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, 2006
-------------
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. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
The Report to Shareholders is attached herewith.
[LOGO OMITTED]
THE GABELLI
GLOBAL UTILITY
& INCOME TRUST
THE GABELLI GLOBAL UTILITY & INCOME TRUST
Semi-Annual Report
June 30, 2006
TO OUR SHAREHOLDERS,
During the second quarter of 2006, the Gabelli Global Utility & Income
Trust's (the "Fund") total return was 3.4% on a net asset value ("NAV") basis
while the Standard & Poor's ("S&P") 500 Utility Index was up 5.7% and the Lipper
Utility Fund Average rose 3.8%. For the six month period ended June 30, 2006,
the Fund's NAV total return was 8.0% versus gains of 4.5% and 6.9% for the S&P
500 Utility Index and the Lipper Utility Fund Average, respectively. The Fund's
market price on June 30, 2006 was $18.30, which equates to a 14.7% discount to
its NAV of $21.46. The Fund's market price rose 0.3% during the second quarter
and 6.4% during the six month period ended June 30, 2006.
Enclosed are the financial statements and the investment portfolio as of
June 30, 2006.
COMPARATIVE RESULTS
------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL RETURNS THROUGH JUNE 30, 2006 (A)
------------------------------------------------
Since
Year to Inception
Quarter Date 1 Year (5/28/04)
------- ---- ------ ---------
GABELLI GLOBAL UTILITY & INCOME TRUST
NAV RETURN (B) ....................................... 3.37% 7.98% 6.54% 12.50%
INVESTMENT RETURN (C) ................................ 0.29 6.44 (0.65) 2.49
S&P 500 Utility Index .................................. 5.69 4.47 5.92 20.78
Lipper Utility Fund Average ............................ 3.80 6.91 10.57 20.16
(a) RETURNS REPRESENT PAST PERFORMANCE AND DO NOT GUARANTEE FUTURE RESULTS.
INVESTMENT RETURNS AND THE PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE.
WHEN SHARES ARE SOLD, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL
COST. CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE DATA
PRESENTED. VISIT WWW.GABELLI.COM FOR PERFORMANCE INFORMATION AS OF THE MOST
RECENT MONTH END. PERFORMANCE RETURNS FOR PERIODS 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 UTILITY INDEX IS AN UNMANAGED INDICATOR OF ELECTRIC AND GAS UTILITY
STOCK PERFORMANCE. THE LIPPER AVERAGE REFLECTS THE AVERAGE PERFORMANCE OF
OPEN-END MUTUAL FUNDS CLASSIFIED IN THIS PARTICULAR CATEGORY. DIVIDENDS ARE
CONSIDERED REINVESTED.
(b) TOTAL RETURNS AND AVERAGE ANNUAL RETURNS REFLECT CHANGES IN NAV AND
REINVESTMENT OF DISTRIBUTIONS AT NAV ON THE EX-DIVIDEND DATE, AND ARE NET
OF EXPENSES. SINCE INCEPTION RETURN IS BASED ON AN INITIAL NAV OF $19.06.
(c) TOTAL RETURNS AND AVERAGE ANNUAL RETURNS REFLECT CHANGES IN CLOSING MARKET
VALUES ON THE AMERICAN STOCK EXCHANGE AND REINVESTMENT OF DISTRIBUTIONS ON
THE PAYABLE DATE. SINCE INCEPTION RETURN BASED ON AN INITIAL OFFERING PRICE
OF $20.00.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
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. The financial
statements and investment portfolio are mailed separately from the commentary.
Both the commentary and the financial statements, including the portfolio of
investments, will be available on our website at www.gabelli.com/funds.
--------------------------------------------------------------------------------
THE GABELLI GLOBAL UTILITY & INCOME TRUST
SUMMARY OF PORTFOLIO HOLDINGS (UNAUDITED)
The following table presents portfolio holdings as a percent of total
investments as of June 30, 2006:
LONG POSITIONS
Energy and Utilities: Integrated .................. 47.9%
Telecommunications ................................ 11.9%
Energy and Utilities: Natural Gas Utilities ....... 7.3%
Energy and Utilities: Electric
Transmission and Distribution ................... 6.7%
U.S. Government Obligations ....................... 5.9%
Energy and Utilities: Water ....................... 5.8%
Cable and Satellite ............................... 2.9%
Energy and Utilities: Oil ......................... 2.7%
Energy and Utilities: Natural Gas Integrated ...... 2.5%
Diversified Industrial ............................ 1.7%
Aerospace ......................................... 0.8%
Environmental Services ............................ 0.8%
Real Estate ....................................... 0.7%
Entertainment ..................................... 0.5%
Wireless Communications ........................... 0.4%
Equipment and Supplies ............................ 0.3%
Automotive: Parts and Accessories ................. 0.2%
Metals and Mining ................................. 0.2%
Aviation: Parts and Services ...................... 0.2%
Transportation .................................... 0.2%
Energy and Utilities: Alternative Energy .......... 0.2%
Communications Equipment .......................... 0.1%
Energy and Utilities: Services .................... 0.1%
-----
100.0%
=====
SHORT POSITION
Equipment and Supplies ............................ (0.3)%
=====
THE GABELLI GLOBAL UTILITY & INCOME TRUST (THE "FUND") FILES A COMPLETE SCHEDULE
OF PORTFOLIO HOLDINGS WITH THE SEC FOR THE FIRST AND THIRD QUARTERS OF EACH
FISCAL YEAR ON FORM N-Q, THE LAST OF WHICH WAS FILED FOR THE QUARTER ENDED MARCH
31, 2006. 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
COMMISSION'S PUBLIC REFERENCE ROOM IN WASHINGTON, DC. INFORMATION ON THE
OPERATION OF THE PUBLIC REFERENCE ROOM MAY BE OBTAINED BY CALLING
1-800-SEC-0330.
PROXY VOTING
The Fund files Form N-PX with its complete proxy voting record for the 12
months ended June 30th, no later than August 31st 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, (i)
by calling 800-GABELLI (800-422-3554); (ii) by writing to The Gabelli Funds at
One Corporate Center, Rye, NY 10580-1422; and (iii) by visiting the Securities
and Exchange Commission's website at www.sec.gov.
SHAREHOLDER MEETING - MAY 15, 2006 - FINAL RESULTS
The Annual Meeting of Shareholders was held on May 15, 2006 at the
Greenwich Library in Greenwich, Connecticut. At that meeting, common
shareholders elected James P. Conn and Salvatore M. Salibello as Trustees of the
Fund. There were 2,964,931 votes and 2,963,331 votes cast in favor of each
Trustee and 23,374 votes and 24,974 votes withheld, respectively.
Anthony J. Colavita, Mario d'Urso, Vincent D. Enright, Michael J.
Melarkey, and Salvatore J. Zizza continue to serve in their capacities as
Trustees.
We thank you for your participation and appreciate your continued support.
2
THE GABELLI GLOBAL UTILITY & INCOME TRUST
SCHEDULE OF INVESTMENTS
JUNE 30, 2006 (UNAUDITED)
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS -- 92.5%
AEROSPACE -- 0.8%
NON U.S. COMPANIES
68,000 Rolls-Royce Group plc+ ..................$ 508,332 $ 520,591
1,076,000 Rolls-Royce Group plc, Cl. B ............ 1,103 2,039
----------- -----------
509,435 522,630
----------- -----------
AVIATION: PARTS AND SERVICES -- 0.2%
U.S. COMPANIES
1,590 Sequa Corp., Cl. A+ ..................... 119,553 129,585
----------- -----------
CABLE AND SATELLITE -- 2.9%
NON U.S. COMPANIES
10,000 Cogeco Inc. ............................. 195,068 179,163
3,500 Rogers Communications Inc., Cl. B ....... 58,568 141,400
U.S. COMPANIES
33,000 Cablevision Systems Corp., Cl. A+ ....... 580,778 707,850
8,000 DIRECTV Group Inc.+ ..................... 138,277 132,000
17,000 EchoStar Communications Corp., Cl. A+ ... 532,625 523,770
4,580 Liberty Global Inc., Cl. A+ ............. 86,290 98,470
4,000 Liberty Global Inc., Cl. C+ ............. 72,761 82,280
----------- -----------
1,664,367 1,864,933
----------- -----------
DIVERSIFIED INDUSTRIAL -- 1.7%
NON U.S. COMPANIES
19,000 Bouygues SA ............................. 635,578 976,939
U.S. COMPANIES
3,600 Woodward Governor Co. ................... 103,102 109,836
----------- -----------
738,680 1,086,775
----------- -----------
ENERGY AND UTILITIES: ALTERNATIVE ENERGY -- 0.2%
U.S. COMPANIES
3,000 Ormat Technologies Inc. ................. 45,000 114,450
----------- -----------
ENERGY AND UTILITIES:
ELECTRIC TRANSMISSION AND DISTRIBUTION -- 6.7%
NON U.S. COMPANIES
8,775 National Grid plc, ADR .................. 401,681 474,377
U.S. COMPANIES
4,900 CH Energy Group Inc. .................... 219,678 235,200
1,000 Consolidated Edison Inc. ................ 44,903 44,440
40,000 Duquesne Light Holdings Inc. ............ 777,948 657,600
18,000 Energy East Corp. ....................... 428,738 430,740
5,000 Northeast Utilities ..................... 90,818 103,350
MARKET
SHARES COST VALUE
------ ---- -------
50,000 NSTAR ...................................$ 1,187,449 $ 1,430,000
40,000 Pepco Holdings Inc. ..................... 757,783 943,200
1,000 UIL Holdings Corp. ...................... 53,385 56,290
----------- -----------
3,962,383 4,375,197
----------- -----------
ENERGY AND UTILITIES: INTEGRATED -- 47.9%
NON U.S. COMPANIES
150,000 AEM SpA ................................. 276,010 348,413
500 Areva ................................... 204,193 347,262
8,000 Chubu Electric Power Co. Inc. ........... 167,490 216,008
10,000 Chugoku Electric Power Co. Inc. ......... 170,328 211,465
76,000 Datang International Power
Generation Co. Ltd. .................... 59,610 52,844
9,000 E.ON AG, ADR ............................ 209,576 345,150
8,400 Electric Power Development Co. Ltd. ..... 194,633 320,028
13,000 Endesa SA ............................... 332,463 452,106
48,000 Endesa SA, ADR .......................... 1,152,820 1,541,760
45,000 Enel SpA ................................ 354,639 387,936
9,760 Energias de Portugal SA, ADR ............ 262,599 383,763
30,000 Enersis SA, ADR ......................... 178,868 337,500
142,000 Hera SpA ................................ 303,068 472,226
10,000 Hokkaido Electric Power Co. Inc. ........ 171,210 237,242
10,000 Hokuriku Electric Power Co. ............. 165,392 231,563
2,000 Huaneng Power International Inc., ADR ... 58,398 52,940
22,000 Iberdrola SA ............................ 447,198 757,786
16,000 Kansai Electric Power Co. Inc. .......... 284,747 357,917
5,000 Korea Electric Power Corp., ADR ......... 72,677 94,800
10,000 Kyushu Electric Power Co. Inc. .......... 178,959 232,436
4,500 Oesterreichische
Elektrizitaetswirtschafts AG,
Cl. A .................................. 209,779 216,415
27,777 Scottish Power plc, ADR ................. 1,167,075 1,198,300
10,000 Shikoku Electric Power Co. Inc. ......... 171,759 224,135
10,000 Tohoku Electric Power Co. Inc. .......... 164,025 219,329
10,000 Tokyo Electric Power Co. Inc. ........... 220,693 276,127
See accompanying notes to financial statements.
3
THE GABELLI GLOBAL UTILITY & INCOME TRUST
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 2006 (UNAUDITED)
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
ENERGY AND UTILITIES: INTEGRATED (CONTINUED)
U.S. COMPANIES
1,000 Allegheny Energy Inc.+ ..................$ 25,689 $ 37,070
7,000 ALLETE Inc. ............................. 233,585 331,450
22,000 Ameren Corp. ............................ 969,632 1,111,000
33,000 American Electric Power Co. Inc. ........ 1,045,068 1,130,250
50,000 Aquila Inc.+ ............................ 185,793 210,500
1,000 Avista Corp. ............................ 20,848 22,830
6,000 Black Hills Corp. ....................... 181,668 205,980
500 Cleco Corp. ............................. 9,790 11,625
500 CMS Energy Corp.+ ....................... 5,055 6,470
300 Constellation Energy Group .............. 13,206 16,356
60,000 DPL Inc. ................................ 1,627,242 1,608,000
44,680 Duke Energy Corp. ....................... 1,084,186 1,312,251
1,000 El Paso Electric Co.+ ................... 17,760 20,160
500 Empire District Electric Co. ............ 11,561 10,275
6,000 Florida Public Utilities Co. ............ 70,646 75,540
10,000 FPL Group Inc. .......................... 349,290 413,800
60,000 Great Plains Energy Inc. ................ 1,797,801 1,671,600
24,000 Hawaiian Electric Industries Inc. ....... 596,570 669,840
7,500 Maine & Maritimes Corp. ................. 221,899 117,000
3,000 MGE Energy Inc. ......................... 93,602 93,450
45,000 NiSource Inc. ........................... 917,604 982,800
6,000 NorthWestern Corp. ...................... 209,603 206,100
19,500 OGE Energy Corp. ........................ 481,891 683,085
4,000 Otter Tail Corp. ........................ 111,884 109,320
1,000 PG&E Corp. .............................. 33,930 39,280
15,000 Pinnacle West Capital Corp. ............. 615,958 598,650
4,200 PPL Corp. ............................... 117,280 135,660
33,000 Progress Energy Inc. .................... 1,410,351 1,414,710
35,000 Public Service Enterprise Group Inc. .... 2,331,700 2,314,200
19,000 SCANA Corp. ............................. 681,560 733,020
45,000 Southern Co. ............................ 1,322,848 1,442,250
1,000 TECO Energy Inc. ........................ 15,970 14,940
800 TXU Corp. ............................... 25,794 47,832
25,000 Unisource Energy Corp. .................. 616,316 778,750
17,000 Vectren Corp. ........................... 408,701 463,250
41,000 Westar Energy Inc. ...................... 860,569 863,050
5,000 Wisconsin Energy Corp. .................. 171,276 201,500
13,000 WPS Resources Corp. ..................... 599,229 644,800
50,000 Xcel Energy Inc. ........................ 845,734 959,000
----------- -----------
27,517,298 31,223,095
----------- -----------
ENERGY AND UTILITIES: NATURAL GAS INTEGRATED -- 2.5%
NON U.S. COMPANIES
80,000 Snam Rete Gas SpA ....................... 347,871 351,739
MARKET
SHARES COST VALUE
------ ---- -------
U.S. COMPANIES
25,000 El Paso Corp. ...........................$ 220,000 $ 375,000
1,000 Energen Corp. ........................... 30,935 38,410
16,000 National Fuel Gas Co. ................... 410,803 562,240
2,000 ONEOK Inc. .............................. 51,437 68,080
10,500 Southern Union Co. ...................... 229,082 284,130
----------- -----------
1,290,128 1,679,599
----------- -----------
ENERGY AND UTILITIES: NATURAL GAS UTILITIES -- 7.3%
U.S. COMPANIES
27,000 Atmos Energy Corp. ...................... 665,564 753,570
1,700 Cascade Natural Gas Corp. ............... 36,137 35,853
2,000 Chesapeake Utilities Corp. .............. 53,224 60,160
33,000 KeySpan Corp. ........................... 1,228,316 1,333,200
8,000 Laclede Group Inc. ...................... 229,823 274,880
20,000 Nicor Inc. .............................. 667,385 830,000
17,000 Peoples Energy Corp. .................... 689,275 610,470
5,000 Piedmont Natural Gas Co. Inc. ........... 116,790 121,500
15,000 Southwest Gas Corp. ..................... 350,760 470,100
5,000 Western Gas Resources Inc. .............. 298,487 299,250
----------- -----------
4,335,761 4,788,983
----------- -----------
ENERGY AND UTILITIES: OIL -- 2.7%
NON U.S. COMPANIES
500 Niko Resources Ltd. ..................... 28,728 28,236
1,500 PetroChina Co. Ltd., ADR ................ 96,520 161,955
10,000 Royal Dutch Shell plc, Cl. A, ADR ....... 511,651 669,800
U.S. COMPANIES
4,929 Chevron Corp. ........................... 303,104 305,894
2,000 ConocoPhillips .......................... 74,050 131,060
2,000 Devon Energy Corp. ...................... 67,255 120,820
1,000 Exxon Mobil Corp. ....................... 45,500 61,350
2,000 Kerr-McGee Corp. ........................ 137,214 138,700
2,000 Murphy Oil Corp. ........................ 78,053 111,720
29 Tel Offshore Trust ...................... 216 173
----------- -----------
1,342,291 1,729,708
----------- -----------
ENERGY AND UTILITIES: SERVICES -- 0.1%
NON U.S. COMPANIES
5,000 ABB Ltd., ADR ........................... 54,615 64,800
----------- -----------
ENERGY AND UTILITIES: WATER -- 5.8%
NON U.S. COMPANIES
1,000 Consolidated Water Co. Ltd. ............. 20,230 24,590
75,000 Severn Trent plc ........................ 1,119,812 1,622,686
2,000 Suez SA ................................. 62,915 82,115
12,000 Suez SA, ADR ............................ 362,710 501,000
7,200 Suez SA, Strips+ ........................ 0 92
50,000 United Utilities plc .................... 502,861 593,136
See accompanying notes to financial statements.
4
THE GABELLI GLOBAL UTILITY & INCOME TRUST
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 2006 (UNAUDITED)
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
ENERGY AND UTILITIES: WATER (CONTINUED)
U.S. COMPANIES
8,666 Aqua America Inc. .......................$ 129,735 $ 197,498
3,000 California Water Service Group .......... 84,840 107,220
4,000 Middlesex Water Co. ..................... 75,033 75,680
22,000 SJW Corp. ............................... 358,906 559,900
----------- -----------
2,717,042 3,763,917
----------- -----------
ENTERTAINMENT -- 0.5%
NON U.S. COMPANIES
10,000 Vivendi SA, ADR ......................... 264,880 349,100
----------- -----------
ENVIRONMENTAL SERVICES -- 0.8%
10,000 Veolia Environnement .................... 272,510 516,864
----------- -----------
METALS AND MINING -- 0.2%
NON U.S. COMPANIES
5,000 Compania de Minas
Buenaventura SA, ADR .................. 104,752 136,400
----------- -----------
REAL ESTATE -- 0.2%
U.S. COMPANIES
5,000 Trizec Properties Inc. .................. 143,800 143,200
----------- -----------
TELECOMMUNICATIONS -- 11.5%
NON U.S. COMPANIES
29,000 BCE Inc. ................................ 574,237 685,850
27,000 BT Group plc, ADR ....................... 924,613 1,195,830
12,000 Deutsche Telekom AG, ADR ................ 202,098 192,480
180,000 Eircom Group plc ........................ 502,967 501,899
6,000 France Telecom SA, ADR .................. 149,213 131,160
3,000 Manitoba Telecom Services Inc. .......... 100,193 122,037
40,000 Portugal Telecom SGPS SA ................ 474,374 482,970
15,000 Royal KPN N.V. Sponsored, ADR ........... 114,993 169,050
1,500 Swisscom AG ............................. 478,884 493,845
24,062 Telecom Italia SpA ...................... 78,318 67,016
17,000 Telefonica SA, ADR ...................... 700,249 845,580
15,000 Telefonos de Mexico SA
de CV, Cl. L, ADR ..................... 231,816 312,450
U.S. COMPANIES
25,000 AT&T Inc. ............................... 610,172 697,250
9,000 BellSouth Corp. ......................... 226,200 325,800
1,000 Embarq Corp.+ ........................... 32,459 40,990
20,000 Sprint Nextel Corp. ..................... 328,202 399,800
25,000 Verizon Communications Inc. ............. 953,369 837,250
----------- -----------
6,682,357 7,501,257
----------- -----------
MARKET
SHARES COST VALUE
------ ---- -------
TRANSPORTATION -- 0.1%
U.S. COMPANIES
2,000 GATX Corp. ..............................$ 56,076 $ 85,000
----------- -----------
WIRELESS COMMUNICATIONS -- 0.4%
NON U.S. COMPANIES
1,600 Mobile TeleSystems, ADR ................. 54,874 47,104
2,200 Vimpel-Communications, ADR+ ............. 68,035 100,804
U.S. COMPANIES
2,100 United States Cellular Corp.+ ........... 95,967 127,260
----------- -----------
218,876 275,168
----------- -----------
TOTAL COMMON STOCKS ..................... 52,039,804 60,350,661
----------- -----------
CONVERTIBLE PREFERRED STOCKS -- 0.1%
TELECOMMUNICATIONS -- 0.0%
U.S. COMPANIES
500 Cincinnati Bell Inc.,
6.750% Cv. Pfd., Ser. B ................ 20,555 21,500
----------- -----------
TRANSPORTATION -- 0.1%
U.S. COMPANIES
200 GATX Corp.,$2.50 Cv. Pfd. ............... 26,010 42,000
----------- -----------
TOTAL CONVERTIBLE PREFERRED STOCKS ...... 46,565 63,500
----------- -----------
PRINCIPAL
AMOUNT
--------
CONVERTIBLE CORPORATE BONDS -- 1.5%
AUTOMOTIVE: PARTS AND ACCESSORIES -- 0.2%
U.S. COMPANIES
$ 150,000 Pep Boys - Manny, Moe & Jack, Cv.,
4.250%, 06/01/07 ....................... 149,260 147,750
----------- -----------
COMMUNICATIONS EQUIPMENT -- 0.1%
U.S. COMPANIES
100,000 Agere Systems Inc., Sub. Deb. Cv.,
6.500%, 12/15/09 ....................... 100,500 99,375
----------- -----------
EQUIPMENT AND SUPPLIES -- 0.3%
U.S. COMPANIES
142,000 Robbins & Myers Inc., Sub. Deb. Cv.,
8.000%, 01/31/08 ....................... 143,031 166,495
----------- -----------
See accompanying notes to financial statements.
5
THE GABELLI GLOBAL UTILITY & INCOME TRUST
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 2006 (UNAUDITED)
PRINCIPAL MARKET
AMOUNT COST VALUE
------ ---- -------
CONVERTIBLE CORPORATE BONDS (CONTINUED)
REAL ESTATE -- 0.5%
U.S. COMPANIES
Palm Harbor Homes Inc., Cv.,
$ 150,000 3.250%, 05/15/24 ......................$ 126,439 $ 128,250
200,000 3.250%, 05/15/24 (a) .................. 197,413 171,000
----------- -----------
323,852 299,250
----------- -----------
TELECOMMUNICATIONS -- 0.4%
NON U.S. COMPANIES
300,000 Nortel Networks Corp., Cv.,
4.250%, 09/01/08 ....................... 289,928 284,250
----------- -----------
TOTAL CONVERTIBLE CORPORATE BONDS ....... 1,006,571 997,120
----------- -----------
U.S. GOVERNMENT OBLIGATIONS -- 5.9%
3,830,000 U.S. Treasury Bills,
4.656% to 4.923%++,
07/06/06 to 10/12/06 ................... 3,805,479 3,805,644
----------- -----------
TOTAL INVESTMENTS -- 100.0% ..........................$56,898,419 65,216,925
===========
SECURITIES SOLD SHORT
(Proceeds received $164,281) ..................................... (164,682)
OTHER ASSETS AND LIABILITIES (NET) ................................. 393,070
-----------
NET ASSETS -- COMMON SHARES
(3,050,236 common shares outstanding) ............................$65,445,313
===========
NET ASSET VALUE PER COMMON SHARE
($65,445,313 / 3,050,236 shares outstanding) ..................... $21.46
======
MARKET
SHARES PROCEEDS VALUE
------ ------- ------
COMMON STOCKS SOLD SHORT -- (0.3)%
EQUIPMENT AND SUPPLIES -- (0.3)%
U.S. COMPANIES
(6,300) Robbins & Myers Inc. ....................$ (164,281) $ (164,682)
=========== ===========
------------------
(a) 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, 2006,
the Rule 144A security is considered liquid and the market value amounted
to $171,000 or 0.26% of total net assets.
+ Non-income producing security.
++ Represents annualized yield at date of purchase.
ADR American Depository Receipt
% OF
MARKET MARKET
VALUE VALUE
------ -------
GEOGRAPHIC DIVERSIFICATION
LONG POSITIONS
North America ....................... 67.6% $44,113,064
Europe .............................. 26.7 17,404,133
Japan ............................... 3.9 2,526,249
Latin America ....................... 1.2 810,940
Asia/Pacific ........................ 0.6 362,539
----- -----------
100.0% $65,216,925
===== ===========
SHORT POSITION
North America ....................... (0.3)% $ (164,682)
===== ===========
See accompanying notes to financial statements.
6
THE GABELLI GLOBAL UTILITY & INCOME TRUST
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2006 (UNAUDITED)
ASSETS:
Investments, at value (cost $56,898,419) ................... $ 65,216,925
Foreign currency, at value (cost $6,305) ................... 6,436
Dividends and interest receivable .......................... 341,556
Receivable for investments sold ............................ 228,299
Other assets ............................................... 2,018
------------
TOTAL ASSETS ............................................... 65,795,234
------------
LIABILITIES:
Securities sold short (proceeds $164,281) .................. 164,682
Payable to custodian ....................................... 22,397
Payable for investment advisory fees ....................... 56,441
Payable for investments purchased .......................... 56,384
Payable for legal and audit fees ........................... 23,789
Payable for shareholder communications expenses ............ 18,019
Other accrued expenses and liabilities ..................... 8,209
------------
TOTAL LIABILITIES .......................................... 349,921
------------
NET ASSETS applicable to 3,050,236
shares outstanding ....................................... $ 65,445,313
============
NET ASSETS CONSIST OF:
Shares of beneficial interest, at $0.001 par value ......... $ 3,050
Additional paid-in capital ................................. 57,122,857
Accumulated net realized loss on investments
and foreign currency transactions ........................ (753)
Net unrealized appreciation on investments ................. 8,318,506
Net unrealized depreciation on securities sold short ....... (401)
Net unrealized appreciation on foreign
currency translations .................................... 2,054
------------
NET ASSETS ................................................. $ 65,445,313
============
NET ASSET VALUE:
($65,445,313 / 3,050,236 shares outstanding;
unlimited number of shares authorized) ..................... $21.46
======
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2006 (UNAUDITED)
INVESTMENT INCOME:
Dividends (net of foreign taxes of $61,516) .............. $ 1,576,959
Interest ................................................. 93,841
-----------
TOTAL INVESTMENT INCOME .................................. 1,670,800
-----------
EXPENSES:
Investment advisory fees ................................. 323,105
Payroll expenses ......................................... 55,759
Shareholder communications expenses ...................... 35,920
Trustees' fees ........................................... 29,150
Legal and audit fees ..................................... 22,956
Custodian fees ........................................... 7,484
Shareholder services fees ................................ 7,118
Miscellaneous expenses ................................... 38,224
-----------
TOTAL EXPENSES ........................................... 519,716
Less: Custodian fee credits .............................. (953)
-----------
NET EXPENSES ............................................. 518,763
-----------
NET INVESTMENT INCOME .................................... 1,152,037
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY:
Net realized gain on investments ......................... 457,985
Net realized loss on foreign
currency transactions .................................. (13,272)
-----------
Net realized gain on investments and loss
on foreign currency transactions ....................... 444,713
Net change in unrealized appreciation/
depreciation on investments and
foreign currency translations .......................... 3,297,728
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCY .................... 3,742,441
-----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ........................................ $ 4,894,478
===========
See accompanying notes to financial statements.
7
THE GABELLI GLOBAL UTILITY & INCOME TRUST
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED
JUNE 30, 2006 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2005
------------ -----------------
OPERATIONS:
Net investment income ...................................... $ 1,152,037 $ 1,919,979
Net realized gain on investments and foreign
currency transactions .................................... 444,713 2,521,834
Net change in unrealized appreciation/depreciation
on investments and foreign currency translations ......... 3,297,728 (1,797,961)
------------ ------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ....... 4,894,478 2,643,852
------------ ------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS:
Net investment income ...................................... (1,171,393)* (1,932,706)
Net realized short-term gain on investments and
foreign currency transactions ............................ (88,731)* (447,122)
Net realized long-term gain on investments and
foreign currency transactions ............................ (355,982)* (2,043,014)
Return of capital .......................................... (214,046)* --
------------ ------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS ................. (1,830,152) (4,422,842)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS ...................... 3,064,326 (1,778,990)
NET ASSETS:
Beginning of period ........................................ 62,380,987 64,159,977
------------ ------------
End of period (including undistributed net investment income
of $0 and $19,356, respectively) ......................... $ 65,445,313 $ 62,380,987
============ ============
---------------
* Based on fiscal year to date book income. Amounts are subject to change and
recharacterization at fiscal year end.
See accompanying notes to financial statements.
8
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 qualifying
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 periodically pay dividends.
2. SIGNIFICANT ACCOUNTING POLICIES. The preparation of financial statements in
accordance with United States ("U.S.") generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts and disclosures in the 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 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 60 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 60 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. Futures contracts are valued at the closing settlement price
of the exchange or board of trade on which the applicable contract is traded.
9
THE GABELLI GLOBAL UTILITY & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
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 to the
valuation and changes in valuation of similar securities, including a comparison
of foreign securities to the equivalent U.S. dollar value ADR 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.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with
primary government securities dealers recognized by the Federal Reserve Board,
with member banks of the Federal Reserve System, or with other brokers or
dealers that meet credit guidelines established by the Adviser and reviewed by
the Board. Under the terms of a typical repurchase agreement, the Fund takes
possession of an underlying debt obligation subject to an obligation of the
seller to repurchase, and the Fund to resell, the obligation at an agreed-upon
price and time, thereby determining the yield during the Fund's holding period.
The Fund will always receive and maintain securities as collateral whose market
value, including accrued interest, will be at least equal to 102% of the dollar
amount invested by the Fund in each agreement. The Fund will make payment for
such securities only upon physical delivery or upon evidence of book entry
transfer of the collateral to the account of the custodian. To the extent that
any repurchase transaction exceeds one business day, the value of the collateral
is marked-to-market on a daily basis to maintain the adequacy of the collateral.
If the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited. At June 30,
2006, there were no open repurchase agreements.
FUTURES CONTRACTS. The Fund may engage in futures contracts for the purpose
of hedging against changes in the value of its portfolio securities and in the
value of securities it intends to purchase. Upon entering into a futures
contract, the Fund is required to deposit with the broker an amount of cash or
cash equivalents equal to a certain percentage of the contract amount. This is
known as the "initial margin." Subsequent payments ("variation margin") are made
or received by the Fund each day, depending on the daily fluctuations in the
value of the contract, which are included in unrealized
appreciation/depreciation on investments and futures contracts. The Fund
recognizes a realized gain or loss when the contract is closed.
There are several risks in connection with the use of futures contracts as
a hedging instrument. The change in value of futures contracts primarily
corresponds with the value of their underlying instruments, which may not
correlate with the change in value of the hedged investments. In addition, there
is the risk that the Fund may not be able to enter into a closing transaction
because of an illiquid secondary market. At June 30, 2006, there were no open
futures contracts.
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. Securities sold short at June 30, 2006 are
reported within the Schedule of Investments.
10
THE GABELLI GLOBAL UTILITY & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
FORWARD FOREIGN EXCHANGE CONTRACTS. The Fund may engage in forward foreign
exchange contracts for 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 investments and 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. In addition, the Fund could be
exposed to risks if the counterparties to the contracts are unable to meet the
terms of their contracts. At June 30, 2006, there were no open forward foreign
exchange contracts.
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 the 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 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 ability 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
those of 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.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME. Securities transactions are
accounted for on the trade date with realized gain or 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 which are recorded as soon as the
Fund is informed of the dividend.
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".
11
THE GABELLI GLOBAL UTILITY & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
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 U.S.
generally accepted accounting principles. These differences are primarily due to
differing treatments of income and gains on various investment securities and
foreign currency transactions held by the Fund, timing differences, and
differing characterizations of distributions made by the Fund. Distributions
from net investment income 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. For the fiscal year
ended December 31, 2005, reclassifications were made to increase accumulated net
investment income by $32,083 and increase accumulated distributions in excess of
net realized gain on investments and foreign currency transactions by $32,083.
The tax character of distributions paid during the fiscal year ended
December 31, 2005 was as follows:
DISTRIBUTIONS PAID FROM:
Ordinary income (Inclusive of
short-term capital gains) .................... $2,379,828
Net long-term capital gains .................... 2,043,014
----------
Total distributions paid ....................... $4,422,842
==========
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.
As of December 31, 2005, the components of accumulated earnings/(losses) on
a tax basis were as follows:
Post October losses ............................ $ (2,065)
Net unrealized appreciation on
investments, payables, and receivables ....... 5,023,667
Net unrealized depreciation on
foreign currency ............................. (1,989)
Undistributed ordinary income .................. 21,421
----------
Total accumulated gain ......................... $5,041,034
==========
The following summarizes the tax cost of investments and the related
unrealized appreciation/depreciation at June 30, 2006:
GROSS GROSS NET UNREALIZED
UNREALIZED UNREALIZED APPRECIATION/
COST/PROCEEDS APPRECIATION DEPRECIATION (DEPRECIATION)
------------- ------------ ------------ --------------
Investments ............... $56,899,564 $9,055,207 $(737,846) $8,317,361
Short sales ............... (164,281) -- (401) (401)
---------- --------- ----------
$9,055,207 $ 738,247 $8,316,960
========== ========= ==========
3. AGREEMENTS AND TRANSACTIONS WITH AFFILIATES. The Fund has entered into an
investment advisory agreement (the "Advisory Agreement") with the Adviser which
provides that the Fund will pay the Adviser on the first business day of
12
THE GABELLI GLOBAL UTILITY & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
each month a fee for the previous month equal on an annual basis to 1.00% of the
value of the Fund's average weekly net 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, 2006, the Fund paid brokerage
commissions of $3,935 to Gabelli & Company, Inc. ("Gabelli & Company"), an
affiliate of the Adviser.
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, 2006, the Fund
paid or accrued $22,500 to the Adviser in connection with the cost of computing
the Fund's NAV, which is included in miscellaneous expenses in the Statement of
Operations.
The Fund is assuming its portion of the allocated cost of the Gabelli
Funds' Chief Compliance Officer in the amount of $2,724 for the six months ended
June 30, 2006 which is included in payroll expenses in the Statement of
Operations.
4. PORTFOLIO SECURITIES. Purchases and proceeds from the sales of securities for
the six months ended June 30, 2006, other than short-term securities, aggregated
$8,458,129 and $6,177,920, 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, 2006 and the fiscal year ended December 31, 2005, the Fund did not have any
transactions in shares of beneficial interest.
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 and expects the risk of loss to be remote.
8. OTHER MATTERS. The Adviser and/or affiliates have received subpoenas from the
Attorney General of the State of New York and the SEC requesting information on
mutual fund trading practices involving certain funds managed by the Adviser.
GAMCO Investors, Inc. ("GAMCO"), the Adviser's parent company, is responding to
these requests for documents and testimony. In June 2006, GAMCO began
discussions with the SEC regarding a possible resolution of their inquiry. Since
these discussions are ongoing, it cannot be determined at this time whether they
will ultimately result in a settlement of this matter. On a separate matter, in
September 2005, the Adviser was informed by the staff of the SEC that the staff
may recommend to the Commission that an administrative remedy and a monetary
penalty be sought from the Adviser in connection with the actions of two of
seven closed-end funds managed by the Adviser relating to Section 19(a) and Rule
19a-1 of the 1940 Act. These provisions require registered investment companies
to provide written statements to shareholders when a dividend is made from a
source other than net investment income. While the two closed-end funds sent
annual statements and provided other materials containing this information, the
funds did not send written statements to shareholders with each distribution in
2002 and 2003. The Adviser believes that all of the funds are now in compliance.
The Adviser believes that these matters would have no effect on the Fund or any
material adverse effect on the Adviser or its ability to manage the Fund. The
staff's notice to the Adviser did not relate to the Fund.
13
THE GABELLI GLOBAL UTILITY & INCOME TRUST
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A GLOBAL UTILITY & INCOME TRUST SHARE OF BENEFICIAL INTEREST
OUTSTANDING THROUGHOUT EACH PERIOD:
SIX MONTHS ENDED
JUNE 30, 2006 YEAR ENDED PERIOD ENDED
(UNAUDITED) DECEMBER 31, 2005 DECEMBER 31, 2004 (D)
----------- ----------------- --------------------
OPERATING PERFORMANCE:
Net asset value, beginning of period ...................... $ 20.45 $ 21.03 $ 19.06(e)
------- ------- -------
Net investment income ..................................... 0.38 0.64 0.28
Net realized and unrealized gain on investments ........... 1.23 0.23 2.29
------- ------- -------
Total from investment operations .......................... 1.61 0.87 2.57
------- ------- -------
DISTRIBUTIONS TO COMMON SHAREHOLDERS:
Net investment income ..................................... (0.38)(a) (0.63) (0.28)
Net realized gain on investments .......................... (0.15)(a) (0.82) (0.06)
Return of capital ......................................... (0.07)(a) -- (0.26)
------- ------- -------
Total distributions to common shareholders ................ (0.60) (1.45) (0.60)
------- ------- -------
NET ASSET VALUE, END OF PERIOD ............................ $ 21.46 $ 20.45 $ 21.03
======= ======= =======
Net asset value total return* ............................. 8.0% 4.2% 13.9%***
======= ======= =======
Market value, end of period ............................... $ 18.30 $ 17.76 $ 19.63
======= ======= =======
Total investment return** ................................. 6.4% (2.3)% 1.3%****
======= ======= =======
RATIOS TO AVERAGE NET ASSETS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) ...................... $65,445 $62,381 $64,160
Ratio of net investment income to average net assets ...... 3.57%(b) 2.99% 2.23%(b)
Ratio of operating expenses to average net assets ......... 1.61%(b)(c) 1.56%(c) 1.49%(b)
Portfolio turnover rate ................................... 10.2% 21.0% 16.9%
(a) Based on fiscal year to date book income. Amounts are subject to change
and recharacterization at fiscal year end.
(b) Annualized.
(c) For the six months ended June 30, 2006 and the year ended December 31,
2005, the effect of the custodian fee credits was minimal.
(d) The Gabelli Global Utility & Income Trust commenced investment operations
on May 28, 2004.
(e) The beginning of period NAV reflects a $0.04 reduction for costs
associated with the initial public offering.
* Based on net asset value per share, adjusted for reinvestment of
distributions at the net asset value per share on the ex-dividend dates.
Total return for periods of less than one year are not annualized.
** Based on market value per share, adjusted for reinvestment of
distributions. Total return for periods of less than one year are not
annualized.
*** Based on net asset value per share at commencement of operations of $19.06
per share.
**** Based on market value per share at initial public offering of $20.00 per
share.
See accompanying notes to financial statements.
14
THE GABELLI GLOBAL UTILITY & INCOME TRUST
BOARD CONSIDERATION AND RE-APPROVAL OF INVESTMENT ADVISORY AGREEMENT (UNAUDITED)
At its meeting on May 17, 2006, 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 short and
medium-term performance of the Fund since inception against a peer group of
equity closed-end funds and the customized peer group selected by Lipper. The
independent board members noted that the Fund comparative performance was
reasonably acceptable.
PROFITABILITY. The independent board members reviewed summary data regarding the
profitability of the Fund to the Adviser and found the profitability to be below
normal.
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.
SHARING OF ECONOMIES OF SCALE. The independent board members noted that the
investment advisory 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 to similar expense ratios of the peer group of equity closed-end funds as
well as the customized Lipper peer group 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 expense ratios were above 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 to the fee for other types of accounts managed by affiliates of
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
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
advisory to the full Board.
15
AUTOMATIC DIVIDEND REINVESTMENT
AND VOLUNTARY CASH PURCHASE PLANS
ENROLLMENT IN THE PLAN
It is the Policy of The Gabelli Global Utility & Income Trust (the "Fund")
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 issue common shares 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 share
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 43010
Providence, RI 02940-3010
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 distributions 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 common shares 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 shares 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 common shares 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 shares. The valuation date is the dividend or distribution
payment date or, if that date is not an American Stock Exchange ("Amex") trading
day, the next trading day. If the net asset value of the common shares at the
time of valuation exceeds the market price of the common shares, participants
will receive common 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 shares in the open market, or on the Amex 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 shares 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.
16
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 common
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 43010,
Providence, RI 02940-3010 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.
17
--------------------------------------------------------------------------------
THE GABELLI GLOBAL UTILITY & INCOME TRUST
AND YOUR PERSONAL PRIVACY
WHO ARE WE?
The Gabelli Global Utility & Income Trust (the "Fund") is a closed-end
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
GABELLI CUSTOMER?
When you purchase shares of the Fund on the American Stock Exchange, you
have the option of registering directly with our transfer agent in order,
for example, to participate in our dividend reinvestment plan.
o 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.
o 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 web site, 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.
--------------------------------------------------------------------------------
[GRAPHIC OMITTED]
PICTURE OF FLAGS
TRUSTEES AND OFFICERS
THE GABELLI GLOBAL UTILITY & INCOME TRUST
ONE CORPORATE CENTER, RYE, NY 10580-1422
TRUSTEES
Anthony J. Colavita
ATTORNEY-AT-LAW,
ANTHONY J. COLAVITA, P.C.
James P. Conn
FORMER CHIEF INVESTMENT OFFICER,
FINANCIAL SECURITY ASSURANCE HOLDINGS LTD.
Mario d'Urso
CHAIRMAN, MITTEL CAPITAL MARKETS SPA
Vincent D. Enright
FORMER SENIOR VICE PRESIDENT &
CHIEF FINANCIAL OFFICER,
KEYSPAN ENERGY CORP.
Michael J. Melarkey
ATTORNEY-AT-LAW,
AVANSINO, MELARKEY, KNOBEL & MULLIGAN
Salvatore M. Salibello
CERTIFIED PUBLIC ACCOUNTANT,
SALIBELLO & BRODER LLP
Salvatore J. Zizza
CHAIRMAN, HALLMARK ELECTRICAL SUPPLIES CORP.
OFFICERS
Bruce N. Alpert
PRESIDENT
Peter D. Goldstein
CHIEF COMPLIANCE OFFICER
James E. McKee
SECRETARY
Agnes Mullady
TREASURER
David I. Schachter
VICE PRESIDENT
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.
STOCK EXCHANGE LISTING
Common
--------
Amex-Symbol: GLU
Shares Outstanding: 3,050,236
The Net Asset Value appears in the Publicly Traded Funds column, under the
heading "Specialized Equity Funds," in Sunday's The New York Times and 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 may be obtained each day by calling (914) 921-5070.
--------------------------------------------------------------------------------
For general information about the Gabelli Funds, call 800-GABELLI
(800-422-3554), fax us at 914-921-5118, visit Gabelli Funds' Internet homepage
at: WWW.GABELLI.COM or e-mail us at: [email protected]
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
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 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 GABELLI GLOBAL UTILITY & INCOME TRUST
ONE CORPORATE CENTER
RYE, NY 10580-1422
(914) 921-5070
WWW.GABELLI.COM
SEMI-ANNUAL REPORT
JUNE 30, 2006
GLU SA 2006
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. SCHEDULE OF INVESTMENTS.
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.
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
=============================================================================================================================
(C) TOTAL NUMBER OF (D) MAXIMUM NUMBER (OR
SHARES (OR UNITS) APPROXIMATE DOLLAR VALUE) OF
(A) TOTAL NUMBER OF PURCHASED AS PART OF SHARES (OR UNITS) THAT MAY YET
SHARES (OR UNITS) (B) AVERAGE PRICE PAID PUBLICLY ANNOUNCED PLANS BE PURCHASED UNDER THE PLANS
PERIOD PURCHASED PER SHARE (OR UNIT) OR PROGRAMS OR PROGRAMS
=============================================================================================================================
Month #1 Common - N/A Common - N/A Common - N/A Common - 3,050,236
01/01/06
through Preferred - N/A Preferred - N/A Preferred - N/A Preferred - N/A
01/31/06
=============================================================================================================================
Month #2 Common - N/A Common - N/A Common - N/A Common - 3,050,236
02/01/06
through Preferred - N/A Preferred - N/A Preferred - N/A Preferred - N/A
02/28/06
=============================================================================================================================
Month #3 Common - N/A Common - N/A Common - N/A Common - 3,050,236
03/01/06
through Preferred - N/A Preferred - N/A Preferred - N/A Preferred - N/A
03/31/06
=============================================================================================================================
Month #4 Common - N/A Common - N/A Common - N/A Common - 3,050,236
04/01/06
through Preferred - N/A Preferred - N/A Preferred - N/A Preferred - N/A
04/30/06
=============================================================================================================================
Month #5 Common - N/A Common - N/A Common - N/A Common - 3,050,236
05/01/06
through Preferred - N/A Preferred - N/A Preferred - N/A Preferred - N/A
05/31/06
=============================================================================================================================
Month #6 Common - N/A Common - N/A Common - N/A Common - 3,050,236
06/01/06
through Preferred - N/A Preferred - N/A Preferred - N/A Preferred - N/A
06/30/06
=============================================================================================================================
Total Common - N/A Common - N/A Common - N/A N/A
Preferred - N/A Preferred - N/A Preferred - 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 10% or more from the net asset
value of the shares.
Any or all preferred shares outstanding may be repurchased when the
Fund's preferred shares are trading at a discount to the liquidation
value of $25.00.
c. The expiration date (if any) of each plan or program - The Fund's
repurchase plans are ongoing.
d. Each plan or program that has expired during the period covered by the
table - The Fund's repurchase plans are ongoing.
e. Each plan or program the registrant has determined to terminate prior
to expiration, or under which the registrant does not intend to make
further purchases. - The Fund's repurchase plans are ongoing.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's Board of Trustees, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 7(d)(2)(ii)(G) 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 September 1, 2006
----------------------------------------------------------------------------
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 September 1, 2006
----------------------------------------------------------------------------
By (Signature and Title)* /s/ Agnes Mullady
-------------------------------------------------------
Agnes Mullady,
Principal Financial Officer and Treasurer
Date September 1, 2006
----------------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.