Monday, January 17, 2022
ADVERTISEMENT

Form N-CSRS LEGG MASON PARTNERS VARI For: Jun 30


News and research before you hear about it on CNBC and others. Claim your 1-week free trial to StreetInsider Premium here.


 

 

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 811-21128

 

 

 

Legg Mason
Partners Variable Equity Trust

(Exact name of registrant as specified in charter)

 

 

620 Eighth Avenue, 47th Floor, New York, NY 10018

(Address of principal executive offices) (Zip code)

 

 

Marc A. De
Oliveira.

Franklin Templeton

100 First Stamford Place

Stamford, CT 06902

(Name
and address of agent for service)

 

 

Registrant’s telephone number, including area code: 1-877-721-1926

Date of fiscal year end: December 31

Date of reporting period: June 30, 2021

 

 

 


ITEM 1. REPORT TO STOCKHOLDERS.

The Semi-Annual Report to Stockholders is filed herewith.

 


 

Semi-Annual Report   June 30, 2021

CLEARBRIDGE

VARIABLE LARGE CAP

GROWTH PORTFOLIO

 

 

 

Your insurance company may no longer send you paper copies of the Fund’s shareholder reports like this one by
mail, unless you specifically request paper copies of the reports from the insurance company or your financial intermediary. Instead, the shareholder reports will be made available on a website, and you will be notified by mail each time a report is
posted and provided with a website link to access the report. Instructions for requesting paper copies will be provided by your insurance company.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. If your insurance company offers electronic delivery, you may elect to
receive shareholder reports and other communications from them electronically by following the instructions provided by the insurance company.

You may elect to receive all future reports in paper free of charge. You can inform the insurance company that
you wish to continue receiving paper copies of shareholder reports by following the instructions provided by them. Your election will apply to all Funds available under your contract with the insurance company.

 

LOGO

 

INVESTMENT PRODUCTS: NOT FDIC INSURED • NO (BA)NK GUARANTEE • MAY LOSE
VALUE

 

 

Portfolio objective

The Portfolio seeks long-term growth of capital.

 

Letter from the president

 

LOGO

 

Dear Shareholder,

We are pleased to provide the semi-annual report of ClearBridge Variable Large Cap Growth Portfolio for the
six-month reporting period ended June 30, 2021. Please read on for Portfolio performance information during the Portfolio’s reporting period.

As always, we remain committed to providing you with excellent service and a full spectrum of investment choices. We also remain committed to supplementing the support you receive from your financial advisor. One
way we accomplish this is through our website, www.leggmason.com. Here you can gain immediate access to market and investment information, including:

 

•  

Market insights and commentaries from our portfolio managers and

 

•  

A host of educational resources.

We look
forward to helping you meet your financial goals.

Sincerely,

 

LOGO

Jane Trust, CFA

President and Chief Executive Officer

July 30, 2021

 

 

II

   ClearBridge Variable Large Cap Growth Portfolio

Performance review

 

For the six months ended June 30, 2021, Class I shares of ClearBridge Variable Large Cap Growth
Portfolio
1 returned 11.55%. The Portfolio’s unmanaged benchmark, the
Russell 1000 Growth Index
i, returned 12.99% for the same period. The Lipper
Variable Large-Cap Growth Funds Category Average
ii returned 12.78% over the same time frame.

 

Performance Snapshot as
of June 30, 2021
(unaudited)
 
     6 months  
ClearBridge Variable Large Cap Growth Portfolio:  

Class I

    11.55

Class II

    11.38
Russell 1000 Growth Index     12.99
Lipper Variable Large-Cap Growth Funds Category Average     12.78

The performance shown represents past performance. Past performance is no guarantee of future results and current performance may
be higher or lower than the performance shown above. Principal value and investment returns will fluctuate and investors’ shares, when redeemed, may be worth more or less than their original cost.

All share class returns assume the reinvestment of all distributions, including returns of capital, if any, at net asset value and the deduction of all Portfolio
expenses. Performance figures for periods shorter than one year represent cumulative figures and are not annualized.

Portfolio performance
figures reflect fee waivers and/or expense reimbursements, without which the performance would have been lower.

 

Total Annual Operating Expenses
(unaudited)

As of the Portfolio’s current prospectus dated May 1, 2021, the gross total annual fund operating expense ratios for Class I and Class II shares were 0.76% and 1.01%, respectively.

Actual expenses may be higher. For example, expenses may be higher than those shown if average net assets decrease. Net assets are more likely to
decrease and Portfolio expense ratios are more likely to increase when markets are volatile.

 

1 

The Portfolio is an underlying investment option of various variable annuity and variable life insurance products. The Portfolio’s performance returns do
not reflect the deduction of expenses imposed in connection with investing in variable annuity or variable life insurance contracts, such as administrative fees, account charges and surrender charges, which, if reflected, would reduce the
performance of the Portfolio. Past performance is no guarantee of future results.

 

ClearBridge Variable Large Cap Growth Portfolio  

 

III


Performance review (cont’d)

 

As always, thank you for your confidence in our stewardship of your assets.

Sincerely,

 

LOGO

Jane Trust, CFA

President and Chief Executive Officer

July 30, 2021

RISKS: Common stocks are subject to market and price fluctuations. Large capitalization companies
may fall out of favor with investors based on market and economic conditions. In return for the relative stability and low volatility of large capitalization companies, the Portfolio’s value may not rise as much as the value of funds that
invest in companies with smaller market capitalizations. Growth stocks as a group may fall out of favor and underperform the overall equity market while the market concentrates on value stocks. Although the Portfolio will not concentrate its
investments in any one industry or investing group, it may weight its investments toward certain industries, thus increasing its exposure to factors adversely affecting issuers within those industries. Please see the Portfolio’s prospectus for
a more complete discussion of these and other risks and the Portfolio’s investment strategies.

All investments are subject to risk including
the possible loss of principal. Past performance is no guarantee of future results. All index performance reflects no deduction for fees, expenses or taxes. Please note that an investor cannot invest directly in an index.

 

i 

The Russell 1000 Growth Index measures the performance of those Russell 1000 Index companies with higher price-to-book ratios and higher forecasted growth values. (A price-to-book ratio is the price of a stock compared to the
difference between a company’s assets and liabilities.) The Russell 1000 Index measures the performance of the large-cap segment of the U.S. equity universe. It is a subset of the Russell 3000 Index and
includes approximately 1,000 of the largest securities based on a combination of their market cap and current index membership. The Russell 1000 represents approximately 90% of the U.S. market. The Russell 3000 Index measures the performance of the
3,000 largest U.S. companies based on total market capitalization, which represents approximately 98% of the U.S. equity market.

 

ii 

Lipper, Inc., a wholly-owned subsidiary of Refinitiv, provides independent insight on global collective investments. Returns are based on the six-month period ended June 30, 2021, including the reinvestment of all distributions, including returns of capital, if any, calculated among the 191 funds in the Portfolio’s Lipper category.

 

 

IV

   ClearBridge Variable Large Cap Growth Portfolio

Portfolio at a glance† (unaudited)

 

Investment breakdown (%) as a percent of total investments

 

LOGO

 

†

The bar graph above represents the composition of the Portfolio’s investments as of June 30, 2021 and December 31, 2020. The Portfolio is
actively managed. As a result, the composition of the Portfolio’s investments is subject to change at any time.

