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 811-21423
The Gabelli Dividend & Income Trust
(Exact name of registrant as specified in charter)
One Corporate Center
Rye, New York 10580-1422
(Address of principal executive offices) (Zip code)
Bruce N. Alpert
Gabelli Funds, LLC
One Corporate Center
Rye, New York 10580-1422
(Name and address of agent for service)
Registrant’s telephone number, including area code: 1-800-422-3554
Date of fiscal year end: December 31
Date of reporting period: June 30, 2014
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Reports to Stockholders.
The Report to Shareholders is attached herewith.
The Gabelli Dividend & Income Trust
Semiannual Report — June 30, 2014
(Y)our Portfolio Management Team
To Our Shareholders,
For six months ended June 30, 2014, the net asset value (“NAV”) total return of The Gabelli Dividend & Income Trust (the “Fund”) was 8.6%, compared with a total return of 7.1% for the Standard & Poor’s (“S&P”) 500 Index. The total return for the Fund’s publicly traded shares was 7.0%. The Fund’s NAV per share was $24.44, while the price of the publicly traded shares closed at $21.90 on the New York Stock Exchange (“NYSE”). See below for additional performance information.
Enclosed are the schedule of investments and financial statements as of June 30, 2014.
Comparative Results
| Average Annual Returns through June 30, 2014 (a) (Unaudited) | Since Inception (11/28/03) |
|||||||||||||||||||
| Year to Date | 1 Year |
5 Year |
10 Year |
|||||||||||||||||
| Gabelli Dividend & Income Trust |
||||||||||||||||||||
| NAV Total Return (b) |
8.62% | 26.88% | 21.82% | 9.50% | 9.21% | |||||||||||||||
| Investment Total Return (c) |
7.03 | 26.11 | 24.90 | 10.28 | 8.56 | |||||||||||||||
| S&P 500 Index |
7.14 | 24.61 | 18.83 | 7.78 | 8.20 | |||||||||||||||
| Dow Jones Industrial Average |
2.66 | 15.46 | 17.76 | 7.62 | 7.96(d) | |||||||||||||||
| Nasdaq Composite Index |
6.18 | 30.98 | 20.57 | 9.20 | 9.16 | |||||||||||||||
| (a) |
Returns represent past performance and do not guarantee future results. Investment returns and the principal value of an investment will fluctuate. When shares are sold, they may be worth more or less than their original cost. Current performance may be lower or higher than the performance data presented. Visit www.gabelli.com for performance information as of the most recent month end. Performance returns for periods of less than one year are not annualized. Investors should carefully consider the investment objectives, risks, charges, and expenses of the Fund before investing. The Dow Jones Industrial Average is an unmanaged index of 30 large capitalization stocks. The S&P 500 and the Nasdaq Composite Indices are unmanaged indicators of stock market performance. Dividends are considered reinvested except for the Nasdaq Composite Index. You cannot invest directly in an index. | |
| (b) |
Total returns and average annual returns reflect changes in the NAV per share and reinvestment of distributions at NAV on the ex-dividend date and are net of expenses. Since inception return is based on an initial NAV of $19.06. | |
| (c) |
Total returns and average annual returns reflect changes in closing market values on the NYSE and reinvestment of distributions. Since inception return is based on an initial offering price of $20.00. | |
| (d) |
From November 30, 2003, the date closest to the Fund’s inception for which data is available. |
The Gabelli Global Small and Mid Cap Value Trust
Semiannual Report — June 30, 2014
(Y)our Portfolio Management Team
To Our Shareholders,
For the period June 23, 2014 through June 30, 2014, the net asset value (“NAV”) total return of The Gabelli Global Small and Mid Cap Trust (the “Fund” or “Global Trust”) was 0.1%, compared with a total return of 0.4% for the Morgan Stanley Capital International (“MSCI”) World SMID Cap Index. The total return for the Fund’s publicly traded shares was (10.2)%. The Fund’s NAV per share was $12.01, while the price of the publicly traded shares closed at $10.78 on the New York Stock Exchange (“NYSE”). See below for additional performance information.
Enclosed are the schedule of investments and financial statements as of June 30, 2014.
Comparative Results
| Average Annual Returns through June 30, 2014 (a) (Unaudited) | Since | |||||
| Inception (06/23/14) |
||||||
| Gabelli Global Small and Mid Cap Value Trust |
||||||
| NAV Total Return (b) |
0.08% | |||||
| Investment Total Return (c) |
(10.17) | |||||
|
MSCI World SMID Cap Index |
0.41 | |||||
| (a) |
Returns represent past performance and do not guarantee future results. Investment returns and the principal value of an investment will fluctuate. When shares are sold, they may be worth more or less than their original cost. Current performance may be lower or higher than the performance data presented. Visit www.gabelli.com for performance information as of the most recent month end. Performance returns for periods of less than one year are not annualized. Investors should carefully consider the investment objectives, risks, charges, and expenses of the Fund before investing. The MSCI World SMID Cap Index captures mid and small cap representation across 23 developed markets. Dividends are considered reinvested. You cannot invest directly in an index. | |
| (b) |
Total returns reflect changes in the NAV per share. Since inception return is based on an initial NAV of $12.00. | |
| (c) |
Total returns reflect changes in closing market values on the NYSE. Since inception return is based on an initial offering price of $12.00. |
Summary of Portfolio Holdings (Unaudited)
The following table presents portfolio holdings as a percent of total investments as of June 30, 2014:
The Gabelli Dividend & Income Trust
3
Summary of Portfolio Holdings (Unaudited)
The following table presents portfolio holdings as a percent of total investments as of June 30, 2014:
The Gabelli Global Small and Mid Cap Value Trust
4
The Gabelli Dividend & Income Trust
Schedule of Investments — June 30, 2014 (Unaudited)
See accompanying notes to financial statements.
5
The Gabelli Dividend & Income Trust
Schedule of Investments (Continued) — June 30, 2014 (Unaudited)
See accompanying notes to financial statements.
6
The Gabelli Dividend & Income Trust
Schedule of Investments (Continued) — June 30, 2014 (Unaudited)
See accompanying notes to financial statements.
7
The Gabelli Dividend & Income Trust
Schedule of Investments (Continued) — June 30, 2014 (Unaudited)
See accompanying notes to financial statements.
8
The Gabelli Dividend & Income Trust
Schedule of Investments (Continued) — June 30, 2014 (Unaudited)
See accompanying notes to financial statements.
9
The Gabelli Dividend & Income Trust
Schedule of Investments (Continued) — June 30, 2014 (Unaudited)
See accompanying notes to financial statements.
10
The Gabelli Dividend & Income Trust
Schedule of Investments (Continued) — June 30, 2014 (Unaudited)
See accompanying notes to financial statements.
11
The Gabelli Global Small and Mid Cap Value Trust
Schedule of Investments — June 30, 2014 (Unaudited)
See accompanying notes to financial statements.
12
The Gabelli Global Small and Mid Cap Value Trust
Schedule of Investments (Continued) — June 30, 2014 (Unaudited)
See accompanying notes to financial statements.
13
The Gabelli Global Small and Mid Cap Value Trust
Schedule of Investments (Continued) — June 30, 2014 (Unaudited)
See accompanying notes to financial statements.
14
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Statements of Assets and Liabilities
June 30, 2014 (Unaudited)
| The Gabelli Dividend & Income Trust |
The Gabelli Global Small and Mid Cap Value Trust |
|||||||
| Assets: |
||||||||
| Investments, at value (cost $1,608,964,181 and $105,076,584, respectively) |
$2,485,303,070 | $105,211,328 | ||||||
| Cash |
4,554 | — | ||||||
| Receivable for investments sold |
896,308 | — | ||||||
| Dividends and interest receivable |
4,250,974 | 2,674 | ||||||
| Deferred offering expense |
145,829 | — | ||||||
| Prepaid expenses |
17,880 | — | ||||||
| Total Assets |
2,490,618,615 | 105,214,002 | ||||||
|
Liabilities: |
||||||||
| Payable to custodian |
— | 54,085 | ||||||
| Distributions payable |
203,241 | — | ||||||
| Payable for Fund shares repurchased |
— | 69,621 | ||||||
| Payable for investments purchased |
511,738 | 5,692,479 | ||||||
| Payable for investment advisory fees |
3,988,380 | 19,051 | ||||||
| Payable for payroll expenses |
128,843 | 581 | ||||||
| Payable for accounting fees |
11,250 | 1,000 | ||||||
| Payable for auction agent fees |
2,840,609 | — | ||||||
| Payable for spin-off expenses |
302,679 | — | ||||||
| Other accrued expenses |
256,078 | 8,722 | ||||||
| Total Liabilities |
8,242,818 | 5,845,539 | ||||||
|
Cumulative Preferred Shares: |
||||||||
| Series A Preferred Shares (5.875%, $25 liquidation value, $0.001 par value, 3,200,000 shares authorized with 3,048,019 shares issued and outstanding) |
76,200,475 | |||||||
| Series B Preferred Shares (Auction Market, $25,000 liquidation value, $0.001 par value, 4,000 shares authorized with 3,600 shares issued and outstanding) |
90,000,000 | |||||||
| Series C Preferred Shares (Auction Market, $25,000 liquidation value, $0.001 par value, 4,800 shares authorized with 4,320 shares issued and outstanding) |
108,000,000 | |||||||
| Series D Preferred Shares (6.000%, $25 liquidation value, $0.001 par value, 2,600,000 shares authorized with 2,542,296 shares issued and outstanding) |
63,557,400 | |||||||
| Series E Preferred Shares (Auction Rate, $25,000 liquidation value, $0.001 par value, 5,400 shares authorized with 4,860 shares issued and outstanding) |
121,500,000 | |||||||
| Total Preferred Shares |
459,257,875 | |||||||
| Net Assets Attributable to Common Shareholders |
$2,023,117,922 | $ 99,368,463 | ||||||
|
Net Assets Attributable to Common Shareholders Consist of: |
||||||||
| Paid-in capital |
$1,159,071,010 | $ 99,259,752 | ||||||
| Accumulated net investment income/(loss) |
2,610,695 | (25,991 | ) | |||||
| Accumulated net realized loss on investments and foreign currency transactions |
(14,907,330 | ) | (53 | ) | ||||
| Net unrealized appreciation on investments |
876,338,889 | 134,744 | ||||||
| Net unrealized appreciation on foreign currency translations |
4,658 | 11 | ||||||
| Net Assets |
$2,023,117,922 | $ 99,368,463 | ||||||
|
Net Asset Value per Common Share: |
||||||||
| Net Assets |
$2,023,117,922 | $ 99,368,463 | ||||||
| Shares outstanding ($0.001 par value; unlimited number of shares authorized) |
82,774,478 | 8,271,048 | ||||||
| Net Asset Value per Common Share |
$24.44 | $12.01 | ||||||
See accompanying notes to financial statements.
