Gabelli Global Utility & Income Trust

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            811-21529                  

                           The Gabelli Global Utility & 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, 2015

 

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 Global Utility & Income Trust

 

Semiannual Report — June 30, 2015

     LOGO     
  

 

 

 

Mario J. Gabelli, CFA 

 

  

     Portfolio Manager    

To Our Shareholders,

For the six months ended June 30, 2015, the net asset value (“NAV”) total return of The Gabelli Global Utility & Income Trust (the “Fund”) was (0.7)%, compared with a total return of (10.7)% for the Standard & Poor’s (“S&P”) 500 Utilities Index. The total return for the Fund’s publicly traded shares was (3.5)%. The Fund’s NAV per share was $21.18, while the price of the publicly traded shares closed at $18.17 on the New York Stock Exchange (“NYSE MKT”). See below for additional performance information.

Enclosed are the financial statements, including the schedule of investments, as of June 30, 2015.

Comparative Results

 

 

Average Annual Returns through June 30, 2015 (a) (Unaudited)      
     Year to Date     1 Year     5 Year     10 Year     Since
Inception
(05/28/04)
     

Gabelli Global Utility & Income Trust

            

  NAV Total Return (b)

     (0.70)%         (5.76)%        10.44%        6.45%        7.56%      

  Investment Total Return (c)

     (3.53)            (7.37)           6.83           6.23           6.15         

S&P 500 Utilities Index

     (10.67)            (2.90)           12.47           6.88           9.46         

Lipper Utility Fund Average

     (6.18)            (5.20)           13.57           8.09           10.10         

S&P 500 Index

     1.23             7.42             17.34           7.89           7.87         
  (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 S&P 500 Utilities Index is an unmanaged indicator of electric and gas utility stock performance. The Lipper Utility Fund Average reflects the average performance of mutual funds classified in this particular category. The S&P 500 Index is an unmanaged indicator of stock market performance. Dividends are considered reinvested. You cannot invest directly in an index.

 
  (b)

Total returns and average annual returns reflect changes in the NAV per share, reinvestment of distributions at NAV on the ex-dividend date, and adjustments for the rights offering 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 MKT, reinvestment of distributions, and adjustments for the rights offering. Since inception return is based on an initial offering price of $20.00.

 
   


Summary of Portfolio Holdings (Unaudited)

The following table presents portfolio holdings as a percent of total investments as of June 30, 2015:

The Gabelli Global Utility & Income Trust

Energy and Utilities: Integrated

     23.3

Telecommunications

     15.1

Cable and Satellite

     11.6

Wireless Communications

     5.6

U.S. Government Obligations

     5.4

Food and Beverage

     4.2

Water

     3.9

Natural Gas Integrated

     3.6

Electric Transmission and Distribution

     3.5

Health Care

     3.0

Diversified Industrial

     2.7

Entertainment

     2.7

Electronics

     2.3

Natural Gas Utilities

     2.1

Financial Services

     2.1

Services

     1.9

Aerospace

     1.7

Oil

     1.0

Hotels and Gaming

     0.8

Business Services

     0.8

Alternative Energy

     0.6

Automotive: Parts and Accessories

     0.4

Building and Construction

     0.3

Transportation

     0.2

Real Estate

     0.2

Specialty Chemicals

     0.2

Environmental Services

     0.2

Machinery

     0.2

Independent Power Producers and Energy Traders

     0.2

Metals and Mining

     0.1

Consumer Products

     0.1

Retail

     0.0 %* 
  

 

 

 
       100.0
  

 

 

 

 

*   Amount represents less than 0.05%.
 

 

The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (“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 Fund files 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.

 

2


The Gabelli Global Utility & Income Trust

Schedule of Investments — June 30, 2015 (Unaudited)

 

 

Shares

        

Cost

 

Market

Value

   COMMON STOCKS — 94.2%    
   ENERGY AND UTILITIES — 43.0%    
   Alternative Energy — 0.6%    
   U.S. Companies    
  15,000       NextEra Energy Partners LP   $    373,624   $    594,300
  6,500       Ormat Technologies Inc.   179,303   244,920
    

 

 

 

     552,927   839,220
    

 

 

 

   Electric Transmission and Distribution — 3.5%
   Non U.S. Companies    
  6,000       Algonquin Power & Utilities Corp.   30,772   44,964
  10,000       Fortis Inc.   308,899   280,865
  8,775       National Grid plc, ADR   401,681   566,602
  5,000       Red Electrica Corporacion SA   227,553   400,678
   U.S. Companies    
  3,000       Consolidated Edison Inc.   143,440   173,640
  38,000       Pepco Holdings Inc.   720,883   1,023,720
  6,500       Twin Disc Inc.   143,026   121,160
  49,608       WEC Energy Group Inc.   1,899,322   2,230,872
    

 

 

 

     3,875,576   4,842,501
    

 

 

 

   Energy and Utilities: Integrated — 23.3%
   Non U.S. Companies    
  150,000       A2A SpA   276,010   178,934
  3,000       Areva SA†   57,303   25,288
  13,000       BP plc, ADR   555,343   519,480
  11,000       Chubu Electric Power Co. Inc.   194,672   163,987
  152,000      

Datang International Power Generation Co. Ltd., Cl. H

  59,610   77,848
  1,400       E.ON SE   24,642   18,651
  8,000       E.ON SE, ADR   176,626   106,760
  9,760       EDP - Energias de Portugal SA, ADR   262,599   372,149
  10,000       Electric Power Development Co. Ltd.   252,321   353,393
  5,500       Emera Inc.   152,289   173,235
  8,000       Endesa SA   198,521   153,091
  74,000       Enel SpA   424,049   335,276
  28,000       Enersis SA, ADR   166,651   443,240
  1,000       Eni SpA   20,630   17,748
  217,100       Hera SpA   426,556   543,125
  12,000       Hokkaido Electric Power Co. Inc.†   149,723   136,193
  18,000       Hokuriku Electric Power Co.   274,290   268,268
  17,000      

Huaneng Power International Inc., ADR

  551,217   897,260
  98,090       Iberdrola SA   510,180   660,728
  5,000       Iberdrola SA, ADR   181,697   131,250
  34,000       Korea Electric Power Corp., ADR   392,916   692,240

Shares

        

Cost

 

Market

Value

 

 

 

22,000

 

  

   Kyushu Electric Power Co. Inc.†  

 

$      324,116

 

 

$      255,260

  10,000       Shikoku Electric Power Co. Inc.   171,759   149,773
  12,000       The Chugoku Electric Power Co. Inc.   188,947   175,120
  18,000       The Kansai Electric Power Co. Inc.†   233,505   199,363
  8,000       Tohoku Electric Power Co. Inc.   126,339   108,379
  2,000       Verbund AG   40,857   29,075
   U.S. Companies    
  2,000       ALLETE Inc.   71,269   92,780
  21,000       Ameren Corp.   816,820   791,280
  30,000       American Electric Power Co. Inc.   943,467   1,589,100
  5,000       Avista Corp.   145,830   153,250
  5,500       Black Hills Corp.   150,289   240,075
  45,638       Cleco Corp.   2,441,270   2,457,606
  10,000       Dominion Resources Inc.   406,566   668,700
  17,000       Duke Energy Corp.(a)   754,741   1,200,540
  4,000       El Paso Electric Co.   77,953   138,640
  40,000       Eversource Energy(a)   845,880   1,816,400
  35,000       Great Plains Energy Inc.   783,130   845,600
  16,000       Hawaiian Electric Industries Inc.   394,905   475,680
  16,500       MGE Energy Inc.   361,486   639,045
  14,000       NextEra Energy Inc.   654,896   1,372,420
  45,000       NiSource Inc.   908,189   2,051,550
  12,500       NorthWestern Corp.   373,647   609,375
  39,000       OGE Energy Corp.   481,891   1,114,230
  14,000       Otter Tail Corp.   352,319   372,400
  1,000       PG&E Corp.   33,930   49,100
  15,000       Pinnacle West Capital Corp.   610,094   853,350
  7,000       PPL Corp.   197,367   206,290
  29,000       Public Service Enterprise Group Inc.   965,990   1,139,120
  18,000       SCANA Corp.   646,320   911,700
  874       Talen Energy Corp.†   14,856   15,004
  38,000       The AES Corp.   371,632   503,880
  2,000       The Empire District Electric Co.   41,522   43,600
  40,000       The Southern Co.   1,178,050   1,676,000
  15,000       Vectren Corp.   360,570   577,200
  36,000       Westar Energy Inc.   763,859   1,231,920
  32,000       Xcel Energy Inc.   541,913   1,029,760
    

 

 

 

     23,084,019   32,050,709
    

 

 

 

   Natural Gas Integrated — 3.6%    
   Non U.S. Companies    
  80,000       Snam SpA   288,733   380,655
   U.S. Companies    
  7,000       Anadarko Petroleum Corp.   651,245   546,420
  4,500       Apache Corp.   359,098   259,335
  13,000       CONSOL Energy Inc.   482,220   282,620
  1,000       Energen Corp.   30,935   68,300
  13,000       Kinder Morgan Inc.   520,955   499,070
 

 

See accompanying notes to financial statements.