 

ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report  

 

1


Portfolio expenses (unaudited)

 

Example

As a shareholder of the Portfolio,
you may incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees; service and/or distribution (12b-1) fees; and other Portfolio expenses. This example is
intended to help you understand your ongoing costs (in dollars) of investing in the Portfolio and to compare these costs with the ongoing costs of investing in other funds.

This example is based on an investment of $1,000 invested on January 1, 2021 and held for the six months ended June 30, 2021.

Actual expenses

The table below titled “Based on Actual Total Return” provides
information about actual account values and actual expenses. You may use the information provided in this table, together with the amount you invested, to estimate the expenses that you paid over the period. To estimate the expenses you paid on your
account, divide your ending account value by $1,000 (for example, an $8,600 ending account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During the Period”.

Hypothetical example for comparison purposes

The table below titled “Based on Hypothetical Total Return” provides information about hypothetical account values and hypothetical expenses based on the
actual expense ratio and an assumed rate of return of 5.00% per year before expenses, which is not the Portfolio’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 the information provided in this table to compare the ongoing costs of investing in the Portfolio and other funds. To do so, compare the 5.00% hypothetical example relating to the Portfolio with the
5.00% hypothetical examples that appear in the shareholder reports of the other funds.

Please note that the expenses shown in the table below are meant
to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, 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 transaction costs were included, your costs would have been higher.

 

Based on actual total return1                       Based on hypothetical total return1        
     Actual
Total
Return2
    Beginning
Account
Value
    Ending
Account
Value
    Annualized
Expense
Ratio
    Expenses
Paid
During
the
Period3
               Hypothetical
Annualized
Total Return
   

Beginning

Account

Value

    Ending
Account
Value
    Annualized
Expense
Ratio
    Expenses
Paid
During
the
Period3
 
Class I     11.55   $ 1,000.00     $ 1,115.50       0.75   $ 3.93       Class I     5.00   $ 1,000.00     $ 1,021.08       0.75   $ 3.76  
Class II     11.38       1,000.00       1,113.80       1.01       5.29       Class II     5.00       1,000.00       1,019.79       1.01       5.06  

 

 

2

   ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report

1  

For the six months ended June 30, 2021.

 

2 

Assumes the reinvestment of all distributions, including returns of capital, if any, at net asset value. Total return is not annualized, as it may not be
representative of the total return for the year. Total returns do not reflect expenses associated with separate accounts such as administrative fees, account charges and surrender charges, which, if reflected, would reduce the total returns.
Performance figures may reflect compensating balance arrangements, fee waivers and/or expense reimbursements. In the absence of compensating balance arrangements, fee waivers and/or expense reimbursements, the total return would have been lower.
Past performance is no guarantee of future results.

 

3 

Expenses (net of compensating balance arrangements, fee waivers and/or expense reimbursements) are equal to each class’ respective annualized expense ratio
multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half-year (181), then divided by 365.

 

ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report  

 

3


Schedule of investments (unaudited)

June 30, 2021

 

ClearBridge Variable Large Cap Growth Portfolio

 

Security                 Shares     Value  
Common Stocks — 99.4%                                
Communication Services — 9.5%                                

Entertainment — 2.9%

                               

Sea Ltd., ADR

                    19,520     $ 5,360,192  

Walt Disney Co.

                    45,070       7,921,954  

Total Entertainment

                            13,282,146  

Interactive Media & Services — 6.6%

                               

Facebook Inc., Class A Shares

                    85,186       29,620,024  

Total Communication Services

                            42,902,170  
Consumer Discretionary — 20.6%                                

Auto Components — 1.7%

                               

Aptiv PLC

                    48,492       7,629,246  

Hotels, Restaurants & Leisure — 1.2%

                               

Booking Holdings Inc.

                    2,528       5,531,492  

Internet & Direct Marketing Retail — 10.8%

                               

Alibaba Group Holding Ltd., ADR

                    35,993       8,162,493  

Amazon.com Inc.

                    11,725       40,335,876  

Total Internet & Direct Marketing Retail

                            48,498,369  

Specialty Retail — 6.9%

                               

Advance Auto Parts Inc.

                    35,389       7,259,699  

Home Depot Inc.

                    32,429       10,341,284  

Tractor Supply Co.

                    30,160       5,611,570  

Ulta Beauty Inc.

                    22,503       7,780,862  

Total Specialty Retail

                            30,993,415  

Total Consumer Discretionary

                            92,652,522  
Consumer Staples — 2.5%                                

Beverages — 2.5%

                               

Anheuser-Busch InBev SA/NV, ADR

                    57,712       4,155,841  

Monster Beverage Corp.

                    75,310       6,879,569  

Total Consumer Staples

                            11,035,410  
Health Care — 12.6%                                

Biotechnology — 2.2%

                               

Amgen Inc.

                    26,740       6,517,875  

BioMarin Pharmaceutical Inc.

                    42,878       3,577,740  

Total Biotechnology

                            10,095,615  

Health Care Equipment & Supplies — 2.3%

                               

Alcon Inc.

                    84,600       5,943,996  

Intuitive Surgical Inc.

                    4,690       4,313,111  

Total Health Care Equipment & Supplies

                            10,257,107  

Health Care Providers & Services — 3.1%

                               

UnitedHealth Group Inc.

                    34,804       13,936,914  

 

See Notes to Financial
Statements.

 

 

4

   ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report

 

 

ClearBridge Variable Large Cap Growth Portfolio

 

Security                 Shares     Value  

Life Sciences Tools & Services — 2.6%

                               

Thermo Fisher Scientific Inc.

                    22,989     $ 11,597,261  

Pharmaceuticals — 2.4%

                               

Zoetis Inc.

                    58,674       10,934,487  

Total Health Care

                            56,821,384  
Industrials — 9.9%                                

Aerospace & Defense — 1.5%

                               

Raytheon Technologies Corp.

                    81,340       6,939,116  

Air Freight & Logistics — 2.6%

                               

United Parcel Service Inc., Class B Shares

                    55,394       11,520,290  

Electrical Equipment — 0.3%

                               

Eaton Corp. PLC

                    9,280       1,375,110  

Professional Services — 2.0%

                               

IHS Markit Ltd.

                    77,849       8,770,468  

Road & Rail — 1.8%

                               

Uber Technologies Inc.

                    160,885       8,063,556  

Trading Companies & Distributors — 1.7%

                               

W.W. Grainger Inc.

                    17,847       7,816,986  

Total Industrials

                            44,485,526  
Information Technology — 41.5%                                

IT Services — 7.5%

                               

Akamai Technologies Inc.

                    55,078       6,422,095  

Fidelity National Information Services Inc.

                    46,980       6,655,657  

Visa Inc., Class A Shares

                    87,977       20,570,782  

Total IT Services

                            33,648,534  

Semiconductors & Semiconductor Equipment —
8.8%

                               

ASML Holding NV, Registered Shares

                    8,780       6,065,575  

NVIDIA Corp.

                    20,337       16,271,634  

NXP Semiconductors NV

                    30,460       6,266,231  

QUALCOMM Inc.

                    77,144       11,026,192  

Total Semiconductors & Semiconductor Equipment

                            39,629,632  

Software — 20.5%

                               

Adobe Inc.

                    26,828       15,711,550  

Atlassian Corp. PLC, Class A Shares

                    26,910       6,912,102  

Microsoft Corp.

                    86,702       23,487,572  

Nutanix Inc., Class A Shares

                    81,299       3,107,248  

Palo Alto Networks Inc.