15
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Statements of Operations
| The Gabelli Dividend & Income Trust For the Six Months Ended June 30, 2014 (Unaudited) |
The Gabelli Global Small and Mid Cap Value Trust For the Period Ended June 30, 2014 (Unaudited)(a) | |||||||||
| Investment Income: |
||||||||||
| Dividends (net of foreign withholding taxes of $894,357 and $400, respectively) |
$ | 36,225,815 | $ | 2,663 | ||||||
| Interest |
259,872 | 696 | ||||||||
|
|
|
|
|
|||||||
| Total Investment Income |
36,485,687 | 3,359 | ||||||||
|
|
|
|
|
|||||||
|
Expenses: |
||||||||||
| Investment advisory fees |
12,211,678 | 19,051 | ||||||||
| Global Trust spin-off expenses |
700,000 | — | ||||||||
| Shareholder communications expenses |
196,179 | 4,255 | ||||||||
| Custodian fees |
145,692 | 638 | ||||||||
| Trustees’ fees |
124,078 | 953 | ||||||||
| Payroll expenses |
96,487 | 581 | ||||||||
| Legal and audit fees |
46,751 | 1,422 | ||||||||
| Shareholder services fees |
22,789 | 733 | ||||||||
| Accounting fees |
22,500 | 1,000 | ||||||||
| Interest expense |
2,150 | — | ||||||||
| Miscellaneous expenses |
145,349 | 717 | ||||||||
|
|
|
|
|
|||||||
| Total Expenses |
13,713,653 | 29,350 | ||||||||
|
|
|
|
|
|||||||
| Net Investment Income/(Loss) |
22,772,034 | (25,991 | ) | |||||||
|
|
|
|
|
|||||||
|
Net Realized and Unrealized Gain/(Loss) on Investments and Foreign Currency: |
||||||||||
| Net realized gain/(loss) on investments |
78,533,852 | (43 | ) | |||||||
| Net realized loss on foreign currency transactions |
(39,735 | ) | (10 | ) | ||||||
|
|
|
|
|
|||||||
| Net realized gain/(loss) on investments and foreign currency transactions |
78,494,117 | (53 | ) | |||||||
|
|
|
|
|
|||||||
|
Net change in unrealized appreciation: |
||||||||||
| on investments |
75,305,099 | 134,744 | ||||||||
| on foreign currency translations |
6,184 | 11 | ||||||||
|
|
|
|
|
|||||||
| Net change in unrealized appreciation on investments and foreign currency translations |
75,311,283 | 134,755 | ||||||||
|
|
|
|
|
|||||||
|
Net Realized and Unrealized Gain/(Loss) on Investments and Foreign Currency |
153,805,400 | 134,702 | ||||||||
|
|
|
|
|
|||||||
| Net Increase in Net Assets Resulting from Operations |
176,577,434 | 108,711 | ||||||||
|
|
|
|
|
|||||||
| Total Distributions to Preferred Shareholders |
(7,337,557 | ) | — | |||||||
|
|
|
|
|
|||||||
| Net Increase in Net Assets Attributable to Common Shareholders Resulting from Operations |
$ | 169,239,877 | $ | 108,711 | ||||||
|
|
|
|
|
|||||||
| (a) | The Gabelli Global Small and Mid Cap Value Trust commenced investment operations on June 23, 2014. |
See accompanying notes to financial statements.
16
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Statements of Changes in Net Assets Attributable to Common Shareholders
| The Gabelli Dividend & Income Trust | The Gabelli Global Small and Mid Cap Value Trust | ||||||||||||||
| Six Months Ended June 30, 2014 (Unaudited) |
Year Ended December 31, 2013 |
Period Ended June 30, 2014 (Unaudited)(a) | |||||||||||||
| Operations: |
|||||||||||||||
| Net investment income/(loss) |
$ | 22,772,034 | $ | 29,739,500 | $ | (25,991 | ) | ||||||||
| Net realized gain/(loss) on investments and foreign currency transactions |
78,494,117 | 174,857,302 | (53 | ) | |||||||||||
| Net change in unrealized appreciation on investments and foreign currency translations |
75,311,283 | 359,066,285 | 134,755 | ||||||||||||
|
|
|
|
|
|
|
||||||||||
| Net Increase in Net Assets Resulting from Operations |
176,577,434 | 563,663,087 | 108,711 | ||||||||||||
|
|
|
|
|
|
|
||||||||||
| Distributions to Preferred Shareholders: |
|||||||||||||||
| Net investment income |
(1,784,103 | )* | (4,483,368 | ) | — | ||||||||||
| Net realized capital gain |
(5,553,454 | )* | (10,402,917 | ) | — | ||||||||||
|
|
|
|
|
|
|
||||||||||
| Total Distributions to Preferred Shareholders |
(7,337,557 | ) | (14,886,285 | ) | — | ||||||||||
|
|
|
|
|
|
|
||||||||||
| Net Increase in Net Assets Attributable to Common Shareholders Resulting from Operations |
169,239,877 | 548,776,802 | 108,711 | ||||||||||||
|
|
|
|
|
|
|
||||||||||
| Distributions to Common Shareholders: |
|||||||||||||||
| Net investment Income |
(20,627,400 | )* | (25,687,928 | ) | — | ||||||||||
| Net realized capital gain |
(69,249,128 | )* | (59,607,256 | ) | — | ||||||||||
| Return of capital |
(57,462,042 | )* | — | — | |||||||||||
|
|
|
|
|
|
|
||||||||||
| Total Distributions to Common Shareholders |
(147,338,570 | ) | (85,295,184 | ) | — | ||||||||||
|
|
|
|
|
|
|
||||||||||
| Fund Share Transactions: |
|||||||||||||||
| Net increase in net assets from common shares issued in offering |
— | — | 99,329,373 | ||||||||||||
| Net decrease from repurchase of common shares |
— | (1,064,150 | ) | (69,621 | ) | ||||||||||
|
|
|
|
|
|
|
||||||||||
| Net Increase/(Decrease) in Net Assets from Fund Share Transactions |
— | (1,064,150 | ) | 99,259,752 | |||||||||||
|
|
|
|
|
|
|
||||||||||
| Net Increase in Net Assets Attributable to Common Shareholders |
21,901,307 | 462,417,468 | 99,368,463 | ||||||||||||
| Net Assets Attributable to Common Shareholders: |
|||||||||||||||
| Beginning of period |
2,001,216,615 | 1,538,799,147 | — | ||||||||||||
|
|
|
|
|
|
|
||||||||||
| End of period (including undistributed net investment income of $2,610,695, $2,250,164, and $0, respectively) |
$ | 2,023,117,922 | $ | 2,001,216,615 | $ | 99,368,463 | |||||||||
|
|
|
|
|
|
|
||||||||||
| * | Based on year to date book income. Amounts are subject to change and recharacterization at year end. |
| (a) | The Gabelli Global Small and Mid Cap Value Trust commenced investment operations on June 23, 2014. |
See accompanying notes to financial statements.