 

3


The Gabelli Global Utility & Income Trust

Schedule of Investments (Continued) — June 30, 2015 (Unaudited)

 

 

Shares

        

Cost

 

Market

Value

   COMMON STOCKS (Continued)    
   ENERGY AND UTILITIES (Continued)    
   Natural Gas Integrated (Continued)    
   U.S. Companies (Continued)    
  30,000       National Fuel Gas Co.   $  1,324,591   $  1,766,700
  4,000       ONEOK Inc.   45,265   157,920
  30,000       Spectra Energy Corp.   634,201   978,000
    

 

 

 

     4,337,243   4,939,020
    

 

 

 

   Natural Gas Utilities — 2.1%    
   Non U.S. Companies    
  1,500       Enagas SA   37,053   40,795
  1,890       GDF Suez   49,337   35,062
  9,954       GDF Suez, ADR   302,490   185,393
  

 

U.S. Companies

   
  16,000       AGL Resources Inc.   637,055   744,960
  10,000       Atmos Energy Corp.   246,554   512,800
  2,400       Chesapeake Utilities Corp.   46,490   129,240
  1,000       ONE Gas Inc.   6,172   42,560
  4,500       Piedmont Natural Gas Co. Inc.   105,090   158,895
  16,000       Southwest Gas Corp.   623,813   851,360
  4,000       The Laclede Group Inc.   128,275   208,240
    

 

 

 

     2,182,329   2,909,305
    

 

 

 

   Oil — 1.0%    
   Non U.S. Companies    
  1,000       PetroChina Co. Ltd., ADR   79,302   110,810
  10,000       Petroleo Brasileiro SA, ADR†   126,587   90,500
  9,000       Royal Dutch Shell plc, Cl. A, ADR   460,931   513,090
  

 

U.S. Companies

   
  11,000       Atlas Resource Partners LP   201,535   68,860
  1,600       Chevron Corp.   96,080   154,352
  2,000       ConocoPhillips   57,019   122,820
  3,000       Devon Energy Corp.   126,975   178,470
  1,000       Exxon Mobil Corp.   45,500   83,200
    

 

 

 

     1,193,929   1,322,102
    

 

 

 

   Services — 1.9%    
   Non U.S. Companies    
  10,000       ABB Ltd., ADR   123,092   208,800
  115,000       Weatherford International plc†   1,608,531   1,411,050
  

 

U.S. Companies

   
  10,000       AZZ Inc.   359,505   518,000
  5,000       Cameron International Corp.†   298,025   261,850
  3,500       Halliburton Co.   110,825   150,745
  1,600       National Oilwell Varco Inc.   120,831   77,248
    

 

 

 

     2,620,809   2,627,693
    

 

 

 

Shares

        

Cost

 

Market

Value

   Water — 3.9%    
   Non U.S. Companies    
  5,000       Consolidated Water Co. Ltd.   $        60,554   $        63,000
  115,000       Severn Trent plc   2,667,241   3,760,213
  37,090       United Utilities Group plc   366,828   519,833
  

 

U.S. Companies

   
  10,000       Aqua America Inc.   119,790   244,900
  5,400       California Water Service Group   76,295   123,390
  4,000       Middlesex Water Co.   75,033   90,240
  17,000       SJW Corp.   287,492   521,730
    

 

 

 

     3,653,233   5,323,306
    

 

 

 

   Diversified Industrial — 2.7%    
   Non U.S. Companies    
  9,000       Bouygues SA   300,585   336,479
  15,800       Jardine Matheson Holdings Ltd.   858,553   896,650
  17,000       Jardine Strategic Holdings Ltd.   566,077   514,590
  

 

U.S. Companies

   
  7,000       General Electric Co.   179,490   185,990
  10,000       Pall Corp.   1,241,947   1,244,500
  10,000       Polypore International Inc.†   598,368   598,800
    

 

 

 

     3,745,020   3,777,009
    

 

 

 

   Environmental Services — 0.2%    
   Non U.S. Companies    
  500       Suez Environnement Co.   0   9,301
  12,000       Veolia Environnement SA   184,423   244,688
    

 

 

 

     184,423   253,989
    

 

 

 

   Independent Power Producers and Energy Traders — 0.2%
   U.S. Companies    
  9,000       NRG Energy Inc.   217,489   205,920
    

 

 

 

   TOTAL ENERGY AND UTILITIES   45,646,997   59,090,774
    

 

 

 

   COMMUNICATIONS — 32.2%    
   Cable and Satellite — 11.6%    
   Non U.S. Companies    
  10,000       Cogeco Inc.   195,069   459,007
  6,782       Liberty Global plc, Cl. A†   167,814   366,703
  17,630       Liberty Global plc, Cl. C†   420,368   892,607
  59,000       Rogers Communications Inc., Cl. B   2,337,872   2,096,270
  410,000       Sky Deutschland AG†   3,605,171   3,084,896
  42,000       Sky plc   507,127   684,338
  

 

U.S. Companies

   
  110,000       Cablevision Systems Corp., Cl. A   1,849,315   2,633,400
  800       Charter Communications Inc., Cl. A†   98,894   137,000
  12,000       Comcast Corp., Cl. A, Special   260,264   719,280
 

 

See accompanying notes to financial statements.

 

4


The Gabelli Global Utility & Income Trust

Schedule of Investments (Continued) — June 30, 2015 (Unaudited)

 

 

Shares

        

Cost

 

Market

Value

   COMMON STOCKS (Continued)  
   COMMUNICATIONS (Continued)  
   Cable and Satellite (Continued)  
   U.S. Companies (Continued)  
  30,000       DIRECTV†   $    1,682,998   $    2,783,700
  26,000       DISH Network Corp., Cl. A†   444,440   1,760,460
  6,000       EchoStar Corp., Cl. A†   150,819   292,080
  168       Liberty Broadband Corp., Cl. B†   8,321   8,744
    

 

 

 

     11,728,472   15,918,485
    

 

 

 

  

 

Telecommunications — 15.0%

 
  

Non U.S. Companies

   
  302       BCE Inc.   13,153   12,830
  45,708       BCE Inc., Toronto   1,418,995   1,942,590
  24,000       BT Group plc, ADR   797,408   1,701,360
  40,000       Deutsche Telekom AG, ADR   658,775   688,600
  29,651       Global Telecom Holding SAE, GDR†   111,809   51,000
  1,375,000       Koninklijke KPN NV   4,141,296   5,257,921
  15,000       Koninklijke KPN NV, ADR   114,993   58,200
  11,000       Manitoba Telecom Services Inc.   308,724   245,805
  5,000       Orange SA, ADR   59,302   76,800
  29,651      

Orascom Telecom Media and Technology Holding SAE, GDR†

  43,481   21,942
  90,000       Pharol SGPS SA†   375,765   39,633
  13,000       Proximus   331,463   458,996
  1,200       Swisscom AG   384,765   672,549
  1,000       Swisscom AG, ADR   43,980   56,000
  20,000       Telecom Italia SpA†   19,045   25,374
  9,300       Telefonica Brasil SA, ADR   161,522   129,549
  39,300       Telefonica Deutschland Holding AG   212,007   226,517
  49,263       Telefonica SA, ADR   718,984   699,535
  70,000       Telekom Austria AG   606,149   463,243
  23,000       Telenet Group Holding NV†   1,047,596   1,251,053
  18,000       VimpelCom Ltd., ADR   155,749   89,460
  

 

U.S. Companies

   
  27,000       AT&T Inc.   758,355   959,040
  21,000       CenturyLink Inc.   658,367   616,980
  60,000       Cincinnati Bell Inc.†   181,440   229,200
  100,000       Jazztel plc†   1,441,564   1,443,733
  20,000       Level 3 Communications Inc.†   768,703   1,053,400
  35,045       Sprint Corp.†   196,705   159,805
  1,000       T-Mobile US Inc.†   22,694   38,770
  41,725       Verizon Communications Inc.   1,709,411   1,944,802
    

 

 

 

     17,462,200   20,614,687
    

 

 

 

Shares

        

Cost

 

Market
Value

   Wireless Communications — 5.6%
   Non U.S. Companies    
  1,000      

America Movil SAB de CV, Cl. L, ADR

  $        15,150   $        21,310
  2,500,000      

Cable & Wireless Communications plc

  1,634,622   2,616,115
  30,700      

Millicom International Cellular SA, SDR

  2,187,424   2,264,582
  4,000       Mobile TeleSystems OJSC, ADR   54,874   39,120
  2,000       SK Telecom Co. Ltd., ADR   40,399   49,580
  20,000      

Turkcell Iletisim Hizmetleri A/S, ADR

  297,607   229,800
  62,000       Vodafone Group plc, ADR   3,007,184   2,259,900
   U.S. Companies    
  70,000       NII Holdings Inc.†   43,344   1,400
  7,500       United States Cellular Corp.†   264,225   282,525
    

 

 

 

     7,544,829   7,764,332
    

 

 

 

   TOTAL COMMUNICATIONS   36,735,501   44,297,504
    

 

 

 

   OTHER — 19.0%    
   Aerospace — 1.7%    
   Non U.S. Companies    
  13,000       Airbus Group NV   813,103   843,497
  20,000       BBA Aviation plc   108,959   94,809
  101,300       Rolls-Royce Holdings plc   830,752   1,384,750
  14,283,300       Rolls-Royce Holdings plc, Cl. C†   21,481   22,442
    

 

 

 

     1,774,295   2,345,498
    

 

 

 

   Automotive: Parts and Accessories — 0.4%  
   U.S. Companies    
  15,000       Cooper Tire & Rubber Co.   447,000   507,450
    

 

 

 

  

 

Building and Construction — 0.0%

 
   Non U.S. Companies    
  500       Acciona SA   25,414   37,754
    

 

 

 

  

 

Business Services — 0.8%

   
   Non U.S. Companies    
  30,000       Sistema JSFC, GDR   280,537   265,500
   U.S. Companies    
  23,000       Diebold Inc.   750,926   805,000
    

 

 

 

     1,031,463   1,070,500
    

 

 

 

   Consumer Products — 0.1%    
   U.S. Companies    
  1,000       The Procter & Gamble Co.   80,450   78,240
    

 

 

 

   Electronics — 2.3%    
   Non U.S. Companies    
  110,000       Sony Corp., ADR†   2,105,643   3,122,900
    

 

 

 

 

 

See accompanying notes to financial statements.

