.71
| $8.22
|
| C
| Actual
| 1.64%
| $1,000.00
| $1,067.48
| $8.43
|
| Hypothetical (h)
| 1.64%
| $1,000.00
| $1,016.71
| $8.22
|
| I
| Actual
| 0.64%
| $1,000.00
| $1,072.19
| $3.30
|
| Hypothetical (h)
| 0.64%
| $1,000.00
| $1,021.68
| $3.22
|
| R1
| Actual
| 1.64%
| $1,000.00
| $1,067.53
| $8.43
|
| Hypothetical (h)
| 1.64%
| $1,000.00
| $1,016.71
| $8.22
|
| R2
| Actual
| 1.14%
| $1,000.00
| $1,069.94
| $5.87
|
| Hypothetical (h)
| 1.14%
| $1,000.00
| $1,019.19
| $5.72
|
| R3
| Actual
| 0.89%
| $1,000.00
| $1,071.21
| $4.58
|
| Hypothetical (h)
| 0.89%
| $1,000.00
| $1,020.44
| $4.47
|
| R4
| Actual
| 0.64%
| $1,000.00
| $1,072.95
| $3.30
|
| Hypothetical (h)
| 0.64%
| $1,000.00
| $1,021.68
| $3.22
|
| R6
| Actual
| 0.56%
| $1,000.00
| $1,073.72
| $2.89
|
| Hypothetical (h)
| 0.56%
| $1,000.00
| $1,022.08
| $2.82
|
| (h)
| 5% class return per year before expenses.
|
| (p)
| “Expenses Paid During Period” are equal to each class’s annualized expense ratio, as shown above, multiplied by the average account value over the period, multiplied
by 182/366 (to reflect the one-half year period). Expenses paid do not include any applicable sales charges (loads). If these transaction costs had been included, your costs would have been higher.
|
Portfolio of Investments
2/29/24 (unaudited)
The Portfolio of Investments is a
complete list of all securities owned by your fund. It is categorized by broad-based asset classes.
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – 98.6%
|
| Aerospace & Defense – 1.1%
|
|
| Rolls-Royce Holdings PLC (a)
|
| 988,937
| $4,607,603
|
| Thales S.A.
|
| 21,082
| 3,122,741
|
|
|
|
|
| $7,730,344
|
| Airlines – 0.6%
|
|
| Air Canada (a)(l)
|
| 302,784
| $4,042,623
|
| Alcoholic Beverages – 1.0%
|
|
| Ambev S.A.
|
| 966,100
| $2,444,839
|
| Kirin Holdings Co. Ltd.
|
| 327,700
| 4,556,367
|
|
|
|
|
| $7,001,206
|
| Apparel Manufacturers – 0.9%
|
|
| Adidas AG
|
| 20,099
| $4,064,806
|
| Compagnie Financiere Richemont S.A.
|
| 14,797
| 2,352,528
|
|
|
|
|
| $6,417,334
|
| Automotive – 2.9%
|
|
| BYD Co. Ltd.
|
| 96,000
| $2,370,113
|
| Compagnie Generale des Etablissements Michelin
|
| 213,900
| 7,904,147
|
| Kia Corp.
|
| 22,612
| 2,114,144
|
| Mahindra & Mahindra Ltd.
|
| 141,850
| 3,305,877
|
| Stellantis N.V.
|
| 147,638
| 3,851,152
|
|
|
|
|
| $19,545,433
|
| Brokerage & Asset Managers – 2.1%
|
|
| 3i Group PLC
|
| 47,570
| $1,481,974
|
| Brookfield Corp.
|
| 163,139
| 6,731,595
|
| iA Financial Corp., Inc.
|
| 38,387
| 2,380,466
|
| IG Group Holdings PLC
|
| 427,582
| 3,772,759
|
|
|
|
|
| $14,366,794
|
| Business Services – 2.0%
|
|
| CGI, Inc. (a)
|
| 34,793
| $3,994,728
|
| Eurofins Scientific SE
|
| 27,720
| 1,654,977
|
| Serco Group PLC
|
| 1,337,178
| 3,161,473
|
| Tata Consultancy Services Ltd.
|
| 100,532
| 4,965,113
|
|
|
|
|
| $13,776,291
|
| Chemicals – 0.6%
|
|
| Nutrien Ltd.
|
| 73,214
| $3,821,596
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Computer Software – 1.2%
|
|
| Check Point Software Technologies Ltd. (a)
|
| 40,077
| $6,429,152
|
| Kingsoft Corp.
|
| 509,200
| 1,421,039
|
|
|
|
|
| $7,850,191
|
| Computer Software - Systems – 5.7%
|
|
| Amadeus IT Group S.A.
|
| 37,108
| $2,180,981
|
| Constellation Software, Inc.
|
| 3,121
| 8,689,058
|
| Hitachi Ltd.
|
| 78,300
| 6,614,658
|
| Hon Hai Precision Industry Co. Ltd.
|
| 2,322,000
| 7,566,269
|
| NEC Corp.
|
| 65,100
| 4,381,397
|
| Samsung Electronics Co. Ltd.
|
| 172,531
| 9,510,195
|
|
|
|
|
| $38,942,558
|
| Construction – 2.8%
|
|
| Anhui Conch Cement Co. Ltd.
|
| 589,000
| $1,287,909
|
| CEMEX S.A.B. de C.V. (a)
|
| 2,582,414
| 1,974,206
|
| Compagnie de Saint-Gobain S.A.
|
| 112,672
| 8,670,440
|
| Heidelberg Materials AG
|
| 42,737
| 4,143,254
|
| James Hardie Industries PLC, GDR (a)
|
| 34,153
| 1,348,616
|
| Midea Group Co. Ltd., “A”
|
| 176,200
| 1,534,133
|
|
|
|
|
| $18,958,558
|
| Consumer Products – 0.6%
|
|
| AmorePacific Corp.
|
| 23,572
| $2,117,160
|
| Kao Corp.
|
| 45,800
| 1,740,107
|
|
|
|
|
| $3,857,267
|
| Containers – 0.8%
|
|
| Brambles Ltd.
|
| 551,445
| $5,401,678
|
| Electrical Equipment – 3.2%
|
|
| Legrand S.A.
|
| 36,178
| $3,655,959
|
| Mitsubishi Electric Corp.
|
| 520,200
| 8,263,449
|
| Schneider Electric SE
|
| 41,645
| 9,443,076
|
|
|
|
|
| $21,362,484
|
| Electronics – 6.8%
|
|
| ASML Holding N.V.
|
| 16,636
| $15,651,747
|
| Novatek Microelectronics Corp.
|
| 143,000
| 2,718,898
|
| NXP Semiconductors N.V.
|
| 11,735
| 2,930,582
|
| Renesas Electronics Corp.
|
| 311,800
| 5,104,810
|
| Taiwan Semiconductor Manufacturing Co. Ltd., ADR
|
| 126,959
| 16,335,814
|
| Tokyo Electron Ltd.
|
| 14,600
| 3,590,595
|
|
|
|
|
| $46,332,446
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Energy - Integrated – 5.6%
|
|
| Cenovus Energy, Inc. (l)
|
| 113,895
| $1,984,760
|
| Eni S.p.A.
|
| 602,402
| 9,276,528
|
| Harbour Energy PLC
|
| 523,939
| 1,669,293
|
| LUKOIL PJSC (a)(u)
|
| 35,153
| 0
|
| PetroChina Co. Ltd.
|
| 7,570,000
| 5,965,502
|
| Petroleo Brasileiro S.A., ADR
|
| 383,001
| 6,327,176
|
| Suncor Energy, Inc. (l)
|
| 122,967
| 4,224,994
|
| TotalEnergies SE
|
| 136,321
| 8,691,331
|
|
|
|
|
| $38,139,584
|
| Engineering - Construction – 0.4%
|
|
| Doosan Bobcat, Inc.
|
| 81,884
| $2,887,094
|
| Food & Beverages – 1.8%
|
|
| AVI Ltd.
|
| 417,818
| $1,947,929
|
| Ezaki Glico Co. Ltd.
|
| 123,100
| 3,668,695
|
| Gruma S.A.B. de C.V.
|
| 167,256
| 2,978,554
|
| Nestle S.A.
|
| 20,720
| 2,149,904
|
| WH Group Ltd.
|
| 2,241,500
| 1,351,284
|
|
|
|
|
| $12,096,366
|
| Food & Drug Stores – 2.3%
|
|
| Loblaw Cos. Ltd.
|
| 32,824
| $3,498,260
|
| Sugi Holdings Co. Ltd. (l)
|
| 200,900
| 3,148,443
|
| Tesco PLC
|
| 2,509,756
| 8,832,562
|
|
|
|
|
| $15,479,265
|
| Gaming & Lodging – 1.6%
|
|
| Aristocrat Leisure Ltd.
|
| 153,935
| $4,665,691
|
| Whitbread PLC
|
| 151,481
| 6,315,812
|
|
|
|
|
| $10,981,503
|
| General Merchandise – 1.2%
|
|
| B&M European Value Retail S.A.
|
| 699,778
| $4,644,546
|
| Dollarama, Inc.
|
| 43,076
| 3,332,070
|
|
|
|
|
| $7,976,616
|
| Insurance – 4.5%
|
|
| AUB Group Ltd.
|
| 75,040
| $1,474,010
|
| China Pacific Insurance Co. Ltd.
|
| 1,753,400
| 3,345,782
|
| DB Insurance Co. Ltd.
|
| 50,708
| 3,762,354
|
| Manulife Financial Corp.
|
| 390,792
| 9,274,885
|
| Ping An Insurance Co. of China Ltd., “H”
|
| 882,500
| 3,956,287
|
| Samsung Fire & Marine Insurance Co. Ltd.
|
| 24,652
| 5,516,894
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Insurance – continued
|
|
| Tokio Marine Holding, Inc.
|
| 109,900
| $3,207,860
|
|
|
|
|
| $30,538,072
|
| Internet – 2.8%
|
|
| Moneysupermarket.com Group PLC
|
| 564,741
| $1,745,111
|
| NetEase, Inc., ADR
|
| 72,366
| 7,809,739
|
| Scout24 AG
|
| 29,910
| 2,172,355
|
| Tencent Holdings Ltd.
|
| 212,600
| 7,527,010
|
|
|
|
|
| $19,254,215
|
| Leisure & Toys – 1.0%
|
|
| Sankyo Co. Ltd. (l)
|
| 593,000
| $6,763,807
|
| Machinery & Tools – 2.6%
|
|
| Finning International, Inc.
|
| 116,139
| $3,044,782
|
| GEA Group AG
|
| 52,717
| 2,123,514
|
| OSG Corp.
|
| 209,600
| 2,935,267
|
| Volvo Group
|
| 353,945
| 9,734,307
|
|
|
|
|
| $17,837,870
|
| Major Banks – 9.4%
|
|
| ABN AMRO Group N.V., GDR
|
| 437,682
| $7,024,740
|
| Bank of China Ltd.
|
| 4,421,000
| 1,739,151
|
| Bank of Ireland Group PLC
|
| 278,021
| 2,420,106
|
| BNP Paribas
|
| 130,025
| 7,782,604
|
| Danske Bank A.S.
|
| 202,154
| 5,935,791
|
| DBS Group Holdings Ltd.
|
| 361,300
| 8,949,596
|
| Erste Group Bank AG
|
| 89,397
| 3,565,287
|
| National Australia Bank Ltd.
|
| 187,493
| 4,124,095
|
| National Bank of Greece S.A (a)
|
| 376,096
| 2,944,573
|
| Nedbank Group Ltd.
|
| 221,748
| 2,534,147
|
| OTP Bank PLC
|
| 33,258
| 1,594,565
|
| UBS Group AG
|
| 276,913
| 7,893,907
|
| UniCredit S.p.A.
|
| 206,604
| 6,902,126
|
|
|
|
|
| $63,410,688
|
| Medical & Health Technology & Services – 0.3%
|
|
| OdontoPrev S.A.
|
| 731,200
| $1,772,437
|
| Medical Equipment – 1.1%
|
|
| Demant A.S. (a)
|
| 75,223
| $3,764,150
|
| Fisher & Paykel Healthcare Corp. Ltd.
|
| 151,576
| 2,261,032
|
| Olympus Corp.
|
| 95,000
| 1,350,987
|
|
|
|
|
| $7,376,169
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Metals & Mining – 4.3%
|
|
| Fortescue Ltd.
|
| 209,881
| $3,537,438
|
| Glencore PLC
|
| 1,394,319
| 6,602,821
|
| Rio Tinto PLC
|
| 119,320
| 7,649,867
|
| Toyota Tsusho Corp.
|
| 83,700
| 5,400,972
|
| Vale S.A.
|
| 426,400
| 5,746,120
|
|
|
|
|
| $28,937,218
|
| Other Banks & Diversified Financials – 4.5%
|
|
| Banca Monte dei Paschi di Siena S.p.A.
|
| 388,260
| $1,586,206
|
| Bangkok Bank Public Co. Ltd.
|
| 733,900
| 2,905,724
|
| China Construction Bank Corp.
|
| 8,614,000
| 5,368,966
|
| Credicorp Ltd.
|
| 29,488
| 5,038,910
|
| Emirates NBD Bank PJSC
|
| 372,873
| 1,857,792
|
| Hana Financial Group, Inc.
|
| 36,295
| 1,542,728
|
| IndusInd Bank Ltd.
|
| 47,170
| 839,052
|
| Julius Baer Group Ltd.
|
| 44,496
| 2,378,889
|
| KB Financial Group, Inc.
|
| 88,842
| 4,236,608
|
| Macquarie Group Ltd.
|
| 36,903
| 4,672,896
|
| Sberbank of Russia PJSC (a)(u)
|
| 715,224
| 0
|
|
|
|
|
| $30,427,771
|
| Pharmaceuticals – 6.6%
|
|
| Chugai Pharmaceutical Co. Ltd.
|
| 141,000
| $5,643,010
|
| Dr. Reddy's Laboratories Ltd.
|
| 22,835
| 1,769,228
|
| Novo Nordisk A.S., “B”
|
| 31,778
| 3,777,050
|
| Roche Holding AG
|
| 44,405
| 11,646,678
|
| Sandoz Group AG (a)
|
| 49,240
| 1,528,954
|
| Sanofi
|
| 100,724
| 9,567,921
|
| Santen Pharmaceutical Co. Ltd.
|
| 511,300
| 5,069,687
|
| Sun Pharmaceutical Industries Ltd.
|
| 314,290
| 5,981,142
|
|
|
|
|
| $44,983,670
|
| Printing & Publishing – 1.5%
|
|
| Transcontinental, Inc., “A”
|
| 131,290
| $1,387,244
|
| Wolters Kluwer N.V.
|
| 57,115
| 9,003,301
|
|
|
|
|
| $10,390,545
|
| Railroad & Shipping – 0.5%
|
|
| Sankyu, Inc.
|
| 94,000
| $3,317,463
|
| Real Estate – 1.2%
|
|
| CapitaLand India Trusts IEU, REIT
|
| 1,963,164
| $1,473,595
|
| Goodman Group, REIT
|
| 140,178
| 2,724,359
|
| KDX Realty Investment Corp., REIT
|
| 1,765
| 1,764,764
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Real Estate – continued
|
|
| Nomura Real Estate Holdings
|
| 98,600
| $2,448,558
|
|
|
|
|
| $8,411,276
|
| Restaurants – 1.5%
|
|
| Pluxee N.V. (a)
|
| 69,326
| $1,980,708
|
| Sodexo
|
| 73,586
| 5,861,487
|
| Wetherspoons (J.D.) PLC (a)
|
| 206,027
| 1,971,314
|
|
|
|
|
| $9,813,509
|
| Specialty Chemicals – 2.1%
|
|
| Linde PLC
|
| 17,285
| $7,757,854
|
| Nitto Denko Corp.
|
| 74,000
| 6,786,953
|
|
|
|
|
| $14,544,807
|
| Specialty Stores – 2.6%
|
|
| Alibaba Group Holding Ltd.
|
| 618,500
| $5,758,816
|
| NEXT PLC
|
| 61,367
| 6,440,318
|
| PDD Holdings, Inc., ADR (a)
|
| 23,719
| 2,953,964
|
| Walmart de Mexico S.A.B. de C.V.
|
| 662,710
| 2,653,679
|
|
|
|
|
| $17,806,777
|
| Telecommunications - Wireless – 2.2%
|
|
| KDDI Corp.
|
| 321,700
| $9,772,024
|
| PT Telekom Indonesia
|
| 19,810,600
| 5,042,469
|
|
|
|
|
| $14,814,493
|
| Telephone Services – 0.5%
|
|
| Hellenic Telecommunications Organization S.A.
|
| 205,520
| $3,100,878
|
| Tobacco – 1.4%
|
|
| British American Tobacco PLC
|
| 197,544
| $5,847,485
|
| Japan Tobacco, Inc.
|
| 132,800
| 3,447,556
|
|
|
|
|
| $9,295,041
|
| Trucking – 0.5%
|
|
| Yamato Holdings Co. Ltd.
|
| 239,500
| $3,634,355
|
| Utilities - Electric Power – 2.3%
|
|
| CLP Holdings Ltd.
|
| 205,500
| $1,712,609
|
| E.ON SE
|
| 518,189
| 6,614,290
|
| Iberdrola S.A.
|
| 624,994
| 7,173,738
|
|
|
|
|
| $15,500,637
|
| Total Common Stocks (Identified Cost, $575,591,848)
|
| $668,898,929
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Preferred Stocks – 0.3%
|
| Metals & Mining – 0.3%
|
|
|
|
|
| Gerdau S.A. (Identified Cost, $2,150,388)
|
| 499,630
| $2,160,899
|
|
| Strike
Price
| First
Exercise
|
|
|
| Warrants – 0.0%
|
|
|
|
|
| Computer Software - Systems – 0.0%
|
Constellation Software, Inc. (CAD 100 principal amount of Series 2 Debentures for 1 warrant, Expiration 3/31/40) (a)
(Identified Cost, $0)
| CAD 11.5
| N/A
| 3,156
| $0
|
|
|
|
|
|
|
| Investment Companies (h) – 0.3%
|
| Money Market Funds – 0.3%
|
|
| MFS Institutional Money Market Portfolio, 5.37% (v) (Identified Cost, $1,906,937)
|
|
| 1,906,939
| $1,906,939
|
| Collateral for Securities Loaned – 0.2%
|
| State Street Navigator Securities Lending Government Money Market Portfolio, 5.34% (j) (Identified Cost, $1,258,635)
|
|
| 1,258,635
| $1,258,635
|
|
|
|
|
| Other Assets, Less Liabilities – 0.6%
|
| 3,921,668
|
| Net Assets – 100.0%
| $678,147,070
|
| (a)
| Non-income producing security.
|
|
|
|
| (h)
| An affiliated issuer, which may be considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common
control. At period end, the aggregate values of the fund's investments in affiliated issuers and in unaffiliated issuers were $1,906,939 and $672,318,463, respectively.
|
|
|
|
| (j)
| The rate quoted is the annualized seven-day yield of the fund at period end.
|
|
|
|
| (l)
| A portion of this security is on loan. See Note 2 for additional information.
|
|
|
|
| (u)
| The security was valued using significant unobservable inputs and is considered level 3 under the fair value hierarchy. For further information about the
fund’s level 3 holdings, please see Note 2 in the Notes to Financial Statements.
|
|
|
|
| (v)
| Affiliated issuer that is available only to investment companies managed by MFS. The rate quoted for the MFS Institutional Money Market Portfolio is the annualized
seven-day yield of the fund at period end.
|
|
|
|
Portfolio of Investments (unaudited)
– continued
| The following abbreviations are used in this report and are defined:
|
| ADR
| American Depositary Receipt
|
| GDR
| Global Depositary Receipt
|
| IEU
| International Equity Unit
|
| REIT
| Real Estate Investment Trust
|
| Abbreviations indicate amounts shown in currencies other than the U.S. dollar. All amounts are stated in U.S. dollars unless otherwise indicated. A list of abbreviations is shown below:
|
| CAD
| Canadian Dollar
|
See Notes to Financial Statements
Financial Statements
Statement of Assets and
Liabilities
At 2/29/24 (unaudited)
This statement represents your
fund’s balance sheet, which details the assets and liabilities comprising the total value of the fund.
| Assets
|
|
| Investments in unaffiliated issuers, at value, including $12,182,673 of securities on loan (identified cost, $579,000,871)
| $672,318,463
|
| Investments in affiliated issuers, at value (identified cost, $1,906,937)
| 1,906,939
|
| Foreign currency, at value (identified cost, $3)
| 3
|
| Receivables for
|
|
| Investments sold
| 44,742,376
|
| Fund shares sold
| 685,546
|
| Interest and dividends
| 1,781,868
|
| Other assets
| 2,099
|
| Total assets
| $721,437,294
|
| Liabilities
|
|
| Payables for
|
|
| Investments purchased
| $40,619,253
|
| Fund shares reacquired
| 631,602
|
| Collateral for securities loaned, at value (c)
| 1,258,635
|
| Payable to affiliates
|
|
| Investment adviser
| 1,318
|
| Administrative services fee
| 587
|
| Shareholder servicing costs
| 90,316
|
| Distribution and service fees
| 559
|
| Payable for independent Trustees' compensation
| 1,893
|
| Deferred foreign capital gains tax expense payable
| 490,414
|
| Accrued expenses and other liabilities
| 195,647
|
| Total liabilities
| $43,290,224
|
| Net assets
| $678,147,070
|
| Net assets consist of
|
|
| Paid-in capital
| $603,611,627
|
| Total distributable earnings (loss)
| 74,535,443
|
| Net assets
| $678,147,070
|
| Shares of beneficial interest outstanding
| 55,047,563
|
| (c)
| Non-cash collateral is not included.
|
Statement of Assets and Liabilities (unaudited) – continued
|
| Net assets
| Shares
outstanding
| Net asset value
per share (a)
|
| Class A
| $26,830,819
| 2,152,119
| $12.47
|
| Class B
| 146,691
| 12,043
| 12.18
|
| Class C
| 490,034
| 40,479
| 12.11
|
| Class I
| 268,468,842
| 21,823,323
| 12.30
|
| Class R1
| 1,038,610
| 86,563
| 12.00
|
| Class R2
| 2,883,438
| 236,512
| 12.19
|
| Class R3
| 1,489,440
| 120,947
| 12.31
|
| Class R4
| 704,984
| 57,249
| 12.31
|
| Class R6
| 376,094,212
| 30,518,328
| 12.32
|
| (a)
| Maximum offering price per share was equal to the net asset value per share for all share classes, except for Class A, for which the maximum offering price per share was $13.23 [100 /
94.25 x $12.47]. On sales of $50,000 or more, the maximum offering price of Class A shares is reduced. A contingent deferred sales charge may be imposed on redemptions of Class A, Class B, and Class C shares.
Redemption price per share was equal to the net asset value per share for Classes I, R1, R2, R3, R4, and R6.
|
See Notes to Financial Statements
Financial Statements
Statement of Operations
Six months ended 2/29/24
(unaudited)
This statement describes how much
your fund earned in investment income and accrued in expenses. It also describes any gains and/or losses generated by fund operations.
| Net investment income (loss)
|
|
| Income
|
|
| Dividends
| $6,751,428
|
| Dividends from affiliated issuers
| 151,200
|
| Other
| 22,596
|
| Income on securities loaned
| 17,767
|
| Interest
| 1,184
|
| Foreign taxes withheld
| (647,920)
|
| Total investment income
| $6,296,255
|
| Expenses
|
|
| Management fee
| $1,587,625
|
| Distribution and service fees
| 49,714
|
| Shareholder servicing costs
| 129,543
|
| Administrative services fee
| 50,248
|
| Independent Trustees' compensation
| 6,113
|
| Custodian fee
| 96,075
|
| Shareholder communications
| 9,462
|
| Audit and tax fees
| 46,248
|
| Legal fees
| 1,550
|
| Miscellaneous
| 89,624
|
| Total expenses
| $2,066,202
|
| Reduction of expenses by investment adviser
| (124,418)
|
| Net expenses
| $1,941,784
|
| Net investment income (loss)
| $4,354,471
|
| Realized and unrealized gain (loss)
|
| Realized gain (loss) (identified cost basis)
|
|
| Unaffiliated issuers
| $7,460,114
|
| Affiliated issuers
| 1,430
|
| Foreign currency
| (33,704)
|
| Net realized gain (loss)
| $7,427,840
|
| Change in unrealized appreciation or depreciation
|
|
| Unaffiliated issuers (includes $344,513 increase in deferred foreign capital gains tax)
| $35,146,650
|
| Affiliated issuers
| (642)
|
| Translation of assets and liabilities in foreign currencies
| (31,358)
|
| Net unrealized gain (loss)
| $35,114,650
|
| Net realized and unrealized gain (loss)
| $42,542,490
|
| Change in net assets from operations
| $46,896,961
|
See Notes to Financial Statements
Financial Statements
Statements of Changes in Net
Assets
These statements describe the
increases and/or decreases in net assets resulting from operations, any distributions, and any shareholder transactions.
|
| Six months ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
|
| Change in net assets
|
|
|
| From operations
|
|
|
| Net investment income (loss)
| $4,354,471
| $17,681,456
|
| Net realized gain (loss)
| 7,427,840
| (21,379,703)
|
| Net unrealized gain (loss)
| 35,114,650
| 78,394,046
|
| Change in net assets from operations
| $46,896,961
| $74,695,799
|
| Total distributions to shareholders
| $(18,501,562)
| $(14,738,424)
|
| Change in net assets from fund share transactions
| $29,812,857
| $70,429,407
|
| Total change in net assets
| $58,208,256
| $130,386,782
|
| Net assets
|
|
|
| At beginning of period
| 619,938,814
| 489,552,032
|
| At end of period
| $678,147,070
| $619,938,814
|
See Notes to Financial Statements
Financial Statements
Financial Highlights
The financial highlights table is
intended to help you understand the fund's financial performance for the semiannual period and the past 5 fiscal years. Certain information reflects financial results for a single fund share. The total returns in the
table represent the rate that an investor would have earned (or lost) on an investment in the fund share class (assuming reinvestment of all distributions) held for the entire period.