                    24,983       9,269,942  

salesforce.com Inc.

                    57,410       14,023,541  

Splunk Inc.

                    44,792       6,476,027  

UiPath Inc., Class A Shares

                    40,914       2,779,288  

 

See Notes to Financial
Statements.

 

ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report  

 

5


Schedule of investments
(unaudited) (cont’d)

June 30, 2021

 

ClearBridge Variable Large Cap Growth Portfolio

 

Security               Shares     Value  

Software — continued

                           

VMware Inc., Class A Shares

                32,608     $ 5,216,302  

Workday Inc., Class A Shares

                22,580       5,390,749  

Total Software

                        92,374,321  

Technology Hardware, Storage & Peripherals —
4.7%

                           

Apple Inc.

                152,792       20,926,392  

Total Information Technology

                        186,578,879  
Materials — 1.2%                            

Chemicals — 1.2%

                           

Ecolab Inc.

                26,524       5,463,148  
Real Estate — 1.6%                            

Equity Real Estate Investment Trusts (REITs) — 1.6%

                           

Equinix Inc.

                8,769       7,037,999  

Total Investments before Short-Term Investments (Cost —
$211,766,708)

 

            446,977,038  
          Rate                
Short-Term Investments — 0.7%                            

JPMorgan 100% U.S. Treasury Securities Money Market Fund, Institutional Class

        0.006     2,490,678       2,490,678  

Western Asset Premier Institutional U.S. Treasury Reserves, Premium Shares

        0.010     622,670       622,670   (a)  

Total Short-Term Investments (Cost — $3,113,348)

                        3,113,348  

Total Investments — 100.1% (Cost — $214,880,056)

                        450,090,386  

Liabilities in Excess of Other Assets — (0.1)%

                        (440,836

Total Net Assets — 100.0%

                      $ 449,649,550  

 

*

Non-income producing security.

 

(a)

In this instance, as defined in the Investment Company Act of 1940, an “Affiliated Company” represents Portfolio ownership of at least 5% of the
outstanding voting securities of an issuer, or a company which is under common ownership or control with the Portfolio. At June 30, 2021, the total market value of investments in Affiliated Companies was $622,670 and the cost was $622,670 (Note
8).

 

Abbreviation(s) used in this schedule:

ADR — American Depositary Receipts

 

See Notes to Financial
Statements.

 

 

6

   ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report

Statement of assets and liabilities (unaudited)

June 30,
2021

 

Assets:         

Investments in unaffiliated securities, at value (Cost — $214,257,386)

     $449,467,716  

Investments in affiliated securities, at value (Cost — $622,670)

     622,670  

Receivable for Portfolio shares sold

     144,681  

Dividends and interest receivable

     78,812  

Prepaid expenses

     896  

Total Assets

     450,314,775  
Liabilities:         

Investment management fee payable

     252,934  

Payable for securities purchased

     250,974  

Service and/or distribution fees payable

     53,876  

Payable for Portfolio shares repurchased

     41,672  

Trustees’ fees payable

     4,420  

Accrued expenses

     61,349  

Total Liabilities

     665,225  
Total Net Assets      $449,649,550  
Net Assets:         

Par value (Note 7)

     $              108  

Paid-in capital in excess of par value

     195,982,607  

Total distributable earnings (loss)

     253,666,835  
Total Net Assets      $449,649,550  
Net Assets:         

Class I

     $181,399,968  

Class II

     $268,249,582  
Shares Outstanding:         

Class I

     4,341,195  

Class II

     6,470,641  
Net Asset Value:         

Class I

     $41.79  

Class II

     $41.46  

 

See Notes to Financial
Statements.

 

ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report  

 

7


Statement of operations (unaudited)

For the
Six Months Ended June 30, 2021

 

Investment Income:         

Dividends

     $  1,412,356  

Interest from unaffiliated investments

     195  

Interest from affiliated investments

     81  

Less: Foreign taxes withheld

     (15,731)  

Total Investment Income

     1,396,901  
Expenses:         

Investment management fee (Note 2)

     1,495,819  

Service and/or distribution fees (Notes 2 and 5)

     320,030  

Fund accounting fees

     35,446  

Legal fees

     19,721  

Audit and tax fees

     14,438  

Transfer agent fees (Note 5)

     14,410  

Shareholder reports

     13,389  

Trustees’ fees

     10,878  

Insurance

     2,584  

Custody fees

     1,530  

Miscellaneous expenses

     1,909  

Total Expenses

     1,930,154  

Less: Fee waivers and/or expense reimbursements (Notes 2 and 5)

     (61)  

Net Expenses

     1,930,093  
Net Investment Loss      (533,192)  
Realized and Unrealized Gain (Loss) on Investments and Foreign Currency Transactions (Notes 1 and 3):         

Net Realized Gain (Loss) From:

        

Investment transactions in unaffiliated securities

     20,179,530  

Foreign currency transactions

     (22)  

Net Realized Gain

     20,179,508  

Change in Net Unrealized Appreciation (Depreciation) From Unaffiliated
Investments

     25,885,526  
Net Gain on Investments and Foreign Currency Transactions      46,065,034  
Increase in Net Assets From Operations      $45,531,842  

 

See Notes to Financial
Statements.

 

 

8

   ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report

Statements of changes in net assets

 

 

For the Six Months Ended June 30, 2021 (unaudited)

and the Year Ended December 31, 2020

   2021      2020  
Operations:                  

Net investment loss

   $    (533,192)      $    (248,925)  

Net realized gain

     20,179,508        16,812,878  

Change in net unrealized appreciation (depreciation)

     25,885,526        86,637,247  

Increase in Net Assets From Operations

     45,531,842        103,201,200  
Distributions to Shareholders From (Notes 1 and 6):                  

Total distributable earnings

     (3,023,213)        (15,745,377)  

Decrease in Net Assets From Distributions to
Shareholders

     (3,023,213)        (15,745,377)  
Portfolio Share Transactions (Note 7):                  

Net proceeds from sale of shares

     22,523,961        65,116,346  

Reinvestment of distributions

     3,023,213        15,745,377  

Cost of shares repurchased

     (52,352,566)        (67,603,237)  

Increase (Decrease) in Net Assets From Portfolio Share
Transactions

     (26,805,392)        13,258,486  

Increase in Net Assets

     15,703,237        100,714,309  
Net Assets:                  

Beginning of period

     433,946,313        333,232,004  

End of period

   $ 449,649,550      $ 433,946,313  

 

See Notes to Financial
Statements.

 

ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report  

 

9


Financial highlights

 

For a share of each class of beneficial interest outstanding throughout each year ended
December 31,
unless otherwise noted:
 
Class I Shares1   20212     2020     2019     2018     2017     2016  
Net asset value, beginning of period     $37.72       $29.99       $23.85       $24.63       $20.76       $21.12  
Income (loss) from operations:            

Net investment income (loss)

    (0.02)       0.03       0.08       0.11       0.07       0.11  

Net realized and unrealized gain (loss)

    4.37       9.11       7.55       (0.06)       5.25       1.46  

Total income from operations

    4.35       9.14       7.63       0.05       5.32       1.57  
Less distributions from:            

Net investment income

    —       (0.01)       (0.10)       (0.08)       (0.05)       (0.11)  

Net realized gains

    (0.28)       (1.40)       (1.39)       (0.75)       (1.40)       (1.82)  

Total distributions

    (0.28)       (1.41)       (1.49)       (0.83)       (1.45)       (1.93)  
Net asset value, end of period     $41.79       $37.72       $29.99       $23.85       $24.63       $20.76  

Total return3

    11.55     30.73     32.16     0.02 %      25.76     7.39
Net assets, end of period (millions)     $181       $172       $151       $122       $135       $115  
Ratios to average net assets:            

Gross expenses

    0.75 %      0.76     0.76     0.79     0.85     0.86

Net expenses6,7

    0.75 5       0.76       0.76       0.79       0.80       0.80  

Net investment income (loss)

    (0.10) 5       0.08       0.29       0.43       0.29       0.50  
Portfolio turnover rate     8     25     20     16     17     17

 

1 

Per share amounts have been calculated using the average shares method.

