The Gabelli Dividend & Income Trust
Schedule of Investments (Continued) — June 30, 2020 (Unaudited)
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Acquisition
Shares
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Issuer
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Acquisition
Date
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Acquisition
Cost
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06/30/20
Carrying
Value
Per Share
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300,000
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Wow Unlimited Media Inc.
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06/05/18
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$345,198
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$0.2173
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(c)
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Mandatory convertible securities are required to be converted on the dates listed; they generally may be converted
prior to these dates at the option of the holder.
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†
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Non-income producing security.
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††
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Represents annualized yields at dates of purchase.
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ADR
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American Depositary Receipt
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CVR
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Contingent Value Right
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REIT
|
Real Estate Investment Trust
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Geographic Diversification
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% of
Total
Investments
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Market
Value
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Long Positions
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North America
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83.8
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%
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$
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1,898,847,840
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Europe
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11.3
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256,662,695
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Japan
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4.6
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103,627,018
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Asia/Pacific
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0.3
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7,896,502
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Latin America
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0.0
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*
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165,400
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Total Investments
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100.0
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%
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$
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2,267,199,455
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*
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Amount represents less than 0.05%.
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See accompanying notes to
financial statements.
10
The Gabelli Dividend & Income Trust
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Statement of Assets and Liabilities
June 30, 2020 (Unaudited)
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Assets:
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Investments, at value (cost $1,766,160,424)
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$
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2,267,199,455
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Foreign currency, at value (cost $9,431)
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9,517
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Cash
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75,746
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Receivable for investments sold
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4,170,569
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Dividends and interest receivable
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3,488,745
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Deferred offering expense
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102,839
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Prepaid expenses
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19,744
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Total Assets
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2,275,066,615
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Liabilities:
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Distributions payable
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214,355
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Payable for investments purchased
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644,131
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Payable for investment advisory fees
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1,641,697
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Payable for payroll expenses
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64,730
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Payable for accounting fees
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11,250
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Payable for shareholder communications expenses
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270,247
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Other accrued expenses
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307,485
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Total Liabilities
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3,153,895
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Cumulative Preferred Shares, each at $0.001 par value:
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Series A (5.875%, $25 liquidation value, 3,200,000 shares authorized with 1,524,009 shares issued
and outstanding)
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38,100,225
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Series B (Auction Market, $25,000 liquidation value, 4,000 shares authorized with 3,600 shares
issued and outstanding)
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90,000,000
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Series C (Auction Market, $25,000 liquidation value, 4,800 shares authorized with 4,320 shares
issued and outstanding)
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108,000,000
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Series E (Auction Rate, $25,000 liquidation value, 5,400 shares authorized with 2,000 shares issued
and outstanding)
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50,000,000
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Series G (5.250%, $25 liquidation value, 4,000,000 shares authorized with 4,000,000 shares issued
and outstanding)
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100,000,000
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Series H (5.375%, $25 liquidation value, 2,000,000 shares authorized with 2,000,000 shares issued
and outstanding)
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50,000,000
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Total Preferred Shares
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436,100,225
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Net Assets Attributable to Common Shareholders.
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|
$
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1,835,812,495
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Net Assets Attributable to Common Shareholders Consist of:
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Paid-in capital
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$
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1,326,660,957
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Total distributable earnings
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509,151,538
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Net Assets
|
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|
$
|
1,835,812,495
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Net Asset Value per Common Share at $0.001 par value:
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($1,835,812,495 ÷ 90,528,701 shares outstanding; unlimited number of shares
authorized)
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$
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20.28
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Statement of Operations
For the Six Months Ended June 30, 2020 (Unaudited)
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Investment Income:
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Dividends (net of foreign withholding taxes of $ 634,060)
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$
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24,381,883
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Interest.
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550,151
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Total Income
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24,932,034
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Expenses:
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Investment advisory fees
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11,532,897
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Shareholder communications expenses
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213,143
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Trustees’ fees
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144,098
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Custodian fees
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143,947
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Payroll expenses
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|
134,796
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|
Legal and audit fees
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41,008
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Shareholder services fees
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35,942
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|
|
Accounting fees
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22,500
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Interest expense
|
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|
182
|
|
|
Miscellaneous expenses
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|
141,969
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|
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Total Expenses.
|
|
|
12,410,482
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|
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|
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|
Less:
|
|
|
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|
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Advisory fee reduction (See Note 3)
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|
|
(1,553,849
|
)
|
|
Expenses paid indirectly by broker (See Note 3)
|
|
|
(8,846
|
)
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|
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|
Total Credits and Reductions
|
|
|
(1,562,695
|
)
|
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|
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|
|
Net Expenses
|
|
|
10,847,787
|
|
|
|
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|
|
Net Investment Income
|
|
|
14,084,247
|
|
|
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|
Net Realized and Unrealized Gain/(Loss) on Investments and Foreign Currency:
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Net realized gain on investments
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|
77,543,331
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|
|
Net realized loss on foreign currency transactions.
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(999
|
)
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Net realized gain on investments and foreign currency transactions
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|
|
77,542,332
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Net change in unrealized appreciation: on investments
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|
|
(371,918,460
|
)
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|
on foreign currency translations
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5,548
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|
|
|
|
|
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|
|
Net change in unrealized appreciation/ depreciation on investments and foreign currency
translations
|
|
|
(371,912,912
|
)
|
|
|
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|
Net Realized and Unrealized Gain/(Loss) on Investments and Foreign Currency
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|
|
(294,370,580
|
)
|
|
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|
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|
Net Decrease in Net Assets Resulting from Operations
|
|
|
(280,286,333
|
)
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|
|
|
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|
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Total Distributions to Preferred Shareholders
|
|
|
(8,979,358
|
)
|
|
|
|
|
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|
|
Net Decrease in Net Assets Attributable to Common Shareholders Resulting from
Operations
|
|
$
|
(289,265,691
|
)
|
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|
|
|
See accompanying notes to
financial statements.