 

5


The Gabelli Global Utility & Income Trust

Schedule of Investments (Continued) — June 30, 2015 (Unaudited)

 

 

             Market

Shares

      

Cost

 

Value

  

COMMON STOCKS (Continued)

   
  

OTHER (Continued)

   
  

Entertainment — 2.7%

   
  

Non U.S. Companies

   

20,000

  

Grupo Televisa SAB, ADR

  $    600,626   $    776,400

118,000

  

Vivendi SA

    3,007,680     2,976,376
    

 

 

 

     3,608,306   3,752,776
    

 

 

 

  

Financial Services — 2.1%

   
  

Non U.S. Companies

   

5,000

  

Deutsche Bank AG

  163,568   150,800

16,000

  

Kinnevik Investment AB, Cl. A

  450,893   513,399

65,000

  

Resona Holdings Inc.

  355,099   355,048
  

U.S. Companies

   

1,000

  

M&T Bank Corp.

  112,548   124,930

9,500

  

National Interstate Corp.

  271,444   259,540

10,000

  

The Bank of New York Mellon Corp.

  398,640   419,700

1,000

  

The Goldman Sachs Group Inc.

  160,212   208,790

15,000

  

The Hartford Financial Services Group Inc.

  514,192   623,550

1,500

  

The PNC Financial Services Group Inc.

  123,954   143,475

1,500

  

UGI Corp.

  41,980   51,675
    

 

 

 

     2,592,530   2,850,907
    

 

 

 

  

Food and Beverage — 4.2%

   
  

Non U.S. Companies

   

120

  

Chocoladefabriken Lindt & Sprungli AG

  604,646   634,558

4,000

  

Chr. Hansen Holding A/S

  151,648   195,161

65,000

  

Cott Corp.

  474,501   635,700

40,000

  

Davide Campari-Milano SpA

  346,184   304,355

1,000

  

Diageo plc

  32,986   28,926

8,000

  

Diageo plc, ADR

  1,006,046   928,320

7,500

  

Heineken NV

  513,513   569,160

17,000

  

Nestlé SA

  1,241,281   1,227,338

2,100

  

Pernod Ricard SA

  247,861   242,547

1,000

  

Yakult Honsha Co. Ltd

  51,696   59,321
  

 

U.S. Companies

   

6,000

  

General Mills Inc.

  298,740   334,320

8,000

  

McCormick & Co. Inc.,
Non-Voting

  565,286   647,600
    

 

 

 

     5,534,388   5,807,306
    

 

 

 

  

 

Health Care — 3.0%

   
  

U.S. Companies

   

11,500

  

Johnson & Johnson

  1,107,959   1,120,790

Shares

      

Cost

 

Market

Value

30,000

  

Omnicare Inc.

  $    2,877,525   $    2,827,500

4,000

  

Owens & Minor Inc.

  140,388   136,000
    

 

 

 

     4,125,872   4,084,290
    

 

 

 

  

 

Hotels and Gaming — 0.8%

   
  

Non U.S. Companies

   

115,000

  

Genting Singapore plc

  122,615   76,419

312,500

  

Mandarin Oriental International Ltd.

  520,015   492,188
  

U.S. Companies

   

10,000

  

Ryman Hospitality Properties Inc.

  458,079   531,100
    

 

 

 

     1,100,709   1,099,707
    

 

 

 

  

 

Machinery — 0.2%

   
  

U.S. Companies

   

6,000

  

Xylem Inc.

  173,899   222,420
    

 

 

 

  

Metals and Mining — 0.1%

   
  

U.S. Companies

   

5,000

  

Ampco-Pittsburgh Corp.

  98,944   75,600

35,000

  

Peabody Energy Corp.

 

431,394

 

76,650

    

530,338

 

152,250

  

Real Estate — 0.2%

   
  

Non U.S. Companies

   

9,000

  

Brookfield Asset Management Inc., Cl. A

 

149,494

 

314,370

  

Specialty Chemicals — 0.2%

   
  

U.S. Companies

   

2,800

  

International Flavors & Fragrances Inc.

 

272,200

 

306,012

  

Transportation — 0.2%

   
  

U.S. Companies

   

6,000

  

GATX Corp.

 

225,750

 

318,900

  

TOTAL OTHER

 

23,777,751

 

26,071,280

  

TOTAL COMMON STOCKS

  106,160,249   129,459,558
    

 

 

 

  

 

CONVERTIBLE PREFERRED STOCKS — 0.1%

 
  

COMMUNICATIONS — 0.1%

   
  

Telecommunications — 0.1%

   
  

U.S. Companies

   

1,600

  

Cincinnati Bell Inc., 6.750%, Ser. B

  36,882   78,448
    

 

 

 

 

 

See accompanying notes to financial statements.

 

6


The Gabelli Global Utility & Income Trust

Schedule of Investments (Continued) — June 30, 2015 (Unaudited)

 

 

 

Shares

       

Cost

 

Market

Value

 
  RIGHTS — 0.0%    
  OTHER — 0.0%    
  Retail — 0.0%    
  U.S. Companies    
  60,000     

Safeway Casa Ley, CVR, expire 01/30/19†

  $        10,159   $         28,500   
  60,000     

Safeway PDC, CVR, expire
01/30/17†

  488     2,928   
   

 

 

 

 

 
  TOTAL RIGHTS   10,647     31,428   
   

 

 

 

 

 
  WARRANTS — 0.0%  
  COMMUNICATIONS — 0.0%  
  Wireless Communications — 0.0%  
  Non U.S. Companies  
  6,000     

Bharti Airtel Ltd., expire
08/04/16†(b)

  28,648     39,596   
   

 

 

 

 

 

Principal
Amount

               
  CONVERTIBLE CORPORATE BONDS — 0.3%  
  OTHER — 0.3%  
  Building and Construction — 0.3%  
  U.S. Companies  
  $  500,000     

Layne Christensen Co.
4.250%, 11/15/18

  500,000     388,438   
   

 

 

 

 

 
  U.S. GOVERNMENT OBLIGATIONS — 5.4%  
  7,387,000     

U.S. Treasury Bills,
0.010% to 0.095%††,
08/20/15 to 11/19/15(c)

  7,385,900     7,386,728   
   

 

 

 

 

 

 

TOTAL INVESTMENTS — 100.0%

  $114,122,326     137,384,196   
   

 

 

Notional
Amount

       

Termination

Date

 

Unrealized
Depreciation

 
 

EQUITY CONTRACT FOR DIFFERENCE SWAP AGREEMENTS

 
$ 1     

Rolls-Royce Holdings plc,
Cl. C(d)

 

06/29/16

    (21,692

 

     (14,100,000 Shares)

   
  1,427,250     

Rolls-Royce Holdings plc(d)

 

06/28/16

    (60,271

 

    (100,000 Shares)

   
     

 

 

 
 

TOTAL EQUITY CONTRACT FOR DIFFERENCE SWAP AGREEMENTS

    (81,963
     

 

 

 

 

    

Market

Value

 
Other Assets and Liabilities (Net)    $ 1,066,085   
PREFERRED STOCK   

(1,026,082 preferred shares outstanding)

     (51,304,100
  

 

 

 
NET ASSETS — COMMON SHARES   

(4,111,411 common shares outstanding)

   $ 87,064,218   
  

 

 

 
NET ASSET VALUE PER COMMON SHARE   

($87,064,218 ÷ 4,111,411 shares outstanding)

   $ 21.18   
  

 

 

 

 

(a)

Securities, or a portion thereof, with a value of $1,044,270, were reserved and/or pledged with the custodian for equity contract for difference swap agreements.

(b)

Security exempt from registration under Rule 144A of the Securities Act of 1933, as amended. This security may be resold in transactions exempt from registration, normally to qualified institutional buyers. At June 30, 2015, the market value of the Rule 144A security amounted to $39,596 or 0.03% of total investments.