 

2 

For the six months ended June 30, 2021 (unaudited).

 

3 

Performance figures may reflect compensating balance arrangements, fee waivers and/or expense reimbursements. In the absence of compensating balance
arrangements, fee waivers and/or expense reimbursements, the total return would have been lower. Total returns do not reflect expenses associated with separate accounts such as administrative fees, account charges and surrender charges which, if
reflected, would reduce the total return for all periods shown. Past performance is no guarantee of future results. Total returns for periods of less than one year are not annualized.

 

4 

The total return includes gains from settlement of security litigations. Without these gains, the total return would have been
-0.11% for the year ended December 31, 2018.

 

 

6 

Reflects fee waivers and/or expense reimbursements.

 

7 

As a result of an expense limitation arrangement, the ratio of total annual fund operating expenses, other than interest, brokerage, taxes, extraordinary
expenses and acquired fund fees and expenses, to average net assets of Class I shares did not exceed 0.80%. This expense limitation arrangement cannot be terminated prior to December 31, 2022 without the Board of Trustees’ consent. In
addition, the manager has agreed to waive the Portfolio’s management fee to an extent sufficient to offset the net management fee payable in connection with any investment in an affiliated money market fund.

 

See Notes to Financial Statements.

 

 

10

   ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report

For a share of each class of beneficial interest outstanding throughout each year ended
December 31,
unless otherwise noted:
 
Class II Shares1   20212     2020     2019     2018     2017     20163  
Net asset value, beginning of period     $37.48       $29.88       $23.78       $24.58       $20.76       $22.01  
Income (loss) from operations:            

Net investment income (loss)

    (0.07)       (0.06)       0.01       0.08       0.01       0.02  

Net realized and unrealized gain (loss)

    4.33       9.07       7.52       (0.09)       5.25       0.59  

Total income (loss) from operations

    4.26       9.01       7.53       (0.01)       5.26       0.61  
Less distributions from:            

Net investment income

    —       (0.01)       (0.04)       (0.04)       (0.04)       (0.10)  

Net realized gains

    (0.28)       (1.40)       (1.39)       (0.75)       (1.40)       (1.76)  

Total distributions

    (0.28)       (1.41)       (1.43)       (0.79)       (1.44)       (1.86)  
Net asset value, end of period     $41.46       $37.48       $29.88       $23.78       $24.58       $20.76  

Total return4

    11.38     30.41     31.84     (0.23) %      25.44     2.69
Net assets, end of period (000s)     $268,250       $261,799       $182,364       $79,652       $19,622       $103  
Ratios to average net assets:            

Gross expenses

    1.01 %6       1.01     1.02     1.06     1.10     1.14 % 

Net expenses7,8

    1.01 6       1.01       1.02       1.05       1.05       1.05 6  

Net investment income (loss)

    (0.35) 6       (0.17)       0.04       0.30       0.05       0.60 6  
Portfolio turnover rate     8     25     20     16     17     17 %9  

 

1 

Per share amounts have been calculated using the average shares method.

 

2 

For the six months ended June 30, 2021 (unaudited).

 

3 

For the period October 31, 2016 (inception date) to December 31, 2016.

 

4 

Performance figures may reflect compensating balance arrangements, fee waivers and/or expense reimbursements. In the absence of compensating balance
arrangements, fee waivers and/or expense reimbursements, the total return would have been lower. Total returns do not reflect expenses associated with separate accounts such as administrative fees, account charges and surrender charges which, if
reflected, would reduce the total return for all periods shown. Past performance is no guarantee of future results. Total returns for periods of less than one year are not annualized.

 

5 

The total return includes gains from settlement of security litigations. Without these gains, the total return would have been
-0.36% for the year ended December 31, 2018.

 

 

7 

Reflects fee waivers and/or expense reimbursements.

 

8 

As a result of an expense limitation arrangement, the ratio of total annual fund operating expenses, other than interest, brokerage, taxes, extraordinary
expenses and acquired fund fees and expenses, to average net assets of Class II shares did not exceed 1.05%. This expense limitation arrangement cannot be terminated prior to December 31, 2022 without the Board of Trustees’ consent.
In addition, the manager has agreed to waive the Portfolio’s management fee to an extent sufficient to offset the net management fee payable in connection with any investment in an affiliated money market fund.

 

9 

For the year ended December 31, 2016.

 

See Notes to Financial Statements.

 

ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report  

 

11


Notes to financial statements (unaudited)

 

1. Organization and significant accounting policies

ClearBridge Variable Large Cap Growth Portfolio (the “Portfolio”) is a separate diversified investment series of Legg Mason Partners Variable Equity Trust (the “Trust”). The Trust, a Maryland
statutory trust, is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company.

Shares of the Portfolio may only be purchased or redeemed through variable annuity contracts and variable life insurance policies offered by the separate accounts
of participating insurance companies or through eligible pension or other qualified plans.

The following are significant accounting policies
consistently followed by the Portfolio and are in conformity with U.S. generally accepted accounting principles (“GAAP”). Estimates and assumptions are required to be made regarding assets, liabilities and changes in net assets resulting
from operations when financial statements are prepared. Changes in the economic environment, financial markets and any other parameters used in determining these estimates could cause actual results to differ. Subsequent events have been evaluated
through the date the financial statements were issued.

(a) Investment valuation.
Equity securities for which market quotations are available are valued at the last reported sales price or official closing price on the primary market or exchange on which they trade. The valuations for fixed income securities (which may include,
but are not limited to, corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and certain derivative instruments are typically the prices supplied by independent third party pricing
services, which may use market prices or broker/dealer quotations or a variety of valuation techniques and methodologies. The independent third party pricing services typically use inputs that are observable such as issuer details, interest rates,
yield curves, prepayment speeds, credit risks/spreads, default rates and quoted prices for similar securities. Investments in open-end funds are valued at the closing net asset value per share of each fund on
the day of valuation. When the Portfolio holds securities or other assets that are denominated in a foreign currency, the Portfolio will normally use the currency exchange rates as of 4:00 p.m. (Eastern Time). If independent third party pricing
services are unable to supply prices for a portfolio investment, or if the prices supplied are deemed by the manager to be unreliable, the market price may be determined by the manager using quotations from one or more broker/dealers or at the
transaction price if the security has recently been purchased and no value has yet been obtained from a pricing service or pricing broker. When reliable prices are not readily available, such as when the value of a security has been significantly
affected by events after the close of the exchange or market on which the security is principally traded, but before the Portfolio calculates its net asset value, the Portfolio values these securities as determined in accordance with procedures
approved by the Portfolio’s Board of Trustees.