11
The Gabelli Dividend & Income Trust
Statements of Changes in Net Assets Attributable to Common Shareholders
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|
Six Months Ended
June 30,
2020
(Unaudited)
|
|
Year
Ended
December 31, 2019
|
|
Operations:
|
|
|
|
|
|
Net investment income
|
|
|
$
|
14,084,247
|
|
|
|
$
|
28,877,496
|
|
|
Net realized gain on investments and foreign currency transactions
|
|
|
|
77,542,332
|
|
|
|
|
102,580,817
|
|
|
Net change in unrealized appreciation/depreciation on investments and foreign currency
translations
|
|
|
|
(371,912,912
|
)
|
|
|
|
336,627,429
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Increase/(Decrease) in Net Assets Resulting from Operations
|
|
|
|
(280,286,333
|
)
|
|
|
|
468,085,742
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions to Preferred Shareholders
|
|
|
|
(8,979,358
|
)*
|
|
|
|
(24,833,499
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Increase/(Decrease) in Net Assets Attributable to Common Shareholders Resulting from
Operations
|
|
|
|
(289,265,691
|
)
|
|
|
|
443,252,243
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions to Common Shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated earnings
|
|
|
|
(59,797,442
|
)*
|
|
|
|
(106,634,718
|
)
|
|
Return of capital
|
|
|
|
—
|
|
|
|
|
(3,082,841
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Distributions to Common Shareholders
|
|
|
|
(59,797,442
|
)
|
|
|
|
(109,717,559
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fund Share Transactions:
|
|
|
|
|
|
|
|
|
|
|
|
Net decrease from repurchase of common shares
|
|
|
|
(1,731,974
|
)
|
|
|
|
—
|
|
|
Net increase in net assets from common shares issued in rights offering
|
|
|
|
—
|
|
|
|
|
164,864,860
|
|
|
Offering costs for common shares charged to paid-in capital
|
|
|
|
(94,621
|
)
|
|
|
|
(928,331
|
)
|
|
Offering costs for preferred shares charged to paid-in capital
|
|
|
|
—
|
|
|
|
|
(1,854,595
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Increase/(Decrease) in Net Assets from Fund Share Transactions
|
|
|
|
(1,826,595
|
)
|
|
|
|
162,081,934
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Increase/(Decrease) in Net Assets Attributable to Common Shareholders
|
|
|
|
(350,889,728
|
)
|
|
|
|
495,616,618
|
|
|
Net Assets Attributable to Common Shareholders:
|
|
|
|
|
|
Beginning of year
|
|
|
|
2,186,702,223
|
|
|
|
|
1,691,085,605
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
End of period
|
|
|
$
|
1,835,812,495
|
|
|
|
$
|
2,186,702,223
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
|
Based on year to date book income. Amounts are subject to change and recharacterization at year end.
|
See accompanying notes to
financial statements.
12
The Gabelli Dividend & Income Trust
Financial Highlights
Selected data for a common share of beneficial
interest outstanding throughout each period:
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2020
|
|
|
Year Ended December 31,
|
|
|
|
|
(Unaudited)
|
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
Operating Performance:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net asset value, beginning of year
|
|
|
|
$
|
24.12
|
|
|
|
|
$
|
20.51
|
|
|
|
|
$
|
25.11
|
|
|
|
|
$
|
22.30
|
|
|
|
|
$
|
21.07
|
|
|
|
|
|
|
$
|
23.57
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
|
|
|
0.16
|
|
|
|
|
|
0.35
|
|
|
|
|
|
0.45
|
|
|
|
|
|
0.32
|
|
|
|
|
|
0.36
|
|
|
|
|
|
|
|
0.30
|
|
|
Net realized and unrealized gain/(loss) on investments, securities sold short, and foreign currency
transactions
|
|
|
|
|
(3.24
|
)
|
|
|
|
|
5.25
|
|
|
|
|
|
(3.43
|
)
|
|
|
|
|
4.09
|
|
|
|
|
|
2.45
|
|
|
|
|
|
|
|
(1.39
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total from investment operations
|
|
|
|
|
(3.08
|
)
|
|
|
|
|
5.60
|
|
|
|
|
|
(2.98
|
)
|
|
|
|
|
4.41
|
|
|
|
|
|
2.81
|
|
|
|
|
|
|
|
(1.09
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions to Preferred Shareholders: (a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
|
|
|
(0.02
|
)*
|
|
|
|
|
(0.07
|
)
|
|
|
|
|
(0.08
|
)
|
|
|
|
|
(0.06
|
)
|
|
|
|
|
(0.05
|
)
|
|
|
|
|
|
|
(0.06
|
)
|
|
Net realized gain
|
|
|
|
|
(0.08
|
)*
|
|
|
|
|
(0.23
|
)
|
|
|
|
|
(0.22
|
)
|
|
|
|
|
(0.22
|
)
|
|
|
|
|
(0.17
|
)
|
|
|
|
|
|
|
(0.12
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total distributions to preferred shareholders
|
|
|
|
|
(0.10
|
)
|
|
|
|
|
(0.30
|
)
|
|
|
|
|
(0.30
|
)
|
|
|
|
|