(c)

At June 30, 2015, $400,000 of the principal amount was pledged as collateral for equity contract for difference swap agreements.

(d)

At June 30, 2015, the Fund had entered into equity contract for difference swap agreements with The Goldman Sachs Group, Inc.

Non-income producing security.

††

Represents annualized yield at date of purchase.

 

ADR American Depositary Receipt
CVR Contingent Value Right
GDR Global Depositary Receipt
SDR Swedish Depositary Receipt

 

Geographic Diversification

  

%of
Market
Value

    

Market

Value

 

North America

     57.4      $  78,822,147   

Europe

     34.8         47,797,480   

Japan

     3.9         5,347,004   

Latin America

     2.5         3,516,886   

Asia/Pacific

     1.3         1,827,738   

Africa/Middle East

         0.1                    72,941   

Total Investments

     100.0      $137,384,196   
 

See accompanying notes to financial statements.

 

7


The Gabelli Global Utility & Income Trust

 

Statement of Assets and Liabilities

June 30, 2015 (Unaudited)

 

 

 

Assets:

  

Investments, at value (cost $114,122,326)

   $ 137,384,196   

Cash

     694,393   

Dividends and interest receivable

     493,657   

Deferred offering expense

     7,038   

Prepaid expenses

     2,090   
  

 

 

 

Total Assets

     138,581,374   
  

 

 

 

Liabilities:

  

Distributions payable

     21,377   

Payable for payroll expenses

     20,031   

Payable for investment advisory fees

     58,261   

Payable for accounting fees

     11,250   

Unrealized depreciation on swap contracts

     81,963   

Other accrued expenses

     20,174   
  

 

 

 

Total Liabilities

     213,056   
  

 

 

 

Preferred Shares:

  

Series A Cumulative Preferred Shares ($50 liquidation value, $0.001 par value, 1,200,000 shares authorized with 1,026,082 shares issued and outstanding)

     51,304,100   
  

 

 

 

Net Assets Attributable to Common Shareholders

   $ 87,064,218   
  

 

 

 

Net Assets Attributable to Common Shareholders Consist of:

  

Paid-in capital

   $ 63,557,014   

Undistributed net investment income

     279,257   

Accumulated net realized gain on investments, swaps contracts, and foreign currency transactions

     49,709   

Net unrealized appreciation on investments

     23,261,870   

Net unrealized depreciation on swap contracts

     (81,963

Net unrealized depreciation on foreign currency translations

     (1,669
  

 

 

 

Net Assets

   $ 87,064,218   
  

 

 

 

Net Asset Value per Common Share:

  

($87,064,218 ÷ 4,111,411 shares outstanding at $0.001 par value; unlimited number of shares authorized)

     $21.18   

Statement of Operations

For the Six Months Ended June 30, 2015 (Unaudited)

 

 

 

Investment Income:

  

Dividends (net of foreign withholding taxes of $143,049)

   $ 2,158,688   

Interest

     13,983   
  

 

 

 

Total Investment Income

     2,172,671   
  

 

 

 

Expenses:

  

Investment advisory fees

     352,614   

Payroll expenses

     50,269   

Shareholder communications expenses

     37,180   

Trustees’ fees

     27,992   

Custodian fees

     26,860   

Legal and audit fees

     24,594   

Accounting fees

     22,500   

Shareholder services fees

     12,852   

Interest expense

     173   

Miscellaneous expenses

     35,772   
  

 

 

 

Total Expenses

     590,806   
  

 

 

 

Less:

  

Expenses paid indirectly by broker (See Note 3)

     (1,858
  

 

 

 

Net Expenses

     588,948   
  

 

 

 

Net Investment Income

     1,583,723   
  

 

 

 

Net Realized and Unrealized Gain/(Loss) on Investments, Swap Contracts, and Foreign Currency:

  

Net realized gain on investments

     531,734   

Net realized gain on swap contracts

     119,515   

Net realized loss on foreign currency transactions

     (13,390
  

 

 

 

Net realized gain on investments, swap contracts, and foreign currency transactions

     637,859   
  

 

 

 

Net change in unrealized appreciation/depreciation:

  

on investments

     (2,013,932

on swap contracts

     (76,964

on foreign currency translations

     2,821   
  

 

 

 

Net change in unrealized appreciation/ depreciation on investments, swap contracts, and foreign currency translations

     (2,088,075
  

 

 

 

Net Realized and Unrealized Gain/(Loss) on Investments, Swap Contracts, and Foreign Currency

     (1,450,216
  

 

 

 

Net Increase in Net Assets Resulting from Operations

     133,507   
  

 

 

 

Total Distributions to Preferred Stock Shareholders

     (769,887
  

 

 

 

Net Decrease in Net Assets Attributable to Common Shareholders Resulting from Operations

   $ (636,380
  

 

 

 

 

 

See accompanying notes to financial statements.

 

8


The Gabelli Global Utility & Income Trust

Statement of Changes in Net Assets Attributable to Common Shareholders

 

 

 

     Six Months Ended
June 30, 2015
(Unaudited)
  Year Ended
December 31, 2014

Operations:

        

Net investment income

     $ 1,583,723       $ 3,551,337  

Net realized gain on investments, swap contracts, and foreign currency transactions

       637,859         1,616,369  

Net change in unrealized appreciation/depreciation on investments, swap contracts, and foreign currency translations

       (2,088,075 )       276,314  
    

 

 

     

 

 

 

Net Increase in Net Assets Resulting from Operations

       133,507         5,444,020  
    

 

 

     

 

 

 

Distributions to Preferred Shareholders:

        

Net investment income

       (692,898 )*       (1,249,038 )

Net realized short term gain

               (414,713 )

Net realized long term gain

       (76,989 )*       (633,402 )
    

 

 

     

 

 

 

Total Distributions to Preferred Shareholders.

       (769,887 )       (2,297,153 )
    

 

 

     

 

 

 

Net Increase/(Decrease) in Net Assets Attributable to Common Shareholders Resulting from Operations

       (636,380 )       3,146,867  
    

 

 

     

 

 

 

Distributions to Common Shareholders:

        

Net investment income

       (592,044 )*       (1,601,855 )

Net realized short term gain

               (540,471 )

Net realized long term gain

       (74,005 )*       (825,048 )

Return of capital

       (1,800,798 )*       (1,969,881 )
    

 

 

     

 

 

 

Total Distributions to Common Shareholders

       (2,466,847 )       (4,937,255 )
    

 

 

     

 

 

 

Fund Share Transactions:

        

Net decrease in net assets from repurchase of common shares

               (144,665 )

Rights offering costs for common shares charged to paid-in capital

               (250 )
    

 

 

     

 

 

 

Net Decrease in Net Assets from Fund Share Transactions:

               (144,915 )
    

 

 

     

 

 

 

Net Decrease in Net Assets Attributable to Common Shareholders

       (3,103,227 )       (1,935,303 )

Net Assets Attributable to Common Shareholders:

        

Beginning of year

       90,167,445         92,102,748  
    

 

 

     

 

 

 

End of period (including undistributed net investment income of $279,257 and $0, respectively)

     $ 87,064,218       $ 90,167,445  
    

 

 

     

 

 

 

 

* Based on year to date book income. Amounts are subject to change and recharacterization at year end.

See accompanying notes to financial statements.

 

9


The Gabelli Global Utility & Income Trust

Financial Highlights

 

 

Selected data for a common share of beneficial interest outstanding throughout each period:

 

                                                                                                                                   
    Six Months Ended
June 30, 2015
(Unaudited)
    Year Ended December 31,  
                      2014                     2013                     2012                     2011                     2010  

Operating Performance:

                       

Net asset value, beginning of year

      $21.93          $22.36          $20.44          $20.57          $20.49          $19.87   

Net investment income

      (0.01       0.86          0.44          0.51          0.57          0.48   

Net realized and unrealized gain on investments, swap contracts, and foreign currency transactions

          0.05              0.47              4.13              0.56              0.71              1.34   

Total from investment operations

          0.04              1.33              4.57              1.07              1.28              1.82   

Distributions to Preferred Shareholders:

                       

Net investment income

      (0.17 )*        (0.30       (0.29                           

Net realized gain

         (0.02 )*           (0.26          (0.17              —                 —                 —   

Total distributions to preferred shareholders

         (0.19          (0.56          (0.46              —                 —                 —   

Net Increase/(Decrease) in Net Assets Attributable to Common Shareholders Resulting from Operations

         (0.15           0.77              4.11              1.07              1.28              1.82   

Distributions to Common Shareholders:

                       

Net investment income

      (0.14 )*        (0.39       (0.25       (0.55       (0.60       (0.67

Net realized gain

      (0.02 )*        (0.33       (0.15       (0.32       (0.39       (0.02

Return of capital

         (0.44 )*           (0.48          (0.80          (0.33          (0.21          (0.51

Total distributions to common shareholders

         (0.60          (1.20          (1.20          (1.20          (1.20          (1.20

Fund Share Transactions:

                       

Increase/(Decrease) in net asset value from common share transactions

                        0.01          (0.00 )(a)        0.00 (a)          

Decrease in net asset value from common shares issued in rights offering

                        (0.88                           

Decrease in net asset value from repurchase of common shares

               (0.00 )(a)                                     

Offering expenses charged to paid-in capital

             —             (0.00 )(a)           (0.12              —                 —                 —   

Total capital share transactions

             —             (0.00 )(a)           (0.99          (0.00 )(a)            0.00 (a)               —   

Net Asset Value, End of Period

      $21.18          $21.93          $22.36          $20.44          $20.57          $20.49   

NAV total return †

         (0.70 )%            3.53         21.54           5.42           6.39           9.60

Market value, end of period

      $18.17          $19.43          $20.04          $20.88          $21.08          $20.31   

Investment total return **

         (3.53 )%            2.98           7.32           5.09         10.12         11.24

See accompanying notes to financial statements.