| Class A
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $11.94
| $10.77
| $13.71
| $10.79
| $10.37
| $11.71
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.07
| $0.33
| $0.31
| $0.31
| $0.25
| $0.30
|
| Net realized and unrealized gain (loss)
| 0.77
| 1.12
| (2.57)
| 2.87
| 0.47
| (1.01)
|
| Total from investment operations
| $0.84
| $1.45
| $(2.26)
| $3.18
| $0.72
| $(0.71)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.31)
| $(0.19)
| $(0.11)
| $(0.26)
| $(0.30)
| $(0.26)
|
| From net realized gain
| —
| (0.09)
| (0.57)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.31)
| $(0.28)
| $(0.68)
| $(0.26)
| $(0.30)
| $(0.63)
|
| Net asset value, end of period (x)
| $12.47
| $11.94
| $10.77
| $13.71
| $10.79
| $10.37
|
| Total return (%) (r)(s)(t)(x)
| 7.13(n)
| 13.60
| (17.24)
| 29.82
| 6.85
| (5.67)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 0.93(a)
| 0.96
| 0.95
| 0.98
| 0.99
| 1.00
|
| Expenses after expense reductions
| 0.89(a)
| 0.89
| 0.89
| 0.89
| 0.89
| 0.89
|
| Net investment income (loss)
| 1.12(a)(l)
| 2.90
| 2.44
| 2.45
| 2.39
| 2.80
|
| Portfolio turnover
| 26(n)
| 56
| 52
| 68
| 72
| 58
|
| Net assets at end of period (000 omitted)
| $26,831
| $27,916
| $18,999
| $110,106
| $93,455
| $84,917
|
See Notes to Financial Statements
Financial Highlights – continued
| Class B
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $11.62
| $10.49
| $13.61
| $10.72
| $10.32
| $11.64
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.02
| $0.23
| $0.23
| $0.22
| $0.17
| $0.24
|
| Net realized and unrealized gain (loss)
| 0.75
| 1.10
| (2.55)
| 2.85
| 0.47
| (1.02)
|
| Total from investment operations
| $0.77
| $1.33
| $(2.32)
| $3.07
| $0.64
| $(0.78)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.21)
| $(0.11)
| $(0.23)
| $(0.18)
| $(0.24)
| $(0.17)
|
| From net realized gain
| —
| (0.09)
| (0.57)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.21)
| $(0.20)
| $(0.80)
| $(0.18)
| $(0.24)
| $(0.54)
|
| Net asset value, end of period (x)
| $12.18
| $11.62
| $10.49
| $13.61
| $10.72
| $10.32
|
| Total return (%) (r)(s)(t)(x)
| 6.70(n)
| 12.81
| (17.99)
| 28.84
| 6.06
| (6.41)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.68(a)
| 1.71
| 1.70
| 1.72
| 1.74
| 1.75
|
| Expenses after expense reductions
| 1.64(a)
| 1.64
| 1.64
| 1.64
| 1.64
| 1.64
|
| Net investment income (loss)
| 0.37(a)(l)
| 2.05
| 1.85
| 1.75
| 1.61
| 2.28
|
| Portfolio turnover
| 26(n)
| 56
| 52
| 68
| 72
| 58
|
| Net assets at end of period (000 omitted)
| $147
| $154
| $161
| $210
| $148
| $152
|
See Notes to Financial Statements
Financial Highlights – continued
| Class C
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $11.58
| $10.48
| $13.59
| $10.70
| $10.28
| $11.59
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.02
| $0.23
| $0.23
| $0.23
| $0.17
| $0.22
|
| Net realized and unrealized gain (loss)
| 0.75
| 1.09
| (2.53)
| 2.83
| 0.47
| (1.00)
|
| Total from investment operations
| $0.77
| $1.32
| $(2.30)
| $3.06
| $0.64
| $(0.78)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.24)
| $(0.13)
| $(0.24)
| $(0.17)
| $(0.22)
| $(0.16)
|
| From net realized gain
| —
| (0.09)
| (0.57)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.24)
| $(0.22)
| $(0.81)
| $(0.17)
| $(0.22)
| $(0.53)
|
| Net asset value, end of period (x)
| $12.11
| $11.58
| $10.48
| $13.59
| $10.70
| $10.28
|
| Total return (%) (r)(s)(t)(x)
| 6.75(n)
| 12.72
| (17.91)
| 28.78
| 6.08
| (6.42)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.68(a)
| 1.71
| 1.70
| 1.72
| 1.74
| 1.75
|
| Expenses after expense reductions
| 1.64(a)
| 1.64
| 1.64
| 1.64
| 1.64
| 1.64
|
| Net investment income (loss)
| 0.33(a)(l)
| 2.10
| 1.90
| 1.82
| 1.64
| 2.04
|
| Portfolio turnover
| 26(n)
| 56
| 52
| 68
| 72
| 58
|
| Net assets at end of period (000 omitted)
| $490
| $418
| $330
| $382
| $220
| $240
|
See Notes to Financial Statements
Financial Highlights – continued
| Class I
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $11.80
| $10.63
| $13.78
| $10.84
| $10.42
| $11.77
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.08
| $0.36
| $0.37
| $0.38
| $0.31
| $0.31
|
| Net realized and unrealized gain (loss)
| 0.76
| 1.10
| (2.59)
| 2.84
| 0.44
| (1.00)
|
| Total from investment operations
| $0.84
| $1.46
| $(2.22)
| $3.22
| $0.75
| $(0.69)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.34)
| $(0.20)
| $(0.36)
| $(0.28)
| $(0.33)
| $(0.29)
|
| From net realized gain
| —
| (0.09)
| (0.57)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.34)
| $(0.29)
| $(0.93)
| $(0.28)
| $(0.33)
| $(0.66)
|
| Net asset value, end of period (x)
| $12.30
| $11.80
| $10.63
| $13.78
| $10.84
| $10.42
|
| Total return (%) (r)(s)(t)(x)
| 7.22(n)
| 13.92
| (17.13)
| 30.14
| 7.09
| (5.45)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 0.68(a)
| 0.71
| 0.70
| 0.72
| 0.75
| 0.75
|
| Expenses after expense reductions
| 0.64(a)
| 0.64
| 0.64
| 0.64
| 0.64
| 0.64
|
| Net investment income (loss)
| 1.34(a)(l)
| 3.14
| 3.09
| 2.91
| 3.06
| 2.89
|
| Portfolio turnover
| 26(n)
| 56
| 52
| 68
| 72
| 58
|
| Net assets at end of period (000 omitted)
| $268,469
| $251,004
| $176,391
| $22,325
| $5,183
| $1,652
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R1
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $11.48
| $10.44
| $13.51
| $10.65
| $10.24
| $11.63
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.02
| $0.23
| $0.23
| $0.22
| $0.17
| $0.22
|
| Net realized and unrealized gain (loss)
| 0.75
| 1.08
| (2.53)
| 2.82
| 0.47
| (1.01)
|
| Total from investment operations
| $0.77
| $1.31
| $(2.30)
| $3.04
| $0.64
| $(0.79)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.25)
| $(0.18)
| $(0.20)
| $(0.18)
| $(0.23)
| $(0.23)
|
| From net realized gain
| —
| (0.09)
| (0.57)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.25)
| $(0.27)
| $(0.77)
| $(0.18)
| $(0.23)
| $(0.60)
|
| Net asset value, end of period (x)
| $12.00
| $11.48
| $10.44
| $13.51
| $10.65
| $10.24
|
| Total return (%) (r)(s)(t)(x)
| 6.75(n)
| 12.68
| (17.95)
| 28.83
| 6.13
| (6.44)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.68(a)
| 1.71
| 1.70
| 1.72
| 1.74
| 1.75
|
| Expenses after expense reductions
| 1.64(a)
| 1.64
| 1.64
| 1.64
| 1.64
| 1.64
|
| Net investment income (loss)
| 0.34(a)(l)
| 2.08
| 1.95
| 1.74
| 1.63
| 2.09
|
| Portfolio turnover
| 26(n)
| 56
| 52
| 68
| 72
| 58
|
| Net assets at end of period (000 omitted)
| $1,039
| $879
| $314
| $233
| $166
| $146
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R2
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $11.68
| $10.55
| $13.72
| $10.80
| $10.38
| $11.73
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.05
| $0.31
| $0.31
| $0.29
| $0.22
| $0.27
|
| Net realized and unrealized gain (loss)
| 0.76
| 1.08
| (2.57)
| 2.86
| 0.47
| (1.01)
|
| Total from investment operations
| $0.81
| $1.39
| $(2.26)
| $3.15
| $0.69
| $(0.74)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.30)
| $(0.17)
| $(0.34)
| $(0.23)
| $(0.27)
| $(0.24)
|
| From net realized gain
| —
| (0.09)
| (0.57)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.30)
| $(0.26)
| $(0.91)
| $(0.23)
| $(0.27)
| $(0.61)
|
| Net asset value, end of period (x)
| $12.19
| $11.68
| $10.55
| $13.72
| $10.80
| $10.38
|
| Total return (%) (r)(s)(t)(x)
| 6.99(n)
| 13.31
| (17.55)
| 29.50
| 6.56
| (5.95)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.18(a)
| 1.21
| 1.20
| 1.22
| 1.24
| 1.25
|
| Expenses after expense reductions
| 1.14(a)
| 1.14
| 1.14
| 1.14
| 1.14
| 1.14
|
| Net investment income (loss)
| 0.86(a)(l)
| 2.76
| 2.61
| 2.30
| 2.12
| 2.54
|
| Portfolio turnover
| 26(n)
| 56
| 52
| 68
| 72
| 58
|
| Net assets at end of period (000 omitted)
| $2,883
| $2,744
| $1,261
| $404
| $156
| $164
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R3
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $11.81
| $10.65
| $13.82
| $10.88
| $10.45
| $11.80
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.06
| $0.35
| $0.32
| $0.29
| $0.25
| $0.30
|
| Net realized and unrealized gain (loss)
| 0.76
| 1.09
| (2.58)
| 2.91
| 0.49
| (1.02)
|
| Total from investment operations
| $0.82
| $1.44
| $(2.26)
| $3.20
| $0.74
| $(0.72)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.32)
| $(0.19)
| $(0.34)
| $(0.26)
| $(0.31)
| $(0.26)
|
| From net realized gain
| —
| (0.09)
| (0.57)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.32)
| $(0.28)
| $(0.91)
| $(0.26)
| $(0.31)
| $(0.63)
|
| Net asset value, end of period (x)
| $12.31
| $11.81
| $10.65
| $13.82
| $10.88
| $10.45
|
| Total return (%) (r)(s)(t)(x)
| 7.03(n)
| 13.67
| (17.37)
| 29.75
| 6.92
| (5.72)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 0.93(a)
| 0.96
| 0.95
| 0.96
| 0.99
| 1.00
|
| Expenses after expense reductions
| 0.89(a)
| 0.89
| 0.89
| 0.89
| 0.89
| 0.89
|
| Net investment income (loss)
| 1.07(a)(l)
| 3.08
| 2.64
| 2.22
| 2.37
| 2.79
|
| Portfolio turnover
| 26(n)
| 56
| 52
| 68
| 72
| 58
|
| Net assets at end of period (000 omitted)
| $1,489
| $1,228
| $532
| $395
| $64
| $58
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R4
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $11.81
| $10.65
| $13.79
| $10.85
| $10.42
| $11.77
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.08
| $0.35
| $0.38
| $0.35
| $0.27
| $0.33
|
| Net realized and unrealized gain (loss)
| 0.76
| 1.11
| (2.59)
| 2.87
| 0.49
| (1.02)
|
| Total from investment operations
| $0.84
| $1.46
| $(2.21)
| $3.22
| $0.76
| $(0.69)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.34)
| $(0.21)
| $(0.36)
| $(0.28)
| $(0.33)
| $(0.29)
|
| From net realized gain
| —
| (0.09)
| (0.57)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.34)
| $(0.30)
| $(0.93)
| $(0.28)
| $(0.33)
| $(0.66)
|
| Net asset value, end of period (x)
| $12.31
| $11.81
| $10.65
| $13.79
| $10.85
| $10.42
|
| Total return (%) (r)(s)(t)(x)
| 7.21(n)
| 13.83
| (17.09)
| 30.12
| 7.18
| (5.45)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 0.68(a)
| 0.71
| 0.69
| 0.72
| 0.74
| 0.75
|
| Expenses after expense reductions
| 0.64(a)
| 0.64
| 0.64
| 0.64
| 0.64
| 0.64
|
| Net investment income (loss)
| 1.33(a)(l)
| 3.08
| 3.11
| 2.73
| 2.62
| 3.04
|
| Portfolio turnover
| 26(n)
| 56
| 52
| 68
| 72
| 58
|
| Net assets at end of period (000 omitted)
| $705
| $391
| $329
| $81
| $62
| $58
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R6
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $11.82
| $10.65
| $13.80
| $10.85
| $10.43
| $11.78
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.08
| $0.35
| $0.37
| $0.36
| $0.29
| $0.34
|
| Net realized and unrealized gain (loss)
| 0.77
| 1.12
| (2.58)
| 2.88
| 0.47
| (1.02)
|
| Total from investment operations
| $0.85
| $1.47
| $(2.21)
| $3.24
| $0.76
| $(0.68)
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.35)
| $(0.21)
| $(0.37)
| $(0.29)
| $(0.34)
| $(0.30)
|
| From net realized gain
| —
| (0.09)
| (0.57)
| —
| —
| (0.37)
|
| Total distributions declared to shareholders
| $(0.35)
| $(0.30)
| $(0.94)
| $(0.29)
| $(0.34)
| $(0.67)
|
| Net asset value, end of period (x)
| $12.32
| $11.82
| $10.65
| $13.80
| $10.85
| $10.43
|
| Total return (%) (r)(s)(t)(x)
| 7.29(n)
| 13.94
| (17.07)
| 30.32
| 7.18
| (5.33)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 0.60(a)
| 0.62
| 0.62
| 0.63
| 0.65
| 0.65
|
| Expenses after expense reductions
| 0.56(a)
| 0.56
| 0.55
| 0.55
| 0.55
| 0.54
|
| Net investment income (loss)
| 1.42(a)(l)
| 3.13
| 3.02
| 2.82
| 2.76
| 3.13
|
| Portfolio turnover
| 26(n)
| 56
| 52
| 68
| 72
| 58
|
| Net assets at end of period (000 omitted)
| $376,094
| $335,205
| $291,234
| $293,695
| $247,726
| $206,790
|
| (a)
| Annualized.
|
| (d)
| Per share data is based on average shares outstanding.
|
| (l)
| Recognition of net investment income by the fund may be affected by the timing of the declaration of dividends by companies in which the fund invests and the actual annual net investment income ratio
may differ.
|
| (n)
| Not annualized.
|
| (r)
| Certain expenses have been reduced without which performance would have been lower.
|
| (s)
| From time to time the fund may receive proceeds from litigation settlements, without which performance would be lower.
|
| (t)
| Total returns do not include any applicable sales charges.
|
| (x)
| The net asset values and total returns have been calculated on net assets which include adjustments made in accordance with U.S. generally accepted accounting principles required at
period end for financial reporting purposes.
|
See Notes to Financial Statements
Notes to Financial Statements
(unaudited)
(1) Business and
Organization
MFS Blended Research International
Equity Fund (the fund) is a diversified series of MFS Series Trust IV (the trust). The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as
amended, as an open-end management investment company.
The fund is an investment company
and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services - Investment
Companies.
(2) Significant Accounting
Policies
General — The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations
during the reporting period. Actual results could differ from those estimates. In the preparation of these financial statements, management has evaluated subsequent events occurring after the date of the fund’s
Statement of Assets and Liabilities through the date that the financial statements were issued. The fund invests in foreign securities, including securities of emerging market issuers. Investments in foreign securities are vulnerable to the effects of changes in the relative values
of the local currency and the U.S. dollar and to the effects of changes in each country’s market, economic, industrial, political, regulatory, geopolitical, environmental, public health, and other conditions.
Investments in emerging markets can involve additional and greater risks than the risks associated with investments in developed foreign markets. Emerging markets can have less developed markets, greater custody and
operational risk, less developed legal, regulatory, accounting, and auditing systems, greater government involvement in the economy, greater risk of new or inconsistent government treatment of or restrictions on
issuers and instruments, and greater political, social, and economic instability than developed markets.
Balance Sheet Offsetting — The fund's accounting policy with respect to balance sheet offsetting is that, absent an event of default by the counterparty or a termination of the agreement, the International
Swaps and Derivatives Association (ISDA) Master Agreement, or similar agreement, does not result in an offset of reported amounts of financial assets and financial liabilities in the Statement of Assets and
Liabilities across transactions between the fund and the applicable counterparty. The fund's right to setoff may be restricted or prohibited by the bankruptcy or insolvency laws of the particular jurisdiction to which
a specific master netting agreement counterparty is subject. Balance sheet offsetting disclosures, to the extent applicable to the fund, have been included in the fund’s Significant Accounting Policies note
under the captions for each of the fund’s in-scope financial instruments and transactions.
Investment Valuations — Subject to its oversight, the fund's Board of Trustees has delegated primary responsibility for determining or causing to be determined the value of the fund’s investments to MFS as
the fund's adviser, pursuant to the fund’s valuation policy and procedures which have been adopted by the adviser and approved by the Board. In accordance with Rule 2a-5 under the Investment Company Act of
1940, the
Notes to Financial
Statements (unaudited) - continued
Board of Trustees designated the adviser as the
“valuation designee” of the fund. If the adviser, as valuation designee, determines that reliable market quotations are not readily available for an investment, the investment is valued at fair value as
determined in good faith by the adviser in accordance with the adviser’s fair valuation policy and procedures.
Under the fund's valuation policy
and procedures, equity securities, including restricted equity securities, are generally valued at the last sale or official closing price on their primary market or exchange as provided by a third-party pricing
service. Equity securities, for which there were no sales reported that day, are generally valued at the last quoted daily bid quotation on their primary market or exchange as provided by a third-party pricing
service. Short-term instruments with a maturity at issuance of 60 days or less may be valued at amortized cost, which approximates market value.
Open-end investment companies are generally valued
at net asset value per share. The values of foreign securities and other assets and liabilities expressed in foreign currencies are converted to U.S. dollars using the mean of bid and asked prices for rates provided
by a third-party pricing service.
Under the fund’s valuation
policy and procedures, market quotations are not considered to be readily available for debt instruments, floating rate loans, and many types of derivatives. These investments are generally valued at fair value based
on information from third-party pricing services or otherwise determined by the adviser in accordance with the adviser’s fair valuation policy and procedures. Securities and other assets generally valued on the
basis of information from a third-party pricing service may also be valued at a broker/dealer bid quotation. In determining values, third-party pricing services can utilize both transaction data and market information
such as yield, quality, coupon rate, maturity, type of issue, trading characteristics, spreads and other market data. An investment may also be valued at fair value if the adviser determines that the
investment’s value has been materially affected by events occurring after the close of the exchange or market on which the investment is principally traded (such as foreign exchange or market) and prior to the
determination of the fund’s net asset value, or after the halt of trading of a specific security where trading does not resume prior to the close of the exchange or market on which the security is principally
traded. Events that occur after foreign markets close (such as developments in foreign markets and significant movements in the U.S. markets) and prior to the determination of the fund’s net asset value may be
deemed to have a material effect on the value of securities traded in foreign markets. Accordingly, the fund’s foreign equity securities may often be valued at fair value. The adviser generally relies on
third-party pricing services or other information (such as the correlation with price movements of similar securities in the same or other markets; the type, cost and investment characteristics of the security; the
business and financial condition of the issuer; and trading and other market data) to assist in determining whether to fair value and at what value to fair value an investment. The value of an investment for purposes
of calculating the fund’s net asset value can differ depending on the source and method used to determine value. When fair valuation is used, the value of an investment used to determine the fund’s net
asset value may differ from quoted or published prices for the same investment. There can be no assurance that the fund could obtain the fair value assigned to an investment if it were to sell the investment at the
same time at which the fund determines its net asset value per share.
Notes to Financial
Statements (unaudited) - continued
Various inputs are used in
determining the value of the fund's assets or liabilities. These inputs are categorized into three broad levels. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value
hierarchy. In such cases, an investment's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fund's assessment of the significance of a
particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment. Level 1 includes unadjusted quoted prices in active markets for identical assets or
liabilities. Level 2 includes other significant observable market-based inputs (including quoted prices for similar securities, interest rates, prepayment speed, and credit risk). Level 3 includes significant
unobservable inputs, which may include the adviser's own assumptions in determining the fair value of investments. The following is a summary of the levels used as of February 29, 2024 in valuing the fund's assets and
liabilities:
| Financial Instruments
| Level 1
| Level 2
| Level 3
| Total
|
| Equity Securities:
|
|
|
|
|
| Japan
| $102,611,784
| $—
| $—
| $102,611,784
|
| France
| 68,335,391
| —
| —
| 68,335,391
|
| United Kingdom
| 64,742,938
| —
| —
| 64,742,938
|
| Canada
| 56,407,061
| 0
| —
| 56,407,061
|
| China
| 51,038,411
| —
| —
| 51,038,411
|
| South Korea
| 31,687,177
| —
| —
| 31,687,177
|
| Netherlands
| 31,679,788
| —
| —
| 31,679,788
|
| Switzerland
| 27,950,860
| —
| —
| 27,950,860
|
| Australia
| 27,948,783
| —
| —
| 27,948,783
|
| Other Countries
| 208,657,635
| —
| 0
| 208,657,635
|
| Mutual Funds
| 3,165,574
| —
| —
| 3,165,574
|
| Total
| $674,225,402
| $0
| $0
| $674,225,402
|
For further information regarding
security characteristics, see the Portfolio of Investments. At February 29, 2024, the fund held two level 3 securities valued at $0, which were also held and valued at $0 at August 31, 2023.
Foreign Currency Translation — Purchases and sales of foreign investments, income, and expenses are converted into U.S. dollars based upon currency exchange rates prevailing on the respective dates of such
transactions or on the reporting date for foreign denominated receivables and payables. Gains and losses attributable to foreign currency exchange rates on sales of securities are recorded for financial statement
purposes as net realized gains and losses on investments. Gains and losses attributable to foreign exchange rate movements on receivables, payables, income and expenses are recorded for financial statement purposes as
foreign currency transaction gains and losses. That portion of both realized and unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately
disclosed.
Security Loans — Under its Securities Lending Agency Agreement with the fund, State Street Bank and Trust Company, as lending agent, loans the securities of the fund to certain qualified
institutions (the “Borrowers”) approved by the fund. Security loans can be terminated at the discretion of either the lending agent or the fund and the related securities must be returned within the
earlier of the standard trade settlement period for such securities or within three business days. The loans are collateralized by
Notes to Financial
Statements (unaudited) - continued
cash and/or U.S. Treasury and federal agency
obligations in an amount typically at least equal to the market value of the securities loaned. On loans collateralized by cash, the cash collateral is invested in a money market fund. The market value of
the loaned securities is determined at the close of business of the fund and any additional required collateral is delivered to the fund on the next business day. The lending agent provides the fund with
indemnification against Borrower default. In the event of Borrower default, the lending agent will, for the benefit of the fund, either purchase securities identical to those loaned or, when such purchase is
commercially impracticable, pay the fund the market value of the loaned securities. In return, the lending agent assumes the fund's rights to the related collateral. If the collateral value is less than
the cost to purchase identical securities, the lending agent is responsible for the shortfall, but only to the extent that such shortfall is not due to a decline in collateral value resulting from collateral
reinvestment for which the fund bears the risk of loss. At period end, the fund had investment securities on loan, all of which were classified as equity securities in the fund's Portfolio of Investments, with a fair
value of $12,182,673. The fair value of the fund's investment securities on loan and a related liability of $1,258,635 for cash collateral received on securities loaned are both presented gross in the Statement of
Assets and Liabilities. Additionally, these loans were collateralized by U.S. Treasury Obligations of $11,453,954 held by the custodian. The collateral on securities loaned exceeded the value of securities on
loan at period end. The liability for cash collateral for securities loaned is carried at fair value, which is categorized as level 2 within the fair value hierarchy. A portion of the income generated upon investment
of the collateral is remitted to the Borrowers, and the remainder is allocated between the fund and the lending agent. On loans collateralized by U.S. Treasury and/or federal agency obligations, a fee is
received from the Borrower, and is allocated between the fund and the lending agent. Income from securities lending is separately reported in the Statement of Operations. The dividend and interest income
earned on the securities loaned is accounted for in the same manner as other dividend and interest income.
Indemnifications — Under the fund's organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to
the fund. Additionally, in the normal course of business, the fund enters into agreements with service providers that may contain indemnification clauses. The fund's maximum exposure under these agreements is unknown
as this would involve future claims that may be made against the fund that have not yet occurred.
Investment Transactions and
Income — Interest income is recorded on the accrual basis. Dividends received in cash are recorded on the ex-dividend date. Certain dividends from foreign securities will be recorded when the fund is informed of the dividend if such information is
obtained subsequent to the ex-dividend date. Dividend and interest payments received in additional securities are recorded on the ex-dividend or ex-interest date in an amount equal to the value of the security on such
date.
The fund may receive proceeds from
litigation settlements. Any proceeds received from litigation involving portfolio holdings are reflected in the Statement of Operations in realized gain/loss if the security has been disposed of by the fund or in
unrealized gain/loss if the security is still held by the fund. Any other proceeds from litigation not related to portfolio holdings are reflected as other income in the Statement of Operations.
Notes to Financial
Statements (unaudited) - continued
Investment transactions are recorded
on the trade date. In determining the net gain or loss on securities sold, the cost of securities is determined on the identified cost basis.
Tax Matters and Distributions — The fund intends to qualify as a regulated investment company, as defined under Subchapter M of the Internal Revenue Code, and to distribute all of its taxable income, including
realized capital gains. As a result, no provision for federal income tax is required. The fund’s federal tax returns, when filed, will remain subject to examination by the Internal Revenue Service for a three
year period. Management has analyzed the fund’s tax positions taken on federal and state tax returns for all open tax years and does not believe that there are any uncertain tax positions that require
recognition of a tax liability. Foreign taxes, if any, have been accrued by the fund in the accompanying financial statements in accordance with the applicable foreign tax law. Foreign income taxes may be withheld by
certain countries in which the fund invests. Additionally, capital gains realized by the fund on securities issued in or by certain foreign countries may be subject to capital gains tax imposed by those
countries.
Distributions to shareholders are
recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from U.S. generally accepted accounting principles. Certain capital
accounts in the financial statements are periodically adjusted for permanent differences in order to reflect their tax character. These adjustments have no impact on net assets or net asset value per share. Temporary
differences which arise from recognizing certain items of income, expense, gain or loss in different periods for financial statement and tax purposes will reverse at some time in the future.
Book/tax differences primarily
relate to wash sale loss deferrals.
The tax character of distributions
made during the current period will be determined at fiscal year end. The tax character of distributions declared to shareholders for the last fiscal year is as follows:
|
| Year ended
8/31/23
|
| Ordinary income (including any short-term capital gains)
| $10,343,305
|
| Long-term capital gains
| 4,395,119
|
| Total distributions
| $14,738,424
|
The federal tax cost and the tax
basis components of distributable earnings were as follows:
| As of 2/29/24
|
|
| Cost of investments
| $589,495,361
|
| Gross appreciation
| 108,488,760
|
| Gross depreciation
| (23,758,719)
|
| Net unrealized appreciation (depreciation)
| $84,730,041
|
| As of 8/31/23
|
|
| Undistributed ordinary income
| 18,216,006
|
| Capital loss carryforwards
| (21,077,266)
|
| Other temporary differences
| (238,217)
|
| Net unrealized appreciation (depreciation)
| 49,239,521
|
Notes to Financial
Statements (unaudited) - continued
The aggregate cost above includes
prior fiscal year end tax adjustments, if applicable.
As of August 31, 2023, the fund had
capital loss carryforwards available to offset future realized gains. These net capital losses may be carried forward indefinitely and their character is retained as short-term and/or long-term losses. Such losses are
characterized as follows:
| Short-Term
| $(9,915,198)
|
| Long-Term
| (11,162,068)
|
| Total
| $(21,077,266)
|
Multiple Classes of Shares of
Beneficial Interest — The fund offers multiple classes of shares, which differ in their respective distribution and service fees. The fund's income, realized and unrealized gain (loss), and common
expenses are allocated to shareholders based on the daily net assets of each class. Dividends are declared separately for each class. Differences in per share dividend rates are generally due to differences in
separate class expenses. Class B and Class C shares will convert to Class A shares approximately eight years after purchase. The fund’s distributions declared to shareholders as reported in the Statements
of Changes in Net Assets are presented by class as follows:
|
| Six months
ended
2/29/24
|
| Year
ended
8/31/23
|
| Class A
| $688,321
|
| $546,445
|
| Class B
| 2,535
|
| 2,838
|
| Class C
| 9,656
|
| 7,387
|
| Class I
| 7,494,228
|
| 5,503,685
|
| Class R1
| 20,382
|
| 17,970
|
| Class R2
| 69,777
|
| 33,852
|
| Class R3
| 34,451
|
| 15,862
|
| Class R4
| 11,319
|
| 9,228
|
| Class R6
| 10,170,893
|
| 8,601,157
|
| Total
| $18,501,562
|
| $14,738,424
|
(3) Transactions with
Affiliates
Investment Adviser — The fund has an investment advisory agreement with MFS to provide overall investment management and related administrative services and facilities to the fund. The management fee is computed daily and paid monthly at the following annual rates based on the fund's average daily net assets:
| Up to $1 billion
| 0.50%
|
| In excess of $1 billion and up to $2.5 billion
| 0.475%
|
| In excess of $2.5 billion
| 0.45%
|
MFS has agreed in writing to reduce
its management fee by a specified amount if certain MFS mutual fund assets exceed thresholds agreed to by MFS and the fund's Board of Trustees. MFS has also agreed in writing to waive at least 0.01% of its management
fee as part of this agreement. The agreement to waive at least 0.01% of the management fee will continue until modified by the fund's Board of Trustees, but such agreement will continue at least until December 31,
2024. For the six months ended February 29, 2024, this management fee reduction amounted to $40,918,
Notes to Financial
Statements (unaudited) - continued
which is included in the reduction of total
expenses in the Statement of Operations.
The management fee incurred for the six months
ended February 29, 2024 was equivalent to an annual effective rate of 0.49% of the fund's average daily net assets.
The investment adviser has agreed in
writing to pay a portion of the fund’s total annual operating expenses, excluding interest, taxes, extraordinary expenses, brokerage and transaction costs, certain tax reclaim recovery expenses (including
contingency fees and closing agreement expenses), and investment-related expenses, such that total fund operating expenses do not exceed the following rates annually of each class’s average daily net assets:
| Classes
|
| A
| B
| C
| I
| R1
| R2
| R3
| R4
| R6
|
| 0.89%
| 1.64%
| 1.64%
| 0.64%
| 1.64%
| 1.14%
| 0.89%
| 0.64%
| 0.58%
|
This written agreement will continue
until modified by the fund’s Board of Trustees, but such agreement will continue at least until December 31, 2024. For the six months ended February 29, 2024, this reduction amounted to $83,500, which is
included in the reduction of total expenses in the Statement of Operations.
Distributor — MFS Fund Distributors, Inc. (MFD), a wholly-owned subsidiary of MFS, as distributor, received $787 for the six months ended February 29, 2024, as its portion of the initial sales
charge on sales of Class A shares of the fund.
The Board of Trustees has adopted a
distribution plan for certain share classes pursuant to Rule 12b-1 of the Investment Company Act of 1940.
The fund's distribution plan
provides that the fund will pay MFD for services provided by MFD and financial intermediaries in connection with the distribution and servicing of certain share classes. One component of the plan is a distribution fee
paid to MFD and another component of the plan is a service fee paid to MFD. MFD may subsequently pay all, or a portion, of the distribution and/or service fees to financial intermediaries. The distribution and service
fees are computed daily and paid monthly.
Distribution Plan Fee Table:
|
| Distribution
Fee Rate (d)
| Service
Fee Rate (d)
| Total
Distribution
Plan (d)
| Annual
Effective
Rate (e)
| Distribution
and Service
Fee
|
| Class A
| —
| 0.25%
| 0.25%
| 0.25%
| $ 33,558
|
| Class B
| 0.75%
| 0.25%
| 1.00%
| 1.00%
| 721
|
| Class C
| 0.75%
| 0.25%
| 1.00%
| 1.00%
| 2,230
|
| Class R1
| 0.75%
| 0.25%
| 1.00%
| 1.00%
| 4,623
|
| Class R2
| 0.25%
| 0.25%
| 0.50%
| 0.50%
| 6,964
|
| Class R3
| —
| 0.25%
| 0.25%
| 0.25%
| 1,618
|
| Total Distribution and Service Fees
|
|
|
|
| $49,714
|
| (d)
| In accordance with the distribution plan for certain classes, the fund pays distribution and/or service fees equal to these annual percentage rates of each class’s average daily
net assets. The distribution and service fee rates disclosed by class represent the current rates in effect at the end of the reporting period. Any rate changes, if applicable, are detailed below.
|
| (e)
| The annual effective rates represent actual fees incurred under the distribution plan for the six months ended February 29, 2024 based on each class's average daily net assets. MFD
has
|
Notes to Financial
Statements (unaudited) - continued
voluntarily agreed to rebate a
portion of each class's 0.25% service fee attributable to accounts for which there is no financial intermediary specified on the account except for accounts attributable to MFS or its affiliates' seed money. There
were no service fee rebates for the six months ended February 29, 2024.
Certain Class A shares are
subject to a contingent deferred sales charge (CDSC) in the event of a shareholder redemption within 18 months of purchase. Class B shares are subject to a CDSC in the event of a shareholder redemption within six
years of purchase. Class C shares are subject to a CDSC in the event of a shareholder redemption within 12 months of purchase. All contingent deferred sales charges are paid to MFD and during the six months
ended February 29, 2024, were as follows:
|
| Amount
|
| Class A
| $33
|
| Class B
| —
|
| Class C
| 25
|
Shareholder Servicing Agent — MFS Service Center, Inc. (MFSC), a wholly-owned subsidiary of MFS, receives a fee from the fund for its services as shareholder servicing agent calculated as a percentage of the
average daily net assets of the fund as determined periodically under the supervision of the fund's Board of Trustees. For the six months ended February 29, 2024, the fee was $2,456, which equated to 0.0008% annually
of the fund's average daily net assets. MFSC also receives reimbursement from the fund for out-of-pocket expenses, sub-accounting and other shareholder servicing costs which may be paid to affiliated and unaffiliated
service providers. Class R6 shares do not incur sub-accounting fees. For the six months ended February 29, 2024, these out-of-pocket expenses, sub-accounting and other shareholder servicing costs amounted to
$127,087.