(0.28
|
)
|
|
|
|
|
(0.22
|
)
|
|
|
|
|
|
|
(0.18
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Increase/(Decrease) in Net Assets Attributable to Common Shareholders Resulting from
Operations
|
|
|
|
|
(3.18
|
)
|
|
|
|
|
5.30
|
|
|
|
|
|
(3.28
|
)
|
|
|
|
|
4.13
|
|
|
|
|
|
2.59
|
|
|
|
|
|
|
|
(1.27
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions to Common Shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
|
|
|
(0.10
|
)*
|
|
|
|
|
(0.29
|
)
|
|
|
|
|
(0.37
|
)
|
|
|
|
|
(0.28
|
)
|
|
|
|
|
(0.31
|
)
|
|
|
|
|
|
|
(0.31
|
)
|
|
Net realized gain
|
|
|
|
|
(0.56
|
)*
|
|
|
|
|
(0.99
|
)
|
|
|
|
|
(0.93
|
)
|
|
|
|
|
(0.97
|
)
|
|
|
|
|
(1.01
|
)
|
|
|
|
|
|
|
(0.65
|
)
|
|
Return of capital
|
|
|
|
|
—
|
|
|
|
|
|
(0.04
|
)
|
|
|
|
|
(0.02
|
)
|
|
|
|
|
(0.07
|
)
|
|
|
|
|
—
|
|
|
|
|
|
|
|
(0.28
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total distributions to common shareholders
|
|
|
|
|
(0.66
|
)
|
|
|
|
|
(1.32
|
)
|
|
|
|
|
(1.32
|
)
|
|
|
|
|
(1.32
|
)
|
|
|
|
|
(1.32
|
)
|
|
|
|
|
|
|
(1.24
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fund Share Transactions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Decrease in net asset value from common shares issued in rights offering
|
|
|
|
|
—
|
|
|
|
|
|
(0.34
|
)
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
—
|
|
|
Increase in net asset value from repurchase of common shares
|
|
|
|
|
0.00
|
(b)
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
0.00
|
(b)
|
|
|
|
|
|
|
0.01
|
|
|
Offering costs and adjustment to offering costs for common shares charged to paid-in capital
|
|
|
|
|
(0.00
|
)(b)
|
|
|
|
|
(0.01
|
)
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
—
|
|
|
Offering costs and adjustment to offering costs for preferred shares charged to paid-in
capital
|
|
|
|
|
—
|
|
|
|
|
|
(0.02
|
)
|
|
|
|
|
—
|
|
|
|
|
|
—
|
(b)
|
|
|
|
|
(0.04
|
)
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total from Fund share transactions
|
|
|
|
|
0.00
|
(b)
|
|
|
|
|
(0.37
|
)
|
|
|
|
|
0.00
|
|
|
|
|
|
0.00
|
(b)
|
|
|
|
|
(0.04
|
)
|
|
|
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Asset Value Attributable to Common Shareholders, End of Period
|
|
|
|
$
|
20.28
|
|
|
|
|
$
|
24.12
|
|
|
|
|
$
|
20.51
|
|
|
|
|
$
|
25.11
|
|
|
|
|
$
|
22.30
|
|
|
|
|
|
|
$
|
21.07
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NAV total return †
|
|
|
|
|
(13.04
|
)%
|
|
|
|
|
22.82
|
%
|
|
|
|
|
(13.75
|
)%
|
|
|
|
|
19.14
|
%
|
|
|
|
|
12.70
|
%
|
|
|
|
|
|
|
(5.59
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market value, end of period
|
|
|
|
$
|
17.60
|
|
|
|
|
$
|
21.95
|
|
|
|
|
$
|
18.30
|
|
|
|
|
$
|
23.41
|
|
|
|
|
$
|
20.04
|
|
|
|
|
|
|
$
|
18.46
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment total return ††
|
|
|
|
|
(16.73
|
)%
|
|
|
|
|
28.13
|
%
|
|
|
|
|
(17.10
|
)%
|
|
|
|
|
24.11
|
%
|
|
|
|
|
16.47
|
%
|
|
|
|
|
|
|
(9.32
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios to Average Net Assets and Supplemental Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets including liquidation value of preferred shares, end of period (in 000’s)
|
|
|
|
$
|
2,271,913
|
|
|
|
|
$
|
2,660,903
|
|
|
|
|
$
|
2,197,065
|
|
|
|
|
$
|
2,629,129
|
|
|
|
|
$
|
2,397,663
|
|
|
|
|
|
|
$
|
2,198,198
|
|
|
Net assets attributable to common shares, end of period (in 000’s)
|
|
|
|
$
|
1,835,812
|
|
|
|
|
$
|
2,186,702
|
|
|
|
|
$
|
1,691,086
|
|
|
|
|
$
|
2,069,871
|
|
|
|
|
$
|
1,838,405
|
|
|
|
|
|
|
$
|
1,738,940
|
|
|
Ratio of net investment income to average net assets attributable to common shares before preferred
share distributions
|
|
|
|
|
1.52
|
%(c)
|
|
|
|
|
1.50
|
%
|
|
|
|
|
1.87
|
%
|
|
|
|
|
1.38
|
%
|
|
|
|
|
1.69
|
%
|
|
|
|
|
|
|
1.60
|
%
|
|
Ratio of operating expenses to average net assets attributable to common shares before fees
waived(d)(e)
|
|
|
|
|
1.34
|
%(c)
|
|
|
|
|
1.21
|
%(f)
|
|
|
|
|
1.35
|
%
|
|
|
|
|
1.38
|
%
|
|
|
|
|
1.39
|
%
|
|
|
|
|
|
|
1.33
|
%
|
|
Ratio of operating expenses to average net assets attributable to common shares net of advisory fee
reduction, if any (d)(g)
|
|
|
|
|
1.17
|
%(c)
|
|
|
|
|
1.21
|
%(f)
|
|
|
|
|
1.13
|
%
|
|
|
|
|
1.38
|
%
|
|
|
|
|
1.39
|
%
|
|
|
|
|
|
|
1.09
|
%
|
|
Portfolio turnover rate
|
|
|
|
|
11.4
|
%
|
|
|
|
|
16.0
|
%
|
|
|
|
|
10.8
|
%
|
|
|
|
|
13.3
|
%
|
|
|
|
|
15.6
|
%
|
|
|
|
|
|
|
8.1
|
%
|
See accompanying notes to
financial statements.
