Gabelli Utility Trust Continues Monthly Distributions, Declaring Distributions of $0.05 Per Share
February 23 2018 - 9:10AM
Business Wire
The Board of Trustees of The Gabelli Utility Trust (NYSE:GUT)
(the “Fund”) approved the continuation of its policy of paying
fixed monthly cash distributions. The Board of Trustees declared
cash distributions of $0.05 per share for each of April, May and
June 2018.
The distribution for April 2018 will be payable on April 23,
2018 to common shareholders of record on April 16, 2018.
The distribution for May 2018 will be payable on May 23, 2018 to
common shareholders of record on May 16, 2018.
The distribution for June 2018 will be payable on June 22, 2018
to common shareholders of record on June 15, 2018.
Each quarter, the Board of Trustees reviews the amount of any
potential distribution from the income, realized capital gain, or
capital available. The Board of Trustees will continue to monitor
the Fund’s distribution level, taking into consideration the Fund’s
net asset value and the financial market environment. If necessary,
the Fund will pay an adjusting distribution in December which
includes any additional income and net realized capital gains in
excess of the monthly distributions for that year to satisfy the
minimum distribution requirements of the Internal Revenue Code for
regulated investment companies. The Fund’s distribution policy is
subject to modification by the Board of Trustees at any time, and
there can be no guarantee that the policy will continue. The
distribution rate should not be considered the dividend yield or
total return on an investment in the Fund. The Gabelli Utility
Trust has paid a distribution to shareholders every month since
October 1999.
The Fund’s shares are currently trading at a premium to net
asset value. The Board of Trustees believes that the premium
at which the Fund shares trade relative to net asset value is not
likely to be sustainable. Shareholders participating in the
Fund’s dividend reinvestment plan should note that at the current
market price, the reinvestment of distributions occurs at a premium
to net asset value.
All or part of the distribution may be treated as long-term
capital gain or qualified dividend income (or a combination of
both) for individuals, each subject to the maximum federal income
tax rate, which is currently 20% in taxable accounts for
individuals (or less depending on an individual’s tax bracket). In
addition, certain U.S. shareholders who are individuals, estates or
trusts and whose income exceeds certain thresholds will be required
to pay a 3.8% Medicare surcharge on their "net investment income",
which includes dividends received from the Fund and capital gains
from the sale or other disposition of shares of the Fund.
If the Fund does not generate sufficient earnings (dividends and
interest income and realized net capital gain) equal to or in
excess of the aggregate distributions paid by the Fund in a given
year, then the amount distributed in excess of the Fund’s earnings
would be deemed a return of capital. Since this would be considered
a return of a portion of a shareholder’s original investment, it is
generally not taxable and would be treated as a reduction in the
shareholder’s cost basis.
Long-term capital gains, qualified dividend income, ordinary
income, and return of capital, if any, will be allocated on a
pro-rata basis to all distributions to common shareholders for the
year. Based on the accounting records of the Fund currently
available, each of the distributions paid to common shareholders in
2018 would be deemed 100% from return of capital on a book basis.
This does not represent information for tax reporting purposes. The
estimated components of each distribution are updated and provided
to shareholders of record in a notice accompanying the distribution
and are available on our website (www.gabelli.com). The final
determination of the sources of all distributions in 2018 will be
made after year end and can vary from the monthly estimates.
Shareholders should not draw any conclusions about the Fund’s
investment performance from the amount of the current distribution.
All shareholders with taxable accounts will receive written
notification regarding the components and tax treatment for all
2018 distributions in early 2019 via Form 1099-DIV.
Investors should carefully consider the investment objectives,
risks, charges, and expenses of the Fund before investing. More
information regarding the Fund’s distribution policy and other
information about the Fund is available by calling 800-GABELLI
(800-422-3554) or visiting www.gabelli.com.
The Gabelli Utility Trust is a diversified, closed-end
management investment company with $312 million in total net assets
whose primary investment objective is to seek long-term growth of
capital and income by investing primarily in utility companies
involved in the generation and distribution of electricity, gas,
and water. The Fund is managed by Gabelli Funds, LLC, a subsidiary
of GAMCO Investors, Inc. (NYSE:GBL).
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The Gabelli Utility TrustDavid Schachter, 914-921-5070
Gabelli Utility (NYSE:GUT)
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