Administrator — MFS provides certain financial, legal, shareholder communications, compliance, and other administrative services to the fund. Under an administrative services agreement, the
fund reimburses MFS the costs incurred to provide these services. The fund is charged an annual fixed amount of $17,500 plus a fee based on average daily net assets. The administrative services fee is
computed daily and paid monthly. The administrative services fee incurred for the six months ended February 29, 2024 was equivalent to an annual effective rate of 0.0158% of the fund's average daily net
assets.
Trustees’ and Officers’
Compensation — The fund pays compensation to independent Trustees in the form of a retainer, attendance fees, and additional compensation to Board and Committee chairpersons.
Independent Trustees’ compensation is accrued daily and paid subsequent to each Trustee Board meeting. The fund does not pay compensation directly to Trustees or officers of the fund who are also officers
of the investment adviser, all of whom receive remuneration from MFS for their services to the fund. Certain officers and Trustees of the fund are officers or directors of MFS, MFD, and MFSC.
Other — The fund invests in the MFS Institutional Money Market Portfolio which is managed by MFS and seeks current income consistent with preservation of capital and liquidity. This money
market fund does not pay a management fee to MFS but does incur investment and operating costs.
On June 23, 2023, MFS redeemed 6,359
shares of Class R3 for an aggregate amount of $74,464.
Notes to Financial
Statements (unaudited) - continued
At February 29, 2024, MFS held
approximately 51% of the outstanding shares of Class B.
The adviser has voluntarily
undertaken to reimburse the fund from its own resources on a quarterly basis for the cost of investment research embedded in the cost of the fund’s securities trades. This agreement may be rescinded at any time.
For the six months ended February 29, 2024, this reimbursement amounted to $22,577, which is included in “Other” income in the Statement of Operations.
(4) Portfolio Securities
For the six months ended February
29, 2024, purchases and sales of investments, other than short-term obligations, aggregated $179,443,462 and $164,194,135, respectively.
(5) Shares of Beneficial
Interest
The fund's Declaration of Trust
permits the Trustees to issue an unlimited number of full and fractional shares of beneficial interest. Transactions in fund shares were as follows:
|
| Six months ended
2/29/24
|
| Year ended
8/31/23
|
|
| Shares
| Amount
|
| Shares
| Amount
|
| Shares sold
|
|
|
|
|
|
| Class A
| 185,285
| $2,208,088
|
| 1,185,812
| $13,339,784
|
| Class B
| —
| —
|
| 327
| 3,827
|
| Class C
| 4,344
| 47,598
|
| 14,132
| 155,634
|
| Class I
| 2,412,555
| 28,157,102
|
| 9,780,227
| 107,922,482
|
| Class R1
| 9,899
| 112,309
|
| 47,712
| 495,278
|
| Class R2
| 33,281
| 384,504
|
| 185,751
| 2,154,293
|
| Class R3
| 22,736
| 268,824
|
| 74,714
| 870,256
|
| Class R4
| 23,363
| 284,825
|
| 1,381
| 15,628
|
| Class R6
| 2,306,409
| 27,004,656
|
| 7,020,399
| 77,491,175
|
|
| 4,997,872
| $58,467,906
|
| 18,310,455
| $202,448,357
|
Shares issued to shareholders
in reinvestment of distributions
|
|
|
|
|
|
| Class A
| 57,104
| $688,102
|
| 48,487
| $546,445
|
| Class B
| 215
| 2,535
|
| 257
| 2,838
|
| Class C
| 825
| 9,656
|
| 672
| 7,387
|
| Class I
| 630,804
| 7,493,954
|
| 494,936
| 5,503,685
|
| Class R1
| 1,756
| 20,382
|
| 1,649
| 17,970
|
| Class R2
| 5,918
| 69,777
|
| 3,064
| 33,852
|
| Class R3
| 2,895
| 34,451
|
| 1,423
| 15,862
|
| Class R4
| 952
| 11,319
|
| 829
| 9,228
|
| Class R6
| 854,194
| 10,164,913
|
| 771,681
| 8,596,530
|
|
| 1,554,663
| $18,495,089
|
| 1,322,998
| $14,733,797
|
Notes to Financial
Statements (unaudited) - continued
|
| Six months ended
2/29/24
|
| Year ended
8/31/23
|
|
| Shares
| Amount
|
| Shares
| Amount
|
| Shares reacquired
|
|
|
|
|
|
| Class A
| (428,369)
| $(5,087,219)
|
| (660,168)
| $(7,500,187)
|
| Class B
| (1,417)
| (16,016)
|
| (2,669)
| (28,943)
|
| Class C
| (757)
| (8,498)
|
| (10,280)
| (113,992)
|
| Class I
| (2,492,771)
| (29,687,853)
|
| (5,590,963)
| (62,844,924)
|
| Class R1
| (1,622)
| (18,841)
|
| (2,904)
| (32,072)
|
| Class R2
| (37,571)
| (439,036)
|
| (73,424)
| (852,422)
|
| Class R3
| (8,668)
| (102,091)
|
| (22,102)
| (259,340)
|
| Class R4
| (192)
| (2,271)
|
| (14)
| (152)
|
| Class R6
| (993,851)
| (11,788,313)
|
| (6,786,078)
| (75,120,715)
|
|
| (3,965,218)
| $(47,150,138)
|
| (13,148,602)
| $(146,752,747)
|
| Net change
|
|
|
|
|
|
| Class A
| (185,980)
| $(2,191,029)
|
| 574,131
| $6,386,042
|
| Class B
| (1,202)
| (13,481)
|
| (2,085)
| (22,278)
|
| Class C
| 4,412
| 48,756
|
| 4,524
| 49,029
|
| Class I
| 550,588
| 5,963,203
|
| 4,684,200
| 50,581,243
|
| Class R1
| 10,033
| 113,850
|
| 46,457
| 481,176
|
| Class R2
| 1,628
| 15,245
|
| 115,391
| 1,335,723
|
| Class R3
| 16,963
| 201,184
|
| 54,035
| 626,778
|
| Class R4
| 24,123
| 293,873
|
| 2,196
| 24,704
|
| Class R6
| 2,166,752
| 25,381,256
|
| 1,006,002
| 10,966,990
|
|
| 2,587,317
| $29,812,857
|
| 6,484,851
| $70,429,407
|
The fund is one of several mutual
funds in which certain MFS funds may invest. The MFS funds do not invest in the underlying funds for the purpose of exercising management or control. At the end of the period, the MFS Lifetime 2040 Fund, the MFS
Lifetime 2050 Fund, the MFS Lifetime 2045 Fund, the MFS Lifetime 2035 Fund, the MFS Lifetime 2055 Fund, the MFS Lifetime 2030 Fund, the MFS Lifetime 2060 Fund, the MFS Lifetime Income Fund, and the MFS Lifetime 2025
Fund were the owners of record of approximately 10%, 9%, 7%, 6%, 6%, 5%, 3%, 2%, and 2%, respectively, of the value of outstanding voting shares of the fund. In addition, the MFS Lifetime 2065 Fund was the owner of
record of less than 1% of the value of outstanding voting shares of the fund.
Effective June 1, 2019, purchases of
the fund’s Class B shares were closed to new and existing investors subject to certain exceptions. Effective September 29, 2023, purchases of the fund's Class R1 and Class R2 shares were closed to new eligible
investors.
(6) Line of Credit
The fund and certain other funds
managed by MFS participate in a $1.45 billion unsecured committed line of credit of which $1.2 billion is reserved for use by the fund and certain other MFS U.S. funds. The line of credit is provided by a syndicate of
banks
Notes to Financial
Statements (unaudited) - continued
under a credit agreement. Borrowings may be made
for temporary financing needs. Interest is charged to each fund, based on its borrowings, generally at a rate equal to the highest of 1) Daily Simple SOFR (Secured Overnight Financing Rate) plus 0.10%, 2) the
Federal Funds Effective Rate, or 3) the Overnight Bank Funding Rate, each plus an agreed upon spread. A commitment fee, based on the average daily unused portion of the committed line of credit, is allocated among the
participating funds. The line of credit expires on March 13, 2025 unless extended or renewed. In addition, the fund and other funds managed by MFS have established unsecured uncommitted borrowing arrangements with
certain banks for temporary financing needs. Interest is charged to each fund, based on its borrowings, at rates equal to customary reference rates plus an agreed upon spread. For the six months ended February 29,
2024, the fund’s commitment fee and interest expense were $1,553 and $0, respectively, and are included in “Miscellaneous” expense in the Statement of Operations.
(7) Investments in Affiliated
Issuers
An affiliated issuer may be
considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common control. For the purposes of this report, the following were affiliated issuers:
| Affiliated Issuers
| Beginning
Value
| Purchases
| Sales
Proceeds
| Realized
Gain
(Loss)
| Change in
Unrealized
Appreciation or
Depreciation
| Ending
Value
|
| MFS Institutional Money Market Portfolio
| $6,449,765
| $50,992,207
| $55,535,821
| $1,430
| $(642)
| $1,906,939
|
| Affiliated Issuers
| Dividend
Income
| Capital Gain
Distributions
|
| MFS Institutional Money Market Portfolio
| $151,200
| $—
|
(8) Russia and Ukraine
Conflict
The fund invests in securities
and/or derivative instruments that are economically tied to Russia and/or Ukraine. Escalation of the conflict between Russia and Ukraine in late February 2022 caused market volatility and disruption in the tradability
of Russian securities, including closure of the local securities market, temporary restriction on securities sales by non-residents, and disruptions to clearance and payment systems. To the extent that the fund is
unable to sell securities, whether due to market constraints or to the sanctions imposed on Russia by the United States and other countries, those securities are considered illiquid and the value of those securities
reflects their illiquid classification. Management continues to monitor these events and to evaluate the related impacts on fund performance.
Proxy Voting Policies and
Information
MFS votes proxies on behalf of the
fund pursuant to proxy voting policies and procedures that are available without charge, upon request, by calling 1-800-225-2606, by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Information regarding how the fund
voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available by August 31 of each year without charge by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Quarterly Portfolio
Disclosure
The fund files a complete schedule
of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The fund's Form N-PORT reports are available on the SEC's Web site at http://www.sec.gov. A shareholder can obtain the portfolio holdings report for the first and third quarters of the fund's fiscal year at mfs.com/openendfunds by choosing the fund's name and then scrolling to the “Resources” section and clicking on the “Prospectus and Reports” tab.
Further Information
From time to time, MFS may post
important information about the fund or the MFS Funds on the MFS Web site (mfs.com). This information is available at https://www.mfs.com/announcements or at mfs.com/openendfunds by choosing the fund’s name and then scrolling to the “Resources” section and clicking on the “Announcements” tab, if any.
Information About Fund
Contracts and Legal Claims
The fund has entered into
contractual arrangements with an investment adviser, administrator, distributor, shareholder servicing agent, and custodian who each provide services to the fund. Unless expressly stated otherwise, shareholders are
not parties to, or intended beneficiaries of these contractual arrangements, and these contractual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek
any remedy under them against the service providers, either directly or on behalf of the fund.
Under the Trust’s By-Laws and
Declaration of Trust, any claims asserted against or on behalf of the MFS Funds, including claims against Trustees and Officers, must be brought in state and federal courts located within the Commonwealth of
Massachusetts.
Provision of Financial
Reports and Summary Prospectuses
The fund produces financial reports
every six months and updates its summary prospectus and prospectus annually. To avoid sending duplicate copies of materials to households, only one copy of the fund’s annual and semiannual report and summary
prospectus may be mailed to shareholders having the same last name and residential address on the fund’s records. However, any shareholder may contact MFSC (please see back cover for address and telephone
number) to request that copies of these reports and summary prospectuses be sent personally to that shareholder.
Save paper with eDelivery.
MFS® will send you prospectuses, reports, and proxies directly via e-mail so you will get information faster with less mailbox clutter.
To sign up:
1. Go to mfs.com.
2. Log in via MFS® Access.
3. Select eDelivery.
If you own your MFS fund shares
through a financial institution or a retirement plan, MFS® TALK, MFS® Access, or eDelivery may not be available to you.
CONTACT
WEB SITE
mfs.com
MFS TALK
1-800-637-8255
24 hours a day
ACCOUNT SERVICE AND LITERATURE
Shareholders
1-800-225-2606
Financial advisors
1-800-343-2829
Retirement plan services
1-800-637-1255
MAILING ADDRESS
MFS Service Center, Inc.
P.O. Box 219341
Kansas City, MO 64121-9341
OVERNIGHT MAIL
MFS Service Center, Inc.
Suite 219341
430 W 7th Street
Kansas City, MO 64105-1407
Semiannual Report
February 29, 2024
MFS® Global New
Discovery Fund
MFS® Global New
Discovery Fund
| 1
|
| 3
|
| 5
|
| 10
|
| 12
|
| 13
|
| 14
|
| 23
|
| 33
|
| 33
|
| 33
|
| 33
|
| 33
|
The report is prepared for the
general information of shareholders. It is authorized for distribution to prospective investors only when preceded or accompanied by a current prospectus.
NOT FDIC INSURED
• MAY LOSE VALUE • NO BANK GUARANTEE
Portfolio structure
Top ten holdings
| Howmet Aerospace, Inc.
| 2.5%
|
| ICON PLC
| 2.1%
|
| GFL Environmental, Inc.
| 2.1%
|
| Cranswick PLC
| 2.1%
|
| ASM International N.V.
| 2.1%
|
| Wabtec Corp.
| 1.9%
|
| LKQ Corp.
| 1.9%
|
| AUB Group Ltd.
| 1.9%
|
| NS Solutions Corp.
| 1.9%
|
| STERIS PLC
| 1.8%
|
GICS equity sectors (g)
| Industrials
| 30.3%
|
| Consumer Discretionary
| 12.2%
|
| Materials
| 11.1%
|
| Information Technology
| 8.7%
|
| Health Care
| 8.6%
|
| Financials
| 7.6%
|
| Real Estate
| 7.4%
|
| Consumer Staples
| 5.0%
|
| Communication Services
| 3.0%
|
| Energy
| 1.7%
|
Issuer country weightings (x)
| United States
| 42.7%
|
| United Kingdom
| 11.1%
|
| Japan
| 8.7%
|
| Canada
| 5.5%
|
| Germany
| 5.2%
|
| France
| 3.9%
|
| Netherlands
| 3.7%
|
| Brazil
| 3.0%
|
| Australia
| 2.9%
|
| Other Countries
| 13.3%
|
Currency exposure weightings (y)
| United States Dollar
| 47.0%
|
| Euro
| 16.2%
|
| British Pound Sterling
| 11.1%
|
| Japanese Yen
| 8.7%
|
| Brazilian Real
| 3.0%
|
| Australian Dollar
| 2.9%
|
| Swiss Franc
| 2.7%
|
| Canadian Dollar
| 2.1%
|
| Norwegian Krone
| 1.9%
|
| Other Currencies
| 4.4%
|
Portfolio Composition - continued
| (g)
| The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and S&P Global Market Intelligence Inc. (“S&P Global Market
Intelligence”). GICS is a service mark of MSCI and S&P Global Market Intelligence and has been licensed for use by MFS. MFS has applied its own internal sector/industry classification methodology for equity
securities and non-equity securities that are unclassified by GICS.
|
| (x)
| Represents the portfolio’s exposure to issuer countries as a percentage of a portfolio’s net assets. For purposes of this presentation, United States includes Cash &
Cash Equivalents.
|
| (y)
| Represents the portfolio’s exposure to a particular currency as a percentage of a portfolio's net assets. For purposes of this presentation, United States Dollar includes Cash
& Cash Equivalents.
|
Cash & Cash Equivalents includes
any cash, investments in money market funds, short-term securities, and other assets less liabilities. Please see the Statement of Assets and Liabilities for additional information related to the fund’s cash
position and other assets and liabilities.
Percentages are based on net assets
as of February 29, 2024.
The portfolio is actively managed
and current holdings may be different.
Expense Table
Fund expenses borne by the
shareholders during the period,
September 1, 2023 through February 29, 2024
As a shareholder of the fund, you
incur two types of costs: (1) transaction costs, including sales charges (loads) on certain purchase or redemption payments, and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and
other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an
investment of $1,000 invested at the beginning of the period and held for the entire period September 1, 2023 through February 29, 2024.
Actual Expenses
The first line for each share class
in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over
the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled
“Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for
Comparison Purposes
The second line for each share class
in the following table provides information about hypothetical account values and hypothetical expenses based on the fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses,
which is not the fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information
to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown
in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line for each share class in the table is useful in
comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Expense Table - continued
Share
Class
|
| Annualized
Expense
Ratio
| Beginning
Account Value
9/01/23
| Ending
Account Value
2/29/24
| Expenses
Paid During
Period (p)
9/01/23-2/29/24
|
| A
| Actual
| 1.35%
| $1,000.00
| $1,071.01
| $6.95
|
| Hypothetical (h)
| 1.35%
| $1,000.00
| $1,018.15
| $6.77
|
| B
| Actual
| 2.10%
| $1,000.00
| $1,066.38
| $10.79
|
| Hypothetical (h)
| 2.10%
| $1,000.00
| $1,014.42
| $10.52
|
| C
| Actual
| 2.10%
| $1,000.00
| $1,066.96
| $10.79
|
| Hypothetical (h)
| 2.10%
| $1,000.00
| $1,014.42
| $10.52
|
| I
| Actual
| 1.10%
| $1,000.00
| $1,072.00
| $5.67
|
| Hypothetical (h)
| 1.10%
| $1,000.00
| $1,019.39
| $5.52
|
| R1
| Actual
| 2.10%
| $1,000.00
| $1,066.99
| $10.79
|
| Hypothetical (h)
| 2.10%
| $1,000.00
| $1,014.42
| $10.52
|
| R2
| Actual
| 1.60%
| $1,000.00
| $1,069.38
| $8.23
|
| Hypothetical (h)
| 1.60%
| $1,000.00
| $1,016.91
| $8.02
|
| R3
| Actual
| 1.35%
| $1,000.00
| $1,070.53
| $6.95
|
| Hypothetical (h)
| 1.35%
| $1,000.00
| $1,018.15
| $6.77
|
| R4
| Actual
| 1.10%
| $1,000.00
| $1,071.94
| $5.67
|
| Hypothetical (h)
| 1.10%
| $1,000.00
| $1,019.39
| $5.52
|
| R6
| Actual
| 1.00%
| $1,000.00
| $1,072.61
| $5.15
|
| Hypothetical (h)
| 1.00%
| $1,000.00
| $1,019.89
| $5.02
|
| (h)
| 5% class return per year before expenses.
|
| (p)
| “Expenses Paid During Period” are equal to each class’s annualized expense ratio, as shown above, multiplied by the average account value over the period, multiplied
by 182/366 (to reflect the one-half year period). Expenses paid do not include any applicable sales charges (loads). If these transaction costs had been included, your costs would have been higher.
|
Portfolio of Investments
2/29/24 (unaudited)
The Portfolio of Investments is a
complete list of all securities owned by your fund. It is categorized by broad-based asset classes.
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – 95.6%
|
| Aerospace & Defense – 5.6%
|
|
| Howmet Aerospace, Inc.
|
| 28,056
| $1,867,127
|
| Melrose Industries PLC
|
| 118,010
| 945,921
|
| Singapore Technologies Engineering Ltd.
|
| 194,000
| 573,832
|
| Teledyne Technologies, Inc. (a)
|
| 1,926
| 822,922
|
|
|
|
|
| $4,209,802
|
| Apparel Manufacturers – 2.0%
|
|
| Burberry Group PLC
|
| 42,567
| $690,460
|
| Skechers USA, Inc., “A” (a)
|
| 13,685
| 845,870
|
|
|
|
|
| $1,536,330
|
| Automotive – 2.8%
|
|
| Lear Corp.
|
| 5,052
| $693,892
|
| LKQ Corp.
|
| 27,723
| 1,449,636
|
|
|
|
|
| $2,143,528
|
| Brokerage & Asset Managers – 4.1%
|
|
| B3 S.A. - Brasil Bolsa Balcao
|
| 341,200
| $880,609
|
| Cboe Global Markets, Inc.
|
| 4,475
| 859,200
|
| Euronext N.V.
|
| 14,393
| 1,326,145
|
|
|
|
|
| $3,065,954
|
| Business Services – 4.1%
|
|
| Elis S.A.
|
| 16,588
| $378,287
|
| Gruppo Mutuionline S.p.A. (l)
|
| 11,734
| 431,826
|
| NS Solutions Corp.
|
| 42,400
| 1,416,916
|
| RS Group PLC
|
| 88,639
| 843,195
|
|
|
|
|
| $3,070,224
|
| Chemicals – 3.6%
|
|
| Borregaard ASA
|
| 43,015
| $745,178
|
| Element Solutions, Inc.
|
| 33,637
| 790,469
|
| IMCD Group N.V.
|
| 4,021
| 612,337
|
| UPL Ltd.
|
| 104,156
| 590,018
|
|
|
|
|
| $2,738,002
|
| Computer Software – 2.6%
|
|
| Dun & Bradstreet Holdings, Inc.
|
| 41,505
| $437,463
|
| Kinaxis, Inc. (a)
|
| 6,167
| 639,261
|
| OBIC Co. Ltd.
|
| 2,500
| 390,625
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Computer Software – continued
|
|
| Totvs S.A.
|
| 78,300
| $483,400
|
|
|
|
|
| $1,950,749
|
| Computer Software - Systems – 2.3%
|
|
| Amadeus IT Group S.A.
|
| 10,282
| $604,313
|
| Kardex AG
|
| 2,313
| 614,638
|
| Rapid7, Inc. (a)
|
| 9,029
| 528,919
|
|
|
|
|
| $1,747,870
|
| Construction – 5.2%
|
|
| Allegion PLC
|
| 4,538
| $580,274
|
| AZEK Co., Inc. (a)
|
| 15,091
| 726,028
|
| Breedon Group PLC
|
| 172,738
| 804,594
|
| Mid-America Apartment Communities, Inc., REIT
|
| 5,111
| 642,351
|
| Summit Materials, Inc., “A” (a)
|
| 26,954
| 1,151,205
|
|
|
|
|
| $3,904,452
|
| Consumer Services – 1.2%
|
|
| Boyd Group Services, Inc.
|
| 3,994
| $937,353
|
| Containers – 1.2%
|
|
| Mayr-Melnhof Karton AG
|
| 2,846
| $362,963
|
| Verallia S.A.
|
| 14,954
| 552,750
|
|
|
|
|
| $915,713
|
| Electrical Equipment – 1.3%
|
|
| nVent Electric PLC
|
| 14,643
| $985,767
|
| Electronics – 2.1%
|
|
| ASM International N.V.
|
| 2,556
| $1,557,234
|
| Energy - Independent – 0.7%
|
|
| Diamondback Energy, Inc.
|
| 2,797
| $510,508
|
| Engineering - Construction – 3.0%
|
|
| Corporacion Inmobiliaria Vesta S.A.B. de C.V. (l)
|
| 194,965
| $683,466
|
| Jacobs Solutions, Inc.
|
| 8,631
| 1,265,736
|
| JGC Corp.
|
| 39,100
| 355,348
|
|
|
|
|
| $2,304,550
|
| Entertainment – 2.1%
|
|
| CTS Eventim AG
|
| 10,711
| $841,607
|
| Lottery Corp. Ltd.
|
| 229,953
| 759,305
|
|
|
|
|
| $1,600,912
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Food & Beverages – 5.0%
|
|
| Bakkafrost P/F
|
| 10,803
| $674,342
|
| Cranswick PLC
|
| 32,115
| 1,559,120
|
| S Foods, Inc.
|
| 21,600
| 450,240
|
| Toyo Suisan Kaisha Ltd.
|
| 8,900
| 516,832
|
| Universal Robina Corp.
|
| 278,500
| 579,641
|
|
|
|
|
| $3,780,175
|
| General Merchandise – 1.4%
|
|
| B&M European Value Retail S.A.
|
| 156,268
| $1,037,177
|
| Insurance – 1.9%
|
|
| AUB Group Ltd.
|
| 72,362
| $1,421,406
|
| Internet – 1.4%
|
|
| Digital Garage, Inc.
|
| 14,300
| $331,460
|
| Scout24 AG
|
| 10,426
| 757,238
|
|
|
|
|
| $1,088,698
|
| Machinery & Tools – 11.1%
|
|
| AGCO Corp.
|
| 5,961
| $653,922
|
| Azbil Corp.
|
| 13,000
| 380,756
|
| IDEX Corp.
|
| 3,201
| 755,116
|
| Ingersoll Rand, Inc.
|
| 13,965
| 1,275,423
|
| Interpump Group S.p.A
|
| 10,151
| 481,197
|
| RB Global, Inc.
|
| 13,993
| 1,062,208
|
| SIG Combibloc Group AG
|
| 25,536
| 505,320
|
| VAT Group AG
|
| 1,003
| 502,209
|
| Veralto Corp.
|
| 10,723
| 926,682
|
| Wabtec Corp.
|
| 10,265
| 1,450,342
|
| Zurn Elkay Water Solutions Corp.
|
| 12,833
| 407,448
|
|
|
|
|
| $8,400,623
|
| Medical & Health Technology & Services – 3.3%
|
|
| AS ONE Corp.
|
| 13,100
| $455,948
|
| ICON PLC (a)
|
| 5,043
| 1,616,887
|
| Selcuk Ecza Deposu Ticaret ve Sanayi A.S.
|
| 227,226
| 437,624
|
|
|
|
|
| $2,510,459
|
| Medical Equipment – 5.2%
|
|
| Bruker BioSciences Corp.
|
| 9,371
| $810,966
|
| Envista Holdings Corp. (a)
|
| 22,910
| 473,092
|
| Gerresheimer AG
|
| 7,455
| 873,418
|
| STERIS PLC
|
| 5,930
| 1,381,156
|
| Tecan Group AG
|
| 1,080
| 421,082
|
|
|
|
|
| $3,959,714
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Oil Services – 1.0%
|
|
| TechnipFMC PLC
|
| 35,262
| $764,833
|
| Other Banks & Diversified Financials – 1.1%
|
|
| Shizuoka Financial Group, Inc.
|
| 81,400
| $795,431
|
| Pollution Control – 2.7%
|
|
| Daiseki Co. Ltd.
|
| 17,900
| $473,409
|
| GFL Environmental, Inc.
|
| 43,239
| 1,560,063
|
|
|
|
|
| $2,033,472
|
| Printing & Publishing – 0.8%
|
|
| Wolters Kluwer N.V.
|
| 3,914
| $616,982
|
| Real Estate – 4.5%
|
|
| Big Yellow Group PLC, REIT
|
| 37,691
| $477,201
|
| Catena AB
|
| 12,406
| 507,901
|
| LEG Immobilien SE (a)
|
| 5,901
| 433,818
|
| Sun Communities, Inc., REIT
|
| 6,642
| 888,434
|
| Tritax Big Box PLC, REIT
|
| 229,016
| 423,801
|
| Unite Group PLC, REIT
|
| 55,935
| 677,824
|
|
|
|
|
| $3,408,979
|
| Restaurants – 1.8%
|
|
| Pluxee N.V. (a)
|
| 9,453
| $270,081
|
| Sodexo
|
| 5,337
| 425,118
|
| Yum China Holdings, Inc.
|
| 15,302
| 656,303
|
|
|
|
|
| $1,351,502
|
| Specialty Chemicals – 3.9%
|
|
| Axalta Coating Systems Ltd. (a)
|
| 18,834
| $616,437
|
| Chemours Co.
|
| 17,169
| 337,714
|
| Croda International PLC
|
| 6,037
| 363,193
|
| Essentra PLC
|
| 294,728
| 619,810
|
| Symrise AG
|
| 9,744
| 995,841
|
|
|
|
|
| $2,932,995
|
| Specialty Stores – 3.9%
|
|
| Burlington Stores, Inc. (a)
|
| 5,138
| $1,053,804
|
| Multiplan Empreendimentos Imobiliarios S.A.
|
| 166,795
| 886,133
|
| NISHIMATSUYA CHAIN Co., Ltd.
|
| 37,300
| 558,057
|
| ZOZO, Inc.
|
| 19,300
| 436,927
|
|
|
|
|
| $2,934,921
|
| Telecommunications - Wireless – 0.9%
|
|
| Wireless Infrastructure Italian S.p.A.
|
| 64,090
| $708,962
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Trucking – 1.8%
|
|
| Saia, Inc. (a)
|
| 1,053
| $605,896
|
| XPO, Inc. (a)
|
| 6,445
| 775,463
|
|
|
|
|
| $1,381,359
|
| Total Common Stocks (Identified Cost, $57,221,357)
|
| $72,306,636
|
| Investment Companies (h) – 2.9%
|
| Money Market Funds – 2.9%
|
|
| MFS Institutional Money Market Portfolio, 5.37% (v) (Identified Cost, $2,219,858)
|
|
| 2,219,920
| $2,219,920
|
| Collateral for Securities Loaned – 0.4%
|
| State Street Navigator Securities Lending Government Money Market Portfolio, 5.34% (j) (Identified Cost, $283,926)
|
|
| 283,926
| $283,926
|
|
|
|
|
| Other Assets, Less Liabilities – 1.1%
|
| 851,793
|
| Net Assets – 100.0%
| $75,662,275
|
| (a)
| Non-income producing security.
|
|
|
|
| (h)
| An affiliated issuer, which may be considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common
control. At period end, the aggregate values of the fund's investments in affiliated issuers and in unaffiliated issuers were $2,219,920 and $72,590,562, respectively.
|
|
|
|
| (j)
| The rate quoted is the annualized seven-day yield of the fund at period end.
|
|
|
|
| (l)
| A portion of this security is on loan. See Note 2 for additional information.
|
|
|
|
| (v)
| Affiliated issuer that is available only to investment companies managed by MFS. The rate quoted for the MFS Institutional Money Market Portfolio is the annualized
seven-day yield of the fund at period end.
|
|
|
|
| The following abbreviations are used in this report and are defined:
|
| REIT
| Real Estate Investment Trust
|
See Notes to Financial Statements
Financial Statements
Statement of Assets and
Liabilities
At 2/29/24 (unaudited)
This statement represents your
fund’s balance sheet, which details the assets and liabilities comprising the total value of the fund.
| Assets
|
|
| Investments in unaffiliated issuers, at value, including $427,029 of securities on loan (identified cost, $57,505,283)
| $72,590,562
|
| Investments in affiliated issuers, at value (identified cost, $2,219,858)
| 2,219,920
|
| Foreign currency, at value (identified cost, $3)
| 3
|
| Receivables for
|
|
| Investments sold
| 1,179,844
|
| Fund shares sold
| 96,674
|
| Interest and dividends
| 140,620
|
| Receivable from investment adviser
| 21,423
|
| Other assets
| 42,416
|
| Total assets
| $76,291,462
|
| Liabilities
|
|
| Payables for
|
|
| Investments purchased
| $225,957
|
| Fund shares reacquired
| 50,390
|
| Collateral for securities loaned, at value (c)
| 283,926
|
| Payable to affiliates
|
|
| Administrative services fee
| 116
|
| Shareholder servicing costs
| 16,311
|
| Distribution and service fees
| 545
|
| Payable for independent Trustees' compensation
| 566
|
| Accrued expenses and other liabilities
| 51,376
|
| Total liabilities
| $629,187
|
| Net assets
| $75,662,275
|
| Net assets consist of
|
|
| Paid-in capital
| $68,478,404
|
| Total distributable earnings (loss)
| 7,183,871
|
| Net assets
| $75,662,275
|
| Shares of beneficial interest outstanding
| 3,391,990
|
| (c)
| Non-cash collateral is not included.
|
Statement of Assets and Liabilities (unaudited) – continued
|
| Net assets
| Shares
outstanding
| Net asset value
per share (a)
|
| Class A
| $26,653,572
| 1,210,990
| $22.01
|
| Class B
| 1,353,314
| 68,507
| 19.75
|
| Class C
| 1,468,968
| 74,367
| 19.75
|
| Class I
| 19,676,959
| 869,824
| 22.62
|
| Class R1
| 139,386
| 7,062
| 19.74
|
| Class R2
| 192,843
| 9,069
| 21.27
|
| Class R3
| 804,763
| 36,573
| 22.00
|
| Class R4
| 189,025
| 8,349
| 22.64
|
| Class R6
| 25,183,445
| 1,107,249
| 22.74
|
| (a)
| Maximum offering price per share was equal to the net asset value per share for all share classes, except for Class A, for which the maximum offering price per share was $23.35 [100 /
94.25 x $22.01]. On sales of $50,000 or more, the maximum offering price of Class A shares is reduced. A contingent deferred sales charge may be imposed on redemptions of Class A, Class B, and Class C shares.