17
The Gabelli Dividend & Income Trust
Financial Highlights
Selected data for a share of beneficial interest outstanding throughout each period:
| Six Months Ended June 30, 2014 |
Year Ended December 31, | |||||||||||||||||||||||
| (Unaudited) | 2013 | 2012 | 2011 | 2010 | 2009 | |||||||||||||||||||
| Operating Performance: |
||||||||||||||||||||||||
| Net asset value, beginning of year |
$ 24.18 | $ 18.58 | $ 17.24 | $ 17.64 | $ 15.58 | $ 12.68 | ||||||||||||||||||
| Net investment income |
0.28 | 0.36 | 0.47 | 0.38 | 0.34 | 0.41 | ||||||||||||||||||
| Net realized and unrealized gain on investments, swap contracts, and foreign currency transactions |
1.85 | 6.45 | 2.00 | 0.28 | 2.63 | 3.64 | ||||||||||||||||||
| Total from investment operations |
2.13 | 6.81 | 2.47 | 0.66 | 2.97 | 4.05 | ||||||||||||||||||
| Distributions to Preferred Shareholders: (a) |
||||||||||||||||||||||||
| Net investment income |
(0.02 | )* | (0.05 | ) | (0.09 | ) | (0.11 | ) | (0.16 | ) | (0.16 | ) | ||||||||||||
| Net realized gain |
(0.07 | )* | (0.13 | ) | (0.08 | ) | (0.05 | ) | — | — | ||||||||||||||
| Total distributions to preferred shareholders |
(0.09 | ) | (0.18 | ) | (0.17 | ) | (0.16 | ) | (0.16 | ) | (0.16 | ) | ||||||||||||
| Net Increase in Net Assets Attributable to Common Shareholders Resulting from Operations |
2.04 | 6.63 | 2.30 | 0.50 | 2.81 | 3.89 | ||||||||||||||||||
| Distributions to Common Shareholders: |
||||||||||||||||||||||||
| Net investment income |
(0.25 | )* | (0.31 | ) | (0.37 | ) | (0.27 | ) | (0.16 | ) | (0.21 | ) | ||||||||||||
| Net realized gain on investments |
(0.84 | )* | (0.72 | ) | (0.31 | ) | (0.14 | ) | — | — | ||||||||||||||
| Return of capital |
(0.69 | )* | — | (0.28 | ) | (0.49 | ) | (0.60 | ) | (0.78 | ) | |||||||||||||
| Total distributions to common shareholders |
(1.78 | ) | (1.03 | ) | (0.96 | ) | (0.90 | ) | (0.76 | ) | (0.99 | ) | ||||||||||||
| Fund Share Transactions: |
||||||||||||||||||||||||
| Increase in net asset value from repurchase of common shares |
— | 0.00(b | ) | 0.00(b | ) | 0.00(b | ) | 0.01 | 0.00 | (b) | ||||||||||||||
| Increase in net asset value from repurchase of preferred shares |
— | — | — | — | — | 0.00 | (b) | |||||||||||||||||
| Total from Fund share transactions |
— | 0.00 | (b) | 0.00 | (b) | 0.00 | (b) | 0.01 | 0.00 | (b) | ||||||||||||||
| Net Asset Value Attributable to Common Shareholders, End of Period |
$ 24.44 | $ 24.18 | $ 18.58 | $ 17.24 | $ 17.64 | $ 15.58 | ||||||||||||||||||
| NAV total return † |
8.62 | % | 36.47 | % | 14.40 | % | 3.61 | % | 19.73 | % | 35.49 | % | ||||||||||||
| Market value, end of period |
$ 21.90 | $ 22.17 | $ 16.18 | $ 15.42 | $ 15.36 | $ 13.11 | ||||||||||||||||||
| Investment total return †† |
7.03 | % | 44.38 | % | 11.38 | % | 6.42 | % | 23.90 | % | 40.35 | % | ||||||||||||
| Ratios to Average Net Assets and Supplemental Data: |
||||||||||||||||||||||||
| Net assets including liquidation value of preferred shares, end of period (in 000’s) |
$2,482,375 | $2,460,474 | $1,998,057 | $1,888,654 | $1,924,427 | $1,759,526 | ||||||||||||||||||
| Net assets attributable to common shares, end of period (in 000’s) |
$2,023,118 | $2,001,217 | $1,538,799 | $1,429,397 | $1,465,169 | $1,300,268 | ||||||||||||||||||
| Ratio of net investment income to average net assets attributable to common shares before preferred share distributions |
2.29 | %(c) | 1.65 | % | 2.62 | % | 2.12 | % | 2.18 | % | 3.18 | % | ||||||||||||
| Ratio of operating expenses to average net assets attributable to common shares before fees waived |
1.38 | %(c) | 1.34 | % | 1.41 | % | 1.50 | % | 1.53 | % | 1.66 | % | ||||||||||||
| Ratio of operating expenses to average net assets attributable to common shares net of advisory fee reduction, if any |
1.38 | %(c) | 1.34 | % | 1.41 | % | 1.40 | % | 1.53 | % | 1.66 | % | ||||||||||||
| Ratio of operating expenses to average net assets including liquidation value of preferred shares before fees waived |
1.12 | %(c) | 1.07 | % | 1.08 | % | 1.14 | % | 1.14 | % | 1.16 | % | ||||||||||||
| Ratio of operating expenses to average net assets including liquidation value of preferred shares net of advisory fee reduction, if any |
1.12 | %(c) | 1.07 | % | 1.08 | % | 1.07 | % | 1.14 | % | 1.16 | % | ||||||||||||
| Portfolio turnover rate |
8.7 | % | 15.8 | % | 14.5 | % | 15.0 | % | 19.0 | % | 13.3 | % | ||||||||||||
See accompanying notes to financial statements.
18
The Gabelli Dividend & Income Trust
Financial Highlights (Continued)
Selected data for a share of beneficial interest outstanding throughout each period:
| Six Months Ended June 30, 2014 |
Year Ended December 31, | |||||||||||||||||||||||
| (Unaudited) | 2013 | 2012 | 2011 | 2010 | 2009 | |||||||||||||||||||
| 5.875% Series A Cumulative Preferred Shares |
||||||||||||||||||||||||
| Liquidation value, end of period (in 000’s) |
$ 76,200 | $ 76,200 | $ 76,200 | $ 76,200 | $ 76,201 | $ 76,201 | ||||||||||||||||||
| Total shares outstanding (in 000’s) |
3,048 | 3,048 | 3,048 | 3,048 | 3,048 | 3,048 | ||||||||||||||||||
| Liquidation preference per share |
$ 25.00 | $ 25.00 | $ 25.00 | $ 25.00 | $ 25.00 | $ 25.00 | ||||||||||||||||||
| Average market value (d) |
$ 25.18 | $ 25.31 | $ 25.72 | $ 25.30 | $ 24.98 | $ 23.34 | ||||||||||||||||||
| Asset coverage per share |
$ 135.13 | $ 133.94 | $ 108.77 | $ 102.81 | $ 104.76 | $ 95.78 | ||||||||||||||||||
| Series B Auction Market Cumulative Preferred Shares |
||||||||||||||||||||||||
| Liquidation value, end of period (in 000’s) |
$ 90,000 | $ 90,000 | $ 90,000 | $ 90,000 | $ 90,000 | $ 90,000 | ||||||||||||||||||
| Total shares outstanding (in 000’s) |
4 | 4 | 4 | 4 | 4 | 4 | ||||||||||||||||||
| Liquidation preference per share |
$ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | ||||||||||||||||||
| Liquidation value (e) |
$ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | ||||||||||||||||||
| Asset coverage per share |
$135,130 | $133,938 | $108,766 | $102,810 | $104,757 | $ 95,781 | ||||||||||||||||||
| Series C Auction Market Cumulative Preferred Shares |
||||||||||||||||||||||||
| Liquidation value, end of period (in 000’s) |
$108,000 | $108,000 | $108,000 | $108,000 | $108,000 | $108,000 | ||||||||||||||||||
| Total shares outstanding (in 000’s) |
4 | 4 | 4 | 4 | 4 | 4 | ||||||||||||||||||
| Liquidation preference per share |
$ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | ||||||||||||||||||
| Liquidation value (e) |
$ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | ||||||||||||||||||
| Asset coverage per share |
$135,130 | $133,938 | $108,766 | $102,810 | $104,757 | $ 95,781 | ||||||||||||||||||
| 6.000% Series D Cumulative Preferred Shares |
||||||||||||||||||||||||
| Liquidation value, end of period (in 000’s) |
$ 63,557 | $ 63,557 | $ 63,557 | $ 63,557 | $ 63,557 | $ 63,557 | ||||||||||||||||||
| Total shares outstanding (in 000’s) |
2,542 | 2,542 | 2,542 | 2,542 | 2,542 | 2,542 | ||||||||||||||||||
| Liquidation preference per share |
$ 25.00 | $ 25.00 | $ 25.00 | $ 25.00 | $ 25.00 | $ 25.00 | ||||||||||||||||||
| Average market value (d) |
$ 25.56 | $ 26.25 | $ 26.79 | $ 26.09 | $ 25.52 | $ 24.44 | ||||||||||||||||||
| Asset coverage per share |
$ 135.13 | $ 133.94 | $ 108.77 | $ 102.81 | $ 104.76 | $ 95.78 | ||||||||||||||||||
| Series E Auction Rate Cumulative Preferred Shares |
||||||||||||||||||||||||
| Liquidation value, end of period (in 000’s) |
$121,500 | $121,500 | $121,500 | $121,500 | $121,500 | $121,500 | ||||||||||||||||||
| Total shares outstanding (in 000’s) |
5 | 5 | 5 | 5 | 5 | 5 | ||||||||||||||||||
| Liquidation preference per share |
$ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | ||||||||||||||||||
| Liquidation value (e) |
$ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | $ 25,000 | ||||||||||||||||||
| Asset coverage per share |
$135,130 | $133,938 | $108,766 | $102,810 | $104,757 | $ 95,781 | ||||||||||||||||||
| Asset Coverage (f) |
541 | % | 536 | % | 435 | % | 411 | % | 419 | % | 383 | % | ||||||||||||
| † | For six months ended June 30, 2014 and the year ended 2013 based on net asset value per share and reinvestment of distributions at net asset value on the ex-dividend date. The years ended 2012, 2011, 2010, and 2009 were based on net asset value per share, adjusted for reinvestment of distributions at prices obtained under the Fund’s dividend reinvestment plan. Total return for a period of less than one year is not annualized. |
| †† | Based on market value per share, adjusted for reinvestment of distributions at prices obtained under the Fund’s dividend reinvestment plan. Total return for a period of less than one year is not annualized. |
| * | Based on year to date book income. Amounts are subject to change and recharacterization at year end. |
| (a) | Calculated based upon average common shares outstanding on the record dates throughout the period. |
| (b) | Amount represents less than $0.005 per share. |
| (c) | Annualized. |
| (d) | Based on weekly prices. |
| (e) | Since February 2008, the weekly auctions have failed. Holders that have submitted orders have not been able to sell any or all of their shares in the auction. |
| (f) | Asset coverage is calculated by combining all series of preferred shares. |
See accompanying notes to financial statements.