 

10


The Gabelli Global Utility & Income Trust

Financial Highlights (Continued)

 

 

Selected data for a common share of beneficial interest outstanding throughout each period:

 

    Six Months Ended
June 30, 2015
(Unaudited)
    Year Ended December 31,  
                  2014                 2013                 2012                 2011                 2010  

Ratios to Average Net Assets and Supplemental Data:

           

Net assets including liquidation value of preferred shares, end of period (in 000’s)

    $138,368        $141,789        $143,724                        

Net assets attributable to common shares, end of period (in 000’s)

    $  87,064        $  90,167        $  92,103        $63,256        $63,334        $62,981   

Ratio of net investment income to average net assets attributable to common shares

    3.55 %(b)      3.85     2.40     2.50     2.75     2.46

Ratio of operating expenses to average net assets attributable to common shares

    1.32 %(b)(c)      1.39     1.22     1.24     1.36     1.65

Ratio of operating expenses to average net assets including liquidation value of preferred shares

    0.84 %(b)(c)      0.89     0.74                     

Portfolio turnover rate

    13.2     26.6     28.2     6.0     5.9     7.8

Preferred Shares:

           

Series A Cumulative Preferred Shares

           

Liquidation value, end of period (in 000’s)

    $  51,304        $  51,621        $  51,621                        

Total shares outstanding (in 000’s)

    1,026        1,032        1,032                        

Liquidation preference per share

    $    50.00        $    50.00        $    50.00                        

Average market value(d)

    $    50.37        $    50.55        $    50.88                        

Asset coverage per share

    $  134.85        $  137.34        $  139.21                        

Asset Coverage

    270     275     278                     

 

Based on net asset value per share, adjusted for reinvestment of distributions at the net asset value per share on the ex-dividend dates and adjustments for the rights offering. 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.

**

Based on market value per share at initial public offering of $20.00 per share, adjusted for reinvestments of distributions at prices obtained under the Fund’s dividend reinvestment plan and adjustments for the rights offering. Total return for a period of less than one year is not annualized.

(a)

Amount represents less than $0.005 per share.

(b)

Annualized.

(c)

The Fund received credits from a designated broker who agreed to pay certain Fund operating expenses. For the six months ended June 30, 2015, there was no impact to the expense ratios.

(d)

Based on weekly prices.

See accompanying notes to financial statements.

 

11


The Gabelli Global Utility & Income Trust

Notes to Financial Statements (Unaudited)

 

 

1. Organization. The Gabelli Global Utility & Income Trust (the “Fund”) is a non-diversified closed-end management investment company organized as a Delaware statutory trust on March 8, 2004 and registered under the Investment Company Act of 1940, as amended (the “1940 Act”). Investment operations commenced on May 28, 2004.

The Fund’s investment objective is to seek a consistent level of after-tax total return over the long term with an emphasis currently on qualified dividends. The Fund will attempt to achieve its investment objective by investing, under normal market conditions, at least 80% of its assets in equity securities (including preferred securities) of domestic and foreign companies involved to a substantial extent in providing products, services, or equipment for the generation or distribution of electricity, gas, or water and infrastructure operations, and in equity securities (including preferred securities) of companies in other industries, in each case in such securities that are expected to pay periodic dividends.

2. Significant Accounting Policies. As an investment company, the Fund follows the investment company accounting and reporting guidance, which is part of U.S. generally accepted accounting principles (“GAAP”) that may require the use of management estimates and assumptions in the preparation of its financial statements. Actual results could differ from those estimates. The following is a summary of significant accounting policies followed by the Fund 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 (the “Board”) 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”).

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

 

12


The Gabelli Global Utility & Income Trust

Notes to Financial Statements (Unaudited) (Continued)

 

 

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 Fund’s 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. The summary of the Fund’s investments in securities and other financial instruments by inputs used to value the Fund’s investments as of June 30, 2015 is as follows:

 

     Valuation Inputs         
     Level 1
Quoted Prices
     Level 2 Other Significant
Observable Inputs
    Level 3 Significant
Unobservable Inputs
     Total Market Value
at 06/30/15
 

INVESTMENTS IN SECURITIES:

          

ASSETS (Market Value):

          

Common Stocks:

          

ENERGY AND UTILITIES (a)

     $  59,090,774                        $  59,090,774   

COMMUNICATIONS

          

Cable and Satellite

     15,909,741         $        8,744           15,918,485   

Wireless Communications

     7,762,932                $  1,400         7,764,332   

Other Industries (a)

     20,614,687                        20,614,687   

OTHER

          

Aerospace

     2,323,056         22,442                2,345,498   

Other Industries (a)

     23,725,782                        23,725,782   

Total Common Stocks

     129,426,972         31,186        1,400         129,459,558   

Convertible Preferred Stocks (a)

     78,448                        78,448   

Rights (a)

                    31,428         31,428   

Warrants (a)

             39,596                39,596   

Convertible Corporate Bonds (a)

             388,438                388,438   

U.S. Government Obligations

             7,386,728                7,386,728   

TOTAL INVESTMENTS IN SECURITIES – ASSETS

     $129,505,420         $7,845,948        $32,828         $137,384,196   

OTHER FINANCIAL INSTRUMENTS:*

          

LIABILITIES (Unrealized Depreciation):

          

EQUITY CONTRACT

          

Contract for Difference Swap Agreements

             $    (81,963             $        (81,963

TOTAL OTHER FINANCIAL INSTRUMENTS:

             $    (81,963              $        (81,963

 

(a)

Please refer to the Schedule of Investments (“SOI”) for the industry classifications of these portfolio holdings.

*

Other financial instruments are derivatives reflected in the SOI, such as options, futures, forwards, and swaps, which may be valued at the unrealized appreciation/depreciation of the instrument.

 

13


The Gabelli Global Utility & Income Trust

Notes to Financial Statements (Unaudited) (Continued)

 

 

The Fund did not have material transfers among Level 1, Level 2, and Level 3 during the six months ended June 30, 2015. The Fund’s policy is to recognize transfers among Levels as of the beginning of the reporting period.

Additional Information to Evaluate Qualitative Information.

General. The Fund uses recognized industry pricing services – approved by the Board 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 Board 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 Fund may engage in various portfolio investment strategies by investing in a number of derivative financial instruments for the purposes of increasing the income of the Fund, hedging against changes in the value of its portfolio securities and in the value of securities it intends to purchase, or hedging against 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, the 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 the 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 the Fund’s ability to pay distributions.

 

14


The Gabelli Global Utility & Income Trust

Notes to Financial Statements (Unaudited) (Continued)

 

 

Collateral requirements differ by type of derivative. Collateral requirements are set by the broker or exchange clearing house for exchange traded derivatives, while collateral terms are contract specific for derivatives traded over-the-counter. Securities pledged to cover obligations of the Fund under derivative contracts are noted in the Schedule of Investments. Cash collateral, if any, pledged for the same purpose will be reported separately in the Statement of Assets and Liabilities.

The Fund’s policy with respect to offsetting is that, absent an event of default by the counterparty or a termination of the agreement, the master agreement does not result in an offset of reported amounts of financial assets and financial liabilities in the Statement of Assets and Liabilities across transactions between the Fund and the applicable counterparty. The enforceability of the right to offset may vary by jurisdiction.

The Fund’s derivative contracts held at June 30, 2015 are not accounted for as hedging instruments under GAAP and are disclosed in the Schedule of Investments together with the related counterparty.

Swap Agreements. The Fund may enter into equity contract for difference swap transactions for the purpose of increasing the income of the Fund. The use of swaps is a highly specialized activity that involves investment techniques and risks different from those associated with ordinary portfolio security transactions. In an equity contract for difference swap, a set of future cash flows is exchanged between two counterparties. One of these cash flow streams will typically be based on a reference interest rate combined with the performance of a notional value of shares of a stock. The other will be based on the performance of the shares of a stock. Depending on the general state of short term interest rates and the returns on the Fund’s portfolio securities at the time an equity contract for difference swap transaction reaches its scheduled termination date, there is a risk that the Fund will not be able to obtain a replacement transaction or that the terms of the replacement will not be as favorable as on the expiring transaction.

Unrealized gains related to swaps are reported as an asset and unrealized losses are reported as a liability in the Statement of Assets and Liabilities. The change in value of swaps, including the accrual of periodic amounts of interest to be received or paid on swaps, is reported as unrealized gain or loss in the Statement of Operations. A realized gain or loss is recorded upon receipt or payment of a periodic payment or termination of swap agreements.