Redemption price per share was equal to the net asset value per share for Classes I, R1, R2, R3, R4, and R6.
|
See Notes to Financial Statements
Financial Statements
Statement of Operations
Six months ended 2/29/24
(unaudited)
This statement describes how much
your fund earned in investment income and accrued in expenses. It also describes any gains and/or losses generated by fund operations.
| Net investment income (loss)
|
|
| Income
|
|
| Dividends
| $410,512
|
| Dividends from affiliated issuers
| 66,233
|
| Income on securities loaned
| 691
|
| Interest
| 46
|
| Other
| 2
|
| Foreign taxes withheld
| (24,984)
|
| Total investment income
| $452,500
|
| Expenses
|
|
| Management fee
| $336,761
|
| Distribution and service fees
| 46,874
|
| Shareholder servicing costs
| 32,874
|
| Administrative services fee
| 10,068
|
| Independent Trustees' compensation
| 1,671
|
| Custodian fee
| 12,155
|
| Shareholder communications
| 7,839
|
| Audit and tax fees
| 37,343
|
| Legal fees
| 178
|
| Registration fees
| 61,829
|
| Miscellaneous
| 15,665
|
| Total expenses
| $563,257
|
| Reduction of expenses by investment adviser
| (147,734)
|
| Net expenses
| $415,523
|
| Net investment income (loss)
| $36,977
|
| Realized and unrealized gain (loss)
|
| Realized gain (loss) (identified cost basis)
|
|
| Unaffiliated issuers
| $(1,379,168)
|
| Affiliated issuers
| (65)
|
| Foreign currency
| 1,863
|
| Net realized gain (loss)
| $(1,377,370)
|
| Change in unrealized appreciation or depreciation
|
|
| Unaffiliated issuers
| $6,370,928
|
| Affiliated issuers
| (142)
|
| Translation of assets and liabilities in foreign currencies
| (1,140)
|
| Net unrealized gain (loss)
| $6,369,646
|
| Net realized and unrealized gain (loss)
| $4,992,276
|
| Change in net assets from operations
| $5,029,253
|
See Notes to Financial Statements
Financial Statements
Statements of Changes in Net
Assets
These statements describe the
increases and/or decreases in net assets resulting from operations, any distributions, and any shareholder transactions.
|
| Six months ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
|
| Change in net assets
|
|
|
| From operations
|
|
|
| Net investment income (loss)
| $36,977
| $243,927
|
| Net realized gain (loss)
| (1,377,370)
| (1,753,970)
|
| Net unrealized gain (loss)
| 6,369,646
| 9,096,193
|
| Change in net assets from operations
| $5,029,253
| $7,586,150
|
| Change in net assets from fund share transactions
| $1,831,973
| $(2,518,809)
|
| Total change in net assets
| $6,861,226
| $5,067,341
|
| Net assets
|
|
|
| At beginning of period
| 68,801,049
| 63,733,708
|
| At end of period
| $75,662,275
| $68,801,049
|
See Notes to Financial Statements
Financial Statements
Financial Highlights
The financial highlights table is
intended to help you understand the fund's financial performance for the semiannual period and the past 5 fiscal years. Certain information reflects financial results for a single fund share. The total returns in the
table represent the rate that an investor would have earned (or lost) on an investment in the fund share class (assuming reinvestment of all distributions) held for the entire period.
| Class A
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $20.56
| $18.22
| $27.56
| $21.57
| $18.72
| $21.27
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.00)(w)
| $0.05
| $(0.10)
| $(0.06)
| $(0.06)
| $(0.03)
|
| Net realized and unrealized gain (loss)
| 1.45
| 2.29
| (7.66)
| 6.96
| 3.49
| (0.62)
|
| Total from investment operations
| $1.45
| $2.34
| $(7.76)
| $6.90
| $3.43
| $(0.65)
|
| Less distributions declared to shareholders
|
| From net investment income
| $—
| $—
| $—
| $—
| $—
| $(0.02)
|
| From net realized gain
| —
| —
| (1.58)
| (0.91)
| (0.58)
| (1.88)
|
| Total distributions declared to shareholders
| $—
| $—
| $(1.58)
| $(0.91)
| $(0.58)
| $(1.90)
|
| Net asset value, end of period (x)
| $22.01
| $20.56
| $18.22
| $27.56
| $21.57
| $18.72
|
| Total return (%) (r)(s)(t)(x)
| 7.05(n)
| 12.84
| (29.71)
| 32.82
| 18.63
| (1.65)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.78(a)
| 1.78
| 1.67
| 1.68
| 1.97
| 2.04
|
| Expenses after expense reductions
| 1.35(a)
| 1.35
| 1.35
| 1.34
| 1.49
| 1.51
|
| Net investment income (loss)
| (0.04)(a)(l)
| 0.26
| (0.45)
| (0.26)
| (0.32)
| (0.16)
|
| Portfolio turnover
| 22(n)
| 29
| 36
| 36
| 84
| 55
|
| Net assets at end of period (000 omitted)
| $26,654
| $24,868
| $23,856
| $44,743
| $17,029
| $11,255
|
See Notes to Financial Statements
Financial Highlights – continued
| Class B
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $18.52
| $16.54
| $25.35
| $20.05
| $17.57
| $20.21
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.07)
| $(0.09)
| $(0.24)
| $(0.25)
| $(0.19)
| $(0.16)
|
| Net realized and unrealized gain (loss)
| 1.30
| 2.07
| (6.99)
| 6.46
| 3.25
| (0.60)
|
| Total from investment operations
| $1.23
| $1.98
| $(7.23)
| $6.21
| $3.06
| $(0.76)
|
| Less distributions declared to shareholders
|
| From net investment income
| $—
| $—
| $—
| $—
| $—
| $—
|
| From net realized gain
| —
| —
| (1.58)
| (0.91)
| (0.58)
| (1.88)
|
| Total distributions declared to shareholders
| $—
| $—
| $(1.58)
| $(0.91)
| $(0.58)
| $(1.88)
|
| Net asset value, end of period (x)
| $19.75
| $18.52
| $16.54
| $25.35
| $20.05
| $17.57
|
| Total return (%) (r)(s)(t)(x)
| 6.64(n)
| 11.97
| (30.24)
| 31.84
| 17.72
| (2.35)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 2.53(a)
| 2.53
| 2.43
| 2.46
| 2.72
| 2.79
|
| Expenses after expense reductions
| 2.10(a)
| 2.10
| 2.10
| 2.10
| 2.24
| 2.26
|
| Net investment income (loss)
| (0.79)(a)(l)
| (0.52)
| (1.15)
| (1.12)
| (1.08)
| (0.91)
|
| Portfolio turnover
| 22(n)
| 29
| 36
| 36
| 84
| 55
|
| Net assets at end of period (000 omitted)
| $1,353
| $1,518
| $1,739
| $2,979
| $2,678
| $2,508
|
See Notes to Financial Statements
Financial Highlights – continued
| Class C
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $18.52
| $16.54
| $25.35
| $20.05
| $17.57
| $20.21
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.07)
| $(0.09)
| $(0.24)
| $(0.25)
| $(0.19)
| $(0.16)
|
| Net realized and unrealized gain (loss)
| 1.30
| 2.07
| (6.99)
| 6.46
| 3.25
| (0.60)
|
| Total from investment operations
| $1.23
| $1.98
| $(7.23)
| $6.21
| $3.06
| $(0.76)
|
| Less distributions declared to shareholders
|
| From net investment income
| $—
| $—
| $—
| $—
| $—
| $—
|
| From net realized gain
| —
| —
| (1.58)
| (0.91)
| (0.58)
| (1.88)
|
| Total distributions declared to shareholders
| $—
| $—
| $(1.58)
| $(0.91)
| $(0.58)
| $(1.88)
|
| Net asset value, end of period (x)
| $19.75
| $18.52
| $16.54
| $25.35
| $20.05
| $17.57
|
| Total return (%) (r)(s)(t)(x)
| 6.64(n)
| 11.97
| (30.24)
| 31.84
| 17.72
| (2.35)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 2.53(a)
| 2.54
| 2.43
| 2.46
| 2.72
| 2.78
|
| Expenses after expense reductions
| 2.10(a)
| 2.10
| 2.10
| 2.10
| 2.24
| 2.26
|
| Net investment income (loss)
| (0.79)(a)(l)
| (0.54)
| (1.16)
| (1.13)
| (1.08)
| (0.91)
|
| Portfolio turnover
| 22(n)
| 29
| 36
| 36
| 84
| 55
|
| Net assets at end of period (000 omitted)
| $1,469
| $1,578
| $2,137
| $3,896
| $3,422
| $3,287
|
See Notes to Financial Statements
Financial Highlights – continued
| Class I
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $21.11
| $18.66
| $28.15
| $21.96
| $19.00
| $21.54
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.02
| $0.10
| $(0.06)
| $(0.00)(w)
| $(0.02)
| $0.01
|
| Net realized and unrealized gain (loss)
| 1.49
| 2.35
| (7.83)
| 7.10
| 3.56
| (0.62)
|
| Total from investment operations
| $1.51
| $2.45
| $(7.89)
| $7.10
| $3.54
| $(0.61)
|
| Less distributions declared to shareholders
|
| From net investment income
| $—
| $—
| $(0.02)
| $—
| $—
| $(0.05)
|
| From net realized gain
| —
| —
| (1.58)
| (0.91)
| (0.58)
| (1.88)
|
| Total distributions declared to shareholders
| $—
| $—
| $(1.60)
| $(0.91)
| $(0.58)
| $(1.93)
|
| Net asset value, end of period (x)
| $22.62
| $21.11
| $18.66
| $28.15
| $21.96
| $19.00
|
| Total return (%) (r)(s)(t)(x)
| 7.15(n)
| 13.13
| (29.55)
| 33.16
| 18.94
| (1.41)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.53(a)
| 1.54
| 1.40
| 1.43
| 1.72
| 1.76
|
| Expenses after expense reductions
| 1.10(a)
| 1.10
| 1.10
| 1.09
| 1.24
| 1.26
|
| Net investment income (loss)
| 0.21(a)(l)
| 0.50
| (0.26)
| (0.02)
| (0.09)
| 0.05
|
| Portfolio turnover
| 22(n)
| 29
| 36
| 36
| 84
| 55
|
| Net assets at end of period (000 omitted)
| $19,677
| $17,671
| $20,703
| $61,502
| $18,688
| $14,059
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R1
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $18.51
| $16.53
| $25.33
| $20.04
| $17.56
| $20.20
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.07)
| $(0.08)
| $(0.23)
| $(0.25)
| $(0.19)
| $(0.16)
|
| Net realized and unrealized gain (loss)
| 1.30
| 2.06
| (6.99)
| 6.45
| 3.25
| (0.60)
|
| Total from investment operations
| $1.23
| $1.98
| $(7.22)
| $6.20
| $3.06
| $(0.76)
|
| Less distributions declared to shareholders
|
| From net investment income
| $—
| $—
| $—
| $—
| $—
| $—
|
| From net realized gain
| —
| —
| (1.58)
| (0.91)
| (0.58)
| (1.88)
|
| Total distributions declared to shareholders
| $—
| $—
| $(1.58)
| $(0.91)
| $(0.58)
| $(1.88)
|
| Net asset value, end of period (x)
| $19.74
| $18.51
| $16.53
| $25.33
| $20.04
| $17.56
|
| Total return (%) (r)(s)(t)(x)
| 6.65(n)
| 11.98
| (30.22)
| 31.80
| 17.73
| (2.35)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 2.53(a)
| 2.53
| 2.43
| 2.45
| 2.72
| 2.79
|
| Expenses after expense reductions
| 2.10(a)
| 2.10
| 2.10
| 2.09
| 2.24
| 2.26
|
| Net investment income (loss)
| (0.79)(a)(l)
| (0.48)
| (1.13)
| (1.11)
| (1.08)
| (0.92)
|
| Portfolio turnover
| 22(n)
| 29
| 36
| 36
| 84
| 55
|
| Net assets at end of period (000 omitted)
| $139
| $130
| $114
| $160
| $120
| $101
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R2
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $19.89
| $17.67
| $26.85
| $21.09
| $18.36
| $20.93
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.03)
| $(0.00)(w)
| $(0.13)
| $(0.14)
| $(0.11)
| $(0.07)
|
| Net realized and unrealized gain (loss)
| 1.41
| 2.22
| (7.47)
| 6.81
| 3.42
| (0.62)
|
| Total from investment operations
| $1.38
| $2.22
| $(7.60)
| $6.67
| $3.31
| $(0.69)
|
| Less distributions declared to shareholders
|
| From net investment income
| $—
| $—
| $—
| $—
| $—
| $—
|
| From net realized gain
| —
| —
| (1.58)
| (0.91)
| (0.58)
| (1.88)
|
| Total distributions declared to shareholders
| $—
| $—
| $(1.58)
| $(0.91)
| $(0.58)
| $(1.88)
|
| Net asset value, end of period (x)
| $21.27
| $19.89
| $17.67
| $26.85
| $21.09
| $18.36
|
| Total return (%) (r)(s)(t)(x)
| 6.94(n)
| 12.56
| (29.91)
| 32.47
| 18.33
| (1.89)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 2.03(a)
| 2.04
| 1.94
| 1.95
| 2.22
| 2.29
|
| Expenses after expense reductions
| 1.60(a)
| 1.60
| 1.60
| 1.59
| 1.74
| 1.76
|
| Net investment income (loss)
| (0.29)(a)(l)
| (0.00)
| (0.61)
| (0.61)
| (0.58)
| (0.41)
|
| Portfolio turnover
| 22(n)
| 29
| 36
| 36
| 84
| 55
|
| Net assets at end of period (000 omitted)
| $193
| $179
| $225
| $237
| $178
| $218
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R3
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $20.56
| $18.22
| $27.56
| $21.57
| $18.72
| $21.26
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.00)(w)
| $0.07
| $(0.08)
| $(0.09)
| $(0.06)
| $(0.03)
|
| Net realized and unrealized gain (loss)
| 1.44
| 2.27
| (7.68)
| 6.99
| 3.49
| (0.62)
|
| Total from investment operations
| $1.44
| $2.34
| $(7.76)
| $6.90
| $3.43
| $(0.65)
|
| Less distributions declared to shareholders
|
| From net investment income
| $—
| $—
| $—
| $—
| $—
| $(0.01)
|
| From net realized gain
| —
| —
| (1.58)
| (0.91)
| (0.58)
| (1.88)
|
| Total distributions declared to shareholders
| $—
| $—
| $(1.58)
| $(0.91)
| $(0.58)
| $(1.89)
|
| Net asset value, end of period (x)
| $22.00
| $20.56
| $18.22
| $27.56
| $21.57
| $18.72
|
| Total return (%) (r)(s)(t)(x)
| 7.00(n)
| 12.84
| (29.71)
| 32.82
| 18.63
| (1.63)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.78(a)
| 1.76
| 1.68
| 1.70
| 1.97
| 2.04
|
| Expenses after expense reductions
| 1.35(a)
| 1.35
| 1.35
| 1.34
| 1.49
| 1.51
|
| Net investment income (loss)
| (0.04)(a)(l)
| 0.34
| (0.37)
| (0.35)
| (0.31)
| (0.16)
|
| Portfolio turnover
| 22(n)
| 29
| 36
| 36
| 84
| 55
|
| Net assets at end of period (000 omitted)
| $805
| $731
| $189
| $294
| $206
| $152
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R4
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $21.13
| $18.67
| $28.15
| $21.96
| $19.00
| $21.56
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.03
| $0.08
| $(0.03)
| $(0.03)
| $(0.02)
| $0.02
|
| Net realized and unrealized gain (loss)
| 1.48
| 2.38
| (7.85)
| 7.13
| 3.56
| (0.64)
|
| Total from investment operations
| $1.51
| $2.46
| $(7.88)
| $7.10
| $3.54
| $(0.62)
|
| Less distributions declared to shareholders
|
| From net investment income
| $—
| $—
| $(0.02)
| $—
| $—
| $(0.06)
|
| From net realized gain
| —
| —
| (1.58)
| (0.91)
| (0.58)
| (1.88)
|
| Total distributions declared to shareholders
| $—
| $—
| $(1.60)
| $(0.91)
| $(0.58)
| $(1.94)
|
| Net asset value, end of period (x)
| $22.64
| $21.13
| $18.67
| $28.15
| $21.96
| $19.00
|
| Total return (%) (r)(s)(t)(x)
| 7.15(n)
| 13.18
| (29.53)
| 33.16
| 18.94
| (1.43)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.53(a)
| 1.56
| 1.43
| 1.45
| 1.72
| 1.78
|
| Expenses after expense reductions
| 1.10(a)
| 1.10
| 1.10
| 1.09
| 1.24
| 1.26
|
| Net investment income (loss)
| 0.27(a)(l)
| 0.41
| (0.13)
| (0.11)
| (0.08)
| 0.08
|
| Portfolio turnover
| 22(n)
| 29
| 36
| 36
| 84
| 55
|
| Net assets at end of period (000 omitted)
| $189
| $93
| $82
| $116
| $87
| $73
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R6
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $21.21
| $18.73
| $28.24
| $22.01
| $19.03
| $21.58
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.03
| $0.12
| $(0.01)
| $(0.00)(w)
| $0.01
| $0.05
|
| Net realized and unrealized gain (loss)
| 1.50
| 2.36
| (7.88)
| 7.14
| 3.55
| (0.64)
|
| Total from investment operations
| $1.53
| $2.48
| $(7.89)
| $7.14
| $3.56
| $(0.59)
|
| Less distributions declared to shareholders
|
| From net investment income
| $—
| $—
| $(0.04)
| $—
| $—
| $(0.08)
|
| From net realized gain
| —
| —
| (1.58)
| (0.91)
| (0.58)
| (1.88)
|
| Total distributions declared to shareholders
| $—
| $—
| $(1.62)
| $(0.91)
| $(0.58)
| $(1.96)
|
| Net asset value, end of period (x)
| $22.74
| $21.21
| $18.73
| $28.24
| $22.01
| $19.03
|
| Total return (%) (r)(s)(t)(x)
| 7.21(n)
| 13.24
| (29.49)
| 33.27
| 19.01
| (1.26)
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions
| 1.43(a)
| 1.43
| 1.33
| 1.37
| 1.62
| 1.69
|
| Expenses after expense reductions
| 1.00(a)
| 1.01
| 1.00
| 1.01
| 1.15
| 1.16
|
| Net investment income (loss)
| 0.31(a)(l)
| 0.62
| (0.03)
| (0.01)
| 0.03
| 0.24
|
| Portfolio turnover
| 22(n)
| 29
| 36
| 36
| 84
| 55
|
| Net assets at end of period (000 omitted)
| $25,183
| $22,034
| $14,688
| $20,788
| $13,432
| $13,382
|
| (a)
| Annualized.
|
| (d)
| Per share data is based on average shares outstanding.
|
| (l)
| Recognition of net investment income by the fund may be affected by the timing of the declaration of dividends by companies in which the fund invests and the actual annual net investment income ratio
may differ.
|
| (n)
| Not annualized.
|
| (r)
| Certain expenses have been reduced without which performance would have been lower.
|
| (s)
| From time to time the fund may receive proceeds from litigation settlements, without which performance would be lower.
|
| (t)
| Total returns do not include any applicable sales charges.
|
| (w)
| Per share amount was less than $0.01.
|
| (x)
| The net asset values and total returns have been calculated on net assets which include adjustments made in accordance with U.S. generally accepted accounting principles required at
period end for financial reporting purposes.
|
See Notes to Financial Statements
Notes to Financial Statements
(unaudited)
(1) Business and
Organization
MFS Global New Discovery
Fund (the fund) is a diversified series of MFS Series Trust IV (the trust). The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended, as
an open-end management investment company.
The fund is an investment company
and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services - Investment
Companies.
(2) Significant Accounting
Policies
General — The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations
during the reporting period. Actual results could differ from those estimates. In the preparation of these financial statements, management has evaluated subsequent events occurring after the date of the fund’s
Statement of Assets and Liabilities through the date that the financial statements were issued. The fund invests in foreign securities. Investments in foreign securities are vulnerable to the effects of changes in the relative values of the local currency and the U.S. dollar and to
the effects of changes in each country’s market, economic, industrial, political, regulatory, geopolitical, environmental, public health, and other conditions.
Balance Sheet Offsetting — The fund's accounting policy with respect to balance sheet offsetting is that, absent an event of default by the counterparty or a termination of the agreement, the International
Swaps and Derivatives Association (ISDA) Master Agreement, or similar agreement, does not result in an offset of reported amounts of financial assets and financial liabilities in the Statement of Assets and
Liabilities across transactions between the fund and the applicable counterparty. The fund's right to setoff may be restricted or prohibited by the bankruptcy or insolvency laws of the particular jurisdiction to which
a specific master netting agreement counterparty is subject. Balance sheet offsetting disclosures, to the extent applicable to the fund, have been included in the fund’s Significant Accounting Policies note
under the captions for each of the fund’s in-scope financial instruments and transactions.
Investment Valuations — Subject to its oversight, the fund's Board of Trustees has delegated primary responsibility for determining or causing to be determined the value of the fund’s investments to MFS as
the fund's adviser, pursuant to the fund’s valuation policy and procedures which have been adopted by the adviser and approved by the Board. In accordance with Rule 2a-5 under the Investment Company Act of
1940, the Board of Trustees designated the adviser as the “valuation designee” of the fund. If the adviser, as valuation designee, determines that reliable market quotations are not readily available for
an investment, the investment is valued at fair value as determined in good faith by the adviser in accordance with the adviser’s fair valuation policy and procedures.
Notes to Financial
Statements (unaudited) - continued
Under the fund's valuation policy
and procedures, equity securities, including restricted equity securities, are generally valued at the last sale or official closing price on their primary market or exchange as provided by a third-party pricing
service. Equity securities, for which there were no sales reported that day, are generally valued at the last quoted daily bid quotation on their primary market or exchange as provided by a third-party pricing
service. Short-term instruments with a maturity at issuance of 60 days or less may be valued at amortized cost, which approximates market value.
Open-end investment companies are generally valued
at net asset value per share. The values of foreign securities and other assets and liabilities expressed in foreign currencies are converted to U.S. dollars using the mean of bid and asked prices for rates provided
by a third-party pricing service.
Under the fund’s valuation
policy and procedures, market quotations are not considered to be readily available for debt instruments, floating rate loans, and many types of derivatives. These investments are generally valued at fair value based
on information from third-party pricing services or otherwise determined by the adviser in accordance with the adviser’s fair valuation policy and procedures. Securities and other assets generally valued on the
basis of information from a third-party pricing service may also be valued at a broker/dealer bid quotation. In determining values, third-party pricing services can utilize both transaction data and market information
such as yield, quality, coupon rate, maturity, type of issue, trading characteristics, spreads and other market data. An investment may also be valued at fair value if the adviser determines that the
investment’s value has been materially affected by events occurring after the close of the exchange or market on which the investment is principally traded (such as foreign exchange or market) and prior to the
determination of the fund’s net asset value, or after the halt of trading of a specific security where trading does not resume prior to the close of the exchange or market on which the security is principally
traded. Events that occur after foreign markets close (such as developments in foreign markets and significant movements in the U.S. markets) and prior to the determination of the fund’s net asset value may be
deemed to have a material effect on the value of securities traded in foreign markets. Accordingly, the fund’s foreign equity securities may often be valued at fair value. The adviser generally relies on
third-party pricing services or other information (such as the correlation with price movements of similar securities in the same or other markets; the type, cost and investment characteristics of the security; the
business and financial condition of the issuer; and trading and other market data) to assist in determining whether to fair value and at what value to fair value an investment. The value of an investment for purposes
of calculating the fund’s net asset value can differ depending on the source and method used to determine value. When fair valuation is used, the value of an investment used to determine the fund’s net
asset value may differ from quoted or published prices for the same investment. There can be no assurance that the fund could obtain the fair value assigned to an investment if it were to sell the investment at the
same time at which the fund determines its net asset value per share.
Various inputs are used in
determining the value of the fund's assets or liabilities. These inputs are categorized into three broad levels. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value
hierarchy. In such cases, an investment's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fund's assessment of the significance of a
particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment. Level 1 includes unadjusted
Notes to Financial
Statements (unaudited) - continued
quoted prices in active markets for identical
assets or liabilities. Level 2 includes other significant observable market-based inputs (including quoted prices for similar securities, interest rates, prepayment speed, and credit risk). Level 3 includes
significant unobservable inputs, which may include the adviser's own assumptions in determining the fair value of investments. The following is a summary of the levels used as of February 29, 2024 in valuing the
fund's assets and liabilities:
| Financial Instruments
| Level 1
| Level 2
| Level 3
| Total
|
| Equity Securities
| $72,306,636
| $—
| $—
| $72,306,636
|
| Mutual Funds
| 2,503,846
| —
| —
| 2,503,846
|
| Total
| $74,810,482
| $—
| $—
| $74,810,482
|
For further information regarding
security characteristics, see the Portfolio of Investments.
The following is a reconciliation of
level 3 assets for which significant unobservable inputs were used to determine fair value. The table presents the activity of level 3 securities held at the beginning and the end of the period.
|
| Equity
Securities
|
| Balance as of 8/31/23
| $0
|
| Realized gain (loss)
| (747,538)
|
| Change in unrealized appreciation or depreciation
| 1,010,785
|
| Sales
| (263,247)
|
| Balance as of 2/29/24
| $—
|
Foreign Currency Translation — Purchases and sales of foreign investments, income, and expenses are converted into U.S. dollars based upon currency exchange rates prevailing on the respective dates of such
transactions or on the reporting date for foreign denominated receivables and payables. Gains and losses attributable to foreign currency exchange rates on sales of securities are recorded for financial statement
purposes as net realized gains and losses on investments. Gains and losses attributable to foreign exchange rate movements on receivables, payables, income and expenses are recorded for financial statement purposes as
foreign currency transaction gains and losses. That portion of both realized and unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately
disclosed.
Security Loans — Under its Securities Lending Agency Agreement with the fund, State Street Bank and Trust Company, as lending agent, loans the securities of the fund to certain qualified
institutions (the “Borrowers”) approved by the fund. Security loans can be terminated at the discretion of either the lending agent or the fund and the related securities must be returned within the
earlier of the standard trade settlement period for such securities or within three business days. The loans are collateralized by cash and/or U.S. Treasury and federal agency obligations in an amount typically
at least equal to the market value of the securities loaned. On loans collateralized by cash, the cash collateral is invested in a money market fund. The market value of the loaned securities is determined
at the close of business of the fund and any additional required collateral is delivered to the fund on the next business day. The lending agent provides the fund with indemnification against Borrower
default. In the event of Borrower default, the lending agent will, for the benefit of the fund, either purchase securities
Notes to Financial
Statements (unaudited) - continued
identical to those loaned or, when such purchase is
commercially impracticable, pay the fund the market value of the loaned securities. In return, the lending agent assumes the fund's rights to the related collateral. If the collateral value is less than
the cost to purchase identical securities, the lending agent is responsible for the shortfall, but only to the extent that such shortfall is not due to a decline in collateral value resulting from collateral
reinvestment for which the fund bears the risk of loss. At period end, the fund had investment securities on loan, all of which were classified as equity securities in the fund's Portfolio of Investments, with a fair
value of $427,029. The fair value of the fund's investment securities on loan and a related liability of $283,926 for cash collateral received on securities loaned are both presented gross in the Statement of Assets
and Liabilities. Additionally, these loans were collateralized by U.S. Treasury Obligations of $166,842 held by the custodian. The collateral on securities loaned exceeded the value of securities on loan at
period end. The liability for cash collateral for securities loaned is carried at fair value, which is categorized as level 2 within the fair value hierarchy. A portion of the income generated upon investment of the
collateral is remitted to the Borrowers, and the remainder is allocated between the fund and the lending agent. On loans collateralized by U.S. Treasury and/or federal agency obligations, a fee is received from
the Borrower, and is allocated between the fund and the lending agent. Income from securities lending is separately reported in the Statement of Operations. The dividend and interest income earned on the
securities loaned is accounted for in the same manner as other dividend and interest income.