13
The Gabelli Dividend & Income Trust
Financial Highlights (Continued)
Selected data for a common share of beneficial
interest outstanding throughout each period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2020
|
|
|
Year Ended December 31,
|
|
|
|
|
(Unaudited)
|
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
Cumulative Preferred Shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5.875% Series A Preferred
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidation value, end of period (in 000’s)
|
|
|
|
$
|
38,100
|
|
|
|
|
$
|
76,201
|
|
|
|
|
$
|
76,201
|
|
|
|
|
$
|
76,201
|
|
|
|
|
$
|
76,201
|
|
|
|
|
|
|
$
|
76,201
|
|
|
Total shares outstanding (in 000’s)
|
|
|
|
|
1,524
|
|
|
|
|
|
3,048
|
|
|
|
|
|
3,048
|
|
|
|
|
|
3,048
|
|
|
|
|
|
3,048
|
|
|
|
|
|
|
|
3,048
|
|
|
Liquidation preference per share
|
|
|
|
$
|
25.00
|
|
|
|
|
$
|
25.00
|
|
|
|
|
$
|
25.00
|
|
|
|
|
$
|
25.00
|
|
|
|
|
$
|
25.00
|
|
|
|
|
|
|
$
|
25.00
|
|
|
Average market value (h)
|
|
|
|
$
|
25.76
|
|
|
|
|
$
|
26.09
|
|
|
|
|
$
|
25.66
|
|
|
|
|
$
|
26.31
|
|
|
|
|
$
|
26.32
|
|
|
|
|
|
|
$
|
25.63
|
|
|
Asset coverage per share(i)
|
|
|
|
$
|
130.24
|
|
|
|
|
$
|
140.28
|
|
|
|
|
$
|
108.56
|
|
|
|
|
$
|
117.53
|
|
|
|
|
$
|
107.18
|
|
|
|
|
|
|
$
|
119.66
|
|
|
Series B Auction Market Preferred
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidation value, end of period (in 000’s)
|
|
|
|
$
|
90,000
|
|
|
|
|
$
|
90,000
|
|
|
|
|
$
|
90,000
|
|
|
|
|
$
|
90,000
|
|
|
|
|
$
|
90,000
|
|
|
|
|
|
|
$
|
90,000
|
|
|
Total shares outstanding (in 000’s)
|
|
|
|
|
4
|
|
|
|
|
|
4
|
|
|
|
|
|
4
|
|
|
|
|
|
4
|
|
|
|
|
|
4
|
|
|
|
|
|
|
|
4
|
|
|
Liquidation preference per share
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
|
|
$
|
25,000
|
|
|
Liquidation value (j)
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
|
|
$
|
25,000
|
|
|
Asset coverage per share(i)
|
|
|
|
$
|
130,240
|
|
|
|
|
$
|
140,284
|
|
|
|
|
$
|
108,555
|
|
|
|
|
$
|
117,528
|
|
|
|
|
$
|
107,181
|
|
|
|
|
|
|
$
|
119,660
|
|
|
Series C Auction Market Preferred
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidation value, end of period (in 000’s)
|
|
|
|
$
|
108,000
|
|
|
|
|
$
|
108,000
|
|
|
|
|
$
|
108,000
|
|
|
|
|
$
|
108,000
|
|
|
|
|
$
|
108,000
|
|
|
|
|
|
|
$
|
108,000
|
|
|
Total shares outstanding (in 000’s)
|
|
|
|
|
4
|
|
|
|
|
|
4
|
|
|
|
|
|
4
|
|
|
|
|
|
4
|
|
|
|
|
|
4
|
|
|
|
|
|
|
|
4
|
|
|
Liquidation preference per share
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
|
|
$
|
25,000
|
|
|
Liquidation value (j)
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
|
|
$
|
25,000
|
|
|
Asset coverage per share(i)
|
|
|
|
$
|
130,240
|
|
|
|
|
$
|
140,284
|
|
|
|
|
$
|
108,555
|
|
|
|
|
$
|
117,528
|
|
|
|
|
$
|
107,181
|
|
|
|
|
|
|
$
|
119,660
|
|
|
6.000% Series D Preferred
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidation value, end of period (in 000’s)
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
$
|
31,779
|
|
|
|
|
$
|
63,557
|
|
|
|
|
$
|
63,557
|
|
|
|
|
|
|
$
|
63,557
|
|
|
Total shares outstanding (in 000’s)
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
1,271
|
|
|
|
|
|
2,542
|
|
|
|
|
|
2,542
|
|
|
|
|
|
|
|
2,542
|
|
|
Liquidation preference per share
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
$
|
25.00
|
|
|
|
|
$
|
25.00
|
|
|
|
|
$
|
25.00
|
|
|
|
|
|
|
$
|
25.00
|
|
|
Average market value (h)
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
$
|
25.83
|
|
|
|
|
$
|
26.57
|
|
|
|
|
$
|
26.58
|
|
|
|
|
|
|
$
|
25.70
|
|
|
Asset coverage per share(i)
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
$
|
108.56
|
|
|
|
|
$
|
117.53
|
|
|
|
|
$
|
107.18
|
|
|
|
|
|
|
$
|
119.66
|
|
See accompanying notes to
financial statements.