The Board of Trustees is responsible for the valuation process and has delegated the supervision of
the daily valuation process to the Global Fund Valuation Committee (formerly

 

 

12

   ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report

known as Legg Mason North Atlantic Fund Valuation Committee prior to March 1, 2021) (the “Valuation
Committee”). The Valuation Committee, pursuant to the policies adopted by the Board of Trustees, is responsible for making fair value determinations, evaluating the effectiveness of the Portfolio’s pricing policies, and reporting to the
Board of Trustees. When determining the reliability of third party pricing information for investments owned by the Portfolio, the Valuation Committee, among other things, conducts due diligence reviews of pricing vendors, monitors the daily change
in prices and reviews transactions among market participants.

The Valuation Committee will consider pricing methodologies it deems relevant and
appropriate when making fair value determinations. Examples of possible methodologies include, but are not limited to, multiple of earnings; discount from market of a similar freely traded security; discounted cash-flow analysis; book value or a
multiple thereof; risk premium/yield analysis; yield to maturity; and/or fundamental investment analysis. The Valuation Committee will also consider factors it deems relevant and appropriate in light of the facts and circumstances. Examples of
possible factors include, but are not limited to, the type of security; the issuer’s financial statements; the purchase price of the security; the discount from market value of unrestricted securities of the same class at the time of purchase;
analysts’ research and observations from financial institutions; information regarding any transactions or offers with respect to the security; the existence of merger proposals or tender offers affecting the security; the price and extent of
public trading in similar securities of the issuer or comparable companies; and the existence of a shelf registration for restricted securities.

For
each portfolio security that has been fair valued pursuant to the policies adopted by the Board of Trustees, the fair value price is compared against the last available and next available market quotations. The Valuation Committee reviews the
results of such back testing monthly and fair valuation occurrences are reported to the Board of Trustees quarterly.

The Portfolio uses valuation
techniques to measure fair value that are consistent with the market approach and/or income approach, depending on the type of security and the particular circumstance. The market approach uses prices and other relevant information generated by
market transactions involving identical or comparable securities. The income approach uses valuation techniques to discount estimated future cash flows to present value.

 

ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report  

 

13


Notes to financial statements
(unaudited) (cont’d)

 

GAAP establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs
are summarized in the three broad levels listed below:

 

•  

Level 1 — quoted prices in active markets for identical investments

 

•  

Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

 

•  

Level 3 — significant unobservable inputs (including the Portfolio’s own assumptions in determining the fair value of investments)

The inputs or methodologies used to value securities are not necessarily an indication of the risk associated with investing in those
securities.

The following is a summary of the inputs used in valuing the Portfolio’s assets carried at fair value:

 

ASSETS  
Description  

Quoted Prices

(Level 1)

    Other Significant
Observable Inputs
(Level 2)
   

Significant
Unobservable
Inputs

(Level 3)

    Total  
Common Stocks†   $ 446,977,038       —       —     $ 446,977,038  
Short-Term Investments†     3,113,348       —       —       3,113,348  
Total Investments   $ 450,090,386       —       —     $ 450,090,386  

 

†  

See Schedule of Investments for additional detailed categorizations.

(b) Foreign currency translation. Investment securities and other assets and liabilities denominated in foreign currencies are translated into
U.S. dollar amounts based upon prevailing exchange rates on the date of valuation. Purchases and sales of investment securities and income and expense items denominated in foreign currencies are translated into U.S. dollar amounts based upon
prevailing exchange rates on the respective dates of such transactions.

The Portfolio does not isolate that portion of the results of operations
resulting from fluctuations in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments.

Net realized foreign exchange gains or losses arise from sales of foreign currencies, including gains and losses on forward foreign currency contracts,
currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Portfolio’s books and the U.S.
dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in

 

 

14

   ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report

the values of assets and liabilities, other than investments in securities, on the date of valuation, resulting from
changes in exchange rates.

Foreign security and currency transactions may involve certain considerations and risks not typically associated with those
of U.S. dollar denominated transactions as a result of, among other factors, the possibility of lower levels of governmental supervision and regulation of foreign securities markets and the possibility of political or economic instability.

(c) Foreign investment risks. The Portfolio’s investments in foreign
securities may involve risks not present in domestic investments. Since securities may be denominated in foreign currencies, may require settlement in foreign currencies or may pay interest or dividends in foreign currencies, changes in the
relationship of these foreign currencies to the U.S. dollar can significantly affect the value of the investments and earnings of the Portfolio. Foreign investments may also subject the Portfolio to foreign government exchange restrictions,
expropriation, taxation or other political, social or economic developments, all of which affect the market and/or credit risk of the investments.

(d) Security transactions and investment income. Security transactions are accounted for on a trade date basis. Interest income (including
interest income from payment-in-kind securities), adjusted for amortization of premium and accretion of discount, is recorded on the accrual basis. Dividend income is
recorded on the ex-dividend date for dividends received in cash and/or securities. Foreign dividend income is recorded on the ex-dividend date or as soon as practicable
after the Portfolio determines the existence of a dividend declaration after exercising reasonable due diligence. The cost of investments sold is determined by use of the specific identification method. To the extent any issuer defaults or a credit
event occurs that impacts the issuer, the Portfolio may halt any additional interest income accruals and consider the realizability of interest accrued up to the date of default or credit event.

(e) REIT distributions. The character of distributions received from Real Estate Investment
Trusts (‘‘REITs’’) held by the Portfolio is generally comprised of net investment income, capital gains, and return of capital. It is the policy of the Portfolio to estimate the character of distributions received from underlying
REITs based on historical data provided by the REITs. After each calendar year end, REITs report the actual tax character of these distributions. Differences between the estimated and actual amounts reported by the REITs are reflected in the
Portfolio’s records in the year in which they are reported by the REITs by adjusting related investment cost basis, capital gains and income, as necessary.

(f) Distributions to shareholders. Distributions from net investment income and distributions of net realized gains, if any, are declared at
least annually. Distributions to shareholders of the Portfolio are recorded on the ex-dividend date and are determined in accordance with income tax regulations, which may differ from GAAP.

 

ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report  

 

15


Notes to financial statements
(unaudited) (cont’d)

 

(g) Share class accounting. Investment income, common expenses and realized/ unrealized gains
(losses) on investments are allocated to the various classes of the Portfolio on the basis of daily net assets of each class. Fees relating to a specific class are charged directly to that share class.

(h) Compensating balance arrangements. The Portfolio has an arrangement with its custodian
bank whereby a portion of the custodian’s fees is paid indirectly by credits earned on the Portfolio’s cash on deposit with the bank.

(i) Federal and other taxes. It is the Portfolio’s policy to comply with the federal income and excise tax requirements of the Internal
Revenue Code of 1986 (the “Code”), as amended, applicable to regulated investment companies. Accordingly, the Portfolio intends to distribute its taxable income and net realized gains, if any, to shareholders in accordance with timing
requirements imposed by the Code. Therefore, no federal or state income tax provision is required in the Portfolio’s financial statements.

Management has analyzed the Portfolio’s tax positions taken on income tax returns for all open tax years and has concluded that as of December 31, 2020,
no provision for income tax is required in the Portfolio’s financial statements. The Portfolio’s federal and state income and federal excise tax returns for tax years for which the applicable statutes of limitations have not expired are
subject to examination by the Internal Revenue Service and state departments of revenue.

Under the applicable foreign tax laws, a withholding tax may be
imposed on interest, dividends and capital gains at various rates.