Indemnifications — Under the fund's organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to
the fund. Additionally, in the normal course of business, the fund enters into agreements with service providers that may contain indemnification clauses. The fund's maximum exposure under these agreements is unknown
as this would involve future claims that may be made against the fund that have not yet occurred.
Investment Transactions and
Income — Interest income is recorded on the accrual basis. Dividends received in cash are recorded on the ex-dividend date. Certain dividends from foreign securities will be recorded when the fund is informed of the dividend if such information is
obtained subsequent to the ex-dividend date. Dividend and interest payments received in additional securities are recorded on the ex-dividend or ex-interest date in an amount equal to the value of the security on such
date.
The fund may receive proceeds from
litigation settlements. Any proceeds received from litigation involving portfolio holdings are reflected in the Statement of Operations in realized gain/loss if the security has been disposed of by the fund or in
unrealized gain/loss if the security is still held by the fund. Any other proceeds from litigation not related to portfolio holdings are reflected as other income in the Statement of Operations.
Investment transactions are recorded
on the trade date. In determining the net gain or loss on securities sold, the cost of securities is determined on the identified cost basis.
Tax Matters and Distributions — The fund intends to qualify as a regulated investment company, as defined under Subchapter M of the Internal Revenue Code, and to distribute all of its taxable income, including
realized capital gains. As a result, no provision for federal income tax is required. The fund’s federal tax returns, when filed, will remain subject to examination by the Internal Revenue Service for a
three
Notes to Financial
Statements (unaudited) - continued
year period. Management has analyzed the
fund’s tax positions taken on federal and state tax returns for all open tax years and does not believe that there are any uncertain tax positions that require recognition of a tax liability. Foreign taxes, if
any, have been accrued by the fund in the accompanying financial statements in accordance with the applicable foreign tax law. Foreign income taxes may be withheld by certain countries in which the fund invests.
Additionally, capital gains realized by the fund on securities issued in or by certain foreign countries may be subject to capital gains tax imposed by those countries.
Distributions to shareholders are
recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from U.S. generally accepted accounting principles. Certain capital
accounts in the financial statements are periodically adjusted for permanent differences in order to reflect their tax character. These adjustments have no impact on net assets or net asset value per share. Temporary
differences which arise from recognizing certain items of income, expense, gain or loss in different periods for financial statement and tax purposes will reverse at some time in the future.
Book/tax differences primarily
relate to net operating losses, passive foreign investment companies, and wash sale loss deferrals.
The fund declared no distributions
for the current period or for the year ended August 31, 2023.
The federal tax cost and the tax
basis components of distributable earnings were as follows:
| As of 2/29/24
|
|
| Cost of investments
| $60,793,795
|
| Gross appreciation
| 16,755,865
|
| Gross depreciation
| (2,739,178)
|
| Net unrealized appreciation (depreciation)
| $14,016,687
|
| As of 8/31/23
|
|
| Capital loss carryforwards
| (5,489,994)
|
| Other temporary differences
| (1,286)
|
| Net unrealized appreciation (depreciation)
| 7,645,898
|
The aggregate cost above includes
prior fiscal year end tax adjustments, if applicable.
As of August 31, 2023, the fund had
capital loss carryforwards available to offset future realized gains. These net capital losses may be carried forward indefinitely and their character is retained as short-term and/or long-term losses. Such losses are
characterized as follows:
| Short-Term
| $(2,918,398)
|
| Long-Term
| (2,571,596)
|
| Total
| $(5,489,994)
|
Multiple Classes of Shares of
Beneficial Interest — The fund offers multiple classes of shares, which differ in their respective distribution and service fees. The fund's income, realized and unrealized gain (loss), and common
expenses are allocated to shareholders based on the daily net assets of each class. Dividends are declared
Notes to Financial
Statements (unaudited) - continued
separately for each class. Differences in per share
dividend rates are generally due to differences in separate class expenses. Class B and Class C shares will convert to Class A shares approximately eight years after purchase.
(3) Transactions with
Affiliates
Investment Adviser — The fund has an investment advisory agreement with MFS to provide overall investment management and related administrative services and facilities to the fund. The management fee is computed daily and paid monthly at the following annual rates based on the fund's average daily net assets:
| Up to $1 billion
| 0.975%
|
| In excess of $1 billion and up to $2.5 billion
| 0.90%
|
| In excess of $2.5 billion
| 0.85%
|
MFS has agreed in writing to reduce
its management fee by a specified amount if certain MFS mutual fund assets exceed thresholds agreed to by MFS and the fund's Board of Trustees. MFS has also agreed in writing to waive at least 0.01% of its management
fee as part of this agreement. The agreement to waive at least 0.01% of the management fee will continue until modified by the fund's Board of Trustees, but such agreement will continue at least until December 31,
2024. For the six months ended February 29, 2024, this management fee reduction amounted to $4,447, which is included in the reduction of total expenses in the Statement of Operations. The management fee incurred for
the six months ended February 29, 2024 was equivalent to an annual effective rate of 0.96% of the fund's average daily net assets.
The investment adviser has agreed in
writing to pay a portion of the fund’s total annual operating expenses, excluding interest, taxes, extraordinary expenses, brokerage and transaction costs, certain tax reclaim recovery expenses (including
contingency fees and closing agreement expenses), and investment-related expenses, such that total fund operating expenses do not exceed the following rates annually of each class’s average daily net assets:
| Classes
|
| A
| B
| C
| I
| R1
| R2
| R3
| R4
| R6
|
| 1.35%
| 2.10%
| 2.10%
| 1.10%
| 2.10%
| 1.60%
| 1.35%
| 1.10%
| 1.01%
|
This written agreement will continue
until modified by the fund’s Board of Trustees, but such agreement will continue at least until December 31, 2024. For the six months ended February 29, 2024, this reduction amounted to $143,287, which is
included in the reduction of total expenses in the Statement of Operations.
Distributor — MFS Fund Distributors, Inc. (MFD), a wholly-owned subsidiary of MFS, as distributor, received $1,384 for the six months ended February 29, 2024, as its portion of the initial sales
charge on sales of Class A shares of the fund.
The Board of Trustees has adopted a
distribution plan for certain share classes pursuant to Rule 12b-1 of the Investment Company Act of 1940.
The fund's distribution plan
provides that the fund will pay MFD for services provided by MFD and financial intermediaries in connection with the distribution and servicing of certain share classes. One component of the plan is a distribution fee
paid to MFD and another component of the plan is a service fee paid to MFD. MFD may subsequently pay all, or a portion, of the distribution and/or service fees to financial intermediaries. The distribution and service
fees are computed daily and paid monthly.
Notes to Financial
Statements (unaudited) - continued
Distribution Plan Fee Table:
|
| Distribution
Fee Rate (d)
| Service
Fee Rate (d)
| Total
Distribution
Plan (d)
| Annual
Effective
Rate (e)
| Distribution
and Service
Fee
|
| Class A
| —
| 0.25%
| 0.25%
| 0.25%
| $ 30,723
|
| Class B
| 0.75%
| 0.25%
| 1.00%
| 1.00%
| 6,705
|
| Class C
| 0.75%
| 0.25%
| 1.00%
| 1.00%
| 7,441
|
| Class R1
| 0.75%
| 0.25%
| 1.00%
| 1.00%
| 645
|
| Class R2
| 0.25%
| 0.25%
| 0.50%
| 0.50%
| 443
|
| Class R3
| —
| 0.25%
| 0.25%
| 0.25%
| 917
|
| Total Distribution and Service Fees
|
|
|
|
| $46,874
|
| (d)
| In accordance with the distribution plan for certain classes, the fund pays distribution and/or service fees equal to these annual percentage rates of each class’s average daily
net assets. The distribution and service fee rates disclosed by class represent the current rates in effect at the end of the reporting period. Any rate changes, if applicable, are detailed below.
|
| (e)
| The annual effective rates represent actual fees incurred under the distribution plan for the six months ended February 29, 2024 based on each class's average daily net assets. MFD
has voluntarily agreed to rebate a portion of each class's 0.25% service fee attributable to accounts for which there is no financial intermediary specified on the account except for accounts attributable to MFS or
its affiliates' seed money. There were no service fee rebates
for the six months ended February 29, 2024.
|
Certain Class A shares are
subject to a contingent deferred sales charge (CDSC) in the event of a shareholder redemption within 18 months of purchase. Class B shares are subject to a CDSC in the event of a shareholder redemption within six
years of purchase. Class C shares are subject to a CDSC in the event of a shareholder redemption within 12 months of purchase. All contingent deferred sales charges are paid to MFD and during the six months
ended February 29, 2024, were as follows:
|
| Amount
|
| Class A
| $35
|
| Class B
| 217
|
| Class C
| 14
|
Shareholder Servicing Agent — MFS Service Center, Inc. (MFSC), a wholly-owned subsidiary of MFS, receives a fee from the fund for its services as shareholder servicing agent calculated as a percentage of the
average daily net assets of the fund as determined periodically under the supervision of the fund's Board of Trustees. For the six months ended February 29, 2024, the fee was $5,716, which equated to 0.0166% annually
of the fund's average daily net assets. MFSC also receives reimbursement from the fund for out-of-pocket expenses, sub-accounting and other shareholder servicing costs which may be paid to affiliated and unaffiliated
service providers. Class R6 shares do not incur sub-accounting fees. For the six months ended February 29, 2024, these out-of-pocket expenses, sub-accounting and other shareholder servicing costs amounted to
$27,158.
Administrator — MFS provides certain financial, legal, shareholder communications, compliance, and other administrative services to the fund. Under an administrative services agreement, the
fund reimburses MFS the costs incurred to provide these services. The fund is charged an annual fixed amount of $17,500 plus a fee based on
Notes to Financial
Statements (unaudited) - continued
average daily net assets. The administrative
services fee is computed daily and paid monthly. The administrative services fee incurred for the six months ended February 29, 2024 was equivalent to an annual effective rate of 0.0292% of the fund's average
daily net assets.
Trustees’ and Officers’
Compensation — The fund pays compensation to independent Trustees in the form of a retainer, attendance fees, and additional compensation to Board and Committee chairpersons.
Independent Trustees’ compensation is accrued daily and paid subsequent to each Trustee Board meeting. The fund does not pay compensation directly to Trustees or officers of the fund who are also officers
of the investment adviser, all of whom receive remuneration from MFS for their services to the fund. Certain officers and Trustees of the fund are officers or directors of MFS, MFD, and MFSC.
Other — The fund invests in the MFS Institutional Money Market Portfolio which is managed by MFS and seeks current income consistent with preservation of capital and liquidity. This money
market fund does not pay a management fee to MFS but does incur investment and operating costs.
At February 29, 2024, MFS held
approximately 65% and 53% of the outstanding shares of Class R1 and Class R4, respectively.
During the six months ended February
29, 2024, pursuant to a policy adopted by the Board of Trustees and designed to comply with Rule 17a-7 under the Investment Company Act of 1940 (the “Act”) and relevant guidance, the fund engaged in
sale transactions with funds and accounts for which MFS serves as investment adviser or sub-adviser (“cross-trades”) which amounted to $24,503. The sales transactions resulted in net realized gains
(losses) of $(19,606).
(4) Portfolio Securities
For the six months ended February
29, 2024, purchases and sales of investments, other than short-term obligations, aggregated $14,614,713 and $14,699,921, respectively.
Notes to Financial
Statements (unaudited) - continued
(5) Shares of Beneficial
Interest
The fund's Declaration of Trust
permits the Trustees to issue an unlimited number of full and fractional shares of beneficial interest. Transactions in fund shares were as follows:
|
| Six months ended
2/29/24
|
| Year ended
8/31/23
|
|
| Shares
| Amount
|
| Shares
| Amount
|
| Shares sold
|
|
|
|
|
|
| Class A
| 91,837
| $1,881,707
|
| 238,781
| $4,470,571
|
| Class B
| 527
| 10,351
|
| 2
| 27
|
| Class C
| 2,411
| 42,359
|
| 8,249
| 145,346
|
| Class I
| 134,360
| 2,853,505
|
| 283,232
| 5,449,784
|
| Class R1
| 20
| 351
|
| 160
| 2,720
|
| Class R2
| 172
| 3,400
|
| 1,132
| 20,714
|
| Class R3
| 1,377
| 28,225
|
| 25,873
| 453,360
|
| Class R4
| 3,961
| 88,541
|
| 7,477
| 128,454
|
| Class R6
| 154,193
| 3,226,811
|
| 483,983
| 9,930,084
|
|
| 388,858
| $8,135,250
|
| 1,048,889
| $20,601,060
|
| Shares reacquired
|
|
|
|
|
|
| Class A
| (90,171)
| $(1,844,784)
|
| (338,627)
| $(6,243,871)
|
| Class B
| (13,965)
| (247,654)
|
| (23,187)
| (394,481)
|
| Class C
| (13,207)
| (247,215)
|
| (52,329)
| (868,786)
|
| Class I
| (101,656)
| (2,146,423)
|
| (555,645)
| (10,854,907)
|
| Class R1
| —
| —
|
| (5)
| (89)
|
| Class R2
| (91)
| (1,781)
|
| (4,901)
| (91,970)
|
| Class R3
| (339)
| (6,907)
|
| (728)
| (14,346)
|
| Class R4
| —
| —
|
| (7,477)
| (150,789)
|
| Class R6
| (85,678)
| (1,808,513)
|
| (229,366)
| (4,500,630)
|
|
| (305,107)
| $(6,303,277)
|
| (1,212,265)
| $(23,119,869)
|
| Net change
|
|
|
|
|
|
| Class A
| 1,666
| $36,923
|
| (99,846)
| $(1,773,300)
|
| Class B
| (13,438)
| (237,303)
|
| (23,185)
| (394,454)
|
| Class C
| (10,796)
| (204,856)
|
| (44,080)
| (723,440)
|
| Class I
| 32,704
| 707,082
|
| (272,413)
| (5,405,123)
|
| Class R1
| 20
| 351
|
| 155
| 2,631
|
| Class R2
| 81
| 1,619
|
| (3,769)
| (71,256)
|
| Class R3
| 1,038
| 21,318
|
| 25,145
| 439,014
|
| Class R4
| 3,961
| 88,541
|
| —
| (22,335)
|
| Class R6
| 68,515
| 1,418,298
|
| 254,617
| 5,429,454
|
|
| 83,751
| $1,831,973
|
| (163,376)
| $(2,518,809)
|
Notes to Financial
Statements (unaudited) - continued
Effective June 1, 2019, purchases of
the fund’s Class B shares were closed to new and existing investors subject to certain exceptions. Effective September 29, 2023, purchases of the fund's Class R1 and Class R2 shares were closed to new eligible
investors.
(6) Line of Credit
The fund and certain other funds
managed by MFS participate in a $1.45 billion unsecured committed line of credit of which $1.2 billion is reserved for use by the fund and certain other MFS U.S. funds. The line of credit is provided by a syndicate of
banks under a credit agreement. Borrowings may be made for temporary financing needs. Interest is charged to each fund, based on its borrowings, generally at a rate equal to the highest of 1) Daily Simple SOFR
(Secured Overnight Financing Rate) plus 0.10%, 2) the Federal Funds Effective Rate, or 3) the Overnight Bank Funding Rate, each plus an agreed upon spread. A commitment fee, based on the average daily unused portion
of the committed line of credit, is allocated among the participating funds. The line of credit expires on March 13, 2025 unless extended or renewed. In addition, the fund and other funds managed by MFS have
established unsecured uncommitted borrowing arrangements with certain banks for temporary financing needs. Interest is charged to each fund, based on its borrowings, at rates equal to customary reference rates plus an
agreed upon spread. For the six months ended February 29, 2024, the fund’s commitment fee and interest expense were $162 and $0, respectively, and are included in “Miscellaneous” expense in the
Statement of Operations.
(7) Investments in Affiliated
Issuers
An affiliated issuer may be
considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common control. For the purposes of this report, the following were affiliated issuers:
| Affiliated Issuers
| Beginning
Value
| Purchases
| Sales
Proceeds
| Realized
Gain
(Loss)
| Change in
Unrealized
Appreciation or
Depreciation
| Ending
Value
|
| MFS Institutional Money Market Portfolio
| $1,435,476
| $10,321,421
| $9,536,770
| $(65)
| $(142)
| $2,219,920
|
| Affiliated Issuers
| Dividend
Income
| Capital Gain
Distributions
|
| MFS Institutional Money Market Portfolio
| $66,233
| $—
|
Proxy Voting Policies and
Information
MFS votes proxies on behalf of the
fund pursuant to proxy voting policies and procedures that are available without charge, upon request, by calling 1-800-225-2606, by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Information regarding how the fund
voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available by August 31 of each year without charge by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Quarterly Portfolio
Disclosure
The fund files a complete schedule
of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The fund's Form N-PORT reports are available on the SEC's Web site at http://www.sec.gov. A shareholder can obtain the portfolio holdings report for the first and third quarters of the fund's fiscal year at mfs.com/openendfunds by choosing the fund's name and then scrolling to the “Resources” section and clicking on the “Prospectus and Reports” tab.
Further Information
From time to time, MFS may post
important information about the fund or the MFS Funds on the MFS Web site (mfs.com). This information is available at https://www.mfs.com/announcements or at mfs.com/openendfunds by choosing the fund’s name and then scrolling to the “Resources” section and clicking on the “Announcements” tab, if any.
Information About Fund
Contracts and Legal Claims
The fund has entered into
contractual arrangements with an investment adviser, administrator, distributor, shareholder servicing agent, and custodian who each provide services to the fund. Unless expressly stated otherwise, shareholders are
not parties to, or intended beneficiaries of these contractual arrangements, and these contractual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek
any remedy under them against the service providers, either directly or on behalf of the fund.
Under the Trust’s By-Laws and
Declaration of Trust, any claims asserted against or on behalf of the MFS Funds, including claims against Trustees and Officers, must be brought in state and federal courts located within the Commonwealth of
Massachusetts.
Provision of Financial
Reports and Summary Prospectuses
The fund produces financial reports
every six months and updates its summary prospectus and prospectus annually. To avoid sending duplicate copies of materials to households, only one copy of the fund’s annual and semiannual report and summary
prospectus may be mailed to shareholders having the same last name and residential address on the fund’s records. However, any shareholder may contact MFSC (please see back cover for address and telephone
number) to request that copies of these reports and summary prospectuses be sent personally to that shareholder.
Save paper with eDelivery.
MFS® will send you prospectuses, reports, and proxies directly via e-mail so you will get information faster with less mailbox clutter.
To sign up:
1. Go to mfs.com.
2. Log in via MFS® Access.
3. Select eDelivery.
If you own your MFS fund shares
through a financial institution or a retirement plan, MFS® TALK, MFS® Access, or eDelivery may not be available to you.
CONTACT
WEB SITE
mfs.com
MFS TALK
1-800-637-8255
24 hours a day
ACCOUNT SERVICE AND LITERATURE
Shareholders
1-800-225-2606
Financial advisors
1-800-343-2829
Retirement plan services
1-800-637-1255
MAILING ADDRESS
MFS Service Center, Inc.
P.O. Box 219341
Kansas City, MO 64121-9341
OVERNIGHT MAIL
MFS Service Center, Inc.
Suite 219341
430 W 7th Street
Kansas City, MO 64105-1407
Semiannual Report
February 29, 2024
MFS® U.S. Government
Money Market Fund
MFS® U.S. Government
Money Market Fund
| 1
|
| 2
|
| 3
|
| 4
|
| 5
|
| 6
|
| 7
|
| 8
|
| 14
|
| 14
|
| 14
|
| 14
|
| 14
|
The report is prepared for the
general information of shareholders. It is authorized for distribution to prospective investors only when preceded or accompanied by a current prospectus.
NOT FDIC INSURED
• MAY LOSE VALUE • NO BANK GUARANTEE
Maturity breakdown (u)
| 0 - 7 days
| 32.2%
|
| 8 - 29 days
| 31.0%
|
| 30 - 59 days
| 12.4%
|
| 60 - 89 days
| 17.2%
|
| 90 - 365 days
| 7.2%
|
| Other Assets Less Liabilities (o)
| (0.0)%
|
Composition including
fixed income credit quality (a)(u)
| A-1+
| 59.9%
|
| A-1
| 40.1%
|
| Other Assets Less Liabilities (o)
| (0.0)%
|
| (a)
| Ratings are assigned to portfolio securities utilizing ratings from Moody’s, Fitch, and Standard & Poor’s rating agencies and applying the following hierarchy: If all
three agencies provide a rating, the middle rating (after dropping the highest and lowest ratings) is assigned; if two of the three agencies rate a security, the lower of the two is assigned. Ratings are shown in the
S&P scale. All ratings are subject to change. The fund did not hold unrated securities. The fund is not rated by these agencies.
|
| (u)
| For purposes of this presentation, accrued interest, where applicable, is included.
|
From time to time Other Assets Less
Liabilities may be negative due to the timing of cash receipts and disbursements.
Percentages are based on net assets
as of February 29, 2024.
The portfolio is actively managed
and current holdings may be different.
Expense Table
Fund expenses borne by the
shareholders during the period,
September 1, 2023 through February 29, 2024
As a shareholder of the fund, you
incur two types of costs: (1) transaction costs, including sales charges (loads) on certain purchase or redemption payments, and (2) ongoing costs, including management fees; and other fund expenses. This example is
intended to help you understand your ongoing costs (in dollars) of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an
investment of $1,000 invested at the beginning of the period and held for the entire period September 1, 2023 through February 29, 2024.
Actual Expenses
The first line in the following
table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period.
Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid
During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for
Comparison Purposes
The second line of the following
table provides information about hypothetical account values and hypothetical expenses based on the fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the
fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the
ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown
in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of the table is useful in comparing ongoing costs only,
and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
|
| Annualized
Expense
Ratio
| Beginning
Account Value
9/01/23
| Ending
Account Value
2/29/24
| Expenses
Paid During
Period (p)
9/01/23-2/29/24
|
| Actual
| 0.45%
| $1,000.00
| $1,024.76
| $2.27
|
| Hypothetical (h)
| 0.45%
| $1,000.00
| $1,022.63
| $2.26
|
| (h)
| 5% fund return per year before expenses.
|
| (p)
| “Expenses Paid During Period” are equal to the fund's annualized expense ratio, as shown above, multiplied by the average account value over the period, multiplied by
182/366 (to reflect the one-half year period). Expenses paid do not include any applicable sales charges (loads). If these transaction costs had been included, your costs would have been higher.
|
Portfolio of Investments
2/29/24 (unaudited)
The Portfolio of Investments is a
complete list of all securities owned by your fund. It is categorized by broad-based asset classes.
| Issuer
|
|
| Shares/Par
| Value ($)
|
| U.S. Government Agencies and Equivalents (y) – 73.4%
|
| Fannie Mae, 5.24%, due 4/22/2024
|
| $18,850,000
| $18,709,232
|
| Federal Farm Credit Bank, 5.29%, due 5/14/2024
|
| 7,950,000
| 7,864,697
|
| Federal Farm Credit Bank, 5.16%, due 6/06/2024
|
| 12,000,000
| 11,835,423
|
| Federal Home Loan Bank, 5.32%, due 3/18/2024
|
| 15,500,000
| 15,461,610
|
| Federal Home Loan Bank, 5.33%, due 4/24/2024
|
| 15,600,000
| 15,476,916
|
| Freddie Mac, 5.26%, due 3/18/2024
|
| 33,000,000
| 32,919,200
|
| U.S. Treasury Bill, 5.29%, due 3/19/2024
|
| 18,800,000
| 18,750,937
|
| U.S. Treasury Bill, 5.32%, due 3/05/2024
|
| 21,400,000
| 21,387,515
|
| U.S. Treasury Bill, 5.27%, due 3/12/2024
|
| 11,900,000
| 11,881,109
|
| U.S. Treasury Bill, 5.33%, due 3/26/2024
|
| 39,600,000
| 39,455,460
|
| U.S. Treasury Bill, 5.34%, due 4/02/2024
|
| 13,300,000
| 13,237,726
|
| U.S. Treasury Bill, 5.26%, due 4/30/2024
|
| 22,000,000
| 21,809,700
|
| U.S. Treasury Bill, 5.29%, due 5/09/2024
|
| 17,700,000
| 17,522,878
|
| U.S. Treasury Bill, 5.31%, due 5/23/2024
|
| 18,500,000
| 18,276,478
|
| U.S. Treasury Bill, 5.15%, due 6/13/2024
|
| 16,000,000
| 15,765,307
|
| Total U.S. Government Agencies and Equivalents, at Amortized Cost and Value
|
|
| $280,354,188
|
| Repurchase Agreements – 26.6%
|
|
BofA Securities, Inc. Repurchase Agreement, 5.29%,
dated 2/29/2024, due 3/01/2024, total to be received $50,688,447 (secured by U.S. Treasury and/or U.S. Government Agency Securities valued at $51,823,830)
|
| $50,681,000
| $50,681,000
|
Fixed Income Clearing Corp. – State Street Bank & Trust Co. Repurchase Agreement,
5.28%,
dated 2/29/2024, due 3/01/2024, total to be received $50,688,102 (secured by U.S. Treasury and/or U.S. Government Agency Securities valued at $51,694,287)
|
| 50,680,669
| 50,680,669
|
| Total Repurchase Agreements, at Cost and Value
|
|
|
| $101,361,669
|
|
|
|
|
| Other Assets, Less Liabilities – (0.0)%
|
|
| (857)
|
| Net Assets – 100.0%
|
|
| $381,715,000
|
| (y)
| The rate shown represents an annualized yield at time of purchase.
|
See Notes to Financial Statements
Financial Statements
Statement of Assets and
Liabilities
At 2/29/24 (unaudited)
This statement represents your
fund’s balance sheet, which details the assets and liabilities comprising the total value of the fund.
| Assets
|
|
| Investments in unaffiliated issuers, at cost and value
| $280,354,188
|
| Investments in unaffiliated repurchase agreements, at cost and value
| 101,361,669
|
| Receivables for
|
|
| Fund shares sold
| 511,952
|
| Interest
| 14,880
|
| Receivable from investment adviser and distributor
| 33,822
|
| Other assets
| 6,213
|
| Total assets
| $382,282,724
|
| Liabilities
|
|
| Payables for
|
|
| Distributions
| $3,676
|
| Fund shares reacquired
| 466,852
|
| Payable to affiliates
|
|
| Administrative services fee
| 353
|
| Shareholder servicing costs
| 60,883
|
| Payable for independent Trustees' compensation
| 2,022
|
| Accrued expenses and other liabilities
| 33,938
|
| Total liabilities
| $567,724
|
| Net assets
| $381,715,000
|
| Net assets consist of
|
|
| Paid-in capital
| $381,717,570
|
| Total distributable earnings (loss)
| (2,570)
|
| Net assets
| $381,715,000
|
| Shares of beneficial interest outstanding
| 381,715,657
|
| Net asset value per share (net assets of $381,715,000 / 381,715,657 shares of beneficial interest
outstanding)
| $1.00
|
A contingent deferred sales charge
may be imposed on redemptions.