The Fund has entered into equity contract for difference swap agreements with The Goldman Sachs Group, Inc. Details of the swaps at June 30, 2015 are reflected within the Schedule of Investments and further details are as follows:

 

Notional Amount    Equity Security Received    Interest Rate/ Equity Security Paid    Termination
Date
   Net Unrealized
Depreciation
  

Market Value

Appreciation on:

  

One month LIBOR plus 90 bps plus

Market Value Depreciation on:

     

$0

  

(14,100,000 Shares)

   Rolls-Royce Holdings plc, Cl. C    Rolls-Royce Holdings plc, Cl. C    6/29/16    $(21,692)         

1,427,250

  

(100,000 Shares)

   Rolls-Royce Holdings plc    Rolls-Royce Holdings plc    6/28/16      (60,271)         
               $(81,963)         

The Fund’s volume of activity in equity contract for difference swap agreements during the six months ended June 30, 2015 had an average monthly notional amount of approximately $1,466,445.

 

15


The Gabelli Global Utility & Income Trust

Notes to Financial Statements (Unaudited) (Continued)

 

 

Forward Foreign Exchange Contracts. The Fund may engage in forward foreign exchange contracts for the purpose of hedging a specific transaction with respect to either the currency in which the transaction is denominated or another currency as deemed appropriate by the Adviser. Forward foreign exchange contracts are valued at the forward rate and are marked-to-market daily. The change in market value is included in unrealized appreciation/depreciation on foreign currency translations. When the contract is closed, the Fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed.

The use of forward foreign exchange contracts does not eliminate fluctuations in the underlying prices of the Fund’s portfolio securities, but it does establish a rate of exchange that can be achieved in the future. Although forward foreign exchange contracts limit the risk of loss due to a decline in the value of the hedged currency, they also limit any potential gain that might result should the value of the currency increase. At June 30, 2015, the Fund held no forward foreign exchange contracts.

At June 30, 2015, the Fund’s derivative liabilities (by type) are as follows:

 

         

Gross Amounts Not Offset in the

Statement of Assets and Liabilities

   
    

Gross Amounts of
Recognized Liabilities
Presented in the Statement
of Assets

and Liabilities

  

Gross Amounts Available
for Offset

in the Statement of Assets
and Liabilities

  

Financial

Instruments

  

Cash

Collateral

Pledged

          Net Amount
  

 

Liabilities

             

Equity Contract for Difference Swap Agreements

   $(81,963)       $81,963                      —

As of June 30, 2015, the value of equity contract for difference swap agreements can be found in the Statement of Assets and Liabilities under Liabilities, Unrealized depreciation on swap contracts. For the six months ended June 30, 2015, the effect of equity contract for difference swap agreements can be found in the Statement of Operations under Net Realized and Unrealized Gain/(Loss) on Investments, Swap Contracts, and Foreign Currency, Net realized gain on swap contracts and Net change in unrealized appreciation/depreciation on swap contracts.

Limitations on the Purchase and Sale of Futures Contracts, Certain Options, and Swaps. Subject to the guidelines of the Board, the 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. The 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 the 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 the Fund’s assets committed to margin and options premiums and (ii) non-bona fide hedging transactions, provided that the 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 the Fund’s existing futures positions or swaps positions and option or swaption premiums would exceed 5% of the market

 

16


The Gabelli Global Utility & Income Trust

Notes to Financial Statements (Unaudited) (Continued)

 

 

value of the 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 the Fund’s commodity interest transactions would not exceed 100% of the market value of the 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, the 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, the 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 the Fund, and on the Fund’s performance.

Foreign Currency Translations. The books and records of the 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. The 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.

Foreign Taxes. The Fund 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 Fund is 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 Board. The continued liquidity of such securities is not as well assured as that of publicly traded securities, and accordingly the Board will monitor their liquidity. At June 30, 2015, the Fund held no restricted securities.

 

17


The Gabelli Global Utility & Income Trust

Notes to Financial Statements (Unaudited) (Continued)

 

 

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 the Fund becomes aware of such dividends.

Distributions to Shareholders. Distributions to 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 the Fund, and timing differences. 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 Fund.

The tax character of distributions paid during the year ended December 31, 2014 was as follows:

 

    

Common

    

Preferred

 

Distributions paid from:

     

Ordinary income (inclusive of short term gains)

   $ 2,142,326       $ 1,663,751   

Net long term capital gains

     825,048         633,402   

Return of capital

     1,969,881           
  

 

 

    

 

 

 

Total distributions paid

   $ 4,937,255       $ 2,297,153   
  

 

 

    

 

 

 

Provision for Income Taxes. The Fund intends to continue to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). It is the policy of the 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.

At December 31, 2014, the components of accumulated earnings/losses on a tax basis were as follows:

 

Net unrealized appreciation on investments, swap contracts, and foreign currency translations

   $ 24,933,012   

Qualified late year loss deferral*

     (102,935

Other temporary differences**

     (20,444
  

 

 

 

Total

   $ 24,809,633   
  

 

 

 

 

*

Under the current law, qualified late year losses realized after October 31 and prior to the Fund’s year end may be elected as occurring on the first day of the following year.

**

Other temporary differences were primarily due to current year dividends payable and mark-to market adjustments on swap contracts.

The Fund is permitted to carry capital losses forward for an unlimited period. Capital losses that are carried forward will retain their character as either short term or long term capital losses.

 

18


The Gabelli Global Utility & Income Trust

Notes to Financial Statements (Unaudited) (Continued)

 

 

The following summarizes the tax cost of investments and the related net unrealized appreciation at June 30, 2015:

 

     Cost    Gross Unrealized
Appreciation
   Gross Unrealized
Depreciation
   Net Unrealized Appreciation

Investments

   $114,599,783    $31,962,796    $(9,178,383)    $22,784,413

The Fund is required to evaluate tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Income tax and related interest and penalties would be recognized by the Fund as tax expense in the Statement of Operations if the tax positions were deemed not to meet the more-likely-than-not threshold. For the six months ended June 30, 2015, the Fund did not incur any income tax, interest, or penalties. As of June 30, 2015, the Adviser has reviewed all open tax years and concluded that there was no impact to the Fund’s net assets or results of operations. The Fund’s federal and state tax returns for the prior three fiscal years remain open, subject to examination. On an ongoing basis, the Adviser will monitor the Fund’s tax positions to determine if adjustments to this conclusion are necessary.

3. Agreements and Transactions with Affiliates ad Other Arrangements. The 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, currently equal on an annual basis to 0.50% of the value of the Fund’s average weekly total assets. In accordance with the Advisory Agreement, the Adviser provides a continuous investment program for the Fund’s portfolio and oversees the administration of all aspects of the Fund’s business and affairs.

During the six months ended June 30, 2015, the Fund paid brokerage commissions on security trades of $7,513 to G.research, Inc., an affiliate of the Adviser.

During the six months ended June 30, 2015, the Fund received credits from a designated broker who agreed to pay certain Fund operating expenses. The amount of such expenses paid through this directed brokerage arrangement during this period was $1,858.

The cost of calculating the Fund’s NAV per share is a Fund expense pursuant to the Advisory Agreement. During the six months ended June 30, 2015, the Fund paid or accrued $22,500 to the Adviser in connection with the cost of computing the Fund’s NAV.

As per the approval of the Board, the Fund compensates officers of the 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). For the six months ended June 30, 2015, the Fund paid or accrued $50,269 in payroll expenses in the Statement of Operations.

The Fund 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 $3,000, the Nominating Committee Chairman receives an annual fee of $2,000, and the Lead Trustee receives 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

 

19


The Gabelli Global Utility & Income Trust

Notes to Financial Statements (Unaudited) (Continued)

 

 

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, 2015, other than short term securities and U.S. Government obligations, aggregated $16,287,427 and $15,966,681, respectively.

5. Capital. The Fund is authorized to issue an unlimited number of common shares of beneficial interest (par value $0.001). The Board has authorized the repurchase of its shares on the open market when the shares are trading at a discount of 10% 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, 2015, the Fund did not repurchase and retire any common shares in the open market. During the year ended December 31, 2014, the Fund repurchased and retired 7,123 shares in the open market at a cost of $144,665 and an average discount of approximately 10.90% from its NAV.

A shelf registration authorizing the offering of $100 million of common shares, preferred shares, notes and subscription rights for common or preferred shares was declared effective by the SEC on April 3, 2013.

The Fund distributed transferable rights for each of the 3,097,284 common shares outstanding. Three rights were required to purchase one additional common share and one newly issued Series A Cumulative Puttable and Callable Preferred Share (“Series A Preferred”) at the combined subscription price of $68.50 (consisting of $18.50 for each common share plus $50.00 for each Series A Preferred share). On June 19, 2013, the Fund issued 1,032,428 common shares and 1,032,428 Series A Preferred, receiving $70,286,465, after the deduction of offering expenses and solicitation fees of $369,721 and $65,132, respectively. The NAV per share of the Fund was reduced by approximately $1.00 as a result of the issuance of common shares below NAV.