(j) Reclassification. GAAP requires that certain components of net assets be reclassified to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or net asset value per
share.

2. Investment management agreement and other transactions with affiliates

Legg Mason Partners Fund Advisor, LLC (“LMPFA”) is the Portfolio’s investment manager and ClearBridge Investments, LLC (“ClearBridge”) is
the Portfolio’s subadviser. Western Asset Management Company, LLC (“Western Asset”) manages the portion of the Portfolio’s cash and short-term instruments allocated to it. LMPFA, ClearBridge and Western Asset are indirect,
wholly-owned subsidiaries of Franklin Resources, Inc. (“Franklin Resources”).

 

 

16

   ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report

Under the investment management agreement, the Portfolio pays an investment management fee, calculated daily and paid
monthly, in accordance with the following breakpoint schedule:

 

Average Daily Net Assets      Annual Rate  
First $1 billion        0.700
Next $1 billion        0.680  
Next $3 billion        0.650  
Next $5 billion        0.600  
Over $10 billion        0.550  

LMPFA provides administrative and certain oversight services to the Portfolio. LMPFA delegates to the subadviser the day-to-day portfolio management of the Portfolio, except for the management of the portion of the Portfolio’s cash and short-term instruments allocated to Western Asset.
For its services, LMPFA pays ClearBridge a fee monthly, at an annual rate equal to 70% of the net management fee it receives from the Portfolio. For Western Asset’s services to the Fund, LMPFA pays Western Asset monthly 0.02% of the portion of
the Fund’s average daily net assets that are allocated to Western Asset by LMPFA.

As a result of expense limitation arrangements between the
Portfolio and LMPFA, the ratio of total annual fund operating expenses, other than interest, brokerage, taxes, extraordinary expenses and acquired fund fees and expenses, to average net assets of Class I and Class II shares did not exceed
0.80% and 1.05%, respectively. These expense limitation arrangements cannot be terminated prior to December 31, 2022 without the Board of Trustees’ consent. In addition, the manager has agreed to waive the Portfolio’s management fee
to an extent sufficient to offset the net management fee payable in connection with any investment in an affiliated money market fund (the “affiliated money market fund waiver”). The affiliated money market fund waiver is not subject to
the recapture provision discussed below.

During the six months ended June 30, 2021, fees waived and/or expenses reimbursed amounted to $61, all of
which was an affiliated money market fund waiver.

LMPFA is permitted to recapture amounts waived and/or reimbursed to a class during the same fiscal
year if the class’ total annual fund operating expenses have fallen to a level below the expense limitation (“expense cap”) in effect at the time the fees were earned or the expenses incurred. In no case will LMPFA recapture any
amount that would result, on any particular business day of the Portfolio, in the class’ total annual fund operating expenses exceeding the expense cap or any other lower limit then in effect.

Legg Mason Investor Services, LLC (“LMIS”) serves as the Portfolio’s sole and exclusive distributor. LMIS is an indirect, wholly-owned broker-dealer
subsidiary of Franklin Resources. As of July 7, 2021, LMIS was renamed Franklin Distributors, LLC.

 

ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report  

 

17


Notes to financial statements
(unaudited) (cont’d)

 

All officers and one Trustee of the Trust are employees of Franklin Resources or its affiliates and do not receive compensation from the Trust.

3. Investments

During the six months ended
June 30, 2021, the aggregate cost of purchases and proceeds from sales of investments (excluding short-term investments) were as follows:

 

Purchases      $ 32,523,808  
Sales        59,997,133  

At June 30, 2021, the aggregate cost of investments and the aggregate gross unrealized appreciation and depreciation of
investments for federal income tax purposes were substantially as follows:

 

      Cost     

Gross

Unrealized
Appreciation

     Gross
Unrealized
Depreciation
    

Net

Unrealized
Appreciation

 
Securities    $ 214,880,056      $ 235,593,220      $ (382,890)      $ 235,210,330  

4. Derivative instruments and hedging activities

During the six months ended June 30, 2021, the Portfolio did not invest in derivative instruments.

5. Class specific expenses, waivers and/or expense reimbursements

The Portfolio has adopted a Rule 12b-1 shareholder services and distribution plan and under that plan the Portfolio pays service and/or distribution fees with respect to its
Class II shares calculated at the annual rate of 0.25% of the average daily net assets of the class. Service and/or distribution fees are accrued daily and paid monthly.

For the six months ended June 30, 2021, class specific expenses were as follows:

 

        Service and/or
Distribution Fees
       Transfer Agent
Fees
 
Class I        —        $ 1,834  
Class II      $ 320,030          12,576  
Total      $ 320,030        $ 14,410  

For the six months ended June 30, 2021, waivers and/or expense reimbursements by class were as follows:

 

        Waivers/Expense
Reimbursements
 
Class I      $ 24  
Class II        37  
Total      $ 61  

 

 

18

   ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report

6. Distributions to shareholders by class

 

        Six Months Ended
June 30, 2021
       Year Ended
December 31, 2020
 
Net Investment Income:                      
Class I        —        $ 27,458  
Class II        —          37,543  
Total        —        $ 65,001  
Net Realized Gains:                      
Class I      $ 1,211,874        $ 6,289,209  
Class II        1,811,339          9,391,167  
Total      $ 3,023,213        $ 15,680,376  

7. Shares of beneficial interest

At June 30, 2021, the Trust had an unlimited number of shares of beneficial interest authorized with a par value of $0.00001 per share. The Portfolio has the ability to issue multiple classes of shares. Each
class of shares represents an identical interest and has the same rights, except that each class bears certain direct expenses, including those specifically related to the distribution of its shares.

Transactions in shares of each class were as follows:

 

     Six Months Ended
June 30,
2021
     Year Ended
December 31,
2020
 
      Shares      Amount      Shares      Amount  
Class I                                    
Shares sold      82,782      $ 3,222,868        308,380      $ 9,701,909  
Shares issued on reinvestment      29,536        1,211,874        176,036        6,316,667  
Shares repurchased      (334,591)        (13,012,530)        (950,783)        (30,552,570)  
Net decrease      (222,273)      $ (8,577,788)        (466,367)      $ (14,533,994)  
Class II                                    
Shares sold      504,269      $ 19,301,093        1,777,335      $ 55,414,437  
Shares issued on reinvestment      44,494        1,811,339        264,038        9,428,710  
Shares repurchased      (1,064,026)        (39,340,036)        (1,158,644)        (37,050,667)  
Net increase (decrease)      (515,263)      $ (18,227,604)        882,729      $ 27,792,480  

8. Transactions with affiliated company

As defined by the 1940 Act, an affiliated company is one in which the Portfolio owns 5% or more of the outstanding voting securities, or a company which is under common ownership or control with the Portfolio. The
following company was considered an affiliated company

 

ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report  

 

19


Notes to financial statements
(unaudited) (cont’d)

 

for all or some portion of the six months ended June 30, 2021. The following transactions were effected in such company for the six months ended June 30,
2021.