14
The Gabelli Dividend & Income Trust
Financial Highlights (Continued)
Selected data for a common share of beneficial
interest outstanding throughout each period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, 2020
|
|
|
Year Ended December 31,
|
|
|
|
|
(Unaudited)
|
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series E Auction Rate Preferred
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidation value, end of period (in 000’s)
|
|
|
|
$
|
50,000
|
|
|
|
|
$
|
50,000
|
|
|
|
|
$
|
100,000
|
|
|
|
|
$
|
121,500
|
|
|
|
|
$
|
121,500
|
|
|
|
|
|
|
$
|
121,500
|
|
|
Total shares outstanding (in 000’s)
|
|
|
|
|
2
|
|
|
|
|
|
2
|
|
|
|
|
|
4
|
|
|
|
|
|
5
|
|
|
|
|
|
5
|
|
|
|
|
|
|
|
5
|
|
|
Liquidation preference per share
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
|
|
$
|
25,000
|
|
|
Liquidation value (j)
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
$
|
25,000
|
|
|
|
|
|
|
$
|
25,000
|
|
|
Asset coverage per share(i)
|
|
|
|
$
|
130,240
|
|
|
|
|
$
|
140,284
|
|
|
|
|
$
|
108,555
|
|
|
|
|
$
|
117,528
|
|
|
|
|
$
|
107,181
|
|
|
|
|
|
|
$
|
119,660
|
|
|
5.250% Series G Preferred
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidation value, end of period (in 000’s)
|
|
|
|
$
|
100,000
|
|
|
|
|
$
|
100,000
|
|
|
|
|
$
|
100,000
|
|
|
|
|
$
|
100,000
|
|
|
|
|
$
|
100,000
|
|
|
|
|
|
|
|
—
|
|
|
Total shares outstanding (in 000’s)
|
|
|
|
|
4,000
|
|
|
|
|
|
4,000
|
|
|
|
|
|
4,000
|
|
|
|
|
|
4,000
|
|
|
|
|
|
4,000
|
|
|
|
|
|
|
|
—
|
|
|
Liquidation preference per share
|
|
|
|
$
|
25.00
|
|
|
|
|
$
|
25.00
|
|
|
|
|
$
|
25.00
|
|
|
|
|
$
|
25.00
|
|
|
|
|
$
|
25.00
|
|
|
|
|
|
|
|
—
|
|
|
Average market value (h)
|
|
|
|
$
|
25.55
|
|
|
|
|
$
|
25.40
|
|
|
|
|
$
|
24.83
|
|
|
|
|
$
|
25.29
|
|
|
|
|
$
|
25.20
|
|
|
|
|
|
|
|
—
|
|
|
Asset coverage per share(i)
|
|
|
|
$
|
130.24
|
|
|
|
|
$
|
140.28
|
|
|
|
|
$
|
108.56
|
|
|
|
|
$
|
117.53
|
|
|
|
|
$
|
107.18
|
|
|
|
|
|
|
|
—
|
|
|
5.375% Series H Preferred (k)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidation value, end of period (in 000’s)
|
|
|
|
$
|
50,000
|
|
|
|
|
$
|
50,000
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
—
|
|
|
Total shares outstanding (in 000’s)
|
|
|
|
|
2,000
|
|
|
|
|
|
2,000
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
—
|
|
|
Liquidation preference per share
|
|
|
|
$
|
25.00
|
|
|
|
|
$
|
25.00
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
—
|
|
|
Average market value (h)
|
|
|
|
$
|
26.07
|
|
|
|
|
$
|
26.08
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
—
|
|
|
Asset coverage per share(i)
|
|
|
|
$
|
130.24
|
|
|
|
|
$
|
140.28
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
—
|
|
|
Asset Coverage (l)
|
|
|
|
|
521
|
%
|
|
|
|
|
561
|
%
|
|
|
|
|
434
|
%
|
|
|
|
|
470
|
%
|
|
|
|
|
429
|
%
|
|
|
|
|
|
|
479
|
%
|
|
†
|
Based on net asset value per share and reinvestment of distributions at net asset value on the ex-dividend date.
Total return for a period of less than one year is not annualized.
|
|
††
|
Based on market value per share, adjusted for reinvestment of distributions at prices obtained under the
Fund’s dividend reinvestment plan. Total return for a period of less than one year is not annualized.
|
|
*
|
Based on year to date book income. Amounts are subject to change and recharacterization at year end.
|
|
(a)
|
Calculated based on average common shares outstanding on the record dates throughout the years.
|
|
(b)
|
Amount represents less than $0.005 per share.
|
|
(d)
|
The Fund received credits from a designated broker who agreed to pay certain Fund operating expenses. For all
periods presented there was no impact on the expense ratios.
|
|
(e)
|
Ratio of operating expenses to average net assets including liquidation value of preferred shares before fee
waived for the six months ended June 30, 2020 and the years ended December 31, 2019, 2018, 2017, 2016, and 2015 would have been 1.07%, 0.96%, 1.06%, 1.07%, 1.07%, and 1.07%, respectively.
|
|
(f)
|
In 2019, due to failed auctions relating to previous fiscal years, the Fund reversed accumulated auction agent
fees. The 2019 ratio of operating expenses to average net assets attributable to common shares and the ratio of operating expenses to average net assets including the liquidation value of preferred shares, excluding the reversal of auction agent
fees, were 1.35% and 1.07%, respectively.
|
|
(g)
|
Ratio of operating expenses to average net assets including liquidation value of preferred shares net of
advisory fee reduction for the six months ended June 30, 2020, and the years ended December 31, 2019, 2018, 2017, 2016, and 2015 would have been 0.94%, 0.96%, 0.89%, 1.07%, 1.07%, and 0.88%, respectively.
|
|
(h)
|
Based on weekly prices.
|
|
(i)
|
Asset coverage per share is calculated by combining all series of preferred shares.
|
|
(j)
|
Since February 2008, the weekly auctions have failed. Holders that have submitted orders have not been able to
sell any or all of their shares in the auctions.
|
|
(k)
|
The 5.375% Series H Preferred was issued June 7, 2019.
|
|
(l)
|
Asset coverage is calculated by combining all series of preferred shares.
|
See accompanying notes to
financial statements.
15
The Gabelli Dividend & Income Trust
Notes to Financial Statements (Unaudited)
1. Organization. The Gabelli Dividend & Income Trust (the Fund) currently
operates as a diversified closed-end management investment company organized as a Delaware statutory trust on November 18, 2003 and registered under the Investment Company Act of 1940, as amended (the 1940 Act). Investment operations commenced
on November 28, 2003.
The Fund’s investment objective is to provide a high level of total return on its assets with an emphasis on
dividends and income. The Fund will attempt to achieve its investment objective by investing, under normal market conditions, at least 80% of its assets in dividend paying securities (such as common and preferred stock) or other income producing
securities (such as fixed income debt securities and securities that are convertible into equity securities).
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
obligations 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 securities are valued using the closing bid price, 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. Certain securities are valued principally using dealer quotations. Futures contracts are valued
at the closing settlement price of the exchange or board of trade on which the applicable contract is traded. OTC futures and options on futures for which market quotations are readily available will be valued by quotations received from a pricing
service or, if no quotations are available from a pricing service, by quotations obtained from one or more dealers in the instrument in question by the Adviser.