The Fund’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 Statement 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 Preferred Shares at the redemption price of $50 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 the Fund’s ability to pay dividends to common shareholders and could lead to sales of portfolio securities at inopportune times. The income received on the Fund’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.

The liquidation value of Series A Preferred is $50 per share. The Series A Preferred has an initial annual dividend rate of 6.00% for the four dividend periods beginning in September 2014 ending on or prior to June 26, 2015, and 3.00% for the subsequent eight dividend periods ending on or prior to June 26, 2016. At that time, the Board will determine a fixed annual dividend rate that will apply for all subsequent dividend periods, which will be 200 basis points over the yield of the ten year U.S. Treasury Note, but in no case will the annual

 

20


The Gabelli Global Utility & Income Trust

Notes to Financial Statements (Unaudited) (Continued)

 

 

dividend rate be less than 3.00% or greater than 5.00%. The Fund will redeem all or any part of the Series A Preferred that holders have properly submitted for redemption during the thirty day period prior to each of June 26, 2015 and June 26, 2018 at the liquidation value plus any accumulated and unpaid dividends. The Series A Preferred is noncallable before June 19, 2018. During the six months ended June 30, 2015, 6,346 shares were put back to the Fund at a liquidation value of $317,300. At June 30, 2015, 1,026,082 Series A Preferred were outstanding and accrued dividends amounted to $21,377.

The holders of Preferred Shares generally are entitled to one vote per share held on each matter submitted to a vote of shareholders of the Fund 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 Fund’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. Industry Concentration. Because the Fund primarily invests in common stocks and other securities of foreign and domestic companies in the utility industry, its portfolio may be subject to greater risk and market fluctuations than a portfolio of securities representing a broad range of investments.

7. Indemnifications. The 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.

8. Subsequent Events. Management has evaluated the impact on the Fund of all 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.

Shareholder Meeting – May 11, 2015 – Final Results

The Fund’s Annual Meeting of Shareholders was held on May 11, 2015 at the Greenwich Library in Greenwich, Connecticut. At that meeting, common and preferred shareholders, voting together as a single class, elected Salvatore M. Salibello, CPA as a Trustee of the Fund. A total of 4,119,720 votes were cast in favor of this Trustee and a total of 142,278 votes were withheld for this Trustee. In addition, preferred shareholders, voting as a separate class, elected James P. Conn as a Trustee of the Fund. A total of 866,808 votes were cast in favor of this Trustee and a total of 47,279 votes were withheld for this Trustee.

Anthony J. Colavita, Vincent D. Enright, Michael J. Melarkey, and Salvatore J. Zizza continue to serve in their capacities as Trustees of the Fund.

We thank you for your participation and appreciate your continued support.

 

21


The Gabelli Global Utility & Income Trust

Board Consideration and Re-Approval of Investment Advisory Agreement (Unaudited)

At its meeting on May 20, 2015, the Board of Trustees (“Board”) of the Fund approved the continuation of the investment advisory agreement with the Adviser for the Fund on the basis of the recommendation by the trustees who are not “interested persons” of the Fund (the “Independent Board Members”). The following paragraphs summarize the material information and factors considered by the Independent Board Members as well as their conclusions relative to such factors.

Nature, Extent, and Quality of Services. The Independent Board Members considered information regarding the portfolio manager, the depth of the analyst pool available to the Adviser and the portfolio manager, the scope of supervisory, administrative, shareholder, and other services supervised or provided by the Adviser and the absence of significant service problems reported to the Board. The Independent Board Members noted the experience, length of service, and reputation of the portfolio manager.

Investment Performance. The Independent Board Members reviewed the performance of the Fund against a peer group of utility and infrastructure closed-end funds selected by Lipper. The Independent Board Members noted that the Fund’s performance was in the bottom quartile for the one, three, and five year periods. The Independent Board Members also reviewed performance of the Fund in relation to the Lipper closed-end core, growth, and equity funds. In the one, three, and five year periods, the Fund’s performance was in the fourth quartile.

Profitability. The Independent Board Members reviewed summary data regarding the profitability of the Fund to the Adviser both with an administrative overhead charge and without such charge and found the profitability to be below normal. The Board also noted that a portion of the Fund’s portfolio transactions was executed by the Adviser’s affiliated broker, resulting in incremental profits to the broker.

Economies of Scale. The Independent Board Members discussed the major elements of the Adviser’s cost structure and the relationship of those elements to potential economies of scale. The Independent Board Members noted that the Fund was a closed-end fund and unlikely to realize any economies of scale potentially available through growth in the absence of additional offerings and that the rights offering had not appeared to produce economies of scale for the Adviser.

Sharing of Economies of Scale. The Independent Board Members noted that the investment management fee schedule for the Fund does not take into account any potential economies of scale.

Service and Cost Comparisons. The Independent Board Members compared the expense ratios of the investment advisory fee, other expenses, and total expenses of the Fund with similar expense ratios of the same peer groups of and noted that the advisory fee includes substantially all administrative services of the Fund as well as investment advisory services of the Adviser. The Independent Board Members noted that the Fund’s total expense ratios were below average and the Fund’s size was below average within the group. The Independent Board Members were presented with, but did not consider to be material to their decision, various information comparing the advisory fee with the fee for other types of accounts managed by the Adviser.

Conclusions. The Independent Board Members concluded that the Fund enjoyed highly experienced portfolio management services, good ancillary services, and a reasonable performance record within its conservative stance. The Independent Board Members also concluded that the Fund’s expense ratios were reasonable in light of the Fund’s size, and that, in part due to the Fund’s structure as a closed-end fund, economies of scale were not a significant factor in their thinking. The Independent Board Members did not view the potential profitability

 

22


The Gabelli Global Utility & Income Trust

Board Consideration and Re-Approval of Investment Advisory Agreement (Unaudited) (Continued)

 

of ancillary services as material to their decision. On the basis of the foregoing and without assigning particular weight to any single conclusion, the Independent Board Members determined to recommend continuation of the investment management agreement to the full Board.

Based on a consideration of all these factors in their totality, the Board Members, including all of the Independent Board Members, determined that the Fund’s advisory fee was fair and reasonable with respect to the quality of services provided and in light of other factors described above that the Board deemed relevant. Accordingly, the Board determined to approve the continuation of the Fund’s Advisory Agreement. The Board Members based their decision on the evaluation of all these factors and did not consider any one factor as all important or controlling.

 

23


AUTOMATIC DIVIDEND REINVESTMENT

AND VOLUNTARY CASH PURCHASE PLANS

Enrollment in the Plan

It is the policy of The Gabelli Global Utility & Income Trust to automatically reinvest dividends payable to common shareholders. As a “registered” shareholder, you automatically become a participant in the Fund’s Automatic Dividend Reinvestment Plan (the “Plan”). The Plan authorizes the Fund to credit shares of common stock to participants upon an income dividend or a capital gains distribution regardless of whether the shares are trading at a discount or a premium to net asset value. All distributions to shareholders whose shares are registered in their own names will be automatically reinvested pursuant to the Plan in additional shares of the Fund. Plan participants may send their stock certificates to Computershare Trust Company, N.A. (“Computershare”) to be held in their dividend reinvestment account. Registered shareholders wishing to receive their distribution in cash must submit this request in writing to:

The Gabelli Global Utility & Income Trust

c/o Computershare

P.O. Box 30170

College Station, TX 77842-3170

Shareholders requesting this cash election must include the shareholder’s name and address as they appear on the share certificate. Shareholders with additional questions regarding the Plan or requesting a copy of the terms of the Plan may contact Computershare at (800) 336-6983.

If your shares are held in the name of a broker, bank, or nominee, you should contact such institution. If such institution is not participating in the Plan, your account will be credited with a cash dividend. In order to participate in the Plan through such institution, it may be necessary for you to have your shares taken out of “street name” and re-registered in your own name. Once registered in your own name, your dividends will be automatically reinvested. Certain brokers participate in the Plan. Shareholders holding shares in “street name” at participating institutions will have dividends automatically reinvested. Shareholders wishing a cash dividend at such institution must contact their broker to make this change.

The number of shares of common stock distributed to participants in the Plan in lieu of cash dividends is determined in the following manner. Under the Plan, whenever the market price of the Fund’s common stock is equal to or exceeds net asset value at the time shares are valued for purposes of determining the number of shares equivalent to the cash dividends or capital gains distribution, participants are issued shares of common stock valued at the greater of (i) the net asset value as most recently determined or (ii) 95% of the then current market price of the Fund’s common stock. The valuation date is the dividend or distribution payment date or, if that date is not a New York Stock Exchange (“NYSE”) trading day, the next trading day. If the net asset value of the common stock at the time of valuation exceeds the market price of the common stock, participants will receive shares from the Fund valued at market price. If the Fund should declare a dividend or capital gains distribution payable only in cash, Computershare will buy common stock in the open market, or on the NYSE or elsewhere, for the participants’ accounts, except that Computershare will endeavor to terminate purchases in the open market and cause the Fund to issue shares at net asset value if, following the commencement of such purchases, the market value of the common stock exceeds the then current net asset value.