19
The Gabelli Global Small and Mid Cap Value Trust
Financial Highlights
Selected data for a share of beneficial interest outstanding throughout the period:
| Period Ended June 30, 2014(a) (Unaudited) |
||||
| Operating Performance: |
||||
| Net asset value, beginning of period |
$ 12.00 | |||
| Net investment loss |
(0.00 | )(b) | ||
| Net realized and unrealized gain on investments and foreign currency transactions |
0.01 | |||
| Total from investment operations |
0.01 | |||
| Net Increase in Net Assets Attributable to Common Shareholders Resulting from Operations |
0.01 | |||
| Fund Share Transactions: |
||||
| Increase in net asset value from repurchase of common shares |
0.00 | (b) | ||
| Total from Fund share transactions |
0.00 | (b) | ||
| Net Asset Value Attributable to Common Shareholders, End of Period |
$ 12.01 | |||
| NAV total return † |
0.08 | % | ||
| Market value, end of period |
$ 10.78 | |||
| Investment total return †† |
(10.17 | )% | ||
| Ratios to Average Net Assets and Supplemental Data: |
||||
| Net assets end of period (in 000’s) |
$99,368 | |||
| Ratio of net investment income to average net assets |
(1.36 | )%(c) | ||
| Ratio of operating expenses to average net assets |
1.54 | %(c) | ||
| Portfolio turnover rate |
0.0 | % | ||
| † | Based on net asset value per share. Total return for a period of less than one year is not annualized. |
| †† | Based on market value per share. Total return for a period of less than one year is not annualized. |
| (a) | The Gabelli Global Small and Mid Cap Value Trust commenced investment operations on June 23, 2014. |
| (b) | Amount represents less than $0.005 per share. |
| (c) | Annualized. |
See accompanying notes to financial statements.
20
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited)
1. Organization. The Gabelli Dividend & Income Trust (“Dividend Trust”) currently operates as a diversified closed-end management investment company organized as a Delaware statutory trust on November 18, 2003 and registered under the Investment Company Act of 1940, as amended (the “1940 Act”). Investment operations commenced on November 28, 2003.
Dividend Trust’s investment objective is to provide a high level of total return on its assets with an emphasis on dividends and income. Dividend Trust will attempt to achieve its investment objective by investing, under normal market conditions, at least 80% of its assets in dividend paying securities (such as common and preferred stock) or other income producing securities (such as fixed income debt securities and securities that are convertible into equity securities).
The Gabelli Global Small and Mid Cap Value Trust (“Global Trust”) is a diversified closed-end management investment company organized as a Delaware statutory trust on August 19, 2013 and registered under the 1940 Act. Investment operations commenced on June 23, 2014. Global Trust had no operations prior to June 23, 2014, other than matters relating to its organization and registration as a closed end management company under the 1940 Act, and the sale of 8,333 common shares for $100,000 on January 22, 2014 to Dividend Trust. On June 23, 2014, Dividend Trust contributed $99,229,373 in cash in exchange for 8,269,115 shares of Global Trust, and on the same date distributed such shares to the holders of record on June 16, 2014 at the rate of one common share of Global Trust for every ten common shares of Dividend Trust.
Global Trust’s investment objective is to seek long term growth of capital. Global Trust will attempt to achieve its investment objective by investing, under normal market conditions, at least 80% of its total assets in equity securities (such as common stock and preferred stock) of companies with small or medium sized market capitalizations (“small cap” and “mid cap” companies, respectively) and at least 40% of its total assets in the equity securities of companies located outside the U.S. and in at least three countries.
2. Significant Accounting Policies. Dividend Trust and Global Trust (each a “Fund”, collectively, the “Funds”) financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), which may require the use of management estimates and assumptions. Actual results could differ from those estimates. The following is a summary of significant accounting policies followed by the Funds in the preparation of its financial statements.
Security Valuation. Portfolio securities listed or traded on a nationally recognized securities exchange or traded in the U.S. over-the-counter market for which market quotations are readily available are valued at the last quoted sale price or a market’s official closing price as of the close of business on the day the securities are being valued. If there were no sales that day, the security is valued at the average of the closing bid and asked prices or, if there were no asked prices quoted on that day, then the security is valued at the closing bid price on that day. If no bid or asked prices are quoted on such day, the security is valued at the most recently available price or, if the Board of Trustees for Dividend Trust or the Board of Trustees for Global Trust (the “Board” or the “Boards”) so determines, by such other method as the Board shall determine in good faith to reflect its fair market value. Portfolio securities traded on more than one national securities exchange or market are valued according to the broadest and most representative market, as determined by Gabelli Funds, LLC (the “Adviser”).
21
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
Portfolio securities primarily traded on a foreign market are generally valued at the preceding closing values of such securities on the relevant market, but may be fair valued pursuant to procedures established by the Board if market conditions change significantly after the close of the foreign market, but prior to the close of business on the day the securities are being valued. Debt instruments with remaining maturities of sixty days or less that are not credit impaired are valued at amortized cost, unless the Board determines such amount does not reflect the securities’ fair value, in which case these securities will be fair valued as determined by the Board. Debt instruments having a maturity greater than sixty days for which market quotations are readily available are valued at the average of the latest bid and asked prices. If there were no asked prices quoted on such day, the security is valued using the closing bid price. U.S. government obligations with maturities greater than sixty days are normally valued using a model that incorporates market observable data such as reported sales of similar securities, broker quotes, yields, bids, offers, and reference data. Certain securities are valued principally using dealer quotations.
Securities and assets for which market quotations are not readily available are fair valued as determined by the Board. Fair valuation methodologies and procedures may include, but are not limited to: analysis and review of available financial and non-financial information about the company; comparisons with the valuation and changes in valuation of similar securities, including a comparison of foreign securities with the equivalent U.S. dollar value American Depositary Receipt securities at the close of the U.S. exchange; and evaluation of any other information that could be indicative of the value of the security.
The inputs and valuation techniques used to measure fair value of the Funds’ investments are summarized into three levels as described in the hierarchy below:
| — | Level 1 — quoted prices in active markets for identical securities; |
| — | Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.); and |
| — | Level 3 — significant unobservable inputs (including the Board’s determinations as to the fair value of investments). |
A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input both individually and in the aggregate that is significant to the fair value measurement. The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
22
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
The summary of Dividend Trust’s investments in securities by inputs used to value its investments as of June 30, 2014 is as follows:
| Dividend Trust | ||||||||||||||||
| Valuation Inputs | ||||||||||||||||
| Level 1 Quoted Prices |
Level 2 Other Significant Observable Inputs |
Level 3 Significant Unobservable Inputs |
Total Market Value at 6/30/14 |
|||||||||||||
| INVESTMENTS IN SECURITIES: |
||||||||||||||||
| ASSETS (Market Value): |
||||||||||||||||
| Common Stocks |
||||||||||||||||
| Aerospace |
$ 55,677,950 | — | $308,215 | $ 55,986,165 | ||||||||||||
| Energy and Utilities: Integrated |
78,773,824 | — | 68,670 | 78,842,494 | ||||||||||||
| Telecommunications |
105,342,084 | $ 1,045,040 | — | 106,387,124 | ||||||||||||
| Other Industries (a) |
2,158,651,424 | — | — | 2,158,651,424 | ||||||||||||
|
|
||||||||||||||||
| Total Common Stocks |
2,398,445,282 | 1,045,040 | 376,885 | 2,399,867,207 | ||||||||||||
|
|
||||||||||||||||
| Preferred Stocks (a) |
2,280,117 | — | — | 2,280,117 | ||||||||||||
| Convertible Preferred Stocks |
||||||||||||||||
| Financial Services |
— | — | 28,500 | 28,500 | ||||||||||||
| Other Industries (a) |
9,889,881 | — | — | 9,889,881 | ||||||||||||
|
|
||||||||||||||||
| Total Preferred Stocks and Convertible Preferred Stocks |
12,169,998 | — | 28,500 | 12,198,498 | ||||||||||||
|
|
||||||||||||||||
| Warrants |
||||||||||||||||
| Energy and Utilities: Natural Gas |
869,584 | — | — | 869,584 | ||||||||||||
| Food and Beverage |
— | 402 | — | 402 | ||||||||||||
|
|
||||||||||||||||
| Total Warrants |
869,584 | 402 | — | 869,986 | ||||||||||||
|
|
||||||||||||||||
| Corporate Bonds |
— | 16,017,999 | 72,562 | 16,090,561 | ||||||||||||
| U.S. Government Obligations |
— | 56,276,818 | — | 56,276,818 | ||||||||||||
|
|
||||||||||||||||
| TOTAL INVESTMENTS IN SECURITIES – ASSETS |
$2,411,484,864 | $73,340,259 | $477,947 | $2,485,303,070 | ||||||||||||
|
|
||||||||||||||||
| (a) | Please refer to the Schedule of Investments for the industry classifications of these portfolio holdings. |
The summary of Global Trust’s investments in securities by inputs used to value its investments as of June 30, 2014 is as follows:
| Global Trust | ||||||||||||
| Valuation Inputs | ||||||||||||
| Level 1 Quoted Prices |
Level 2 Other Significant Observable Inputs |
Total Market Value at 6/30/14 |
||||||||||
| INVESTMENTS IN SECURITIES: |
||||||||||||
| ASSETS (Market Value): |
||||||||||||
| Common Stocks(a) |
$21,654,787 | — | $ 21,654,787 | |||||||||
| U.S. Government Obligations |
— | $83,556,541 | 83,556,541 | |||||||||
|
|
||||||||||||
| TOTAL INVESTMENTS IN SECURITIES – ASSETS |
$21,654,787 | $83,556,541 | $105,211,328 | |||||||||
|
|
||||||||||||
| (a) | Please refer to the Schedule of Investments for the industry classifications of these portfolio holdings. |
Dividend Trust did not have material transfers among Level 1, Level 2, and Level 3 during the six months ended June 30, 2014. Global Trust did not have transfers among Level 1 and Level 2 during the period ended June 30, 2014. The Funds’ policy is to recognize transfers among Levels as of the beginning of the reporting period.