Securities and assets for which market quotations are not readily available are fair valued as determined by the Board. Fair valuation
methodologies and procedures may include, but are not limited to: analysis and review of available financial and non-financial information about the company; comparisons with the valuation and changes in valuation of similar securities, including a
comparison of foreign securities with the equivalent U.S.
16
The Gabelli Dividend & Income Trust
Notes to Financial Statements (Unaudited) (Continued)
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 by inputs used to value the Fund’s investments as of June 30, 2020 is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Valuation Inputs
|
|
|
|
|
|
|
|
Level 1
Quoted Prices
|
|
|
Level 2 Other Significant
Observable
Inputs
|
|
|
Total Market Value
at 6/30/20
|
|
|
INVESTMENTS IN SECURITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS (Market Value):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stocks:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Energy and Utilities: Services
|
|
$
|
8,208,030
|
|
|
$
|
6,400
|
|
|
$
|
8,214,430
|
|
|
Entertainment
|
|
|
56,891,623
|
|
|
|
65,189
|
|
|
|
56,956,812
|
|
|
Other Industries (a)
|
|
|
2,133,511,539
|
|
|
|
—
|
|
|
|
2,133,511,539
|
|
|
Total Common Stocks
|
|
|
2,198,611,192
|
|
|
|
71,589
|
|
|
|
2,198,682,781
|
|
|
Closed-End Funds
|
|
|
—
|
|
|
|
860,000
|
|
|
|
860,000
|
|
|
Convertible Preferred Stocks (a)
|
|
|
2,435,250
|
|
|
|
—
|
|
|
|
2,435,250
|
|
|
Mandatory Convertible Securities (a)
|
|
|
7,036,960
|
|
|
|
—
|
|
|
|
7,036,960
|
|
|
Preferred Stocks (a)
|
|
|
52,420
|
|
|
|
1,795,003
|
|
|
|
1,847,423
|
|
|
Rights (a)
|
|
|
328,920
|
|
|
|
—
|
|
|
|
328,920
|
|
|
Warrants (a)
|
|
|
524
|
|
|
|
—
|
|
|
|
524
|
|
|
Convertible Corporate Bonds (a)
|
|
|
—
|
|
|
|
1,565,895
|
|
|
|
1,565,895
|
|
|
Corporate Bonds (a)
|
|
|
—
|
|
|
|
49,053
|
|
|
|
49,053
|
|
|
U.S. Government Obligations
|
|
|
—
|
|
|
|
54,392,649
|
|
|
|
54,392,649
|
|
|
TOTAL INVESTMENTS IN SECURITIES – ASSETS
|
|
$
|
2,208,465,266
|
|
|
$
|
58,734,189
|
|
|
$
|
2,267,199,455
|
|
|
|
(a)
|
Please refer to the Schedule of Investments for the industry classifications of these portfolio holdings.
|
The Fund held no level 3 investments at June 30, 2020.
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 are 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
17
The Gabelli Dividend & Income Trust
Notes to Financial Statements (Unaudited) (Continued)
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 or preferred
equities, warrants, options, rights, or 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 may include backtesting the prices realized in subsequent trades of these fair valued securities to fair values previously recognized.
Securities Sold Short. The Fund may enter into short sale transactions. Short selling involves selling securities that may or
may not be owned and, at times, borrowing the same securities for delivery to the purchaser, with an obligation to replace such borrowed securities at a later date. The proceeds received from short sales are recorded as liabilities and the Fund
records an unrealized gain or loss to the extent of the difference between the proceeds received and the value of an open short position on the day of determination. The Fund records a realized gain or loss when the short position is closed out. By
entering into a short sale, the Fund bears the market risk of an unfavorable change in the price of the security sold short. Dividends on short sales are recorded as an expense by the Fund on the ex-dividend date and interest expense is recorded on
the accrual basis. The broker retains collateral for the value of the open positions, which is adjusted periodically as the value of the position fluctuates.
Investments in Other Investment Companies. The Fund may invest, from time to time, in shares of other investment companies (or
entities that would be considered investment companies but are excluded from the definition pursuant to certain exceptions under the 1940 Act) (the Acquired Funds) in accordance with the 1940 Act and related rules. Shareholders in the Fund would
bear the pro rata portion of the periodic expenses of the Acquired Funds in addition to the Fund’s expenses. For the six months ended June 30, 2020, the Fund’s pro rata portion of the periodic expenses charged by the Acquired Funds
was less than 1 basis point.
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
18
The Gabelli Dividend & Income Trust
Notes to Financial Statements (Unaudited) (Continued)
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 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. For the restricted securities the Fund held at June 30, 2020, refer to the Schedule of
Investments.
Securities Transactions and Investment Income. Securities transactions are accounted for on the trade date with
realized gain/(loss) on investments determined by using the identified cost method. Interest income (including amortization of premium and accretion of discount) is recorded on an 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.
Custodian Fee Credits. When cash balances are maintained in the custody account, the Fund receives credits which are
used to offset custodian fees. The gross expenses paid under the custody arrangement are included in custodian fees in the Statement of Operations with the corresponding expense offset, if any, shown as “Custodian fee credits.”
Distributions to Shareholders. Distributions to common shareholders are recorded on the ex-dividend date. The characterization of
distributions 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 held by the Fund, timing differences, and differing characterizations of distributions made by the Fund. Distributions from net investment income for federal income tax purposes include net
realized gains on foreign currency transactions. These book/tax differences are either temporary or permanent in nature. To the extent these
19
The Gabelli Dividend & Income Trust
Notes to Financial Statements (Unaudited) (Continued)
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.
Under the Fund’s current common share
distribution policy, the Fund declares and pays monthly distributions from net investment income, capital gains, and paid-in capital. The actual source of the distribution is determined after the end of the calendar year. Pursuant to this policy,
distributions during the year may be made in excess of required distributions. To the extent such distributions are made from current earnings and profits, they are considered ordinary income or long term capital gains. Distributions sourced from
paid-in capital should not be considered as dividend yield or the total return from an investment in the Fund. The Board will continue to monitor the Fund’s distribution level, taking into consideration the Fund’s NAV and the financial
market environment. The Fund’s distribution policy is subject to modification by the Board at any time.