See Notes to Financial Statements
Financial Statements
Statement of Operations
Six months ended 2/29/24
(unaudited)
This statement describes how much
your fund earned in investment income and accrued in expenses. It also describes any gains and/or losses generated by fund operations.
| Net investment income (loss)
|
|
| Income
|
|
| Interest
| $10,499,679
|
| Expenses
|
|
| Management fee
| $781,291
|
| Shareholder servicing costs
| 243,101
|
| Administrative services fee
| 32,905
|
| Independent Trustees' compensation
| 5,063
|
| Custodian fee
| 8,100
|
| Shareholder communications
| 7,266
|
| Audit and tax fees
| 24,267
|
| Legal fees
| 1,305
|
| Miscellaneous
| 51,788
|
| Total expenses
| $1,155,086
|
| Fees paid indirectly
| (8,100)
|
| Reduction of expenses by investment adviser
| (275,101)
|
| Net expenses
| $871,885
|
| Net investment income (loss)
| $9,627,794
|
| Realized gain (loss) (identified cost basis)
|
|
| Unaffiliated issuers
| $5,933
|
| Change in net assets from operations
| $9,633,727
|
See Notes to Financial Statements
Financial Statements
Statements of Changes in Net
Assets
These statements describe the
increases and/or decreases in net assets resulting from operations, any distributions, and any shareholder transactions.
|
| Six months ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
|
| Change in net assets
|
|
|
| From operations
|
|
|
| Net investment income (loss)
| $9,627,794
| $16,327,307
|
| Net realized gain (loss)
| 5,933
| —
|
| Change in net assets from operations
| $9,633,727
| $16,327,307
|
| Total distributions to shareholders
| $(9,627,807)
| $(16,327,307)
|
| Change in net assets from fund share transactions
| $(7,007,635)
| $(75,638,632)
|
| Total change in net assets
| $(7,001,715)
| $(75,638,632)
|
| Net assets
|
|
|
| At beginning of period
| 388,716,715
| 464,355,347
|
| At end of period
| $381,715,000
| $388,716,715
|
See Notes to Financial Statements
Financial Statements
Financial Highlights
The financial highlights table is
intended to help you understand the fund's financial performance for the semiannual period and the past 5 fiscal years. Certain information reflects financial results for a single fund share. The total returns in the
table represent the rate that an investor would have earned (or lost) on an investment in the fund share class (assuming reinvestment of all distributions) held for the entire period.
|
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $1.00
| $1.00
| $1.00
| $1.00
| $1.00
| $1.00
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $0.02
| $0.04
| $0.00(w)
| $0.00
| $0.00(w)
| $0.02
|
| Net realized and unrealized gain (loss)
| 0.00(w)
| —
| (0.00)(w)
| 0.00(w)
| 0.01
| 0.00(w)
|
| Total from investment operations
| $0.02
| $0.04
| $0.00(w)
| $0.00(w)
| $0.01
| $0.02
|
| Less distributions declared to shareholders
|
| From net investment income
| $(0.02)
| $(0.04)
| $(0.00)(w)
| $—
| $(0.01)
| $(0.02)
|
| From net realized gain
| —
| —
| (0.00)(w)
| —
| —
| —
|
| Total distributions declared to shareholders
| $(0.02)
| $(0.04)
| $(0.00)(w)
| $—
| $(0.01)
| $(0.02)
|
| Net asset value, end of period
| $1.00
| $1.00
| $1.00
| $1.00
| $1.00
| $1.00
|
| Total return (%) (r)(t)
| 2.48(n)
| 3.81
| 0.27
| 0.00
| 0.61
| 1.70
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions (f)
| 0.59(a)
| 0.57
| 0.59
| 0.55
| 0.60
| 0.62
|
| Expenses after expense reductions (f)
| 0.45(a)
| 0.45
| 0.23
| 0.06
| 0.36
| 0.61
|
| Net investment income (loss)
| 4.93(a)
| 3.70
| 0.31
| 0.00
| 0.45
| 1.69
|
| Net assets at end of period (000 omitted)
| $381,715
| $388,717
| $464,355
| $344,209
| $518,651
| $303,799
|
| (a)
| Annualized.
|
| (d)
| Per share data is based on average shares outstanding.
|
| (f)
| Ratios do not reflect reductions from fees paid indirectly, if applicable. See Note 2 in the Notes to Financial Statements for additional information.
|
| (n)
| Not annualized.
|
| (r)
| Certain expenses have been reduced without which performance would have been lower.
|
| (t)
| Total returns do not include any applicable sales charges.
|
| (w)
| Per share amount was less than $0.01.
|
See Notes to Financial Statements
Notes to Financial Statements
(unaudited)
(1) Business and
Organization
MFS U.S. Government Money Market
Fund (the fund) is a diversified series of MFS Series Trust IV (the trust). The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended, as
an open-end management investment company.
The fund is an investment company
and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services - Investment
Companies.
(2) Significant Accounting
Policies
General — The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations
during the reporting period. Actual results could differ from those estimates. In the preparation of these financial statements, management has evaluated subsequent events occurring after the date of the fund’s
Statement of Assets and Liabilities through the date that the financial statements were issued.
Balance Sheet Offsetting — The fund's accounting policy with respect to balance sheet offsetting is that, absent an event of default by the counterparty or a termination of the agreement, the International
Swaps and Derivatives Association (ISDA) Master Agreement, or similar agreement, does not result in an offset of reported amounts of financial assets and financial liabilities in the Statement of Assets and
Liabilities across transactions between the fund and the applicable counterparty. The fund's right to setoff may be restricted or prohibited by the bankruptcy or insolvency laws of the particular jurisdiction to which
a specific master netting agreement counterparty is subject. Balance sheet offsetting disclosures, to the extent applicable to the fund, have been included in the fund’s Significant Accounting Policies note
under the captions for each of the fund’s in-scope financial instruments and transactions.
Investment Valuations — Subject to its oversight, the fund’s Board of Trustees has delegated primary responsibility for determining or causing to be determined the value of the fund’s investments to
MFS as the fund’s adviser, pursuant to the fund’s valuation policy and procedures which have been adopted by the adviser and approved by the Board. In accordance with Rule 2a-5 under the Investment Company
Act of 1940, the Board of Trustees designated the adviser as the “valuation designee” of the fund. If the adviser, as valuation designee, determines that reliable market quotations are not readily
available for an investment, the investment is valued at fair value as determined in good faith by the adviser in accordance with the adviser’s fair valuation policy and procedures.
Under the fund's valuation policies
and procedures, market quotations are not considered to be readily available for debt instruments. Debt instruments held by the fund are generally valued at amortized cost, which approximates market value.
Notes to Financial
Statements (unaudited) - continued
Amortized cost involves valuing an instrument at
its cost as adjusted for amortization of premium or accretion of discount rather than its current market value. The amortized cost value of an instrument can be different from the market value of an instrument.
Various inputs are used in
determining the value of the fund's assets or liabilities. These inputs are categorized into three broad levels. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value
hierarchy. In such cases, an investment's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fund's assessment of the significance of a
particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment. Level 1 includes unadjusted quoted prices in active markets for identical assets or
liabilities. Level 2 includes other significant observable market-based inputs (including quoted prices for similar securities, interest rates, prepayment speed, and credit risk). Level 3 includes significant
unobservable inputs, which may include the adviser's own assumptions in determining the fair value of investments. The following is a summary of the levels used as of February 29, 2024 in valuing the fund's assets and
liabilities:
| Financial Instruments
| Level 1
| Level 2
| Level 3
| Total
|
| Short-Term Securities
| $—
| $381,715,857
| $—
| $381,715,857
|
For further information regarding
security characteristics, see the Portfolio of Investments.
Repurchase Agreements — The fund enters into bilateral repurchase agreements under the terms of Master Repurchase Agreements with approved counterparties, some of which may be novated to the clearing
agency, Fixed Income Clearing Corporation (FICC). Each repurchase agreement is recorded at cost. For both bilateral and cleared repurchase agreements, the fund requires that the securities collateral in a
repurchase transaction be transferred to a custodian. On a daily basis, the fund monitors the collateral to ensure that its value, including accrued interest, is greater than amounts owed to the fund under each such
repurchase agreement. In the event of default, the settlement of a cleared repurchase agreement is guaranteed by FICC. Upon an event of default on a bilateral repurchase agreement, the non-defaulting party may
close out all transactions traded under a Master Repurchase Agreement and net amounts owed under each transaction to one net amount payable by one party to the other. Absent an event of default, the Master Repurchase
Agreement does not result in an offset of reported amounts of assets and liabilities in the Statement of Assets and Liabilities across transactions between the fund and the applicable counterparty. At February
29, 2024, the fund had investments in repurchase agreements with a gross value of $101,361,669 included in investments in unaffiliated issuers in the Statement of Assets and Liabilities. The value of the related
collateral exceeded the value of the repurchase agreements at period end.
Indemnifications — Under the fund's organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to
the fund. Additionally, in the normal course of business, the fund enters into agreements with service providers that may contain indemnification clauses. The fund's maximum exposure under these agreements is unknown
as this would involve future claims that may be made against the fund that have not yet occurred.
Notes to Financial
Statements (unaudited) - continued
Investment Transactions and
Income — Interest income is recorded on the accrual basis. All premium and discount is amortized or accreted for financial statement purposes in accordance with U.S. generally accepted accounting principles.
Investment transactions are recorded
on the trade date. In determining the net gain or loss on securities sold, the cost of securities is determined on the identified cost basis.
Fees Paid Indirectly — The fund’s custody fee may be reduced by credits earned under a previous arrangement that measured the value of U.S. dollars deposited with the custodian by the fund. The
amount of the credits that were used to reduce the fund's custody fee for the six months ended February 29, 2024, is shown as a reduction of total expenses in the Statement of Operations.
Tax Matters and Distributions — The fund intends to qualify as a regulated investment company, as defined under Subchapter M of the Internal Revenue Code, and to distribute all of its taxable income, including
realized capital gains. As a result, no provision for federal income tax is required. The fund’s federal tax returns, when filed, will remain subject to examination by the Internal Revenue Service for a three
year period. Management has analyzed the fund’s tax positions taken on federal and state tax returns for all open tax years and does not believe that there are any uncertain tax positions that require
recognition of a tax liability.
Distributions to shareholders are
recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from U.S. generally accepted accounting principles. Certain capital
accounts in the financial statements are periodically adjusted for permanent differences in order to reflect their tax character. These adjustments have no impact on net assets or net asset value per share. Temporary
differences which arise from recognizing certain items of income, expense, gain or loss in different periods for financial statement and tax purposes will reverse at some time in the future.
During the year ended August 31,
2023, there were no significant adjustments due to differences between book and tax accounting.
The tax character of distributions
made during the current period will be determined at fiscal year end. The tax character of distributions declared to shareholders for the last fiscal year is as follows:
|
| Year ended
8/31/23
|
| Ordinary income (including any short-term capital gains)
| $16,327,307
|
The federal tax cost and the tax
basis components of distributable earnings were as follows:
| As of 2/29/24
|
|
| Cost of investments
| $381,715,857
|
| As of 8/31/23
|
|
| Undistributed ordinary income
| 1,148
|
| Capital loss carryforwards
| (5,979)
|
| Other temporary differences
| (3,659)
|
The aggregate cost above includes
prior fiscal year end tax adjustments, if applicable.
Notes to Financial
Statements (unaudited) - continued
As of August 31, 2023, the fund had
capital loss carryforwards available to offset future realized gains. These net capital losses may be carried forward indefinitely and their character is retained as short-term and/or long-term losses. Such losses are
characterized as follows:
(3) Transactions with
Affiliates
Investment Adviser — The fund has an investment advisory agreement with MFS to provide overall investment management and related administrative services and facilities to the fund. The management fee is computed daily and paid monthly at the following annual rates based on the fund's average daily net assets:
| Up to $1 billion
| 0.40%
|
| In excess of $1 billion
| 0.35%
|
MFS has agreed in writing to reduce
its management fee by a specified amount if certain MFS mutual fund assets exceed thresholds agreed to by MFS and the fund's Board of Trustees. MFS has also agreed in writing to waive at least 0.01% of its management
fee as part of this agreement. The agreement to waive at least 0.01% of the management fee will continue until modified by the fund's Board of Trustees, but such agreement will continue at least until December 31,
2024. For the six months ended February 29, 2024, this management fee reduction amounted to $25,169, which is included in the reduction of total expenses in the Statement of Operations.
The management fee incurred for the six months
ended February 29, 2024 was equivalent to an annual effective rate of 0.39% of the fund's average daily net assets.
The investment adviser has agreed in
writing to pay a portion of the fund’s total annual operating expenses, excluding interest, taxes, extraordinary expenses, brokerage and transaction costs, and investment-related expenses, such that total fund
operating expenses do not exceed 0.45% annually of the fund’s average daily net assets. This written agreement will continue until modified by the fund’s Board of Trustees, but such agreement will continue
at least until December 31, 2024. For the six months ended February 29, 2024, this reduction amounted to $249,932, which is included in the reduction of total expenses in the Statement of Operations.
Distributor — Certain shares acquired through an exchange may be subject to a contingent deferred sales charge upon redemption depending on when the shares exchanged were originally purchased.
Contingent deferred sales charges paid to MFS Distributors, Inc. (MFD) during the six months ended February 29, 2024 were $8,754.
Shareholder Servicing Agent — MFS Service Center, Inc. (MFSC), a wholly-owned subsidiary of MFS, receives a fee from the fund for its services as shareholder servicing agent calculated as a percentage of the
average daily net assets of the fund as determined periodically under the supervision of the fund's Board of Trustees. For the six months ended February 29, 2024, the fee was $122,749, which equated to 0.0628%
annually of the fund's average daily net assets. MFSC also receives reimbursement from the fund for out-of-pocket expenses, sub-accounting and other shareholder servicing costs which may be paid to affiliated and
unaffiliated service providers. For the six months ended February 29, 2024, these out-of-pocket expenses, sub-accounting and other shareholder servicing costs amounted to $120,352.
Notes to Financial
Statements (unaudited) - continued
Administrator — MFS provides certain financial, legal, shareholder communications, compliance, and other administrative services to the fund. Under an administrative services agreement, the
fund reimburses MFS the costs incurred to provide these services. The fund is charged an annual fixed amount of $17,500 plus a fee based on average daily net assets. The administrative services fee is
computed daily and paid monthly. The administrative services fee incurred for the six months ended February 29, 2024 was equivalent to an annual effective rate of 0.0168% of the fund's average daily net
assets.
Trustees’ and Officers’
Compensation — The fund pays compensation to independent Trustees in the form of a retainer, attendance fees, and additional compensation to Board and Committee chairpersons.
Independent Trustees’ compensation is accrued daily and paid subsequent to each Trustee Board meeting. The fund does not pay compensation directly to Trustees or officers of the fund who are also officers
of the investment adviser, all of whom receive remuneration from MFS for their services to the fund. Certain officers and Trustees of the fund are officers or directors of MFS, MFD, and MFSC.
Prior to December 31, 2001, the fund
had an unfunded defined benefit plan (“DB plan”) for independent Trustees. As of December 31, 2001, the Board took action to terminate the DB plan with respect to then-current and any future
independent Trustees, such that the DB plan covers only certain of those former independent Trustees who retired on or before December 31, 2001. The DB plan resulted in a pension expense of $754 and is included in
“Independent Trustees’ compensation” in the Statement of Operations for the six months ended February 29, 2024. The liability for deferred retirement benefits payable to those former independent
Trustees under the DB plan amounted to $606 at February 29, 2024, and is included in “Payable for independent Trustees’ compensation” in the Statement of Assets and Liabilities. The deferred
retirement benefits compensation fee is accrued daily and paid monthly.
(4) Shares of Beneficial
Interest
The fund's Declaration of Trust
permits the Trustees to issue an unlimited number of full and fractional shares of beneficial interest. The number of shares sold, reinvested and reacquired corresponds to the net proceeds from the sale of shares,
reinvestment of distributions and cost of shares reacquired, respectively, since shares are sold and reacquired at $1.00 per share. Transactions in fund shares were as follows:
|
| Six months ended
2/29/24
|
| Year ended
8/31/23
|
| Shares sold
| 88,648,277
|
| 224,642,194
|
Shares issued to shareholders in
reinvestment of distributions
| 9,579,768
|
| 16,262,845
|
| Shares reacquired
| (105,235,678)
|
| (316,543,671)
|
| Net change
| (7,007,633)
|
| (75,638,632)
|
Effective at the close of business
on May 29, 2020, the fund was closed to all purchases subject to certain exceptions.
Notes to Financial
Statements (unaudited) - continued
(5) Line of Credit
The fund and certain other funds
managed by MFS participate in a $1.45 billion unsecured committed line of credit of which $1.2 billion is reserved for use by the fund and certain other MFS U.S. funds. The line of credit is provided by a syndicate of
banks under a credit agreement. Borrowings may be made for temporary financing needs. Interest is charged to each fund, based on its borrowings, generally at a rate equal to the highest of 1) Daily Simple SOFR
(Secured Overnight Financing Rate) plus 0.10%, 2) the Federal Funds Effective Rate, or 3) the Overnight Bank Funding Rate, each plus an agreed upon spread. A commitment fee, based on the average daily unused portion
of the committed line of credit, is allocated among the participating funds. The line of credit expires on March 13, 2025 unless extended or renewed. In addition, the fund and other funds managed by MFS have
established unsecured uncommitted borrowing arrangements with certain banks for temporary financing needs. Interest is charged to each fund, based on its borrowings, at rates equal to customary reference rates plus an
agreed upon spread. For the six months ended February 29, 2024, the fund’s commitment fee and interest expense were $1,003 and $0, respectively, and are included in “Miscellaneous” expense in the
Statement of Operations.
Proxy Voting Policies and
Information
MFS votes proxies on behalf of the
fund pursuant to proxy voting policies and procedures that are available without charge, upon request, by calling 1-800-225-2606, by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Information regarding how the fund
voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available by August 31 of each year without charge by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Portfolio Holdings
Information
The fund files monthly portfolio
information with the SEC on Form N-MFP. The fund’s Form N-MFP reports are available on the SEC’s Web site at http://www.sec.gov. A shareholder can also access the fund’s portfolio holdings as of each month end and the fund’s Form N-MFP reports at mfs.com/openendfunds after
choosing “Click here for access to Money Market fund reports”.
Further Information
From time to time, MFS may post
important information about the fund or the MFS Funds on the MFS Web site (mfs.com). This information is available at https://www.mfs.com/announcements or at mfs.com/openendfunds by choosing the fund’s name and then scrolling to the “Resources” section and clicking on the “Announcements” tab, if any.
Information About Fund
Contracts and Legal Claims
The fund has entered into
contractual arrangements with an investment adviser, administrator, distributor, shareholder servicing agent, and custodian who each provide services to the fund. Unless expressly stated otherwise, shareholders are
not parties to, or intended beneficiaries of these contractual arrangements, and these contractual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek
any remedy under them against the service providers, either directly or on behalf of the fund.
Under the Trust’s By-Laws and
Declaration of Trust, any claims asserted against or on behalf of the MFS Funds, including claims against Trustees and Officers, must be brought in state and federal courts located within the Commonwealth of
Massachusetts.
Provision of Financial
Reports and Summary Prospectuses
The fund produces financial reports
every six months and updates its summary prospectus and prospectus annually. To avoid sending duplicate copies of materials to households, only one copy of the fund’s annual and semiannual report and summary
prospectus may be mailed to shareholders having the same last name and residential address on the fund’s records. However, any shareholder may contact MFSC (please see back cover for address and telephone
number) to request that copies of these reports and summary prospectuses be sent personally to that shareholder.
Save paper with eDelivery.
MFS® will send you prospectuses, reports, and proxies directly via e-mail so you will get information faster with less mailbox clutter.
To sign up:
1. Go to mfs.com.
2. Log in via MFS® Access.
3. Select eDelivery.
If you own your MFS fund shares
through a financial institution or a retirement plan, MFS® TALK, MFS® Access, or eDelivery may not be available to you.
CONTACT
WEB SITE
mfs.com
MFS TALK
1-800-637-8255
24 hours a day
ACCOUNT SERVICE AND LITERATURE
Shareholders
1-800-225-2606
Financial advisors
1-800-343-2829
Retirement plan services
1-800-637-1255
MAILING ADDRESS
MFS Service Center, Inc.
P.O. Box 219341
Kansas City, MO 64121-9341
OVERNIGHT MAIL
MFS Service Center, Inc.
Suite 219341
430 W 7th Street
Kansas City, MO 64105-1407
Semiannual Report
February 29, 2024
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The report is prepared for the
general information of shareholders. It is authorized for distribution to prospective investors only when preceded or accompanied by a current prospectus.
NOT FDIC INSURED
• MAY LOSE VALUE • NO BANK GUARANTEE
Portfolio structure
Top ten holdings
| Monolithic Power Systems, Inc.
| 3.6%
|
| Cadence Design Systems, Inc.
| 3.1%
|
| Vulcan Materials Co.
| 2.6%
|
| AMETEK, Inc.
| 2.6%
|
| Howmet Aerospace, Inc.
| 2.4%
|
| MSCI, Inc.
| 2.3%
|
| Verisk Analytics, Inc., “A”
| 2.3%
|
| Synopsys, Inc.
| 2.2%
|
| Copart, Inc.
| 2.2%
|
| Gartner, Inc.
| 2.2%
|
GICS equity sectors (g)
| Information Technology
| 24.7%
|
| Industrials
| 22.7%
|
| Health Care
| 17.0%
|
| Consumer Discretionary
| 12.6%
|
| Financials
| 9.4%
|
| Communication Services
| 4.7%
|
| Materials
| 3.1%
|
| Real Estate
| 2.2%
|
| Consumer Staples
| 1.4%
|
| Energy
| 1.3%
|
| Equity Warrants (o)
| 0.0%
|
| (g)
| The Global Industry Classification Standard (GICS®) was developed by and/or is the exclusive property of MSCI, Inc. and S&P Global Market Intelligence Inc. (“S&P Global Market
Intelligence”). GICS is a service mark of MSCI and S&P Global Market Intelligence and has been licensed for use by MFS. MFS has applied its own internal sector/industry classification methodology for equity
securities and non-equity securities that are unclassified by GICS.
|
Cash & Cash
Equivalents includes any cash, investments in money market funds, short-term securities, and other assets less liabilities. Please see the Statement of Assets and Liabilities for additional information related to the
fund’s cash position and other assets and liabilities.
Other includes equivalent
exposure from currency derivatives and/or any offsets to derivative positions and may be negative.
Percentages are based on
net assets as of February 29, 2024.
The portfolio is actively
managed and current holdings may be different.
Expense Table
Fund expenses borne by the
shareholders during the period,
September 1, 2023 through February 29, 2024
As a shareholder of the fund, you
incur two types of costs: (1) transaction costs, including sales charges (loads) on certain purchase or redemption payments, and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and
other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an
investment of $1,000 invested at the beginning of the period and held for the entire period September 1, 2023 through February 29, 2024.
Actual Expenses
The first line for each share class
in the following table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over
the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled
“Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for
Comparison Purposes
The second line for each share class
in the following table provides information about hypothetical account values and hypothetical expenses based on the fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses,
which is not the fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information
to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown
in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line for each share class in the table is useful in
comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Expense Table - continued
Share
Class
|
| Annualized
Expense
Ratio
| Beginning
Account Value
9/01/23
| Ending
Account Value
2/29/24
| Expenses
Paid During
Period (p)
9/01/23-2/29/24
|
| A
| Actual
| 1.02%
| $1,000.00
| $1,161.81
| $5.48
|
| Hypothetical (h)
| 1.02%
| $1,000.00
| $1,019.79
| $5.12
|
| B
| Actual
| 1.78%
| $1,000.00
| $1,157.03
| $9.55
|
| Hypothetical (h)
| 1.78%
| $1,000.00
| $1,016.01
| $8.92
|
| C
| Actual
| 1.78%
| $1,000.00
| $1,157.23
| $9.55
|
| Hypothetical (h)
| 1.78%
| $1,000.00
| $1,016.01
| $8.92
|
| I
| Actual
| 0.77%
| $1,000.00
| $1,163.02
| $4.14
|
| Hypothetical (h)
| 0.77%
| $1,000.00
| $1,021.03
| $3.87
|
| R1
| Actual
| 1.78%
| $1,000.00
| $1,157.41
| $9.55
|
| Hypothetical (h)
| 1.78%
| $1,000.00
| $1,016.01
| $8.92
|
| R2
| Actual
| 1.27%
| $1,000.00
| $1,160.12
| $6.82
|
| Hypothetical (h)
| 1.27%
| $1,000.00
| $1,018.55
| $6.37
|
| R3
| Actual
| 1.02%
| $1,000.00
| $1,161.71
| $5.48
|
| Hypothetical (h)
| 1.02%
| $1,000.00
| $1,019.79
| $5.12
|
| R4
| Actual
| 0.77%
| $1,000.00
| $1,162.99
| $4.14
|
| Hypothetical (h)
| 0.77%
| $1,000.00
| $1,021.03
| $3.87
|
| R6
| Actual
| 0.65%
| $1,000.00
| $1,163.62
| $3.50
|
| Hypothetical (h)
| 0.65%
| $1,000.00
| $1,021.63
| $3.27
|
| (h)
| 5% class return per year before expenses.
|
| (p)
| “Expenses Paid During Period” are equal to each class’s annualized expense ratio, as shown above, multiplied by the average account value over the period, multiplied
by 182/366 (to reflect the one-half year period). Expenses paid do not include any applicable sales charges (loads). If these transaction costs had been included, your costs would have been higher.
|
Portfolio of Investments
2/29/24 (unaudited)
The Portfolio of Investments is a
complete list of all securities owned by your fund. It is categorized by broad-based asset classes.
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – 99.1%
|
| Aerospace & Defense – 3.6%
|
|
| Hexcel Corp.
|
| 1,143,922
| $85,176,432
|
| Howmet Aerospace, Inc.
|
| 5,204,330
| 346,348,161
|
| TransDigm Group, Inc.
|
| 84,870
| 99,954,794
|
|
|
|
|
| $531,479,387
|
| Automotive – 2.2%
|
|
| Copart, Inc. (a)
|
| 6,178,057
| $328,363,730
|
| Brokerage & Asset Managers – 2.0%
|
|
| Ares Management Co.
|
| 942,108
| $124,951,784
|
| LPL Financial Holdings, Inc.
|
| 564,391
| 151,194,705
|
| TPG, Inc.
|
| 521,165
| 23,113,668
|
|
|
|
|
| $299,260,157
|
| Business Services – 13.1%
|
|
| CoStar Group, Inc. (a)
|
| 3,093,258
| $269,206,244
|
| Equifax, Inc.
|
| 461,840
| 126,354,806
|
| Factset Research Systems, Inc.
|
| 313,404
| 144,974,422
|
| FleetCor Technologies, Inc. (a)
|
| 403,916
| 112,801,621
|
| Morningstar, Inc.
|
| 734,555
| 219,330,777
|
| MSCI, Inc.
|
| 603,698
| 338,656,467
|
| TransUnion
|
| 1,839,550
| 142,804,267
|
| Tyler Technologies, Inc. (a)
|
| 510,794
| 223,288,489
|
| Verisk Analytics, Inc., “A”
|
| 1,398,413
| 338,276,105
|
|
|
|
|
| $1,915,693,198
|
| Computer Software – 8.4%
|
|
| ANSYS, Inc. (a)
|
| 317,269
| $106,021,782
|
| Autodesk, Inc. (a)
|
| 292,584
| 75,536,411
|
| Bumble, Inc., “A” (a)
|
| 930,948
| 10,659,354
|
| Cadence Design Systems, Inc. (a)
|
| 1,494,252
| 454,820,424
|
| Datadog, Inc., “A” (a)
|
| 1,242,278
| 163,309,866
|
| Dun & Bradstreet Holdings, Inc.
|
| 3,257,759
| 34,336,780
|
| PTC, Inc. (a)
|
| 279,561
| 51,162,458
|
| Synopsys, Inc. (a)
|
| 572,968
| 328,728,931
|
|
|
|
|
| $1,224,576,006
|
| Computer Software - Systems – 6.4%
|
|
| Arista Networks, Inc. (a)
|
| 441,130
| $122,431,220
|
| Constellation Software, Inc.
|
| 102,075
| 284,183,148
|
| Guidewire Software, Inc. (a)
|
| 1,208,955
| 144,276,690
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Computer Software - Systems – continued
|
|
| HubSpot, Inc. (a)
|
| 251,369
| $155,549,651
|
| ServiceNow, Inc. (a)
|
| 305,354
| 235,531,754
|
|
|
|
|
| $941,972,463
|
| Construction – 4.5%
|
|
| AZEK Co., Inc. (a)
|
| 4,085,855
| $196,570,484
|
| Martin Marietta Materials, Inc.
|
| 118,959
| 68,723,804
|
| Vulcan Materials Co.
|
| 1,452,572
| 386,166,266
|
|
|
|
|
| $651,460,554
|
| Consumer Products – 1.4%
|
|
| Church & Dwight Co., Inc.
|
| 1,744,565
| $174,665,848
|
| ODDITY Tech Ltd. (a)(l)
|
| 831,195
| 35,059,805
|
|
|
|
|
| $209,725,653
|
| Consumer Services – 1.6%
|
|
| Bright Horizons Family Solutions, Inc. (a)
|
| 2,007,164
| $230,542,857
|
| Electrical Equipment – 5.0%
|
|
| AMETEK, Inc.
|
| 2,103,040
| $378,925,747
|
| Hubbell, Inc.
|
| 299,775
| 114,115,349
|
| Littlefuse, Inc.
|
| 254,908
| 60,729,282
|
| nVent Electric PLC
|
| 1,483,819
| 99,890,695
|
| Rockwell Automation, Inc.
|
| 263,674
| 75,168,184
|
|
|
|
|
| $728,829,257
|
| Electronics – 6.0%
|
|
| ASM International N.V.
|
| 527,830
| $321,578,824
|
| Entegris, Inc.
|
| 249,724
| 33,552,916
|
| Monolithic Power Systems, Inc.
|
| 730,796
| 526,202,352
|
|
|
|
|
| $881,334,092
|
| Energy - Independent – 1.3%
|
|
| Chesapeake Energy Corp.
|
| 1,317,378
| $109,052,551
|
| Diamondback Energy, Inc.
|
| 429,818
| 78,450,381
|
|
|
|
|
| $187,502,932
|
| Engineering - Construction – 0.6%
|
|
| Quanta Services, Inc.
|
| 356,267
| $86,042,043
|
| Entertainment – 1.8%
|
|
| Spotify Technology S.A. (a)
|
| 1,014,068
| $260,017,176
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Gaming & Lodging – 3.9%
|
|
| DraftKings, Inc. (a)
|
| 3,672,776
| $159,104,656
|
| Hyatt Hotels Corp.
|
| 1,551,655
| 238,318,691
|
| Las Vegas Sands Corp.
|
| 1,230,850
| 67,105,942
|
| Red Rock Resorts, Inc.
|
| 1,788,754
| 103,729,845
|
|
|
|
|
| $568,259,134
|
| General Merchandise – 0.3%
|
|
| Five Below, Inc. (a)
|
| 197,132
| $39,560,450
|
| Insurance – 1.8%
|
|
| Arthur J. Gallagher & Co.
|
| 1,092,789
| $266,564,021
|
| Internet – 2.5%
|
|
| Gartner, Inc. (a)
|
| 701,648
| $326,659,243
|
| Match Group, Inc. (a)
|
| 1,156,215
| 41,669,989
|
|
|
|
|
| $368,329,232
|
| Leisure & Toys – 2.3%
|
|
| Electronic Arts, Inc.
|
| 274,855
| $38,336,775
|
| Take-Two Interactive Software, Inc. (a)
|
| 2,071,743
| 304,401,199
|
|
|
|
|
| $342,737,974
|
| Machinery & Tools – 2.7%
|
|
| Ingersoll Rand, Inc.
|
| 1,879,486
| $171,653,456
|
| Wabtec Corp.
|
| 1,551,567
| 219,220,902
|
|
|
|
|
| $390,874,358
|
| Medical & Health Technology & Services – 4.8%
|
|
| Chemed Corp.
|
| 182,258
| $114,117,202
|
| ICON PLC (a)
|
| 750,542
| 240,638,776
|
| IDEXX Laboratories, Inc. (a)
|
| 258,168
| 148,505,979
|
| Veeva Systems, Inc. (a)
|
| 861,897
| 194,366,392
|
|
|
|
|
| $697,628,349
|
| Medical Equipment – 10.2%
|
|
| Agilent Technologies, Inc.
|
| 1,619,339
| $222,432,405
|
| Bio-Techne Corp.
|
| 1,412,299
| 103,902,837
|
| Bruker BioSciences Corp.
|
| 2,707,741
| 234,327,906
|
| DexCom, Inc. (a)
|
| 1,626,230
| 187,130,286
|
| Envista Holdings Corp. (a)
|
| 558,061
| 11,523,960
|
| Masimo Corp. (a)
|
| 644,192
| 82,804,440
|
| Natera, Inc. (a)
|
| 1,429,957
| 123,676,981
|
| STERIS PLC
|
| 1,175,159
| 273,706,283
|
| Waters Corp. (a)
|
| 189,419
| 63,913,759
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Common Stocks – continued
|
| Medical Equipment – continued
|
|
| West Pharmaceutical Services, Inc.
|
| 544,975
| $195,297,241
|
|
|
|
|
| $1,498,716,098
|
| Pharmaceuticals – 2.1%
|
|
| Argenx SE, ADR (a)
|
| 104,756
| $39,808,328
|
| Ascendis Pharma, ADR (a)(h)
|
| 1,169,326
| 172,779,610
|
| Legend Biotech Corp., ADR (a)
|
| 1,339,933
| 87,310,034
|
|
|
|
|
| $299,897,972
|
| Pollution Control – 0.9%
|
|
| GFL Environmental, Inc.
|
| 3,452,542
| $124,567,715
|
| Printing & Publishing – 2.3%
|
|
| Warner Music Group Corp.
|
| 1,048,913
| $36,638,531
|
| Wolters Kluwer N.V.
|
| 1,946,395
| 306,819,354
|
|
|
|
|
| $343,457,885
|
| Restaurants – 2.2%
|
|
| Chipotle Mexican Grill, Inc., “A” (a)
|
| 68,991
| $185,500,931
|
| Wingstop, Inc.
|
| 408,405
| 143,370,575
|
|
|
|
|
| $328,871,506
|
| Specialty Stores – 4.6%
|
|
| Lululemon Athletica, Inc. (a)
|
| 318,720
| $148,870,925
|
| O'Reilly Automotive, Inc. (a)
|
| 210,978
| 229,421,697
|
| Tractor Supply Co.
|
| 417,880
| 106,275,242
|
| Ulta Beauty, Inc. (a)
|
| 344,949
| 189,225,223
|
|
|
|
|
| $673,793,087
|
| Telecommunications - Wireless – 0.3%
|
|
| SBA Communications Corp., REIT
|
| 228,193
| $47,744,821
|
| Trucking – 0.3%
|
|
| Saia, Inc. (a)
|
| 77,612
| $44,657,945
|
| Total Common Stocks (Identified Cost, $8,765,801,575)
|
| $14,512,460,052
|
|
| Strike
Price
| First
Exercise
|
|
|
| Warrants – 0.0%
|
|
|
|
|
| Computer Software - Systems – 0.0%
|
| Constellation Software, Inc. (CAD 100 principal amount of Series 2 Debentures for 1 warrant, Expiration 3/31/2040)
(a)(Identified Cost, $0)
| CAD 11.5
| N/A
| 115,391
| $0
|
Portfolio of Investments (unaudited)
– continued
| Issuer
|
|
| Shares/Par
| Value ($)
|
| Investment Companies (h) – 0.7%
|
| Money Market Funds – 0.7%
|
|
| MFS Institutional Money Market Portfolio, 5.37% (v) (Identified Cost, $104,380,272)
|
|
| 104,380,747
| $104,380,746
|
| Collateral for Securities Loaned – 0.2%
|
| JPMorgan U.S. Government Money Market Fund - Class IM Shares, 5.25% (j) (Identified Cost, $27,517,600)
|
|
| 27,517,600
| $27,517,600
|
|
|
|
|
| Other Assets, Less Liabilities – 0.0%
|
| 6,736,400
|
| Net Assets – 100.0%
| $14,651,094,798
|
| (a)
| Non-income producing security.
|
|
|
|
| (h)
| An affiliated issuer, which may be considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common
control. At period end, the aggregate values of the fund's investments in affiliated issuers and in unaffiliated issuers were $277,160,356 and $14,367,198,042, respectively.
|
|
|
|
| (j)
| The rate quoted is the annualized seven-day yield of the fund at period end.
|
|
|
|
| (l)
| A portion of this security is on loan. See Note 2 for additional information.
|
|
|
|
| (v)
| Affiliated issuer that is available only to investment companies managed by MFS. The rate quoted for the MFS Institutional Money Market Portfolio is the annualized
seven-day yield of the fund at period end.
|
|
|
|
| The following abbreviations are used in this report and are defined:
|
| ADR
| American Depositary Receipt
|
| REIT
| Real Estate Investment Trust
|
| Abbreviations indicate amounts shown in currencies other than the U.S. dollar. All amounts are stated in U.S. dollars unless otherwise indicated. A list of abbreviations is shown below:
|
| CAD
| Canadian Dollar
|
See Notes to Financial Statements
Financial Statements
Statement of Assets and
Liabilities
At 2/29/24 (unaudited)
This statement represents your
fund’s balance sheet, which details the assets and liabilities comprising the total value of the fund.
| Assets
|
|
| Investments in unaffiliated issuers, at value, including $27,636,673 of securities on loan (identified cost,
$8,655,802,581)
| $14,367,198,042
|
| Investments in affiliated issuers, at value (identified cost, $241,896,866)
| 277,160,356
|
| Receivables for
|
|
| Investments sold
| 158,153,360
|
| Fund shares sold
| 19,780,426
|
| Interest and dividends
| 6,370,561
|
| Other assets
| 78,582
|
| Total assets
| $14,828,741,327
|
| Liabilities
|
|
| Payables for
|
|
| Investments purchased
| $133,726,293
|
| Fund shares reacquired
| 13,259,967
|
| Collateral for securities loaned, at value
| 27,517,600
|
| Payable to affiliates
|
|
| Investment adviser
| 495,095
|
| Administrative services fee
| 3,368
|
| Shareholder servicing costs
| 2,251,593
|
| Distribution and service fees
| 38,662
|
| Payable for independent Trustees' compensation
| 18,879
|
| Accrued expenses and other liabilities
| 335,072
|
| Total liabilities
| $177,646,529
|
| Net assets
| $14,651,094,798
|
| Net assets consist of
|
|
| Paid-in capital
| $8,875,376,824
|
| Total distributable earnings (loss)
| 5,775,717,974
|
| Net assets
| $14,651,094,798
|
| Shares of beneficial interest outstanding
| 471,516,816
|
Statement of Assets and Liabilities (unaudited) – continued
|
| Net assets
| Shares
outstanding
| Net asset value
per share (a)
|
| Class A
| $1,771,311,662
| 60,917,716
| $29.08
|
| Class B
| 7,365,364
| 325,590
| 22.62
|
| Class C
| 82,726,840
| 3,783,779
| 21.86
|
| Class I
| 3,888,751,344
| 123,881,102
| 31.39
|
| Class R1
| 3,128,194
| 139,023
| 22.50
|
| Class R2
| 26,380,844
| 981,342
| 26.88
|
| Class R3
| 662,795,829
| 22,949,312
| 28.88
|
| Class R4
| 276,669,102
| 9,037,491
| 30.61
|
| Class R6
| 7,931,965,619
| 249,501,461
| 31.79
|
| (a)
| Maximum offering price per share was equal to the net asset value per share for all share classes, except for Class A, for which the maximum offering price per share was $30.85 [100 /
94.25 x $29.08]. On sales of $50,000 or more, the maximum offering price of Class A shares is reduced. A contingent deferred sales charge may be imposed on redemptions of Class A, Class B, and Class C shares.
Redemption price per share was equal to the net asset value per share for Classes I, R1, R2, R3, R4, and R6.
|
See Notes to Financial Statements
Financial Statements
Statement of Operations
Six months ended 2/29/24
(unaudited)
This statement describes how much
your fund earned in investment income and accrued in expenses. It also describes any gains and/or losses generated by fund operations.
| Net investment income (loss)
|
|
| Income
|
|
| Dividends
| $32,241,631
|
| Dividends from affiliated issuers
| 8,742,028
|
| Income on securities loaned
| 397,599
|
| Other
| 106,595
|
| Foreign taxes withheld
| (60,677)
|
| Total investment income
| $41,427,176
|
| Expenses
|
|
| Management fee
| $41,716,186
|
| Distribution and service fees
| 3,177,698
|
| Shareholder servicing costs
| 4,010,066
|
| Administrative services fee
| 305,852
|
| Independent Trustees' compensation
| 63,340
|
| Custodian fee
| 219,817
|
| Shareholder communications
| 388,996
|
| Audit and tax fees
| 34,447
|
| Legal fees
| 33,977
|
| Miscellaneous
| 225,923
|
| Total expenses
| $50,176,302
|
| Fees paid indirectly
| (3,232)
|
| Reduction of expenses by investment adviser and distributor
| (841,352)
|
| Net expenses
| $49,331,718
|
| Net investment income (loss)
| $(7,904,542)
|
| Realized and unrealized gain (loss)
|
| Realized gain (loss) (identified cost basis)
|
|
| Unaffiliated issuers
| $344,130,211
|
| Affiliated issuers
| 18,022
|
| Foreign currency
| (33,432)
|
| Net realized gain (loss)
| $344,114,801
|
| Change in unrealized appreciation or depreciation
|
|
| Unaffiliated issuers
| $1,664,281,817
|
| Affiliated issuers
| 60,242,061
|
| Translation of assets and liabilities in foreign currencies
| 11,680
|
| Net unrealized gain (loss)
| $1,724,535,558
|
| Net realized and unrealized gain (loss)
| $2,068,650,359
|
| Change in net assets from operations
| $2,060,745,817
|
See Notes to Financial Statements
Financial Statements
Statements of Changes in Net
Assets
These statements describe the
increases and/or decreases in net assets resulting from operations, any distributions, and any shareholder transactions.
|
| Six months ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
|
| Change in net assets
|
|
|
| From operations
|
|
|
| Net investment income (loss)
| $(7,904,542)
| $3,667,814
|
| Net realized gain (loss)
| 344,114,801
| (225,145,025)
|
| Net unrealized gain (loss)
| 1,724,535,558
| 1,583,140,947
|
| Change in net assets from operations
| $2,060,745,817
| $1,361,663,736
|
| Change in net assets from fund share transactions
| $(483,955,811)
| $(1,488,530,966)
|
| Total change in net assets
| $1,576,790,006
| $(126,867,230)
|
| Net assets
|
|
|
| At beginning of period
| 13,074,304,792
| 13,201,172,022
|
| At end of period
| $14,651,094,798
| $13,074,304,792
|
See Notes to Financial Statements
Financial Statements
Financial Highlights
The financial highlights table is
intended to help you understand the fund's financial performance for the semiannual period and the past 5 fiscal years. Certain information reflects financial results for a single fund share. The total returns in the
table represent the rate that an investor would have earned (or lost) on an investment in the fund share class (assuming reinvestment of all distributions) held for the entire period.
| Class A
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $25.03
| $22.55
| $31.84
| $24.65
| $20.19
| $19.16
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.05)
| $(0.06)
| $(0.15)
| $(0.18)
| $(0.07)
| $(0.07)
|
| Net realized and unrealized gain (loss)
| 4.10
| 2.54
| (8.02)
| 7.60
| 4.71
| 1.83
|
| Total from investment operations
| $4.05
| $2.48
| $(8.17)
| $7.42
| $4.64
| $1.76
|
| Less distributions declared to shareholders
|
| From net realized gain
| $—
| $—
| $(1.12)
| $(0.23)
| $(0.18)
| $(0.73)
|
| Net asset value, end of period (x)
| $29.08
| $25.03
| $22.55
| $31.84
| $24.65
| $20.19
|
| Total return (%) (r)(s)(t)(x)
| 16.18(n)
| 11.00
| (26.53)
| 30.30
| 23.16
| 10.13
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions (f)
| 1.04(a)
| 1.04
| 1.03
| 1.01
| 1.05
| 1.10
|
| Expenses after expense reductions (f)
| 1.02(a)
| 1.03
| 1.01
| 1.00
| 1.04
| 1.09
|
| Net investment income (loss)
| (0.39)(a)
| (0.24)
| (0.54)
| (0.65)
| (0.35)
| (0.36)
|
| Portfolio turnover
| 17(n)
| 30
| 21
| 23
| 34
| 21
|
| Net assets at end of period (000 omitted)
| $1,771,312
| $1,560,931
| $1,477,097
| $2,130,372
| $1,483,320
| $1,065,566
|
See Notes to Financial Statements
Financial Highlights – continued
| Class B
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $19.55
| $17.75
| $25.48
| $19.91
| $16.47
| $15.90
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.11)
| $(0.18)
| $(0.28)
| $(0.31)
| $(0.19)
| $(0.17)
|
| Net realized and unrealized gain (loss)
| 3.18
| 1.98(g)
| (6.33)(g)
| 6.11
| 3.81
| 1.47
|
| Total from investment operations
| $3.07
| $1.80
| $(6.61)
| $5.80
| $3.62
| $1.30
|
| Less distributions declared to shareholders
|
| From net realized gain
| $—
| $—
| $(1.12)
| $(0.23)
| $(0.18)
| $(0.73)
|
| Net asset value, end of period (x)
| $22.62
| $19.55
| $17.75
| $25.48
| $19.91
| $16.47
|
| Total return (%) (r)(s)(t)(x)
| 15.70(n)
| 10.14
| (27.05)
| 29.36
| 22.20
| 9.28
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions (f)
| 1.79(a)
| 1.79
| 1.78
| 1.76
| 1.80
| 1.85
|
| Expenses after expense reductions (f)
| 1.78(a)
| 1.78
| 1.76
| 1.75
| 1.79
| 1.84
|
| Net investment income (loss)
| (1.14)(a)
| (0.99)
| (1.30)
| (1.39)
| (1.10)
| (1.12)
|
| Portfolio turnover
| 17(n)
| 30
| 21
| 23
| 34
| 21
|
| Net assets at end of period (000 omitted)
| $7,365
| $8,033
| $10,002
| $18,021
| $17,725
| $18,581
|
| Class C
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $18.89
| $17.15
| $24.66
| $19.28
| $15.95
| $15.42
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.11)
| $(0.17)
| $(0.27)
| $(0.30)
| $(0.18)
| $(0.16)
|
| Net realized and unrealized gain (loss)
| 3.08
| 1.91(g)
| (6.12)(g)
| 5.91(g)
| 3.69
| 1.42
|
| Total from investment operations
| $2.97
| $1.74
| $(6.39)
| $5.61
| $3.51
| $1.26
|
| Less distributions declared to shareholders
|
| From net realized gain
| $—
| $—
| $(1.12)
| $(0.23)
| $(0.18)
| $(0.73)
|
| Net asset value, end of period (x)
| $21.86
| $18.89
| $17.15
| $24.66
| $19.28
| $15.95
|
| Total return (%) (r)(s)(t)(x)
| 15.72(n)
| 10.15
| (27.06)
| 29.34
| 22.23
| 9.31
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions (f)
| 1.79(a)
| 1.79
| 1.78
| 1.76
| 1.80
| 1.85
|
| Expenses after expense reductions (f)
| 1.78(a)
| 1.78
| 1.76
| 1.75
| 1.79
| 1.84
|
| Net investment income (loss)
| (1.14)(a)
| (0.99)
| (1.30)
| (1.40)
| (1.10)
| (1.11)
|
| Portfolio turnover
| 17(n)
| 30
| 21
| 23
| 34
| 21
|
| Net assets at end of period (000 omitted)
| $82,727
| $76,216
| $85,842
| $137,007
| $109,521
| $78,858
|
See Notes to Financial Statements
Financial Highlights – continued
| Class I
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $26.99
| $24.26
| $34.07
| $26.30
| $21.48
| $20.28
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.02)
| $0.00(w)
| $(0.08)
| $(0.12)
| $(0.02)
| $(0.02)
|
| Net realized and unrealized gain (loss)
| 4.42
| 2.73
| (8.61)
| 8.12
| 5.02
| 1.95
|
| Total from investment operations
| $4.40
| $2.73
| $(8.69)
| $8.00
| $5.00
| $1.93
|
| Less distributions declared to shareholders
|
| From net realized gain
| $—
| $—
| $(1.12)
| $(0.23)
| $(0.18)
| $(0.73)
|
| Net asset value, end of period (x)
| $31.39
| $26.99
| $24.26
| $34.07
| $26.30
| $21.48
|
| Total return (%) (r)(s)(t)(x)
| 16.30(n)
| 11.25
| (26.32)
| 30.60
| 23.45
| 10.42
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions (f)
| 0.79(a)
| 0.79
| 0.78
| 0.76
| 0.80
| 0.84
|
| Expenses after expense reductions (f)
| 0.77(a)
| 0.78
| 0.77
| 0.75
| 0.79
| 0.83
|
| Net investment income (loss)
| (0.14)(a)
| 0.01
| (0.28)
| (0.40)
| (0.10)
| (0.09)
|
| Portfolio turnover
| 17(n)
| 30
| 21
| 23
| 34
| 21
|
| Net assets at end of period (000 omitted)
| $3,888,751
| $3,541,201
| $4,344,475
| $4,444,325
| $3,837,781
| $1,330,368
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R1
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $19.44
| $17.65
| $25.35
| $19.81
| $16.39
| $15.82
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.11)
| $(0.18)
| $(0.28)
| $(0.31)
| $(0.18)
| $(0.17)
|
| Net realized and unrealized gain (loss)
| 3.17
| 1.97(g)
| (6.30)(g)
| 6.08
| 3.78
| 1.47
|
| Total from investment operations
| $3.06
| $1.79
| $(6.58)
| $5.77
| $3.60
| $1.30
|
| Less distributions declared to shareholders
|
| From net realized gain
| $—
| $—
| $(1.12)
| $(0.23)
| $(0.18)
| $(0.73)
|
| Net asset value, end of period (x)
| $22.50
| $19.44
| $17.65
| $25.35
| $19.81
| $16.39
|
| Total return (%) (r)(s)(t)(x)
| 15.74(n)
| 10.14
| (27.07)
| 29.36
| 22.18
| 9.33
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions (f)
| 1.79(a)
| 1.79
| 1.78
| 1.76
| 1.80
| 1.85
|
| Expenses after expense reductions (f)
| 1.78(a)
| 1.78
| 1.76
| 1.75
| 1.79
| 1.84
|
| Net investment income (loss)
| (1.14)(a)
| (0.99)
| (1.30)
| (1.39)
| (1.09)
| (1.12)
|
| Portfolio turnover
| 17(n)
| 30
| 21
| 23
| 34
| 21
|
| Net assets at end of period (000 omitted)
| $3,128
| $3,097
| $3,040
| $5,281
| $4,187
| $3,472
|
| Class R2
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $23.17
| $20.93
| $29.70
| $23.06
| $18.95
| $18.08
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.08)
| $(0.10)
| $(0.20)
| $(0.24)
| $(0.12)
| $(0.11)
|
| Net realized and unrealized gain (loss)
| 3.79
| 2.34
| (7.45)
| 7.11
| 4.41
| 1.71
|
| Total from investment operations
| $3.71
| $2.24
| $(7.65)
| $6.87
| $4.29
| $1.60
|
| Less distributions declared to shareholders
|
| From net realized gain
| $—
| $—
| $(1.12)
| $(0.23)
| $(0.18)
| $(0.73)
|
| Net asset value, end of period (x)
| $26.88
| $23.17
| $20.93
| $29.70
| $23.06
| $18.95
|
| Total return (%) (r)(s)(t)(x)
| 16.01(n)
| 10.70
| (26.70)
| 30.00
| 22.83
| 9.84
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions (f)
| 1.29(a)
| 1.29
| 1.28
| 1.26
| 1.30
| 1.35
|
| Expenses after expense reductions (f)
| 1.27(a)
| 1.28
| 1.27
| 1.25
| 1.29
| 1.34
|
| Net investment income (loss)
| (0.64)(a)
| (0.49)
| (0.79)
| (0.90)
| (0.60)
| (0.61)
|
| Portfolio turnover
| 17(n)
| 30
| 21
| 23
| 34
| 21
|
| Net assets at end of period (000 omitted)
| $26,381
| $23,393
| $21,633
| $29,120
| $15,176
| $11,060
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R3
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $24.86
| $22.40
| $31.63
| $24.49
| $20.06
| $19.04
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.05)
| $(0.05)
| $(0.14)
| $(0.18)
| $(0.07)
| $(0.06)
|
| Net realized and unrealized gain (loss)
| 4.07
| 2.51
| (7.97)
| 7.55
| 4.68
| 1.81
|
| Total from investment operations
| $4.02
| $2.46
| $(8.11)
| $7.37
| $4.61
| $1.75
|
| Less distributions declared to shareholders
|
| From net realized gain
| $—
| $—
| $(1.12)
| $(0.23)
| $(0.18)
| $(0.73)
|
| Net asset value, end of period (x)
| $28.88
| $24.86
| $22.40
| $31.63
| $24.49
| $20.06
|
| Total return (%) (r)(s)(t)(x)
| 16.17(n)
| 10.98
| (26.52)
| 30.29
| 23.16
| 10.14
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions (f)
| 1.04(a)
| 1.04
| 1.03
| 1.01
| 1.05
| 1.09
|
| Expenses after expense reductions (f)
| 1.02(a)
| 1.03
| 1.01
| 1.00
| 1.04
| 1.09
|
| Net investment income (loss)
| (0.39)(a)
| (0.24)
| (0.54)
| (0.65)
| (0.35)
| (0.34)
|
| Portfolio turnover
| 17(n)
| 30
| 21
| 23
| 34
| 21
|
| Net assets at end of period (000 omitted)
| $662,796
| $592,712
| $557,897
| $777,474
| $451,972
| $239,505
|
| Class R4
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $26.32
| $23.66
| $33.25
| $25.67
| $20.97
| $19.82
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.02)
| $0.00(w)
| $(0.08)
| $(0.12)
| $(0.02)
| $(0.02)
|
| Net realized and unrealized gain (loss)
| 4.31
| 2.66
| (8.39)
| 7.93
| 4.90
| 1.90
|
| Total from investment operations
| $4.29
| $2.66
| $(8.47)
| $7.81
| $4.88
| $1.88
|
| Less distributions declared to shareholders
|
| From net realized gain
| $—
| $—
| $(1.12)
| $(0.23)
| $(0.18)
| $(0.73)
|
| Net asset value, end of period (x)
| $30.61
| $26.32
| $23.66
| $33.25
| $25.67
| $20.97
|
| Total return (%) (r)(s)(t)(x)
| 16.30(n)
| 11.24
| (26.30)
| 30.61
| 23.45
| 10.40
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions (f)
| 0.79(a)
| 0.79
| 0.78
| 0.76
| 0.80
| 0.84
|
| Expenses after expense reductions (f)
| 0.77(a)
| 0.78
| 0.76
| 0.75
| 0.79
| 0.83
|
| Net investment income (loss)
| (0.14)(a)
| 0.01
| (0.29)
| (0.40)
| (0.10)
| (0.08)
|
| Portfolio turnover
| 17(n)
| 30
| 21
| 23
| 34
| 21
|
| Net assets at end of period (000 omitted)
| $276,669
| $268,875
| $300,198
| $389,323
| $242,937
| $173,441
|
See Notes to Financial Statements
Financial Highlights – continued
| Class R6
| Six months
ended
| Year ended
|
|
| 2/29/24
(unaudited)
| 8/31/23
| 8/31/22
| 8/31/21
| 8/31/20
| 8/31/19
|
| Net asset value, beginning of period
| $27.32
| $24.52
| $34.39
| $26.51
| $21.63
| $20.40
|
| Income (loss) from investment operations
|
| Net investment income (loss) (d)
| $(0.00)(w)
| $0.04
| $(0.05)
| $(0.09)
| $(0.00)(w)
| $(0.00)(w)
|
| Net realized and unrealized gain (loss)
| 4.47
| 2.76
| (8.70)
| 8.20
| 5.06
| 1.96
|
| Total from investment operations
| $4.47
| $2.80
| $(8.75)
| $8.11
| $5.06
| $1.96
|
| Less distributions declared to shareholders
|
| From net realized gain
| $—
| $—
| $(1.12)
| $(0.23)
| $(0.18)
| $(0.73)
|
| Net asset value, end of period (x)
| $31.79
| $27.32
| $24.52
| $34.39
| $26.51
| $21.63
|
| Total return (%) (r)(s)(t)(x)
| 16.36(n)
| 11.42
| (26.24)
| 30.78
| 23.57
| 10.51
|
Ratios (%) (to average net assets)
and Supplemental data:
|
| Expenses before expense reductions (f)
| 0.66(a)
| 0.67
| 0.66
| 0.66
| 0.70
| 0.75
|
| Expenses after expense reductions (f)
| 0.65(a)
| 0.65
| 0.65
| 0.65
| 0.69
| 0.74
|
| Net investment income (loss)
| (0.02)(a)
| 0.14
| (0.18)
| (0.30)
| (0.01)
| (0.01)
|
| Portfolio turnover
| 17(n)
| 30
| 21
| 23
| 34
| 21
|
| Net assets at end of period (000 omitted)
| $7,931,966
| $6,999,847
| $6,400,990
| $8,056,150
| $5,343,295
| $3,053,325
|
| (a)
| Annualized.
|
| (d)
| Per share data is based on average shares outstanding.
|
| (f)
| Ratios do not reflect reductions from fees paid indirectly, if applicable. See Note 2 in the Notes to Financial Statements for additional information.
|
| (g)
| The per share amount varies from the net realized and unrealized gain/loss for the period because of the timing of sales of fund shares and the per share amount of realized and unrealized gains and
losses at such time.
|
| (n)
| Not annualized.
|
| (r)
| Certain expenses have been reduced without which performance would have been lower.
|
| (s)
| From time to time the fund may receive proceeds from litigation settlements, without which performance would be lower.
|
| (t)
| Total returns do not include any applicable sales charges.
|
| (w)
| Per share amount was less than $0.01.
|
| (x)
| The net asset values and total returns have been calculated on net assets which include adjustments made in accordance with U.S. generally accepted accounting principles required at
period end for financial reporting purposes.
|
See Notes to Financial Statements
Notes to Financial Statements
(unaudited)
(1) Business and
Organization
MFS Mid Cap Growth Fund (the
fund) is a diversified series of MFS Series Trust IV (the trust). The trust is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended, as an open-end
management investment company.
The fund is an investment company
and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services - Investment
Companies.
(2) Significant Accounting
Policies
General — The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations
during the reporting period. Actual results could differ from those estimates. In the preparation of these financial statements, management has evaluated subsequent events occurring after the date of the fund’s
Statement of Assets and Liabilities through the date that the financial statements were issued.
Balance Sheet Offsetting — The fund's accounting policy with respect to balance sheet offsetting is that, absent an event of default by the counterparty or a termination of the agreement, the International
Swaps and Derivatives Association (ISDA) Master Agreement, or similar agreement, does not result in an offset of reported amounts of financial assets and financial liabilities in the Statement of Assets and
Liabilities across transactions between the fund and the applicable counterparty. The fund's right to setoff may be restricted or prohibited by the bankruptcy or insolvency laws of the particular jurisdiction to which
a specific master netting agreement counterparty is subject. Balance sheet offsetting disclosures, to the extent applicable to the fund, have been included in the fund’s Significant Accounting Policies note
under the captions for each of the fund’s in-scope financial instruments and transactions.
Investment Valuations — Subject to its oversight, the fund's Board of Trustees has delegated primary responsibility for determining or causing to be determined the value of the fund’s investments to MFS as
the fund's adviser, pursuant to the fund’s valuation policy and procedures which have been adopted by the adviser and approved by the Board. In accordance with Rule 2a-5 under the Investment Company Act of
1940, the Board of Trustees designated the adviser as the “valuation designee” of the fund. If the adviser, as valuation designee, determines that reliable market quotations are not readily available for
an investment, the investment is valued at fair value as determined in good faith by the adviser in accordance with the adviser’s fair valuation policy and procedures.
Under the fund's valuation policy
and procedures, equity securities, including restricted equity securities, are generally valued at the last sale or official closing price on their primary market or exchange as provided by a third-party pricing
service. Equity securities, for which there were no sales reported that day, are generally valued at the last quoted daily bid quotation on their primary market or exchange as provided by a
Notes to Financial
Statements (unaudited) - continued
third-party pricing service. Short-term instruments
with a maturity at issuance of 60 days or less may be valued at amortized cost, which approximates market value.
Open-end investment companies are generally valued
at net asset value per share. The values of foreign securities and other assets and liabilities expressed in foreign currencies are converted to U.S. dollars using the mean of bid and asked prices for rates provided
by a third-party pricing service.
Under the fund’s valuation
policy and procedures, market quotations are not considered to be readily available for debt instruments, floating rate loans, and many types of derivatives. These investments are generally valued at fair value based
on information from third-party pricing services or otherwise determined by the adviser in accordance with the adviser’s fair valuation policy and procedures. Securities and other assets generally valued on the
basis of information from a third-party pricing service may also be valued at a broker/dealer bid quotation. In determining values, third-party pricing services can utilize both transaction data and market information
such as yield, quality, coupon rate, maturity, type of issue, trading characteristics, spreads and other market data. An investment may also be valued at fair value if the adviser determines that the
investment’s value has been materially affected by events occurring after the close of the exchange or market on which the investment is principally traded (such as foreign exchange or market) and prior to the
determination of the fund’s net asset value, or after the halt of trading of a specific security where trading does not resume prior to the close of the exchange or market on which the security is principally
traded. Events that occur after foreign markets close (such as developments in foreign markets and significant movements in the U.S. markets) and prior to the determination of the fund’s net asset value may be
deemed to have a material effect on the value of securities traded in foreign markets. Accordingly, the fund’s foreign equity securities may often be valued at fair value. The adviser generally relies on
third-party pricing services or other information (such as the correlation with price movements of similar securities in the same or other markets; the type, cost and investment characteristics of the security; the
business and financial condition of the issuer; and trading and other market data) to assist in determining whether to fair value and at what value to fair value an investment. The value of an investment for purposes
of calculating the fund’s net asset value can differ depending on the source and method used to determine value. When fair valuation is used, the value of an investment used to determine the fund’s net
asset value may differ from quoted or published prices for the same investment. There can be no assurance that the fund could obtain the fair value assigned to an investment if it were to sell the investment at the
same time at which the fund determines its net asset value per share.
Various inputs are used in
determining the value of the fund's assets or liabilities. These inputs are categorized into three broad levels. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value
hierarchy. In such cases, an investment's level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fund's assessment of the significance of a
particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the investment. Level 1 includes unadjusted quoted prices in active markets for identical assets or
liabilities. Level 2 includes other significant observable market-based inputs (including quoted prices for similar securities, interest rates, prepayment speed, and credit risk). Level 3 includes significant
Notes to Financial
Statements (unaudited) - continued
unobservable inputs, which may include the
adviser's own assumptions in determining the fair value of investments. The following is a summary of the levels used as of February 29, 2024 in valuing the fund's assets and liabilities:
| Financial Instruments
| Level 1
| Level 2
| Level 3
| Total
|
| Equity Securities:
|
|
|
|
|
| United States
| $13,140,353,234
| $—
| $—
| $13,140,353,234
|
| Netherlands
| 628,398,178
| —
| —
| 628,398,178
|
| Canada
| 408,750,863
| 0
| —
| 408,750,863
|
| Denmark
| 172,779,610
| —
| —
| 172,779,610
|
| China
| 87,310,034
| —
| —
| 87,310,034
|
| Belgium
| 39,808,328
| —
| —
| 39,808,328
|
| Israel
| 35,059,805
| —
| —
| 35,059,805
|
| Mutual Funds
| 131,898,346
| —
| —
| 131,898,346
|
| Total
| $14,644,358,398
| $0
| $—
| $14,644,358,398
|
For further information regarding
security characteristics, see the Portfolio of Investments.
Foreign Currency Translation — Purchases and sales of foreign investments, income, and expenses are converted into U.S. dollars based upon currency exchange rates prevailing on the respective dates of such
transactions or on the reporting date for foreign denominated receivables and payables. Gains and losses attributable to foreign currency exchange rates on sales of securities are recorded for financial statement
purposes as net realized gains and losses on investments. Gains and losses attributable to foreign exchange rate movements on receivables, payables, income and expenses are recorded for financial statement purposes as
foreign currency transaction gains and losses. That portion of both realized and unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately
disclosed.
Security Loans — Under its Securities Lending Agency Agreement with the fund, JPMorgan Chase and Co., as lending agent, loans the securities of the fund to certain qualified institutions (the
“Borrowers”) approved by the fund. Security loans can be terminated at the discretion of either the lending agent or the fund and the related securities must be returned within the earlier of the standard
trade settlement period for such securities or within three business days. The loans are collateralized by cash and/or U.S. Treasury and federal agency obligations in an amount typically at least equal to the market
value of the securities loaned. On loans collateralized by cash, the cash collateral is invested in a money market fund. The market value of the loaned securities is determined at the close of business of the fund and
any additional required collateral is delivered to the fund on the next business day. The lending agent provides the fund with indemnification against Borrower default. In the event of Borrower default, the lending
agent will, for the benefit of the fund, either purchase securities identical to those loaned or, when such purchase is commercially impracticable, pay the fund the market value of the loaned securities. In return,
the lending agent assumes the fund's rights to the related collateral. If the collateral value is less than the cost to purchase identical securities, the lending agent is responsible for the shortfall, but only to
the extent that such shortfall is not due to a decline in collateral value resulting from collateral reinvestment for which the fund bears the risk of loss. At period end, the fund had investment securities on loan,
all of which were classified as equity securities
Notes to Financial
Statements (unaudited) - continued
in the fund's Portfolio of Investments, with a fair
value of $27,636,673. The fair value of the fund's investment securities on loan and a related liability of $27,517,600 for cash collateral received on securities loaned are both presented gross in the Statement of
Assets and Liabilities. The value of the fund's securities on loan is marked to market daily and daily market fluctuations could cause the value of loaned securities to be more or less than the value of the collateral
received. The value of the fund's securities on loan net of the related collateral is $119,073 at period end. This collateral shortfall was adjusted for the following business day. The liability for cash collateral
for securities loaned is carried at fair value, which is categorized as level 2 within the fair value hierarchy. A portion of the income generated upon investment of the collateral is remitted to the Borrowers, and
the remainder is allocated between the fund and the lending agent. On loans collateralized by U.S. Treasury and/or federal agency obligations, a fee is received from the Borrower, and is allocated between the fund and
the lending agent. Income from securities lending is separately reported in the Statement of Operations. The dividend and interest income earned on the securities loaned is accounted for in the same manner as other
dividend and interest income.
Indemnifications — Under the fund's organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to
the fund. Additionally, in the normal course of business, the fund enters into agreements with service providers that may contain indemnification clauses. The fund's maximum exposure under these agreements is unknown
as this would involve future claims that may be made against the fund that have not yet occurred.
Investment Transactions and
Income — Dividends received in cash are recorded on the ex-dividend date. Certain dividends from foreign securities will be recorded when the fund is informed of the dividend if such information is
obtained subsequent to the ex-dividend date. Dividend payments received in additional securities are recorded on the ex-dividend date in an amount equal to the value of the security on such date.
The fund may receive proceeds from
litigation settlements. Any proceeds received from litigation involving portfolio holdings are reflected in the Statement of Operations in realized gain/loss if the security has been disposed of by the fund or in
unrealized gain/loss if the security is still held by the fund. Any other proceeds from litigation not related to portfolio holdings are reflected as other income in the Statement of Operations.
Investment transactions are recorded
on the trade date. In determining the net gain or loss on securities sold, the cost of securities is determined on the identified cost basis.
Fees Paid Indirectly — The fund's custody fee may be reduced by a credit earned under an arrangement that measures the value of U.S. dollars deposited with the custodian by the fund. The amount of the
credit, for the six months ended February 29, 2024, is shown as a reduction of total expenses in the Statement of Operations.
Tax Matters and Distributions — The fund intends to qualify as a regulated investment company, as defined under Subchapter M of the Internal Revenue Code, and to distribute all of its taxable income, including
realized capital gains. As a result, no provision for federal income tax is required. The fund’s federal tax returns, when filed, will remain subject to examination by the Internal Revenue Service for a three
year period. Management has analyzed the fund’s tax positions taken on federal and
Notes to Financial
Statements (unaudited) - continued
state tax returns for all open tax years and does
not believe that there are any uncertain tax positions that require recognition of a tax liability. Foreign taxes, if any, have been accrued by the fund in the accompanying financial statements in accordance with the
applicable foreign tax law. Foreign income taxes may be withheld by certain countries in which the fund invests. Additionally, capital gains realized by the fund on securities issued in or by certain foreign countries
may be subject to capital gains tax imposed by those countries.
Distributions to shareholders are
recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from U.S. generally accepted accounting principles. Certain capital
accounts in the financial statements are periodically adjusted for permanent differences in order to reflect their tax character. These adjustments have no impact on net assets or net asset value per share. Temporary
differences which arise from recognizing certain items of income, expense, gain or loss in different periods for financial statement and tax purposes will reverse at some time in the future.
Book/tax differences primarily
relate to net operating losses, wash sale loss deferrals, and redemptions in-kind.
The federal tax cost and the tax
basis components of distributable earnings were as follows:
| As of 2/29/24
|
|
| Cost of investments
| $8,914,345,597
|
| Gross appreciation
| 5,853,039,349
|
| Gross depreciation
| (123,026,548)
|
| Net unrealized appreciation (depreciation)
| $5,730,012,801
|
| As of 8/31/23
|
|
| Capital loss carryforwards
| (262,818,736)
|
| Late year ordinary loss deferral
| (176,108)
|
| Other temporary differences
| (12,227)
|
| Net unrealized appreciation (depreciation)
| 3,977,979,228
|
The aggregate cost above includes
prior fiscal year end tax adjustments, if applicable.
As of August 31, 2023, the fund had
capital loss carryforwards available to offset future realized gains. These net capital losses may be carried forward indefinitely and their character is retained as short-term and/or long-term losses. Such losses are
characterized as follows:
| Short-Term
| $(262,818,736)
|
Multiple Classes of Shares of
Beneficial Interest — The fund offers multiple classes of shares, which differ in their respective distribution and service fees. The fund's income, realized and unrealized gain (loss), and common
expenses are allocated to shareholders based on the daily net assets of each class. Dividends are declared separately for each class. Differences in per share dividend rates are generally due to differences in
separate class expenses. Class B and Class C shares will convert to Class A shares approximately eight years after purchase.
Notes to Financial
Statements (unaudited) - continued
(3) Transactions with
Affiliates
Investment Adviser — The fund has an investment advisory agreement with MFS to provide overall investment management and related administrative services and facilities to the fund. The management fee is computed daily and paid monthly at the following annual rates based on the fund's average daily net assets:
| Up to $1 billion
| 0.75%
|
| In excess of $1 billion and up to $2.5 billion
| 0.70%
|
| In excess of $2.5 billion and up to $5 billion
| 0.65%
|
| In excess of $5 billion and up to $10 billion
| 0.62%
|
| In excess of $10 billion and up to $20 billion
| 0.60%
|
| In excess of $20 billion
| 0.55%
|
MFS has agreed in writing to reduce
its management fee by a specified amount if certain MFS mutual fund assets exceed thresholds agreed to by MFS and the fund's Board of Trustees. MFS has also agreed in writing to waive at least 0.01% of its management
fee as part of this agreement. The agreement to waive at least 0.01% of the management fee will continue until modified by the fund's Board of Trustees, but such agreement will continue at least until December 31,
2024. For the six months ended February 29, 2024, this management fee reduction amounted to $841,233, which is included in the reduction of total expenses in the Statement of Operations.
The management fee incurred for the six months
ended February 29, 2024 was equivalent to an annual effective rate of 0.63% of the fund's average daily net assets.
The investment adviser has agreed in
writing to pay a portion of the fund’s total annual operating expenses, excluding interest, taxes, extraordinary expenses, brokerage and transaction costs, certain tax reclaim recovery expenses (including
contingency fees and closing agreement expenses), and investment-related expenses, such that total fund operating expenses do not exceed the following rates annually of each class’s average daily net assets:
| Classes
|
| A
| B
| C
| I
| R1
| R2
| R3
| R4
| R6
|
| 1.30%
| 2.05%
| 2.05%
| 1.05%
| 2.05%
| 1.55%
| 1.30%
| 1.05%
| 0.95%
|
This written agreement will continue
until modified by the fund’s Board of Trustees, but such agreement will continue at least until December 31, 2024. For the six months ended February 29, 2024, the fund’s actual operating expenses did not
exceed the limit and therefore, the investment adviser did not pay any portion of the fund’s expenses related to this agreement.
Distributor — MFS Fund Distributors, Inc. (MFD), a wholly-owned subsidiary of MFS, as distributor, received $98,836 for the six months ended February 29, 2024, as its portion of the initial
sales charge on sales of Class A shares of the fund.
The Board of Trustees has adopted a
distribution plan for certain share classes pursuant to Rule 12b-1 of the Investment Company Act of 1940.
The fund's distribution plan
provides that the fund will pay MFD for services provided by MFD and financial intermediaries in connection with the distribution and servicing of certain share classes. One component of the plan is a distribution fee
paid to MFD and
Notes to Financial
Statements (unaudited) - continued
another component of the plan is a service fee paid
to MFD. MFD may subsequently pay all, or a portion, of the distribution and/or service fees to financial intermediaries. The distribution and service fees are computed daily and paid monthly.
Distribution Plan Fee Table:
|
| Distribution
Fee Rate (d)
| Service
Fee Rate (d)
| Total
Distribution
Plan (d)
| Annual
Effective
Rate (e)
| Distribution
and Service
Fee
|
| Class A
| —
| 0.25%
| 0.25%
| 0.25%
| $ 1,959,941
|
| Class B
| 0.75%
| 0.25%
| 1.00%
| 1.00%
| 36,326
|
| Class C
| 0.75%
| 0.25%
| 1.00%
| 1.00%
| 375,544
|
| Class R1
| 0.75%
| 0.25%
| 1.00%
| 1.00%
| 14,605
|
| Class R2
| 0.25%
| 0.25%
| 0.50%
| 0.50%
| 57,549
|
| Class R3
| —
| 0.25%
| 0.25%
| 0.25%
| 733,733
|
| Total Distribution and Service Fees
|
|
|
|
| $3,177,698
|
| (d)
| In accordance with the distribution plan for certain classes, the fund pays distribution and/or service fees equal to these annual percentage rates of each class’s average daily
net assets. The distribution and service fee rates disclosed by class represent the current rates in effect at the end of the reporting period. Any rate changes, if applicable, are detailed below.
|
| (e)
| The annual effective rates represent actual fees incurred under the distribution plan for the six months ended February 29, 2024 based on each class's average daily net assets. MFD
has voluntarily agreed to rebate a portion of each class's 0.25% service fee attributable to accounts for which there is no financial intermediary specified on the account except for accounts attributable to MFS or
its affiliates' seed money. For the six months ended February 29, 2024, this rebate amounted to $119 for Class A shares and is included in the reduction of total expenses in the Statement of Operations.
|
Certain Class A shares are
subject to a contingent deferred sales charge (CDSC) in the event of a shareholder redemption within 18 months of purchase. Class B shares are subject to a CDSC in the event of a shareholder redemption within six
years of purchase. Class C shares are subject to a CDSC in the event of a shareholder redemption within 12 months of purchase. All contingent deferred sales charges are paid to MFD and during the six months
ended February 29, 2024, were as follows:
|
| Amount
|
| Class A
| $7,950
|
| Class B
| 1,407
|
| Class C
| 2,641
|
Shareholder Servicing Agent — MFS Service Center, Inc. (MFSC), a wholly-owned subsidiary of MFS, receives a fee from the fund for its services as shareholder servicing agent calculated as a percentage of the
average daily net assets of the fund as determined periodically under the supervision of the fund's Board of Trustees. For the six months ended February 29, 2024, the fee was $208,916, which equated to 0.0032%
annually of the fund's average daily net assets. MFSC also receives reimbursement from the fund for out-of-pocket expenses, sub-accounting and other shareholder servicing costs which may be paid to affiliated and
unaffiliated service providers. Class R6 shares do not incur sub-accounting fees. For the six months ended February 29, 2024, these out-of-pocket expenses, sub-accounting and other shareholder servicing costs amounted
to $3,801,150.
Notes to Financial
Statements (unaudited) - continued
Administrator — MFS provides certain financial, legal, shareholder communications, compliance, and other administrative services to the fund. Under an administrative services agreement, the
fund reimburses MFS the costs incurred to provide these services. The fund is charged an annual fixed amount of $17,500 plus a fee based on average daily net assets. The administrative services fee is
computed daily and paid monthly. The administrative services fee incurred for the six months ended February 29, 2024 was equivalent to an annual effective rate of 0.0047% of the fund's average daily net
assets.
Trustees’ and Officers’
Compensation — The fund pays compensation to independent Trustees in the form of a retainer, attendance fees, and additional compensation to Board and Committee chairpersons.
Independent Trustees’ compensation is accrued daily and paid subsequent to each Trustee Board meeting. The fund does not pay compensation directly to Trustees or officers of the fund who are also officers
of the investment adviser, all of whom receive remuneration from MFS for their services to the fund. Certain officers and Trustees of the fund are officers or directors of MFS, MFD, and MFSC.
Other — The fund invests in the MFS Institutional Money Market Portfolio which is managed by MFS and seeks current income consistent with preservation of capital and liquidity. This money
market fund does not pay a management fee to MFS but does incur investment and operating costs.
The adviser has voluntarily
undertaken to reimburse the fund from its own resources on a quarterly basis for the cost of investment research embedded in the cost of the fund’s securities trades. This agreement may be rescinded at any time.
For the six months ended February 29, 2024, this reimbursement amounted to $106,595, which is included in “Other” income in the Statement of Operations.
(4) Portfolio Securities
For the six months ended February
29, 2024, purchases and sales of investments, other than short-term obligations, aggregated $2,173,623,831 and $2,402,273,606, respectively.
Notes to Financial
Statements (unaudited) - continued
(5) Shares of Beneficial
Interest
The fund's Declaration of Trust
permits the Trustees to issue an unlimited number of full and fractional shares of beneficial interest. Transactions in fund shares were as follows:
|
| Six months ended
2/29/24
|
| Year ended
8/31/23
|
|
| Shares
| Amount
|
| Shares
| Amount
|
| Shares sold
|
|
|
|
|
|
| Class A
| 3,489,384
| $90,192,930
|
| 6,793,284
| $157,786,486
|
| Class B
| 615
| 11,949
|
| 4,974
| 93,494
|
| Class C
| 226,146
| 4,386,558
|
| 339,404
| 5,947,419
|
| Class I
| 11,389,820
| 317,928,241
|
| 32,405,384
| 802,020,268
|
| Class R1
| 9,041
| 180,623
|
| 28,035
| 508,425
|
| Class R2
| 104,765
| 2,504,889
|
| 200,572
| 4,328,218
|
| Class R3
| 1,656,723
| 42,779,730
|
| 3,483,597
| 79,637,903
|
| Class R4
| 451,563
| 12,202,947
|
| 1,244,875
| 30,125,069
|
| Class R6
| 21,800,776
| 609,029,481
|
| 47,356,728
| 1,192,536,320
|
|
| 39,128,833
| $1,079,217,348
|
| 91,856,853
| $2,272,983,602
|
| Shares reacquired
|
|
|
|
|
|
| Class A
| (4,933,177)
| $(126,948,621)
|
| (9,923,273)
| $(229,185,981)
|
| Class B
| (86,031)
| (1,698,490)
|
| (157,611)
| (2,852,374)
|
| Class C
| (476,857)
| (9,248,559)
|
| (1,310,183)
| (22,895,214)
|
| Class I
| (18,719,372)
| (509,735,301)
|
| (80,289,596)
| (1,995,690,788)
|
| Class R1
| (29,310)
| (577,768)
|
| (40,959)
| (738,986)
|
| Class R2
| (133,037)
| (3,075,527)
|
| (224,530)
| (4,795,328)
|
| Class R3
| (2,548,011)
| (64,236,024)
|
| (4,547,088)
| (105,133,340)
|
| Class R4
| (1,629,764)
| (42,045,152)
|
| (3,718,861)
| (87,895,279)
|
| Class R6
| (28,554,071)
| (805,607,717)
|
| (52,147,027)
| (1,312,327,278)
|
|
| (57,109,630)
| $(1,563,173,159)
|
| (152,359,128)
| $(3,761,514,568)
|
| Net change
|
|
|
|
|
|
| Class A
| (1,443,793)
| $(36,755,691)
|
| (3,129,989)
| $(71,399,495)
|
| Class B
| (85,416)
| (1,686,541)
|
| (152,637)
| (2,758,880)
|
| Class C
| (250,711)
| (4,862,001)
|
| (970,779)
| (16,947,795)
|
| Class I
| (7,329,552)
| (191,807,060)
|
| (47,884,212)
| (1,193,670,520)
|
| Class R1
| (20,269)
| (397,145)
|
| (12,924)
| (230,561)
|
| Class R2
| (28,272)
| (570,638)
|
| (23,958)
| (467,110)
|
| Class R3
| (891,288)
| (21,456,294)
|
| (1,063,491)
| (25,495,437)
|
| Class R4
| (1,178,201)
| (29,842,205)
|
| (2,473,986)
| (57,770,210)
|
| Class R6
| (6,753,295)
| (196,578,236)
|
| (4,790,299)
| (119,790,958)
|
|
| (17,980,797)
| $(483,955,811)
|
| (60,502,275)
| $(1,488,530,966)
|
Notes to Financial
Statements (unaudited) - continued
The fund is one of several mutual
funds in which certain MFS funds may invest. The MFS funds do not invest in the underlying funds for the purpose of exercising management or control. At the end of the period, the MFS Growth Allocation Fund, the MFS
Moderate Allocation Fund, the MFS Aggressive Growth Allocation Fund, and the MFS Conservative Allocation Fund were the owners of record of approximately 4%, 3%, 2%, and 1%, respectively, of the value of outstanding
voting shares of the fund. In addition, the MFS Lifetime Income Fund, the MFS Lifetime 2025 Fund, the MFS Lifetime 2030 Fund, the MFS Lifetime 2035 Fund, the MFS Lifetime 2040 Fund, the MFS Lifetime 2045 Fund, the MFS
Lifetime 2050 Fund, the MFS Lifetime 2055 Fund, the MFS Lifetime 2060 Fund, and the MFS Lifetime 2065 Fund were each the owners of record of less than 1% of the value of outstanding voting shares of the fund.
Effective June 1, 2019, purchases of
the fund’s Class B shares were closed to new and existing investors subject to certain exceptions. Effective September 29, 2023, purchases of the fund's Class R1 and Class R2 shares were closed to new eligible
investors.
(6) Line of Credit
The fund and certain other funds
managed by MFS participate in a $1.45 billion unsecured committed line of credit of which $1.2 billion is reserved for use by the fund and certain other MFS U.S. funds. The line of credit is provided by a syndicate of
banks under a credit agreement. Borrowings may be made for temporary financing needs. Interest is charged to each fund, based on its borrowings, generally at a rate equal to the highest of 1) Daily Simple SOFR
(Secured Overnight Financing Rate) plus 0.10%, 2) the Federal Funds Effective Rate, or 3) the Overnight Bank Funding Rate, each plus an agreed upon spread. A commitment fee, based on the average daily unused portion
of the committed line of credit, is allocated among the participating funds. The line of credit expires on March 13, 2025 unless extended or renewed. In addition, the fund and other funds managed by MFS have
established unsecured uncommitted borrowing arrangements with certain banks for temporary financing needs. Interest is charged to each fund, based on its borrowings, at rates equal to customary reference rates plus an
agreed upon spread. For the six months ended February 29, 2024, the fund’s commitment fee and interest expense were $32,048 and $0, respectively, and are included in “Miscellaneous” expense in the
Statement of Operations.
(7) Investments in Affiliated
Issuers
An affiliated issuer may be
considered one in which the fund owns 5% or more of the outstanding voting securities, or a company which is under common control. For the purposes of this report, the following were affiliated issuers:
| Affiliated Issuers
| Beginning
Value
| Purchases
| Sales
Proceeds
| Realized
Gain
(Loss)
| Change in
Unrealized
Appreciation or
Depreciation
| Ending
Value
|
| Ascendis Pharma, ADR
| $88,520,882
| $24,590,007
| $607,534
| $(7,643)
| $60,283,898
| $172,779,610
|
| MFS Institutional Money Market Portfolio
| 419,936,182
| 441,453,137
| 756,992,401
| 25,665
| (41,837)
| 104,380,746
|
|
| $508,457,064
| $466,043,144
| $757,599,935
| $18,022
| $60,242,061
| $277,160,356
|
Notes to Financial
Statements (unaudited) - continued
| Affiliated Issuers
| Dividend
Income
| Capital Gain
Distributions
|
| Ascendis Pharma, ADR
| $—
| $—
|
| MFS Institutional Money Market Portfolio
| 8,742,028
| —
|
|
| $8,742,028
| $—
|
(8) Subsequent Event
On April 5, 2024, the fund recorded
redemption proceeds for a distribution in-kind of portfolio securities and cash that were valued at $192,072,468. The redeeming shareholder generally receives a pro rata share of the securities held by the
fund. The distribution of such securities generated a realized gain of $99,675,662 for the fund.
Proxy Voting Policies and
Information
MFS votes proxies on behalf of the
fund pursuant to proxy voting policies and procedures that are available without charge, upon request, by calling 1-800-225-2606, by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Information regarding how the fund
voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available by August 31 of each year without charge by visiting mfs.com/proxyvoting, or by visiting the SEC’s Web site at http://www.sec.gov.
Quarterly Portfolio
Disclosure
The fund files a complete schedule
of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The fund's Form N-PORT reports are available on the SEC's Web site at http://www.sec.gov. A shareholder can obtain the portfolio holdings report for the first and third quarters of the fund's fiscal year at mfs.com/openendfunds by choosing the fund's name and then scrolling to the “Resources” section and clicking on the “Prospectus and Reports” tab.
Further Information
From time to time, MFS may post
important information about the fund or the MFS Funds on the MFS Web site (mfs.com). This information is available at https://www.mfs.com/announcements or at mfs.com/openendfunds by choosing the fund’s name and then scrolling to the “Resources” section and clicking on the “Announcements” tab, if any.
Information About Fund
Contracts and Legal Claims
The fund has entered into
contractual arrangements with an investment adviser, administrator, distributor, shareholder servicing agent, and custodian who each provide services to the fund. Unless expressly stated otherwise, shareholders are
not parties to, or intended beneficiaries of these contractual arrangements, and these contractual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek
any remedy under them against the service providers, either directly or on behalf of the fund.
Under the Trust’s By-Laws and
Declaration of Trust, any claims asserted against or on behalf of the MFS Funds, including claims against Trustees and Officers, must be brought in state and federal courts located within the Commonwealth of
Massachusetts.
Provision of Financial
Reports and Summary Prospectuses
The fund produces financial reports
every six months and updates its summary prospectus and prospectus annually. To avoid sending duplicate copies of materials to households, only one copy of the fund’s annual and semiannual report and summary
prospectus may be mailed to shareholders having the same last name and residential address on the fund’s records. However, any shareholder may contact MFSC (please see back cover for address and telephone
number) to request that copies of these reports and summary prospectuses be sent personally to that shareholder.
Save paper with eDelivery.
MFS® will send you prospectuses, reports, and proxies directly via e-mail so you will get information faster with less mailbox clutter.
To sign up:
1. Go to mfs.com.
2. Log in via MFS® Access.
3. Select eDelivery.
If you own your MFS fund shares
through a financial institution or a retirement plan, MFS® TALK, MFS® Access, or eDelivery may not be available to you.
CONTACT
WEB SITE
mfs.com
MFS TALK
1-800-637-8255
24 hours a day
ACCOUNT SERVICE AND LITERATURE
Shareholders
1-800-225-2606
Financial advisors
1-800-343-2829
Retirement plan services
1-800-637-1255
MAILING ADDRESS
MFS Service Center, Inc.
P.O. Box 219341
Kansas City, MO 64121-9341
OVERNIGHT MAIL
MFS Service Center, Inc.
Suite 219341
430 W 7th Street
Kansas City, MO 64105-1407
Item 1(b):
Not applicable.
ITEM 2. CODE OF ETHICS.
The Registrant has adopted a Code of Ethics (the "Code") pursuant to Section 406 of the Sarbanes-Oxley Act and as defined in Form N-CSR that applies to the Registrant's principal executive officer and principal financial and accounting officer. During the period covered by this report, the Registrant has not amended any provision in the Code that relates to an element of the Code's definition enumerated in paragraph
(b)of Item 2 of this Form N-CSR. During the period covered by this report, the Registrant did not grant a waiver, including an implicit
waiver, from any provision of the Code. David L. DiLorenzo (Principal Executive Officer) and James O. Yost (Principal Financial Officer) were the two persons covered by the Code prior to April 1, 2024. Beginning April 1, 2024, David L. DiLorenzo (Principal Executive Officer) and Kasey L. Phillips (Principal Financial Officer) are the two persons covered by the Code.
A copy of the Code is attached hereto as EX-99.COE.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable for semi-annual reports.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable for semi-annual reports.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to the Registrant.
ITEM 6. INVESTMENTS
A schedule of investments for each series covered by this Form N-CSR is included as part of the report to shareholders of such series under Item 1(a) of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the Registrant.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the Registrant.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
Not applicable to the Registrant.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There were no material changes to the procedures by which shareholders may send recommendations to the Board for nominees to the Registrant's Board since the Registrant last provided disclosure as to such procedures in response to the requirements of Item 407 (c)(2)(iv) of Regulation S-K or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a)Based upon their evaluation of the effectiveness of the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the "Act")) as conducted within 90 days of the filing date of this report on Form N-CSR, the Registrant's principal financial officer and principal executive officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the Registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.
(b)There were no changes in the Registrant's internal controls over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the period covered by the report that have materially affected, or are reasonably likely to materially affect, the Registrant's internal control over financial reporting.
ITEM 12. DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the Registrant.
ITEM 13. RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION.
Not Applicable.
ITEM 14. EXHIBITS.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy the Item 2 requirements through filing of an exhibit: Attached hereto as EX-99.COE.
(2)A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Act (17 CFR 270.30a-2): Attached hereto as EX-99.302CERT.
(3)Any written solicitation to purchase securities under Rule 23c-1 under the Act (17 CFR 270.23c-1) sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable.
(4)Change in the registrant's independent public accountant. Not applicable.
(b)If the report is filed under Section 13(a) or 15(d) of the Exchange Act, provide the certifications required by Rule 30a-2(b) under the Act (17 CFR 270.30a-2(b)), Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR 240.13a-14(b) or 240.15d-14(b)) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished pursuant to this paragraph will not be deemed "filed" for the purposes of Section 18 of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference. Attached hereto as EX-99.906CERT.
Notice
A copy of the Amended and Restated Declaration of Trust, as amended, of the Registrant is on file with the Secretary of State of The Commonwealth of Massachusetts and notice is hereby given that this instrument is executed on behalf of the Registrant by an officer of the Registrant as an officer and not individually and the obligations of or arising out of this instrument are not binding upon any of the Trustees or shareholders individually, but are binding only upon the assets and property of the respective constituent series of the Registrant.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) MFS SERIES TRUST IV
By (Signature and Title)*
/S/ DAVID L. DILORENZO
David L. DiLorenzo, President
Date: April 12, 2024
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 (Signature and Title)*
/S/ DAVID L. DILORENZO
David L. DiLorenzo, President (Principal Executive Officer)
Date: April 12, 2024
By (Signature and Title)*
/S/ KASEY L. PHILLIPS
Kasey L. Phillips, Treasurer (Principal Financial Officer and Accounting Officer) Date: April 12, 2024
* Print name and title of each signing officer under his or her signature.