23
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
Additional Information to Evaluate Qualitative Information.
General. The Funds use recognized industry pricing services – approved by the Boards and unaffiliated with the Adviser – to value most of its securities, and uses broker quotes provided by market makers of securities not valued by these and other recognized pricing sources. Several different pricing feeds are received to value domestic equity securities, international equity securities, preferred equity securities, and fixed income securities. The data within these feeds is ultimately sourced from major stock exchanges and trading systems where these securities trade. The prices supplied by external sources are checked by obtaining quotations or actual transaction prices from market participants. If a price obtained from the pricing source is deemed unreliable, prices will be sought from another pricing service or from a broker/dealer that trades that security or similar securities.
Fair Valuation. Fair valued securities may be common and preferred equities, warrants, options, rights, and fixed income obligations. Where appropriate, Level 3 securities are those for which market quotations are not available, such as securities not traded for several days, or for which current bids are not available, or which are restricted as to transfer. Among the factors to be considered to fair value a security are recent prices of comparable securities that are publicly traded, reliable prices of securities not publicly traded, the use of valuation models, current analyst reports, valuing the income or cash flow of the issuer, or cost if the preceding factors do not apply. A significant change in the unobservable inputs could result in a lower or higher value in Level 3 securities. The circumstances of Level 3 securities are frequently monitored to determine if fair valuation measures continue to apply.
The Adviser reports quarterly to the Boards the results of the application of fair valuation policies and procedures. These include back testing the prices realized in subsequent trades of these fair valued securities to fair values previously recognized.
Derivative Financial Instruments. The Funds may engage in various portfolio investment strategies by investing in a number of derivative financial instruments for the purposes of achieving additional return or of hedging the value of a Fund’s portfolio, increasing the income of a Fund, hedging or protecting its exposure to interest rate movements and movements in the securities markets, managing risks, protecting the value of its portfolio against uncertainty in the level of future currency exchange rates, or hedging a specific transaction with respect to either the currency in which the transaction is denominated or another currency. Investing in certain derivative financial instruments, including participation in the options, futures, or swap markets, entails certain execution, liquidity, hedging, tax, and securities, interest, credit, or currency market risks. Losses may arise if the Adviser’s prediction of movements in the direction of the securities, foreign currency, and interest rate markets is inaccurate. Losses may also arise if the counterparty does not perform its duties under a contract, or that, in the event of default, a Fund may be delayed in or prevented from obtaining payments or other contractual remedies owed to it under derivative contracts. The creditworthiness of the counterparties is closely monitored in order to minimize these risks. Participation in derivative transactions involves investment risks, transaction costs, and potential losses to which a Fund would not be subject absent the use of these strategies. The consequences of these risks, transaction costs, and losses may have a negative impact on a Fund’s ability to pay distributions.
The Funds’ derivative contracts held at June 30, 2014, if any, are not accounted for as hedging instruments under GAAP and are disclosed in the Schedule of Investments together with the related counterparty.
24
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
Limitations on the Purchase and Sale of Futures Contracts, Certain Options, and Swaps. Subject to the guidelines of the Board, a Fund may engage in “commodity interest” transactions (generally, transactions in futures, certain options, certain currency transactions, and certain types of swaps) only for bona fide hedging or other permissible transactions in accordance with the rules and regulations of the Commodity Futures Trading Commission (“CFTC”). Pursuant to amendments by the CFTC to Rule 4.5 under the Commodity Exchange Act (“CEA”), the Adviser has filed a notice of exemption from registration as a “commodity pool operator” with respect to the Fund. A Fund and the Adviser are therefore not subject to registration or regulation as a commodity pool operator under the CEA. In addition, certain trading restrictions are now applicable to the Fund as of January 1, 2013. These trading restrictions permit a Fund to engage in commodity interest transactions that include (i) “bona fide hedging” transactions, as that term is defined and interpreted by the CFTC and its staff, without regard to the percentage of a Fund’s assets committed to margin and options premiums and (ii) non-bona fide hedging transactions, provided that a Fund does not enter into such non-bona fide hedging transactions if, immediately thereafter, either (a) the sum of the amount of initial margin deposits on a Fund’s existing futures positions or swaps positions and option or swaption premiums would exceed 5% of the market value of a Fund’s liquidating value, after taking into account unrealized profits and unrealized losses on any such transactions, or (b) the aggregate net notional value of a Fund’s commodity interest transactions would not exceed 100% of the market value of a Fund’s liquidating value, after taking into account unrealized profits and unrealized losses on any such transactions. Therefore, in order to claim the Rule 4.5 exemption, a Fund is limited in its ability to invest in commodity futures, options, and certain types of swaps (including securities futures, broad based stock index futures, and financial futures contracts). As a result, in the future, a Fund will be more limited in its ability to use these instruments than in the past, and these limitations may have a negative impact on the ability of the Adviser to manage a Fund, and on a Fund’s performance.
Foreign Currency Translations. The books and records of each Fund are maintained in U.S. dollars. Foreign currencies, investments, and other assets and liabilities are translated into U.S. dollars at current exchange rates. Purchases and sales of investment securities, income, and expenses are translated at the exchange rate prevailing on the respective dates of such transactions. Unrealized gains and losses that result from changes in foreign exchange rates and/or changes in market prices of securities have been included in unrealized appreciation/depreciation on investments and foreign currency translations. Net realized foreign currency gains and losses resulting from changes in exchange rates include foreign currency gains and losses between trade date and settlement date on investment securities transactions, foreign currency transactions, and the difference between the amounts of interest and dividends recorded on the books of the Fund and the amounts actually received. The portion of foreign currency gains and losses related to fluctuation in exchange rates between the initial purchase trade date and subsequent sale trade date is included in realized gain/(loss) on investments.
Foreign Securities. Each Fund may directly purchase securities of foreign issuers. Investing in securities of foreign issuers involves special risks not typically associated with investing in securities of U.S. issuers. The risks include possible revaluation of currencies, the inability to repatriate funds, less complete financial information about companies, and possible future adverse political and economic developments. Moreover, securities of many foreign issuers and their markets may be less liquid and their prices more volatile than securities of comparable U.S. issuers.
25
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
Foreign Taxes. The Funds may be subject to foreign taxes on income, gains on investments, or currency repatriation, a portion of which may be recoverable. The Fund will accrue such taxes and recoveries as applicable, based upon its current interpretation of tax rules and regulations that exist in the markets in which it invests.
Restricted Securities. The Funds are not subject to an independent limitation on the amount it may invest in securities for which the markets are restricted. Restricted securities include securities whose disposition is subject to substantial legal or contractual restrictions. The sale of restricted securities often requires more time and results in higher brokerage charges or dealer discounts and other selling expenses than does the sale of securities eligible for trading on national securities exchanges or in the over-the-counter markets. Restricted securities may sell at a price lower than similar securities that are not subject to restrictions on resale. Securities freely saleable among qualified institutional investors under special rules adopted by the SEC may be treated as liquid if they satisfy liquidity standards established by the Boards. The continued liquidity of such securities is not as well assured as that of publicly traded securities, and accordingly the Boards will monitor their liquidity. For the restricted securities the Funds held as of June 30, 2014, refer to the Schedules of Investments.
Securities Transactions and Investment Income. Securities transactions are accounted for on the trade date with realized gain/(loss) on investments determined by using the identified cost method. Interest income (including amortization of premium and accretion of discount) is recorded on the accrual basis. Premiums and discounts on debt securities are amortized using the effective yield to maturity method. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities that are recorded as soon after the ex-dividend date as a Fund becomes aware of such dividends.
Custodian Fee Credits. When cash balances are maintained in the custody account, the Funds receive credits which are used to offset custodian fees. The gross expenses paid under the custody arrangement are included in custodian fees in the Statement of Operations with the corresponding expense offset, if any, shown as “Custodian fee credits.”
Distributions to Shareholders. Distributions to common shareholders are recorded on the ex-dividend date. Distributions to shareholders are based on income and capital gains as determined in accordance with federal income tax regulations, which may differ from income and capital gains as determined under GAAP. These differences are primarily due to differing treatments of income and gains on various investment securities and foreign currency transactions held by a Fund, timing differences, and differing characterizations of distributions made by a Fund. Distributions from net investment income for federal income tax purposes include net realized gains on foreign currency transactions. These book/tax differences are either temporary or permanent in nature. To the extent these differences are permanent, adjustments are made to the appropriate capital accounts in the period when the differences arise. These reclassifications have no impact on the NAV of the Funds.
Under Dividend Trust’s current common share distribution policy, the Fund declares and pays monthly distributions from net investment income, capital gains, and paid-in capital. The actual source of the distribution is determined after the end of the calendar year. Pursuant to this policy, distributions during the year may be made in excess of required distributions. To the extent such distributions are made from current earnings and profits, they are considered ordinary income or long term capital gains. The Fund’s current distribution policy may restrict the Fund’s ability to pass through to shareholders all of its net realized long term capital gains as a Capital Gain Distribution, subject to the maximum federal income tax rate and may cause such gains to be treated as ordinary income. Distributions sourced from paid-in capital should not be considered as dividend yield or the total return
26
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
from an investment in the Fund. The Board will continue to monitor the Fund’s distribution level, taking into consideration the Fund’s NAV and the financial market environment. The Fund’s distribution policy is subject to modification by the Board at any time.
Distributions to shareholders of Dividend Trust’s 5.875% Series A Preferred Shares, Series B Auction Market Preferred Shares, Series C Auction Market Preferred Shares, 6.000% Series D Preferred Shares, and Series E Auction Rate Preferred Shares (“Preferred Shares”) are recorded on a daily basis and are determined as described in Note 5.
The tax character of distributions paid during the year ended December 31, 2013 for Dividend Trust was as follows:
| Common | Preferred | |||||||
| Distributions paid from: |
||||||||
| Ordinary income |
$ | 26,125,755 | $ | 4,559,641 | ||||
| Net long term capital gains |
59,169,429 | 10,326,644 | ||||||
|
|
|
|
|
|||||
| Total distributions paid |
$ | 85,295,184 | $ | 14,886,285 | ||||
|
|
|
|
|
|||||
Global Trust expects to distribute its net investment income and net realized capital gains, if any, annually.
Provision for Income Taxes. Dividend Trust intends to continue to qualify as, and Global Trust intends to qualify as, regulated investment companies under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). It is the policy of each Fund to comply with the requirements of the Code applicable to regulated investment companies and to distribute substantially all of its net investment company taxable income and net capital gains. Therefore, no provision for federal income taxes is required.
As of December 31, 2013, the components of accumulated earnings/losses on a tax basis for Dividend Trust were net unrealized appreciation on investments and foreign currency translations of $784,683,563.
Under the Regulated Investment Company Modernization Act of 2010, the Funds are permitted to carry forward for an unlimited period capital losses incurred. As a result of the rule, post enactment capital losses that are carried forward will retain their character as either short term or long term capital losses rather than being considered all short term as under previous law.
The following summarizes the tax cost of investments and the related net unrealized appreciation at June 30, 2014:
| Dividend Trust |
||||||||||||||
| Cost |
Gross Unrealized Appreciation |
Gross Unrealized Depreciation |
Net Unrealized Appreciation |
|||||||||||
| Investments |
$1,619,608,423 | $906,448,170 | $(40,753,523 | ) | $865,694,647 | |||||||||
|
Global Trust |
||||||||||||||
| Cost |
Gross Unrealized Appreciation |
Gross Unrealized Depreciation |
Net Unrealized Appreciation |
|||||||||||
| Investments |
$105,076,584 | $206,936 | $(72,192) | $134,744 | ||||||||||
The Funds are required to evaluate tax positions taken or expected to be taken in the course of preparing the Funds’ tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the
27
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
applicable tax authority. Income tax and related interest and penalties would be recognized by the Funds as tax expense in the Statement of Operations if the tax positions were deemed not to meet the more-likely-than-not threshold. During the six months ended June 30, 2014, Dividend Trust did not incur any income tax, interest, or penalty. As of June 30, 2014, the Adviser has reviewed all open tax years and concluded that there was no impact to Dividend Trust’s net assets or results of operations. Dividend Trust’s federal and state tax returns for the prior three fiscal years remain open, subject to examination by these taxing authorities. As of June 30, 2014, there were no open tax years for Global Trust. On an ongoing basis, the Adviser will monitor the Funds’ tax positions to determine if adjustments to this conclusion are necessary.
3. Agreements and Transactions with Affiliates. Each Fund has entered into an investment advisory agreement (the “Advisory Agreement”) with the Adviser which provides that the Fund will pay the Adviser a fee, computed weekly and paid monthly, equal on an annual basis to 1.00% of the value of the Fund’s average weekly net assets including the liquidation value of preferred shares. In accordance with the Advisory Agreements, the Adviser provides a continuous investment program for each Fund’s portfolio and oversees the administration of all aspects of the Fund’s business and affairs.
The Adviser has agreed to reduce the management fee on the incremental assets attributable to Dividend Trust’s Preferred Shares if the total return of the NAV of the common shares of Dividend Trust, including distributions and advisory fee subject to reduction, does not exceed the stated dividend rate of each particular series of the Preferred Shares for the year. Dividend Trust’s total return on the NAV of the common shares is monitored on a monthly basis to assess whether the total return on the NAV of the common shares exceeds the stated dividend rate of each particular series of Preferred Shares for the period. For the six months ended June 30, 2014, Dividend Trust’s total return on the NAV of the common shares exceeded the stated dividend rate of the outstanding Preferred Shares. Thus, advisory fees were accrued on these assets.
During the six months ended June 30, 2014, Dividend Trust and Global Trust paid brokerage commissions on security trades of $140,441 and $3,317, respectively, to G.research, Inc., an affiliate of the Adviser.
The cost of calculating each Fund’s NAV per share is a Fund expense pursuant to the Advisory Agreement. During the six months ended June 30, 2014, Dividend Trust and Global Trust paid or accrued $22,500 and $1,000, respectively, to the Adviser in connection with the cost of computing each Fund’s NAV.
As per the approval of the Boards, Dividend Trust and Global Trust compensate officers of each Fund, who are employed by the Fund and are not employed by the Adviser (although the officers may receive incentive based variable compensation from affiliates of the Adviser). During the six months ended June 30, 2014, Dividend Trust and Global Trust paid or accrued $96,487 and $581 in payroll expenses in the Statement of Operations, respectively.
Dividend Trust pays each Trustee who is not considered an affiliated person an annual retainer of $18,000 plus $2,000 for each Board meeting attended. Each Trustee is reimbursed by the Fund for any out of pocket expenses incurred in attending meetings. All Board committee members receive $1,000 per meeting attended, the Audit Committee Chairman receives an annual fee of $3,000, the Proxy Voting Committee Chairman receives an annual fee of $1,500, the Nominating Committee Chairman and the Lead Trustee each receive an annual fee of $2,000. A Trustee may receive a single meeting fee, allocated among the participating funds, for participation
28
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
in certain meetings held on behalf of multiple funds. Trustees who are directors or employees of the Adviser or an affiliated company receive no compensation or expense reimbursement from the Fund.
Global Trust pays each Trustee who is not considered an affiliated person an annual retainer of $3,000 plus $1,000 for each Board meeting attended. Each Trustee is reimbursed by the Fund for any out of pocket expenses incurred in attending meetings. All Board committee members receive $500 per meeting attended, the Audit Committee Chairman receives an annual fee of $2,000, the Proxy Voting Committee Chairman receives an annual fee of $1,000, the Nominating Committee Chairman and the Lead Trustee each receive an annual fee of $1,000. A Trustee may receive a single meeting fee, allocated among the participating funds, for participation in certain meetings held on behalf of multiple funds. Trustees who are directors or employees of the Adviser or an affiliated company receive no compensation or expense reimbursement from the Fund.
4. Portfolio Securities. Purchases and sales of securities during the six months ended June 30, 2014, other than short term securities and U.S. Government obligations, aggregated $204,240,511 and $226,720,980, respectively, for Dividend Trust and $21,519,589 and $0, respectively, for Global Trust.
5. Capital. Dividend Trust is authorized to issue an unlimited number of common shares of beneficial interest (par value $0.001). The Board has authorized the repurchase and retirement of its shares on the open market when the shares are trading at a discount of 7.5% or more (or such other percentage as the Board may determine from time to time) from the NAV of the shares. During the six months ended June 30, 2014 and the year ended December 31, 2013, Dividend Trust did not repurchase common shares of beneficial interest in the open market.
Global Trust is authorized to issue an unlimited number of common shares of beneficial interest (par value $0.001). The Board has authorized the repurchase and retirement of its shares on the open market when the shares are trading at a discount of 7.5% or more (or such other percentage as the Board may determine from time to time) from the NAV of the shares. During the period ended June 30, 2014, Global Trust repurchased and retired 6,400 of its common shares at a cost of $69,621 and an average discount of 9.37% from its liquidation preference.
Transactions in common shares were as follows:
| Six Months Ended June 30, 2014 (Unaudited) |
Year Ended December 31, 2013 |
|||||||||||
| Dividend Trust | Dividend Trust | |||||||||||
| Shares | Amount | Shares | Amount |
|||||||||
| Net decrease from repurchase of common shares |
— | $— | (53,241 | ) | $ | (1,064,150 | ) | |||||
| Period Ended June 30, 2014 (Unaudited) |
||||||||||
| Global Trust | ||||||||||
| Shares |
Amount |
|||||||||
| Initial seed capital |
8,333 | $ 100,000 | ||||||||
| Additional shares issued in conjunction with the spin-off from Dividend Trust |
8,269,115 | 99,229,373 | ||||||||
| Decrease from repurchase of common shares |
(6,400 | ) | (69,621 | ) | ||||||
|
|
|
|
|
|||||||
| Net increase from issuance and repurchase of common shares |
8,271,048 | $99,259,752 | ||||||||
|
|
|
|
|
|||||||
29
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
A shelf registration for Dividend Trust authorizing the offering of an additional $500 million of common or preferred shares or notes was declared effective by the SEC on July 11, 2013.
Dividend Trust’s Declaration of Trust, as amended, authorizes the issuance of an unlimited number of shares of $0.001 par value Preferred Shares. The Preferred Shares are senior to the common shares and result in the financial leveraging of the common shares. Such leveraging tends to magnify both the risks and opportunities to common shareholders. Dividends on the Preferred Shares are cumulative. The Fund is required by the 1940 Act and by the Statements of Preferences to meet certain asset coverage tests with respect to the Preferred Shares. If the Fund fails to meet these requirements and does not correct such failure, the Fund may be required to redeem, in part or in full, the Series A, Series B, Series C, Series D, and Series E Preferred Shares at redemption prices of $25, $25,000, $25,000, $25, and $25,000, respectively, per share plus an amount equal to the accumulated and unpaid dividends whether or not declared on such shares in order to meet these requirements. Additionally, failure to meet the foregoing asset coverage requirements could restrict Dividend Trust’s ability to pay dividends to common shareholders and could lead to sales of portfolio securities at inopportune times. The income received on Dividend Trust’s assets may vary in a manner unrelated to the fixed and variable rates, which could have either a beneficial or detrimental impact on net investment income and gains available to common shareholders.
For Series B, Series C, and Series E Preferred Shares, the dividend rates, as set by the auction process that is generally held every seven days, are expected to vary with short term interest rates. Since February 2008, the number of Series B, Series C, and Series E Preferred Shares subject to bid orders by potential holders has been less than the number of shares of Series B, Series C, and Series E Preferred Shares subject to sell orders. Holders that have submitted sell orders have not been able to sell any or all of the Series B, Series C, and Series E Preferred Shares for which they have submitted sell orders. Therefore the weekly auctions have failed, and the dividend rate has been the maximum rate. The current maximum rate for Series B, Series C, and Series E Preferred Shares is 150%, 150%, and 250%, respectively, of the seven day Telerate/British Bankers Association LIBOR rate on the date of such auction. Existing Series B, Series C, and Series E Preferred shareholders may submit an order to hold, bid, or sell such shares on each auction date, or trade their shares in the secondary market. There were no redemptions of Series B, Series C, and Series E Preferred Shares during the six months ended June 30, 2014.
Dividend Trust may redeem in whole or in part the 5.875% Series A and 6.000% Series D Preferred Shares at the redemption price at any time. The Board has authorized the repurchase of Series A and Series D Preferred Shares in the open market at prices less than the $25 liquidation value per share. During the six months ended June 30, 2014, Dividend Trust did not repurchase any shares of Series A or Series D Preferred Shares.
30
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
The following table summarizes Cumulative Preferred Stock information of Dividend Trust:
| Series |
Issue Date | Issued/ Authorized |
Number of Shares Outstanding at 06/30/14 |
Net Proceeds |
2014 Dividend Rate Range |
Dividend Rate at 06/30/14 |
Accrued Dividend at 06/30/2014 | |||||||||||
| A 5.875% |
October 12, 2004 | 3,200,000 | 3,048,019 | $ | 77,280,971 | Fixed Rate | 5.875% | $62,177 | ||||||||||
| B Auction Market |
October 12, 2004 | 4,000 | 3,600 | 98,858,617 | 1.616% to 1.626% | 1.624% | 24,360 | |||||||||||
| C Auction Market |
October 12, 2004 | 4,800 | 4,320 | 118,630,341 | 1.618% to 1.629% | 1.623% | 19,476 | |||||||||||
| D 6.000% |
November 3, 2005 | 2,600,000 | 2,542,296 | 62,617,239 | Fixed Rate | 6.000% | 52,965 | |||||||||||
| E Auction Rate |
November 3, 2005 | 5,400 | 4,860 | 133,379 | 2.618% to 2.625% | 2.623% | 44,263 | |||||||||||
The holders of Dividend Trust Preferred Shares generally are entitled to one vote per share held on each matter submitted to a vote of shareholders of Dividend Trust and will vote together with holders of common shares as a single class. The holders of Preferred Shares voting together as a single class also have the right currently to elect two Trustees and under certain circumstances are entitled to elect a majority of the Board of Trustees. In addition, the affirmative vote of a majority of the votes entitled to be cast by holders of all outstanding shares of the Preferred Shares, voting as a single class, will be required to approve any plan of reorganization adversely affecting the Preferred Shares, and the approval of two-thirds of each class, voting separately, of the Dividend Trust’s outstanding voting stock must approve the conversion of the Fund from a closed-end to an open-end investment company. The approval of a majority (as defined in the 1940 Act) of the outstanding Preferred Shares and a majority (as defined in the 1940 Act) of the Fund’s outstanding voting securities are required to approve certain other actions, including changes in the Fund’s investment objectives or fundamental investment policies.
6. Indemnifications. Each Fund enters into contracts that contain a variety of indemnifications. The Fund’s maximum exposure under these arrangements is unknown. However, the Fund has not had prior claims or losses pursuant to these contracts. Management has reviewed the Fund’s existing contracts and expects the risk of loss to be remote.
7. Other Matters. On April 24, 2008, the Adviser entered into a settlement with the SEC to resolve an inquiry regarding prior frequent trading in shares of the GAMCO Global Growth Fund (the “Global Growth Fund”) by one investor who was banned from the Global Growth Fund in August 2002. Under the terms of the settlement, the Adviser, without admitting or denying the SEC’s findings and allegations, paid $16 million (which included a $5 million civil monetary penalty). On the same day, the SEC filed a civil action in the U.S. District Court for the Southern District of New York (the “Court”) against the Executive Vice President and Chief Operating Officer (the “Officer”) of the Adviser, alleging violations of certain federal securities laws arising from the same matter. On May 2, 2014, the SEC filed with the Court a stipulation of voluntary dismissal of the civil action against the Officer, and on June 19, 2014, the Court approved the stipulation and entered an order of dismissal of the action against the Officer. The settlement by the Adviser and the disposition of the action against the Officer did not have a material adverse impact on the Adviser or its ability to fulfill its obligations under the Advisory Agreement.
31
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
8. Subsequent Events. Management has evaluated the impact on the Funds of all other subsequent events occurring through the date the financial statements were issued and has determined that there were no subsequent events requiring recognition or disclosure in the financial statements.
We have separated the portfolio managers’ commentary from the financial statements and investment portfolio due to corporate governance regulations stipulated by the Sarbanes-Oxley Act of 2002. We have done this to ensure that the content of the portfolio managers’ commentary is unrestricted. The financial statements and investment portfolio are mailed separately from the commentary. Both the commentary and the financial statements, including the portfolio of investments, will be available on our website at www.gabelli.com.
The Dividend Trust Net Asset Value per share appears in the Publicly Traded Funds column, under the heading “General Equity Funds,” in Monday’s The Wall Street Journal. It is also listed in Barron’s Mutual Funds/Closed End Funds section under the heading “General Equity Funds.”
The Global Trust Net Asset Value per share appears in the Publicly Traded Funds column, under the heading “World Equity Funds,” in Monday’s The Wall Street Journal. It is also listed in Barron’s Mutual Funds/Closed End Funds section under the heading “World Equity Funds.”
The Net Asset Value per share may be obtained each day by calling (914) 921-5070 or visiting www.gabelli.com.
NASDAQ symbol for the Net Asset Value: Dividend Trust - “XGDVX” Global Trust - “XGGZX”
Notice is hereby given in accordance with Section 23(c) of the Investment Company Act of 1940, as amended, that each Fund may from time to time purchase its common shares in the open market when each Fund’s shares are trading at a discount of 7.5% or more from the net asset value of the shares. The Dividend Trust may also from time to time purchase its preferred shares in the open market when the preferred shares are trading at a discount to the liquidation value.
32
The Gabelli Dividend & Income Trust and The Gabelli Global Small and Mid Cap Value Trust
Notes to Financial Statements (Unaudited) (Continued)
The Funds file a complete schedule of portfolio holdings with the Securities and Exchange Commission (the “SEC”) for the first and third quarters of each fiscal year on Form N-Q. Shareholders may obtain this information at www.gabelli.com or by calling the Fund at 800-GABELLI (800-422-3554). The Fund’s Form N-Q is available on the SEC’s website at www.sec.gov and may also be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 800-SEC-0330.
Proxy Voting
The Funds file Form N-PX with its complete proxy voting record for the twelve months ended June 30, no later than August 31 of each year. A description of the Fund’s proxy voting policies, procedures, and how the Fund voted proxies relating to portfolio securities is available without charge, upon request, by (i) calling 800-GABELLI (800-422-3554); (ii) writing to The Gabelli Funds at One Corporate Center, Rye, NY 10580-1422; or (iii) visiting the SEC’s website at www.sec.gov.
Shareholder Meeting – May 12, 2014 – Final Results
The Dividend Trust’s Annual Meeting of Shareholders was held on May 12, 2014 at the Greenwich Library in Greenwich, Connecticut. At that meeting, common and preferred shareholders, voting together as a single class, elected Frank J. Fahrenkopf, Jr., Anthonie C. van Ekris, and Salvatore J. Zizza as Trustees of the Dividend Trust. A total of 76,740,653 votes, 76,752,362 votes, and 76,810,730 votes were cast in favor of these Trustees and a total of 1,115,889 votes, 1,104,180 votes, and 1,045,812 votes were withheld for these Trustees, respectively. In addition, preferred shareholders, voting as a separate class, elected Anthony J. Colavita as a Trustee of the Fund. A total of 4,694,463 votes were cast in favor of this Trustee and a total of 200,015 votes were withheld for this Trustee.
Mario J. Gabelli, CFA, James P. Conn, Mario d’Urso, Michael J. Melarkey, Salvatore M. Salibello CPA, and Edward T. Tokar continue to serve in their capacities as Trustees of the Fund.
We thank you for your participation and appreciate your continued support.
Certifications
The Dividend Trust’s Chief Executive Officer has certified to the New York Stock Exchange (“NYSE”) that, as of June 11, 2014, he was not aware of any violation by the Fund of applicable NYSE corporate governance listing standards. The Fund reports to the SEC on Form N-CSR which contains certifications by the Fund’s principal executive officer and principal financial officer that relate to the Fund’s disclosure in such reports and that are required by Rule 30a-2(a) under the 1940 Act.
33
THE GABELLI DIVIDEND & INCOME TRUST
One Corporate Center
Rye, NY 10580-1422
Portfolio Management Team Biographies
Mario J. Gabelli, CFA, is Chairman and Chief Executive Officer of GAMCO Investors, Inc. that he founded in 1977 and Chief Investment Officer – Value Portfolios of Gabelli Funds, LLC and GAMCO Asset Management Inc. Mr. Gabelli is a summa cum laude graduate of Fordham University and holds an MBA degree from Columbia Business School and Honorary Doctorates from Fordham University and Roger Williams University.
Christopher J. Marangi joined Gabelli in 2003 as a research analyst. He currently serves as a portfolio manager of Gabelli Funds, LLC and manages several funds within the Gabelli/GAMCO Funds Complex. Mr. Marangi graduated magna cum laude and Phi Beta Kappa with a BA in Political Economy from Williams College and holds an MBA with honors from Columbia Business School.
Barbara G. Marcin, CFA, joined GAMCO Investors, Inc. in 1999 and currently serves as a portfolio manager of Gabelli Funds, LLC and manages several funds within the Gabelli/GAMCO Funds Complex. Prior to joining GAMCO, Ms. Marcin was head of value investments at Citibank Global Asset Management. Ms. Marcin graduated with Distinction as an Echols Scholar from the University of Virginia and holds an MBA degree from Harvard University’s Graduate School of Business.
Robert D. Leininger, CFA, joined GAMCO Investors, Inc. in 1993 as an equity analyst. Subsequently, he was a partner and portfolio manager at Rorer Asset Management before rejoining GAMCO in 2010 where he currently serves as a portfolio manager of Gabelli Funds, LLC and co-manages the Fund. Mr. Leininger is a magna cum laude graduate of Amherst College with a degree in Economics and holds an MBA from the Wharton School at the University of Pennsylvania.
Jeffrey J. Jonas, CFA, joined Gabelli in 2003 as a research analyst. He focuses on companies in the cardiovascular, healthcare services, and pharmacy benefits management sectors, among others. He also serves as a portfolio manager of Gabelli Funds, LLC and manages several funds within the Gabelli/GAMCO Funds Complex. Mr. Jonas was a Presidential Scholar at Boston College, where he received a BS in Finance and Management Information Systems.
Kevin V. Dreyer joined Gabelli in 2005 as a research analyst covering companies within the consumer sector. He currently serves as a portfolio manager of Gabelli Funds, LLC and manages several funds within the Gabelli/GAMCO Funds Complex. Mr. Dreyer received a BSE from the University of Pennsylvania and an MBA from Columbia Business School.
THE GABELLI GLOBAL SMALL AND MID CAP VALUE TRUST
One Corporate Center
Rye, NY 10580-1422
Portfolio Management Team Biographies
Mario J. Gabelli, CFA, is Chairman and Chief Executive Officer of GAMCO Investors, Inc. that he founded in 1977 and Chief Investment Officer – Value Portfolios of Gabelli Funds, LLC and GAMCO Asset Management Inc. Mr. Gabelli is a summa cum laude graduate of Fordham University and holds an MBA degree from Columbia Business School and Honorary Doctorates from Fordham University and Roger Williams University.
Christopher J. Marangi joined Gabelli in 2003 as a research analyst. He currently serves as a portfolio manager of Gabelli Funds, LLC and manages several funds within the Gabelli/GAMCO Funds Complex. Mr. Marangi graduated magna cum laude and Phi Beta Kappa with a BA in Political Economy from Williams College and holds an MBA with honors from Columbia Business School.
Jeffrey J. Jonas, CFA, joined Gabelli in 2003 as a research analyst. He focuses on companies in the cardiovascular, healthcare services, and pharmacy benefits management sectors, among others. He also serves as a portfolio manager of Gabelli Funds, LLC and manages several funds within the Gabelli/GAMCO Funds Complex. Mr. Jonas was a Presidential Scholar at Boston College, where he received a BS in Finance and Management Information Systems.
Kevin V. Dreyer joined Gabelli in 2005 as a research analyst covering companies within the consumer sector. He currently serves as a portfolio manager of Gabelli Funds, LLC and manages several funds within the Gabelli/GAMCO Funds Complex. Mr. Dreyer received a BSE from the University of Pennsylvania and an MBA from Columbia Business School.
Item 2. Code of Ethics.
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. Investments.
| (a) | Schedule of Investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the report to shareholders filed under Item 1 of this form. |
| (b) | Not applicable. |
| 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.
There has been no change, as of the date of this filing, in any of the portfolio managers identified in response to paragraph (a)(1) of this Item in the registrant’s most recently filed annual report on Form N-CSR.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
REGISTRANT PURCHASES OF EQUITY SECURITIES
| Period
|
(a) Total
Number of
|
(b)
Average Price Paid
|
(c) Total
Number of
|
(d) Maximum Number (or
| ||||
|
Month #1 01/01/14 through 01/31/14 |
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – 82,774,478
Preferred Series A – 3,048,019
Preferred Series D – 2,542,296
| ||||
|
Month #2 02/01/14 through 02/28/14 |
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – 82,774,478
Preferred Series A – 3,048,019
Preferred Series D – 2,542,296
| ||||
|
Month #3 03/01/14 through 03/31/14 |
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – 82,774,478
Preferred Series A – 3,048,019
Preferred Series D – 2,542,296
| ||||
|
Month #4 04/01/14 through 04/30/14 |
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – 82,774,478
Preferred Series A – 3,048,019
Preferred Series D – 2,542,296
| ||||
|
Month 05/01/14 through 05/31/14 |
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – 82,774,478
Preferred Series A – 3,048,019
Preferred Series D – 2,542,296
| ||||
|
Month #6 06/01/14 through 06/30/14 |
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – 82,774,478
Preferred Series A – 3,048,019
Preferred Series D – 2,542,296
|
| Total |
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
Common – N/A
Preferred Series A – N/A
Preferred Series D – N/A
|
N/A
|
Footnote columns (c) and (d) of the table, by disclosing the following information in the aggregate for all plans or programs publicly announced:
| a. | The date each plan or program was announced – The notice of the potential repurchase of common and preferred shares occurs quarterly in the Fund’s quarterly report in accordance with Section 23(c) of the Investment Company Act of 1940, as amended. |
| b. | The dollar amount (or share or unit amount) approved – Any or all common shares outstanding may be repurchased when the Fund’s common shares are trading at a discount of 7.5% or more from the net asset value of the shares. |
Any or all preferred shares outstanding may be repurchased when the Fund’s preferred shares are trading at a discount to the liquidation value of $25.00.
| c. | The expiration date (if any) of each plan or program – The Fund’s repurchase plans are ongoing. |
| d. | Each plan or program that has expired during the period covered by the table – The Fund’s repurchase plans are ongoing. |
| e. | Each plan or program the registrant has determined to terminate prior to expiration, or under which the registrant does not intend to make further purchases. – The Fund’s repurchase plans are ongoing. |
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which the shareholders may recommend nominees to the registrant’s Board of Trustees, where those changes were implemented after the registrant last provided disclosure in response to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR 229.407) (as required by Item 22(b)(15) of Schedule 14A (17 CFR 240.14a-101)), or this Item.
Item 11. Controls and Procedures.
| (a) | The registrant’s principal executive and principal financial officers, or persons performing similar functions, 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”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)). |
| (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 (17 CFR 270.30a-3(d)) that occurred during the registrant’s second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
Item 12. Exhibits.
| (a)(1) | Not applicable. | |
| (a)(2) | Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto. | |
| (a)(3) | Not applicable. | |
| (b) | Certifications pursuant to Rule 30a-2(b) under the 1940 Act and Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto. | |
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) The Gabelli Dividend & Income Trust | ||||||
| By (Signature and Title)* | /s/ Bruce N. Alpert | |||||
| Bruce N. Alpert, Principal Executive Officer | ||||||
| Date 9/4/2014 | ||||||
| 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/ Bruce N. Alpert | |||||
| Bruce N. Alpert, Principal Executive Officer | ||||||
| Date 9/4/2014 | ||||||
| By (Signature and Title)* | /s/ Agnes Mullady | |||||
| Agnes Mullady, Principal Financial Officer and Treasurer | ||||||
| Date 9/4/2014 | ||||||
| * | Print the name and title of each signing officer under his or her signature. |