Distributions to shareholders of
the Fund’s 5.875% Series A Preferred Shares, Series B Auction Market Preferred Shares, Series C Auction Market Preferred Shares, Series E Auction Rate Preferred Shares, 5.250% Series G Preferred Shares, and 5.375% Series H Preferred Shares
(Preferred Shares) are recorded on a daily basis and are determined as described in Note 5.
The tax character of distributions paid during the year ended
December 31, 2019 was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
|
|
|
Preferred
|
|
|
Distributions paid from:
|
|
|
|
|
|
|
|
|
|
Ordinary income (inclusive of short term capital gains)
|
|
$
|
27,072,100
|
|
|
$
|
6,304,653
|
|
|
Net long term capital gains
|
|
|
79,562,618
|
|
|
|
18,528,846
|
|
|
Return of capital
|
|
|
3,082,841
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Total distributions paid
|
|
$
|
109,717,559
|
|
|
$
|
24,833,499
|
|
|
|
|
|
|
|
|
|
|
|
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.
The following
summarizes the tax cost of investments and the related net unrealized appreciation at June 30, 2020:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
|
|
|
Gross
Unrealized
Appreciation
|
|
Gross
Unrealized
Depreciation
|
|
|
Net Unrealized
Appreciation
|
|
Investments
|
|
$
|
1,779,784,000
|
|
|
$659,483,371
|
|
$
|
(172,067,916
|
)
|
|
$487,415,455
|
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. During the six months ended June 30, 2020, the Fund did not incur any income tax, interest, or penalty. As of June 30, 2020, 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
20
The Gabelli Dividend & Income Trust
Notes to Financial Statements (Unaudited) (Continued)
three 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. Investment Advisory Agreement and Other
Transactions. 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, equal on an annual basis to 1.00% of
the value of the Fund’s average weekly net assets including the liquidation value of preferred shares. In accordance with the Advisory 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.
The Adviser has agreed to reduce the management fee on the
incremental assets attributable to the Series A, Series B, Series C, and Series E Preferred Shares if the total return of the NAV of the common shares of the Fund, including distributions and advisory fee subject to reduction, does not exceed the
stated dividend rate of each particular series of the Preferred Shares for the year. The Fund’s total return on the NAV of the common shares is monitored on a monthly basis to assess whether the total return on the NAV of the common shares
exceeds the stated dividend rate or corresponding swap rate of each particular series of Preferred Shares for the period. For the six months ended June 30, 2020, the Fund’s total return on the NAV of the common shares did not exceed the
stated dividend rate on each of the outstanding Preferred Shares. Thus, advisory fees with respect to the liquidation value of the Preferred Shares were reduced by $1,553,849. Advisory fees were accrued on the Series G and Series H Preferred Shares.
During the six months ended June 30, 2020, the Fund paid $10,216 in brokerage commissions on security trades to G.research, LLC, an
affiliate of the Adviser.
During the six months ended June 30, 2020, 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 $8,846.
The cost of calculating the Fund’s NAV per share is a Fund expense pursuant to the Advisory Agreement. Under the sub-administration agreement
with Bank of New York Mellon, the fees paid include the cost of calculating the Fund’s NAV. The Fund reimburses the Adviser for this service. During the six months ended June 30, 2020, the Fund accrued $22,500 in accounting fees in the
Statement of Operations.
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). During the six months ended June 30, 2020, the Fund accrued $134,796 in payroll expenses in the Statement of
Operations.
The Fund pays each Trustee who is not considered an affiliated person an annual retainer of $18,000 plus $2,000 for each Board
meeting attended. Each Trustee is reimbursed by the Fund for any out of pocket expenses incurred in attending meetings. All Board committee members receive $1,000 per meeting attended, the Audit Committee Chairman receives an annual fee of $3,000,
and the Nominating Committee Chairman and the Lead Trustee each receives an annual fee of $2,000. A Trustee may receive a single meeting fee, allocated among the participating funds, for participation in certain meetings held on behalf of multiple
funds. Trustees who are directors or employees of the Adviser or an affiliated company receive no compensation or expense reimbursement from the Fund.
21
The Gabelli Dividend & Income Trust
Notes to Financial Statements (Unaudited) (Continued)
4. Portfolio Securities. Purchases and sales of securities during the six months ended
June 30, 2020, other than short term securities and U.S. Government obligations, aggregated $257,208,876, and $299,286,686, 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 and retirement of its common shares on the open market when the shares are trading at a discount of 7.5% or more (or such other percentage as the Board may determine from time to time) from the NAV of the shares. During the
six months ended June 30, 2020, the Fund repurchased and retired 146,968 common shares in the open market at an investment of $1,731,974 and an average discount of approximately 20.32% from its NAV. During the year ended December 31, 2019,
the Fund did not repurchase any common shares.
For the six months ended June 30, 2020, transactions in common stock were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30,
2020
(Unaudited)
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Net decrease from repurchase of common shares
|
|
|
(146,968
|
)
|
|
$
|
(1,731,974
|
)
|
The Fund has an effective shelf registration initially authorizing the offering of an additional $500
million of common or preferred shares or notes under the current shelf registration. As of June 30, 2020, after considering the common shares rights offering, the Fund has approximately $335 million available for issue under the current shelf
registration.
During the year ended December 31, 2019, the Fund completed a rights offering whereby one transferable right was issued
for each common share held as of October 7, 2019. Ten rights were required to purchase one additional common share at the subscription price of $20.00. On November 21, 2019, the Fund issued 8,243,243 common shares receiving net proceeds of
$163,936,529, after the deduction of estimated offering expenses of $548,000 and solicitation fees of $380,331. The NAV of the Fund was reduced by $(0.34) per share on the day the additional common shares were issued due to the additional common
shares being issued below NAV.