 

     Affiliate
Value at
December 31,
2020
     Purchased    Sold
      Cost      Shares    Cost      Shares
Western Asset Premier Institutional U.S. Treasury Reserves, Premium Shares    $ 1,184,960      $ 7,729,282      7,729,282    $ 8,291,572      8,291,572

 

(cont’d)    Realized
Gain (Loss)
     Interest
Income
     Net Increase
(Decrease) in
Unrealized
Appreciation
(Depreciation)
     Affiliate
Value at
June 30,
2021
 
Western Asset Premier Institutional U.S. Treasury Reserves, Premium Shares      —      $ 81        —      $ 622,670  

9. Recent accounting pronouncement

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the
Effects of Reference Rate Reform on Financial Reporting
(the “ASU”). The amendments in the ASU provide optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned
discontinuation of the London Interbank Offered Rate and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12,
2020 through December 31, 2022. Management has reviewed the requirements and believes the adoption of this ASU will not have a material impact on the financial statements.

10. Other matter

The outbreak of the respiratory illness
COVID-19 (commonly referred to as “coronavirus”) has continued to rapidly spread around the world, causing considerable uncertainty for the global economy and financial markets. The ultimate economic
fallout from the pandemic, and the long-term impact on economies, markets, industries and individual issuers, are not known. The COVID-19 pandemic could adversely affect the value and liquidity of the
Portfolio’s investments, impair the Portfolio’s ability to satisfy redemption requests, and negatively impact the Portfolio’s performance. In addition, the outbreak of COVID-19, and measures
taken to mitigate its effects, could result in disruptions to the services provided to the Portfolio by its service providers.

 

 

20

   ClearBridge Variable Large Cap Growth Portfolio 2021 Semi-Annual Report

Additional shareholder information (unaudited)

 

Results of special meeting of shareholders

A
special meeting of shareholders was held on June 15, 2021 for shareholders of record as of March 1, 2021 (the “Record Date”) to elect the Board of Trustees of the Trust.

Shareholders of the Portfolio and each other series of the Trust voted together as a single class to elect the Board.

Shareholders of the Trust voted as indicated below (vote totals are rounded to the nearest whole number). Effective July 1, 2021, the Board is composed of the
following Trustees:

 

Trustee    For      Withheld  
Paul R. Ades      5,981,348,834        244,899,549  
Andrew L. Breech      6,002,179,542        224,068,841  
Althea L. Duersten      5,992,166,375        234,082,008  
Stephen R. Gross      5,985,107,528        241,140,855  
Susan M. Heilbron      5,972,898,124        253,350,259  
Howard J. Johnson      5,972,990,414        253,257,968  
Arnold L. Lehman      5,981,237,869        245,010,514  
Robin J.W. Masters      6,004,137,733        222,110,650  
Jerome H. Miller      5,985,092,839        241,155,543  
Ken Miller      5,977,795,002        248,453,381  
G. Peter O’Brien      5,988,225,486        238,022,897  
Thomas F. Schlafly      5,980,117,822        246,130,561  
Jane E. Trust      6,008,081,612        218,166,771  

The above Trustees have also been elected to serve as board members of other mutual funds within the Franklin Templeton fund
complex.

 

 

ClearBridge Variable Large Cap Growth Portfolio  

 

21


ClearBridge

Variable Large Cap Growth Portfolio

 

Trustees*

Paul R. Ades

Andrew L. Breech

Althea L. Duersten**

Chair

Stephen R. Gross

Susan M. Heilbron

Howard J. Johnson

Arnold L. Lehman

Robin J. W. Masters

Jerome H. Miller

Ken Miller

G. Peter O’Brien

Thomas F. Schlafly

Jane Trust

Investment manager

Legg Mason Partners Fund Advisor, LLC

Subadviser

ClearBridge Investments, LLC

Distributor

Franklin Distributors, LLC†

Custodian

The Bank of New York Mellon

Transfer agent

BNY Mellon
Investment

Servicing (US) Inc.

4400 Computer Drive

Westborough, MA 01581

Independent
registered public accounting firm

PricewaterhouseCoopers LLP

Baltimore, MD

 

* 

During a June 15, 2021 special meeting of shareholders, a new group of Trustees were elected to oversee the mutual funds of Legg Mason Global Asset
Management Trust, Legg Mason Partners Equity Trust and Legg Mason Partners Variable Equity Trust, effective July 1, 2021.

 

** 

Effective January 1, 2021, Ms. Duersten became Chair.

 

† 

Effective July 7, 2021, LMIS was renamed Franklin Distributors, LLC.

ClearBridge Variable Large Cap Growth Portfolio

The Portfolio is a separate investment series
of Legg Mason Partners Variable Equity Trust, a Maryland statutory trust.

 

ClearBridge Variable Large Cap Growth Portfolio

Legg Mason Funds

620 Eighth Avenue, 47th Floor

New York, NY 10018

The Portfolio files its complete schedule of
portfolio holdings with the Securities and Exchange Commission (“SEC”) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Portfolio’s Forms N-PORT are available on the SEC’s website at www.sec.gov. To obtain information on Form N-PORT, shareholders can call the Portfolio at 1-877-721-1926.

Information on how the Portfolio voted proxies relating
to portfolio securities during the prior 12-month period ended June 30th of each year and a description of the policies and procedures that the Portfolio uses to determine how to vote proxies related to
portfolio transactions are available (1) without charge, upon request, by calling the Portfolio at 1-877-721-1926, (2) at
www.leggmason.com/variablefunds and (3) on the SEC’s website at www.sec.gov.

 

This report is submitted for the general information of the shareholders of ClearBridge Variable Large Cap Growth Portfolio. This report is not authorized for distribution to prospective investors in the Portfolio
unless preceded or accompanied by a current prospectus.

Investors should consider the Portfolio’s investment objectives, risks, charges and
expenses carefully before investing. The prospectus contains this and other important information about the Portfolio. Please read the prospectus carefully before investing.

www.leggmason.com

© 2021 Franklin Distributors, LLC,

Member FINRA/SIPC. All rights reserved.


Legg Mason Funds Privacy and Security Notice

 

Your Privacy and the Security of Your Personal Information is Very Important to the Legg Mason Funds

This Privacy and Security Notice (the “Privacy Notice”) addresses the Legg Mason Funds’ privacy and data protection practices with respect to
nonpublic personal information the Funds receive. The Legg Mason Funds include any funds sold by the Funds’ distributor, Franklin Distributors, LLC, as well as Legg Mason-sponsored closed-end funds. The
provisions of this Privacy Notice apply to your information both while you are a shareholder and after you are no longer invested with the Funds.

The Type of Nonpublic Personal Information the Funds Collect About You

The Funds collect and
maintain nonpublic personal information about you in connection with your shareholder account. Such information may include, but is not limited to:

 

•  

Personal information included on applications or other forms;

 

•  

Account balances, transactions, and mutual fund holdings and positions;

 

•  

Bank account information, legal documents, and identity verification documentation;

 

•  

Online account access user IDs, passwords, security challenge question responses; and

 

•  

Information received from consumer reporting agencies regarding credit history and creditworthiness (such as the amount of an individual’s total debt,
payment history, etc.).

How the Funds Use Nonpublic Personal Information About You

The Funds do not sell or share your nonpublic personal information with third parties or with affiliates for their marketing purposes, or with other financial
institutions or affiliates for joint marketing purposes, unless you have authorized the Funds to do so. The Funds do not disclose any nonpublic personal information about you except as may be required to perform transactions or services you have
authorized or as permitted or required by law.