The automatic reinvestment of dividends and capital gains distributions will not relieve participants of any income tax which may be payable on such distributions. A participant in the Plan will be treated for federal income tax purposes as having received, on a dividend payment date, a dividend or distribution in an amount equal to the cash the participant could have received instead of shares.

Voluntary Cash Purchase Plan

The Voluntary Cash Purchase Plan is yet another vehicle for our shareholders to increase their investment in the Fund. In order to participate in the Voluntary Cash Purchase Plan, shareholders must have their shares registered in their own name.

Participants in the Voluntary Cash Purchase Plan have the option of making additional cash payments to Computershare for investments in the Fund’s shares at the then current market price. Shareholders may send an amount from $250 to $10,000. Computershare will use these funds to purchase shares in the open market on or about the 1st and 15th of each month. Computershare will charge each shareholder who participates $0.75, plus a pro rata share of the brokerage commissions. Brokerage charges for such purchases are expected to be less than the usual brokerage charge for such transactions. It is suggested that any voluntary cash payments be sent to Computershare, P.O. Box 30170, College Station, TX 77842–3170 such that Computershare receives such payments approximately 10 days before the 1st and 15th of the month. Funds not received at least five days before the investment date shall be held for investment until the next purchase date. A payment may be withdrawn without charge if notice is received by Computershare at least 48 hours before such payment is to be invested.

Shareholders wishing to liquidate shares held at Computershare must do so in writing or by telephone. Please submit your request to the above mentioned address or telephone number. Include in your request your name, address, and account number. The cost to liquidate shares is $2.50 per transaction as well as the brokerage commission incurred. Brokerage charges are expected to be less than the usual brokerage charge for such transactions.

For more information regarding the Dividend Reinvestment Plan and Voluntary Cash Purchase Plan, brochures are available by calling (914) 921-5070 or by writing directly to the Fund.

The Fund reserves the right to amend or terminate the Plan as applied to any voluntary cash payments made and any dividend or distribution paid subsequent to written notice of the change sent to the members of the Plan at least 90 days before the record date for such dividend or distribution. The Plan also may be amended or terminated by Computershare on at least 90 days written notice to participants in the Plan.

 

24


 

THE GABELLI GLOBAL UTILITY & INCOME TRUST

AND YOUR PERSONAL PRIVACY

Who are we?

The Gabelli Global Utility & Income Trust is a closed-end management investment company registered with the Securities and Exchange Commission under the Investment Company Act of 1940. We are managed by Gabelli Funds, LLC, which is affiliated with GAMCO Investors, Inc. GAMCO Investors, Inc. is a publicly held company that has subsidiaries that provide investment advisory or brokerage services for a variety of clients.

What kind of non-public information do we collect about you if you become a Fund shareholder?

When you purchase shares of the Fund on the New York Stock Exchange, you have the option of registering directly with our transfer agent in order, for example, to participate in our dividend reinvestment plan.

 

   

Information you give us on your application form. This could include your name, address, telephone number, social security number, bank account number, and other information.

 

   

Information about your transactions with us. This would include information about the shares that you buy or sell; it may also include information about whether you sell or exercise rights that we have issued from time to time. If we hire someone else to provide services — like a transfer agent — we will also have information about the transactions that you conduct through them.

What information do we disclose and to whom do we disclose it?

We do not disclose any non-public personal information about our customers or former customers to anyone other than our affiliates, our service providers who need to know such information, and as otherwise permitted by law. If you want to find out what the law permits, you can read the privacy rules adopted by the Securities and Exchange Commission. They are in volume 17 of the Code of Federal Regulations, Part 248. The Commission often posts information about its regulations on its website, www.sec.gov.

What do we do to protect your personal information?

We restrict access to non-public personal information about you to the people who need to know that information in order to provide services to you or the Fund and to ensure that we are complying with the laws governing the securities business. We maintain physical, electronic, and procedural safeguards to keep your personal information confidential.




 

 

 

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THE GABELLI GLOBAL UTILITY & INCOME TRUST

One Corporate Center

Rye, NY 10580-1422

Portfolio Manager Biography

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.

 

 

 

 

We have separated the portfolio manager’s 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 manager’s commentary is unrestricted. Both the commentary and the financial statements, including the portfolio of investments, will be available on our website at www.gabelli.com.

The Net Asset Value per share appears in the Publicly Traded Funds column, under the heading “Specialized 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 “Specialized Equity Funds.”

The Net Asset Value per share may be obtained each day by calling (914) 921-5070 or visiting www.gabelli.com.

The NASDAQ symbol for the Net Asset Value is “XGLUX.”

 

Notice is hereby given in accordance with Section 23(c) of the Investment Company Act of 1940, as amended, that the Fund may from time to time purchase its common shares in the open market when the Fund’s shares are trading at a discount of 10% or more from the net asset value of the shares. The Fund 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.


 

THE GABELLI GLOBAL UTILITY & INCOME TRUST

One Corporate Center

Rye, NY 10580-1422

 

t 800-GABELLI (800-422-3554)

 

f 914-921-5118

 

e info@gabelli.com

GABELLI.COM

 

 

 

TRUSTEES

   OFFICERS

Anthony J. Colavita

President,

Anthony J. Colavita, P.C.

 

James P. Conn

Former Managing Director &

Chief Investment Officer,

Financial Security Assurance

Holdings Ltd.

 

Vincent D. Enright

Former Senior Vice President &

Chief Financial Officer,

KeySpan Corp.

 

Michael J. Melarkey

Partner,

Avansino, Melarkey, Knobel,

Mulligan & McKenzie

 

Salvatore M. Salibello, CPA

Partner,

Salibello & Company

 

Salvatore J. Zizza

Chairman,

Zizza & Associates Corp.

  

Bruce N. Alpert

President

 

Andrea R. Mango

Secretary & Vice President

 

Agnes Mullady

Treasurer

 

Richard J. Walz

Chief Compliance Officer

 

David I. Schachter

Vice President

 

Adam E. Tokar

Vice President & Ombudsman

 

INVESTMENT ADVISER

 

Gabelli Funds, LLC

One Corporate Center

Rye, New York 10580-1422

 

CUSTODIAN

 

State Street Bank and Trust

Company

 

COUNSEL

 

Skadden, Arps, Slate, Meagher &

Flom LLP

 

TRANSFER AGENT AND REGISTRAR

 

Computershare Trust Company, N.A.

 

 

GLU Q2/2015

LOGO

 


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 

Shares (or Units) 

Purchased 

 

 

(b) Average Price Paid 

per Share (or Unit) 

 

 

(c) Total Number of 

Shares (or Units) 

Purchased as Part of 
Publicly Announced 

Plans or Programs 

 

 

 (d) Maximum Number (or
 Approximate Dollar Value) of
 Shares (or Units)  that May
 Yet Be Purchased Under the
 Plans or Programs

 

Month #1 01/01/15 through 01/31/15

 

 

Common – N/A

 

Preferred Series A – N/A

 

Common – N/A

 

Preferred Series A – N/A

 

Common – N/A

 

Preferred Series A – N/A

 

Common – 4,111,411

 

Preferred Series A – 1,032,428

Month #2 02/01/15 through 02/28/15

 

 

Common – N/A

 

Preferred Series A – N/A

 

Common – N/A

 

Preferred Series A – N/A

 

Common – N/A

 

Preferred Series A – N/A

 

Common – 4,111,411

 

Preferred Series A – 1,032,428

Month #3   03/01/15 through 03/31/15

 

 

Common – N/A

 

Preferred Series A – N/A

 

Common – N/A

 

Preferred Series A – N/A

 

Common – N/A

 

Preferred Series A – N/A

 

Common – 4,111,411

 

Preferred Series A – 1,032,428

Month #4 04/01/15 through 04/30/15

 

 

Common – N/A

 

Preferred Series A – N/A

 

Common – N/A

 

Preferred Series A – N/A

 

Common – N/A

 

Preferred Series A – N/A

 

Common – 4,111,411

 

Preferred Series A – 1,032,428

Month #5 05/01/15 through 05/31/15

 

 

Common – N/A

 

Preferred Series A – N/A

 

Common – N/A

 

Preferred Series A – N/A

 

Common – N/A

 

Preferred Series A – N/A

 

Common – 4,111,411

 

Preferred Series A – 1,032,428

Month 06/01/15 through 06/30/15

 

 

Common – N/A

 

Preferred Series A – 6,346

 

Common – N/A

 

Preferred Series A – $50.00

 

Common – N/A

 

Preferred Series A – 6,346

 

Common – 4,111,411

 

Preferred Series A – 1,032,428 – 6,346 = 1,026,082

Total  

Common – N/A

 

Preferred Series A – 6,346

 

 

Common – N/A

 

Preferred Series A – $50.00

 

 

Common – N/A

 

Preferred Series A – 6,346

 

  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 $50.00.

 

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 Global Utility & Income Trust
By (Signature and Title)*     /s/ Bruce N. Alpert
        Bruce N. Alpert, Principal Executive Officer
Date       9/3/2015

 

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       9/3/2015

 

 

By (Signature and Title)*     /s/ Agnes Mullady
        Agnes Mullady, Principal Financial Officer and Treasurer
Date       9/3/2015

 

* Print the name and title of each signing officer under his or her signature.