On June 7, 2019, the Fund issued 2,000,000 shares of Series H Preferred, receiving $48,145,405 after the
deduction of estimated offering expenses of $279,595 and underwriting fees of $1,575,000. The liquidation value of the Series H Preferred is $25 per share. The Series H Preferred has an annual dividend rate of 5.375%. The Series H Preferred is
noncallable before June 7, 2024.
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 Statements of Preferences to meet certain asset coverage tests with respect to the Preferred Shares. If the Fund fails to meet these requirements and
does not correct such failure, the Fund may be required to redeem, in part or in full, the Series A, Series B, Series C, Series E, Series G, and Series H Preferred Shares at redemption prices of $25, $25,000, $25,000, $25,000, $25, and $25,
respectively, per share plus an amount equal to the accumulated and unpaid dividends whether or not declared on such shares in order
22
The Gabelli Dividend & Income Trust
Notes to Financial Statements (Unaudited) (Continued)
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.
For Series B, Series C, and Series E Preferred Shares, the dividend rates, as set by the auction process that is generally held every seven days,
are expected to vary with short term interest rates. Since February 2008, the number of Series B, Series C, and Series E Preferred Shares subject to bid orders by potential holders has been less than the number of shares of Series B, Series C, and
Series E Preferred Shares subject to sell orders. Holders that have submitted sell orders have not been able to sell any or all of the Series B, Series C, and Series E Preferred Shares for which they have submitted sell orders. Therefore the weekly
auctions have failed, and the dividend rate has been the maximum rate. The current maximum rate for Series B, Series C, and Series E Preferred Shares is 150, 150, and 250 basis points, respectively, greater than the seven day ICE LIBOR rate on the
date of such auction. Existing Series B, Series C, and Series E Preferred shareholders may submit an order to hold, bid, or sell such shares on each auction date, or trade their shares in the secondary market. During the year ended December 31,
2019, the Fund redeemed and retired 2,000 shares of its outstanding Series E Auction Rate Preferred Shares at the liquidation value of $50,000,000. There were no redemptions of Series B or Series C Preferred Shares during the six months ended
June 30, 2020.
The Fund may redeem in whole or in part the 5.875% Series A Preferred Shares at the redemption price at any time.
Commencing July 1, 2021 and June 10, 2024 and at any time thereafter, the Fund, at its option, may redeem the 5.250% Series G Cumulative Preferred Shares and the 5.375% Series H Cumulative Preferred Shares, respectively, in whole or in
part at the redemption price. The Board has authorized the repurchase of Series A, Series G, and Series H Preferred Shares in the open market at prices less than the $25 liquidation value per share. On December 26, 2019, the Fund redeemed and
retired 1,271,148 shares of the Series D Preferred Stock at the liquidation value of $25 per share plus accrued interest and accrued and unpaid dividends. On May 6, 2020, the Fund redeemed and retired 1,524,010 shares of the Series A Preferred
at the liquidation value of $25 per share plus accrued and unpaid dividends. During the six months ended June 30, 2020 and year ended December 31, 2019, the Fund did not repurchase any Series G Preferred Shares.
The Fund has the authority to purchase its auction rate and auction market preferred shares through negotiated private transactions. The Fund is
not obligated to purchase any dollar amount or number of auction rate or auction market preferred shares, and the timing and amount of any auction rate or auction market preferred shares purchased will depend on market conditions, share price,
capital availability, and other factors. The Fund is not soliciting holders to sell these shares nor recommending that holders offer them to the Fund. Any offers can be accepted or rejected in the Fund’s discretion.
23
The Gabelli Dividend & Income Trust
Notes to Financial Statements (Unaudited) (Continued)
The following table summarizes Cumulative Preferred Share information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series
|
|
Issue Date
|
|
Authorized
|
|
|
Number of Shares
Outstanding at
06/30/20
|
|
Net
Proceeds
|
|
|
2020 Dividend
Rate Range
|
|
Dividend
Rate at
06/30/20
|
|
|
Accrued
Dividend at
06/30/20
|
|
A 5.875%
|
|
October 12, 2004
|
|
|
3,200,000
|
|
|
|
1,524,009
|
|
|
$
|
77,280,971
|
|
|
Fixed Rate
|
|
|
5.875%
|
|
|
$
|
31,089
|
|
|
B Auction Market
|
|
October 12, 2004
|
|
|
4,000
|
|
|
|
3,600
|
|
|
|
98,858,617
|
|
|
1.592% to 3.086%
|
|
|
1.609%
|
|
|
|
27,772
|
|
|
C Auction Market
|
|
October 12, 2004
|
|
|
4,800
|
|
|
|
4,320
|
|
|
|
118,630,341
|
|
|
1.592% to 3.093%
|
|
|
1.607%
|
|
|
|
23,775
|
|
|
E Auction Rate
|
|
November 3, 2005
|
|
|
5,400
|
|
|
|
2,000
|
|
|
|
133,379,387
|
|
|
2.601% to 4.085%
|
|
|
2.613%
|
|
|
|
21,477
|
|
|
G 5.250%
|
|
July 1, 2016
|
|
|
4,000,000
|
|
|
|
4,000,000
|
|
|
|
96,634,565
|
|
|
Fixed Rate
|
|
|
5.250%
|
|
|
|
72,916
|
|
|
H 5.375%
|
|
June 7, 2019
|
|
|
2,000,000
|
|
|
|
2,000,000
|
|
|
|
48,145,405
|
|
|
Fixed Rate
|
|
|
5.375%
|
|
|
|
37,326
|
|
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.
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.
7. Subsequent Events. On
August 24, 2020, the Fund announced that the Board authorized the redemption of all remaining outstanding Series A Preferred. The Series A Preferred will be redeemed at $25.3631076 per share, which consists of the $25 per share Liquidation
Preference plus $0.3631076 per share representing accumulated and unpaid dividends and distributions to the redemption date of September 25, 2020.
Management has evaluated the impact on the Fund of all other subsequent events occurring through the date the financial statements were issued and
has determined that there were no other subsequent events requiring recognition or disclosure in the financial statements.
24
The Gabelli Dividend & Income Trust
Notes to Financial Statements (Unaudited) (Continued)