The Funds may disclose information about you to:

 

•  

Employees, agents, and affiliates on a “need to know” basis to enable the Funds to conduct ordinary business, or to comply with obligations to
government regulators;

 

•  

Service providers, including the Funds’ affiliates, who assist the Funds as part of the ordinary course of business (such as printing, mailing services, or
processing or servicing your account with us) or otherwise perform services on the Funds’ behalf, including companies that may perform statistical analysis, market research and marketing services solely for the Funds;

 

•  

Permit access to transfer, whether in the United States or countries outside of the United States to such Funds’ employees, agents and affiliates and
service providers as required to enable the Funds to conduct ordinary business, or to comply with obligations to government regulators;

 

•  

The Funds’ representatives such as legal counsel, accountants and auditors to enable the Funds to conduct ordinary business, or to comply with obligations
to government regulators;

 

•  

Fiduciaries or representatives acting on your behalf, such as an IRA custodian or trustee of a grantor trust.

 

NOT PART OF THE 
SEMI-ANNUAL REPORT

Legg Mason Funds Privacy and Security Notice (cont’d)

 

Except as otherwise permitted by applicable law, companies acting on the Funds’
behalf, including those outside the United States, are contractually obligated to keep nonpublic personal information the Funds provide to them confidential and to use the information the Funds share only to provide the services the Funds ask them
to perform. The Funds may disclose nonpublic personal information about you when necessary to enforce their rights or protect against fraud, or as permitted or required by applicable law, such as in connection with a law enforcement or regulatory
request, subpoena, or similar legal process. In the event of a corporate action or in the event a Fund service provider changes, the Funds may be required to disclose your nonpublic personal information to third parties. While it is the Funds’
practice to obtain protections for disclosed information in these types of transactions, the Funds cannot guarantee their privacy policy will remain unchanged.

Keeping You Informed of the Funds’ Privacy and Security Practices

The Funds will notify
you annually of their privacy policy as required by federal law. While the Funds reserve the right to modify this policy at any time they will notify you promptly if this privacy policy changes.

The Funds’ Security Practices

The
Funds maintain appropriate physical, electronic and procedural safeguards designed to guard your nonpublic personal information. The Funds’ internal data security policies restrict access to your nonpublic personal information to authorized
employees, who may use your nonpublic personal information for Fund business purposes only.

Although the Funds strive to protect your nonpublic personal
information, they cannot ensure or warrant the security of any information you provide or transmit to them, and you do so at your own risk. In the event of a breach of the confidentiality or security of your nonpublic personal information, the Funds
will attempt to notify you as necessary, so you can take appropriate protective steps. If you have consented to the Funds using electronic communications or electronic delivery of statements, they may notify you under such circumstances using the
most current email address you have on record with them.

In order for the Funds to provide effective service to you, keeping your account information
accurate is very important. If you believe that your account information is incomplete, not accurate or not current, if you have questions about the Funds’ privacy practices, or our use of your nonpublic personal information, write the Funds
using the contact information on your account statements, email the Funds by clicking on the Contact Us section of the Funds’ website at www.leggmason.com, or contact the Fund at
1-877-721-1926.

Revised April
2018

Legg Mason California Consumer Privacy Act Policy

Although much of the personal information we collect is “nonpublic personal information” subject to federal law, residents of California may, in certain circumstances, have additional rights under the
California Consumer Privacy Act (“CCPA”). For example, if you are a broker,

 

NOT PART OF THE 
SEMI-ANNUAL REPORT

Legg Mason Funds Privacy and Security Notice (cont’d)

 

dealer, agent, fiduciary, or representative acting by or on behalf of, or for, the
account of any other person(s) or household, or a financial advisor, or if you have otherwise provided personal information to us separate from the relationship we have with personal investors, the provisions of this Privacy Policy apply to your
personal information (as defined by the CCPA).

 

•  

In addition to the provisions of the Legg Mason Funds Security and Privacy Notice, you may have the right to know the categories and specific pieces of personal
information we have collected about you.

 

•  

You also have the right to request the deletion of the personal information collected or maintained by the Funds.

If you wish to exercise any of the rights you have in respect of your personal information, you should advise the Funds by contacting them as set forth below. The
rights noted above are subject to our other legal and regulatory obligations and any exemptions under the CCPA. You may designate an authorized agent to make a rights request on your behalf, subject to the identification process described below. We
do not discriminate based on requests for information related to our use of your personal information, and you have the right not to receive discriminatory treatment related to the exercise of your privacy rights.

We may request information from you in order to verify your identity or authority in making such a request. If you have appointed an authorized agent to make a
request on your behalf, or you are an authorized agent making such a request (such as a power of attorney or other written permission), this process may include providing a password/passcode, a copy of government issued identification, affidavit or
other applicable documentation, i.e. written permission. We may require you to verify your identity directly even when using an authorized agent, unless a power of attorney has been provided. We reserve the right to deny a request submitted by an
agent if suitable and appropriate proof is not provided.

For the 12-month period prior to the date of this
Privacy Policy, the Legg Mason Funds have not sold any of your personal information; nor do we have any plans to do so in the future.

Contact
Information

Address: Data Privacy Officer, 100 International Dr., Baltimore, MD 21202

Email: [email protected]

Phone:
1-800-396-4748

Revised
October 2020

 

NOT PART OF THE 
SEMI-ANNUAL REPORT

    

    

www.leggmason.com

© 2021 Franklin Distributors, LLC, Member FINRA/SIPC. All rights reserved.

FD04226 8/21 SR21-4202


Not applicable.

 

ITEM 3.

AUDIT COMMITTEE FINANCIAL EXPERT.

Not applicable.

 

ITEM 4.

PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Not applicable.

 

ITEM 5.

AUDIT COMMITTEE OF LISTED REGISTRANTS.

Not applicable.

 

ITEM 6.

SCHEDULE OF INVESTMENTS.

Included herein under Item 1.

 

ITEM 7.

DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

 

ITEM 8.

PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

 

ITEM 9.

PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.

Not applicable.

 

ITEM 10.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

Not applicable.

 

ITEM 11.

CONTROLS AND PROCEDURES.

 

  (a)

The registrant’s principal executive officer and principal financial officer have concluded that the
registrant’s disclosure controls and procedures (as defined in Rule 30a- 3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of
the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the disclosure controls and procedures required by Rule 30a-3(b) under the 1940 Act and 15d-15(b) under the Securities Exchange Act of 1934.

 

  (b)

There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are 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

 

(a) (1) Not applicable.

Exhibit 
99.CODE ETH

(a) (2) 
Certifications pursuant to section 302 of the Sarbanes-Oxley Act of 2002 attached hereto.

Exhibit 99.CERT

(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 attached hereto.

Exhibit 99.906CERT


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this
Report to be signed on its behalf by the undersigned, there unto duly authorized.

 

Legg Mason Partners Variable Equity Trust
By:  

/s/ Jane Trust

  Jane Trust
  Chief Executive Officer
Date:   August 17, 2021

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940,
this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

By:  

/s/ Jane Trust

  Jane Trust
  Chief Executive Officer
Date:   August 17, 2021
By:  

/s/ Christopher Berarducci

  Christopher Berarducci
  Principal Financial Officer
Date:   August 17, 2021

CERTIFICATIONS PURSUANT TO SECTION 302

EX-99.CERT

CERTIFICATIONS

I, Jane Trust, certify that:

 

1.

I have reviewed this report on Form N-CSR of Legg Mason Partners
Variable Equity Trust – ClearBridge Variable Large Cap Growth Portfolio;

 

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report,
fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the
periods presented in this report;

 

4.

The registrant’s other certifying officers and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule
30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

 

  a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be
designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is
being prepared;

 

  b)

Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles;