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 811-09397
--------------------
The Gabelli Utilities Fund
----------------------------------------
(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, 2003
--------------------
Date of reporting period: June 30, 2003
-----------------
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, 450 Fifth Street, NW,
Washington, DC 20549-0609. 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 GABELLI UTILITIES FUND
SEMI-ANNUAL REPORT
JUNE 30, 2003
TO OUR SHAREHOLDERS,
We are changing the way we provide portfolio managers' commentary to
shareholders of our Funds. Our shareholder reports have typically contained
commentary on each portfolio manager's assessment of the stock market,
individual stocks and how economic events affect their thinking in managing a
specific Fund. We have always provided details about performance and presented
returns, both good and bad, hopefully in a clear and concise fashion. These
comments have been included as part of each Fund's quarterly, semi-annual, and
annual financial statements.
The Sarbanes-Oxley Act's new corporate governance regulations now require
a Fund's principal executive and financial officers to certify the entire
contents of shareholder reports in a filing with the Securities and Exchange
Commission on form N-CSR. This certification covers the portfolio manager's
commentary and subjective opinions if they are attached to or a part of the
financial statements.
Rather than ask our portfolio managers to eliminate their opinions and/or
restrict their commentary to historical facts only, we are removing their
commentary from the financial statements and sending it to you separately. As a
result, this commentary will no longer be considered part of a Fund's financial
report and therefore will not be subject to the officers' certifications.
We trust that you understand that our approach is an unintended
consequence of the ever-increasing regulatory requirements affecting public
companies generally. We hope the specific certification requirements of these
new regulations will be modified as they relate to mutual funds, since
investment companies have different corporate structures and objectives than
other public companies.
Sincerely yours,
/S/ BRUCE N. ALPERT
Bruce N. Alpert
Chief Operating Officer
August 8, 2003 Gabelli Funds, LLC
THE GABELLI UTILITIES FUND
PORTFOLIO OF INVESTMENTS -- JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
MARKET
SHARES COST VALUE
------ ---- ------
COMMON STOCKS -- 89.1%
ENERGY AND UTILITIES: ELECTRIC -- 16.5%
60,000 AES Corp.+ ..........$ 244,930 $ 381,000
45,000 British Energy plc .. 131,497 2,970
20,000 Cleco Corp. ......... 403,257 346,400
35,000 DPL Inc. ............ 754,639 557,900
6,000 DTE Energy Co. ...... 243,922 231,840
60,000 Edison International+ 746,180 985,800
40,000 El Paso Electric Co.+ 472,166 493,200
4,000 FPL Group Inc. ...... 233,940 267,400
20,000 Great Plains
Energy Inc. ....... 439,569 577,600
13,000 Green Mountain
Power Corp. ....... 272,406 260,000
8,000 Hawaiian Electric
Industries Inc. ... 349,855 366,800
9,000 Maine Public
Service Co. ....... 263,394 292,590
----------- ------------
4,555,755 4,763,500
----------- ------------
ENERGY AND UTILITIES: INTEGRATED -- 56.8%
100,000 Allegheny
Energy Inc. ....... 1,021,300 845,000
1,500 ALLETE Inc. ......... 32,135 39,825
15,000 Alliant Energy Corp. 282,537 285,450
10,000 Ameren Corp. ........ 415,936 441,000
60,000 Aquila Inc. ......... 145,573 154,800
5,000 CH Energy Group Inc. 221,063 225,000
7,000 Cinergy Corp. ....... 231,170 257,530
60,000 CMS Energy Corp. .... 462,629 486,000
17,000 Constellation Energy
Group Inc. ........ 448,840 583,100
40,000 DQE Inc. ............ 607,116 602,800
33,000 Duke Energy Corp. ... 746,431 658,350
40,000 El Paso Corp. ....... 404,947 323,200
16,000 Enel SpA ............ 100,877 99,768
18,000 Energy East Corp. ... 342,891 373,680
4,000 Entergy Corp. ....... 152,640 211,120
12,000 FirstEnergy Corp. ... 392,677 461,400
4,200 Florida Public
Utilities Co. ..... 60,350 68,670
3,000 MGE Energy Inc. ..... 94,500 94,140
20,000 Mirant Corp.+ ....... 80,300 58,000
18,000 NiSource Inc. ....... 365,389 342,000
10,000 Northeast Utilities . 165,918 167,400
17,000 NSTAR ............... 722,602 774,350
3,000 Otter Tail Corp. .... 82,030 80,940
23,000 Pepco Holdings Inc. . 440,764 440,680
28,000 PG&E Corp.+ ......... 365,349 592,200
12,500 PPL Corp. ........... 408,359 537,500
15,000 Progress Energy Inc. 644,243 658,500
17,000 TECO Energy Inc. .... 249,854 203,830
10,000 TXU Corp. ........... 195,942 224,500
23,000 Unisource
Energy Corp. ...... 431,615 432,400
55,500 Utilities
HOLDRs Trust ...... 3,842,104 4,140,300
35,000 Westar Energy Inc. .. 408,486 568,050
15,000 Wisconsin
Energy Corp. ...... 327,822 435,000
35,000 Xcel Energy Inc. .... 515,587 526,400
----------- ------------
15,409,976 16,392,883
----------- ------------
ENERGY AND UTILITIES: NATURAL GAS -- 9.2%
2,500 Atmos Energy Corp. .. 55,202 62,000
10,000 Energen Corp. ....... 239,277 333,000
3,000 Laclede Group Inc. .. 73,220 80,400
22,000 National Fuel
Gas Co. ........... 460,949 573,100
MARKET
SHARES COST VALUE
------ ---- ------
10,000 Nicor Inc. ..........$ 198,513 $ 371,100
11,000 NUI Corp. ........... 159,079 170,720
20,000 ONEOK Inc. .......... 316,715 392,600
500 RGC Resources Inc. .. 9,744 11,670
27,000 Southern Union Co.+ . 414,380 457,380
10,000 Southwest Gas Corp. . 207,698 211,800
----------- ------------
2,134,777 2,663,770
----------- ------------
ENERGY AND UTILITIES: WATER -- 1.0%
4,000 Middlesex Water Co. . 91,740 98,560
8,000 Pennichuck Corp. .... 187,846 197,600
----------- ------------
279,586 296,160
----------- ------------
TELECOMMUNICATIONS: LOCAL -- 5.3%
15,000 BellSouth Corp. ..... 479,309 399,450
13,000 SBC Communications
Inc. .............. 448,805 332,150
20,000 Verizon Communications
Inc. .............. 756,596 789,000
----------- ------------
1,684,710 1,520,600
----------- ------------
WIRELESS COMMUNICATIONS -- 0.3%
10,000 Motorola Inc. ....... 86,133 94,300
----------- ------------
TOTAL COMMON STOCKS . 24,150,937 25,731,213
----------- ------------
PREFERRED STOCKS -- 3.5%
ENERGY AND UTILITIES: INTEGRATED -- 2.6%
8,800 Cinergy Corp.,
9.500% Cv. Pfd. ... 440,000 521,312
12,500 Mirant Trust I,
6.250% Cv. Pfd.,
Ser. A ............ 454,205 223,125
----------- ------------
894,205 744,437
----------- ------------
TELECOMMUNICATIONS -- 0.9%
5,000 Citizens Communications Co.,
5.000% Cv. Pfd. ... 252,750 265,000
----------- ------------
TOTAL PREFERRED
STOCKS ............ 1,146,955 1,009,437
----------- ------------
PRINCIPAL
AMOUNT
---------
CONVERTIBLE BONDS -- 1.4%
ENERGY AND UTILITIES: ELECTRIC -- 1.4%
$ 450,000 AES Corp., Sub. Deb. Cv.,
4.500%, 08/15/05 .. 340,429 405,000
----------- ------------
U.S. GOVERNMENT OBLIGATIONS -- 5.7%
1,633,000 U.S. Treasury Bills,
0.801% to 1.096%++,
07/03/03 to
09/18/03 .......... 1,631,666 1,631,650
----------- ------------
TOTAL
INVESTMENTS --
99.7% .............$27,269,987 $28,777,300
===========
OTHER ASSETS AND
LIABILITIES (NET) -- 0.3% ..... 96,321
-----------
NET ASSETS -- 100.0% .............$28,873,621
===========
- ----------------
For Federal tax purposes:
Aggregate cost ...................$27,269,987
===========
Gross unrealized appreciation ....$ 2,786,333
Gross unrealized depreciation .... (1,279,020)
-----------
Net unrealized appreciation ......$ 1,507,313
===========
- ----------------
+ Non-income producing security.
++ Represents annualized yield at date of purchase.
See accompanying notes to financial statements.
2
THE GABELLI UTILITIES FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
ASSETS:
Investments, at value (cost $27,269,987) ....... $ 28,777,300
Dividends and interest receivable .............. 73,155
Receivable from investments sold ............... 8,320
Receivable for Fund shares sold ................ 226,445
------------
TOTAL ASSETS ................................... 29,085,220
------------
LIABILITIES:
Payable for Fund shares redeemed ............... 5,281
Payable for investments purchased .............. 142,254
Payable for investment advisory fees ........... 25,965
Payable for distribution fees .................. 5,789
Other accrued expenses and liabilities ......... 32,310
------------
TOTAL LIABILITIES .............................. 211,599
------------
NET ASSETS applicable to 3,766,975
shares outstanding ........................... $ 28,873,621
============
NET ASSETS CONSIST OF:
Shares of beneficial interest, at par value .... $ 30,732
Additional paid-in capital ..................... 30,766,949
Distributions in excess of net investment income (1,006,662)
Accumulated net realized loss on investments ... (2,424,711)
Net unrealized appreciation on investments ..... 1,507,313
------------
TOTAL NET ASSETS ............................... $ 28,873,621
============
SHARES OF CAPITAL STOCK:
CLASS AAA:
Shares of capital stock outstanding
($0.001 par value) ........................... 3,701,379
============
Net Asset Value, offering and redemption
price per share .............................. $7.67
=====
CLASS A:
Shares of capital stock outstanding
($0.001 par value) ........................... 18,170
======
Net Asset Value and redemption price per
share price per share ........................ $7.69
=====
Maximum sales charge ........................... 5.75%
=====
Maximum offering price per share (NAV (DIVIDE) 0.9425,
based on maximum sales charge of 5.75%
of the offering price at June 30, 2003) ...... $8.16
=====
CLASS B:
Shares of capital stock outstanding
($0.001 par value) ........................... 8,884
=====
Net Asset Value, offering and redemption
price per share .............................. $7.62(a)
=====
CLASS C:
Shares of capital stock outstanding
($0.001 par value) ........................... 38,541
======
Net Asset Value, offering and redemption
price per share .............................. $7.64(a)
=====
- -----------------------
(a) Redemption price varies based on the length of time held.
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
INVESTMENT INCOME:
Dividends ............................ $ 413,122
Interest ............................. 35,328
-----------
TOTAL INVESTMENT INCOME .............. 448,450
-----------
EXPENSES:
Investment advisory fees ............. 99,218
Distribution fees .................... 25,918
Shareholder communications expenses .. 17,157
Shareholder services fees ............ 14,730
Legal and audit fees ................. 13,287
Trustees' fees ....................... 12,113
Registration fees .................... 11,573
Custodian fees ....................... 4,437
Miscellaneous expenses ............... 3,228
-----------
TOTAL EXPENSES ....................... 201,661
Less: Expense reimbursements ......... (1,775)
-----------
TOTAL NET EXPENSES ................... 199,886
-----------
NET INVESTMENT INCOME ................ 248,564
-----------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS:
Net realized loss on investments ..... (565,403)
Net change in unrealized appreciation/
depreciation on investments ........ 3,041,014
-----------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS ..................... 2,475,611
-----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS .................... $ 2,724,175
===========
See accompanying notes to financial statements.
3
THE GABELLI UTILITIES FUND
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
SIX MONTHS ENDED
JUNE 30, 2003 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2002
------------ -----------------
OPERATIONS:
Net investment income .................................................... $ 248,564 $ 305,491
Net realized loss on investments ......................................... (565,403) (115,023)
Net change in unrealized appreciation/depreciation on investments ........ 3,041,014 (1,822,900)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS .......... 2,724,175 (1,632,432)
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income
Class AAA ................................................................ (244,065) (305,491)
Class A .................................................................. (624) --
Class B .................................................................. (2,261) --
Class C .................................................................. (1,614) --
------------ ------------
(248,564) (305,491)
------------ ------------
RETURN OF CAPITAL
Class AAA ................................................................ (988,440) (844,040)
Class A .................................................................. (2,530) --
Class B .................................................................. (9,157) --
Class C .................................................................. (6,535) --
------------ ------------
(1,006,662) (844,040)
------------ ------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS ...................................... (1,255,226) (1,149,531)
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Class AAA .............................................................. 13,724,854 6,269,955
Class A ................................................................ 127,307 --
Class B ................................................................ 74,038 --
Class C ................................................................ 263,169 --
------------ ------------
Net increase in net assets from shares of beneficial interest transactions 14,189,368 6,269,955
------------ ------------
NET INCREASE IN NET ASSETS ............................................... 15,658,317 3,487,992
------------ ------------
NET ASSETS:
Beginning of period ...................................................... 13,215,304 9,727,312
------------ ------------
End of period ............................................................ $ 28,873,621 $ 13,215,304
============ ============
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
1. ORGANIZATION. The Gabelli Utilities Fund (the "Fund") was organized on May
18, 1999 as a Delaware Business Trust. The Fund is a diversified, open-end
management investment company registered under the Investment Company Act of
1940, as amended (the "1940 Act"). The Fund commenced operations on August 31,
1999. The Fund's primary objective is to provide a high level of total return
through a combination of capital appreciation and current income.
2. SIGNIFICANT ACCOUNTING POLICIES. The preparation of financial statements in
accordance with accounting principles generally accepted in the United States
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
4
THE GABELLI UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
- --------------------------------------------------------------------------------
so determines, by such other method as the Board of Trustees 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 foreign markets are
generally valued at the preceding closing values of such securities on their
respective exchanges. Securities and assets for which market quotations are not
readily available are valued at their fair value as determined in good faith
under procedures established by and under the general supervision of the Board
of Trustees. Short term debt securities with remaining maturities of 60 days or
less are valued at amortized cost, unless the Board of Trustees determines such
does not reflect the securities fair value, in which case these securities will
be valued at their fair value as determined by the Board of Trustees. Debt
instruments having a maturity greater than 60 days for which market quotations
are readily available are valued at the latest average of the bid and asked
prices. If there were no asked prices quoted on such day, the security is valued
using the closing bid price. Options are valued at the last sale price on the
exchange on which they are listed. If no sales of such options have taken place
that day, they will be valued at the mean between their closing bid and asked
prices.
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
of Trustees. 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.
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 as earned.
Dividend income is recorded on the ex-dividend date.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders are recorded on the ex-dividend date. Income distributions and
capital gain distributions are determined in accordance with Federal income tax
regulations which may differ from accounting principles generally accepted in
the United States. These differences are primarily due to differing treatments
of income and gains on various investment securities held by the Fund, timing
differences and differing characterization of distributions made by the Fund.
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. As a result, a Federal income tax provision is not required.
The Fund has a net capital loss carryforward for Federal income tax purposes at
December 31, 2002 of $1,798,633. This capital loss carryforward is available to
reduce future distributions of net capital gains to shareholders. $1,088,544 of
the loss carryforward is available through 2008; $655,271 is available through
2009; and $54,818 is available through 2010.
3. INVESTMENT ADVISORY AGREEMENT. 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 daily and paid
5
THE GABELLI UTILITIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
- --------------------------------------------------------------------------------
monthly, at the annual rate of 1.00% of the value of the Fund's average daily
net assets. In accordance with the Advisory Agreement, the Adviser provides a
continuous investment program for the Fund's portfolio, oversees the
administration of all aspects of the Fund's business and affairs and pays the
compensation of all Officers and Trustees of the Fund who are its affiliates.
The Adviser contractually agreed to reimburse expenses of the Fund to the extent
necessary to maintain the annualized total operating expenses for Class AAA, A,
B, and C of 2.00%, 2.00%, 2.75% and 2.75%, respectively, of average daily net
assets. For the six months ended June 30, 2003, the Adviser reimbursed the Fund
in the amount of $1,775. The Fund is obliged to repay the Adviser for a period
of two fiscal years following the fiscal year in which the Adviser reimbursed
the Fund only to the extent that the operating expenses of the Fund fall below
2.00%, 2.00%, 2.75% and 2.75% of average daily net assets for Class AAA, A, B,
andC, respectively. The cumulative amount which the Fund may repay the Adviser
is $122,750.
4. DISTRIBUTION PLAN. The Fund's Board of Trustees has adopted a distribution
plan (the "Plan") for each class of shares pursuant to Rule 12b-1 under the 1940
Act. For the six months ended June 30, 2003, the Fund incurred distribution
costs payable to Gabelli & Company, Inc., an affiliate of the Adviser, of
$24,375 and $58 for Class AAA and Class A Shares, respectively, or 0.25% of
average daily net assets, the annual limitation under its Plan. Class B and
Class C Shares incurred distribution costs of $871 and $614, respectively, or
1.00% of average daily net assets, the annual limitation under each plan. Such
payments are accrued daily and paid monthly.
5. PORTFOLIO SECURITIES. Purchases and proceeds from the sales of securities for
the six months ended June 30, 2003, other than short term securities, aggregated
$15,872,832 and $3,053,214, respectively.
6. TRANSACTIONS WITH AFFILIATES. During the six months ended June 30, 2003, the
Fund paid brokerage commissions of $30,712 to Gabelli & Company, Inc. Gabelli &
Company has informed the Fund that it received commissions (sales charges and
underwriting fees) from investors on sales or redemptions of Fund shares in the
amount of $867.
7. SHARES OF BENEFICIAL INTEREST. Transactions in shares of beneficial interest
were as follows:
SIX MONTHS ENDED
JUNE 30, 2003 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2002
-------------------------------------------------------------
CLASS AAA
-------------------------------------------------------------
SHARES AMOUNT SHARES AMOUNT
------------ ------------ ----------- -----------
Shares sold ........................................ 3,174,303 $ 23,171,304 1,489,471 $11,221,609
Shares issued upon reinvestment of dividends ....... 133,179 937,089 134,423 1,024,609
Shares redeemed .................................... (1,504,238) (10,383,540) (791,745) (5,976,263)
---------- ------------ --------- -----------
Net increase ................................... 1,803,244 $ 13,724,854 832,149 $ 6,269,955
========== ============ ========= ===========
CLASS A
-----------------------------
SHARES AMOUNT
------------ -------------
Shares sold ........................................ 18,689 $ 131,480
Shares issued upon reinvestment of dividends ....... 335 2,514
Shares redeemed .................................... (854) (6,687)
---------- ------------
Net increase ................................... 18,170 $ 127,307
========== ============
CLASS B
-----------------------------
SHARES AMOUNT
------------ -------------
Shares sold ........................................ 37,131 $ 272,522
Shares issued upon reinvestment of dividends ....... 1,255 8,307
Shares redeemed .................................... (29,502) (206,791)
---------- ------------
Net increase ................................... 8,884 $ 74,038
========== ============
CLASS C
-----------------------------
SHARES AMOUNT
------------ -------------
Shares sold ........................................ 41,560 $ 286,831
Shares issued upon reinvestment of dividends ....... 1,112 8,149
Shares redeemed .................................... (4,131) (31,811)
---------- ------------
Net increase ................................... 38,541 $ 263,169
========== ============
6
THE GABELLI UTILITIES FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Selected data for a share of capital stock outstanding throughout each period:
INCOME
FROM INVESTMENT OPERATIONS DISTRIBUTIONS
-------------------------------------------------------- ---------------------------------------------------
Net In Excess
Net Asset Realized and Total Net of Net
Period Value, Net Unrealized from Net Realized Realized
Ended Beginning Investment Gain (Loss) on Investment Investment Gain on Gain on Total
December 31 of Period Income Investments Operations Income Investments Investments Distributions
- ----------- --------- ---------- -------------- ----------- ---------- ----------- ----------- -------------
CLASS AAA
2003(e) $ 6.96 $0.09 $1.04 $ 1.13 $(0.09) -- $(0.33)(d) $(0.42)
2002 9.13 0.22 (1.55) (1.33) (0.22) -- (0.62)(d) (0.84)
2001 11.72 0.11 (1.86) (1.75) (0.11) -- (0.73)(d) (0.84)
2000 10.89 0.89 0.83 1.72 (0.89) -- -- (0.89)
1999+ 10.00 0.04(a) 2.18 2.22 (0.03) (1.23) (0.07) (1.33)
CLASS A
2003(e) 6.96 0.09 1.06 1.15 (0.09) -- (0.33)(d) (0.42)
CLASS B
2003(e) 6.96 0.07 1.01 1.08 (0.07) -- (0.35)(d) (0.42)
CLASS C
2003(e) 6.96 0.06 1.04 1.10 (0.06) -- (0.36)(d) (0.42)
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
-----------------------------------------------------------------------------------
Net
Net Asset Net Assets Investment Expenses Expenses
Period Value, End of Income/(Loss) Net of Before Portfolio
Ended End of Total Period to Average Net Waivers/ Waivers/ Turnover
December 31 Period Return++ (in 000's) Assets Reimbursements(f) Reimbursements(c) Rate
- ----------- --------- -------- ----------- -------------- ----------------- ----------------- ---------
CLASS AAA
2003(e) $ 7.67 17.0% $28,372 2.53% 2.00% 2.00% 16%
2002 6.96 (15.1) 13,215 2.91 2.00 2.64 41
2001 9.13 (15.4) 9,727 1.02 2.00 2.49 110
2000 11.72 16.4 13,281 8.31 2.00 2.88 215
1999+ 10.89 22.3 3,685 0.99(b) 2.00(b) 10.63(b) 94
CLASS A
2003(e) 7.69 17.3 140 2.31 2.00 2.00 16
CLASS B
2003(e) 7.62 16.3 68 2.12 2.75 2.75 16
CLASS C
2003(e) 7.64 16.6 294 1.72 2.75 2.75 16
- -------------------------
+ From commencement of investment operations on August 31, 1999 through
December 31, 1999.
++ Total return represents aggregate total return of a hypothetical $1,000
investment at the beginning of the period and sold at the end of the period
including reinvestment of dividends. Total return for less than one year is
not annualized.
(a) Based on average month-end shares outstanding.
(b) Annualized.
(c) During the six months ended June 30, 2003 and the periods ended December 31,
2002, 2001, 2000 and 1999, the Adviser reimbursed certain expenses. If such
expense reimbursement had not occurred, the ratio of operating expenses to
average net assets would have been as shown.
(d) Return of Capital.
(e) For the period ended June 30, 2003; unaudited.
(f) The Fund incurred interest expense for the six months ended June 30, 2003.
If interest expense had not been incurred, the ratios of operating expenses
to average net assets would have been 1.99%, 1.99%, 2.74% and 2.74% for
Class AAA, Class A, Class B and Class C shares, respectively.
See accompanying notes to financial statements.
7
THE GABELLI UTILITIES FUND
One Corporate Center
Rye, New York 10580-1422
800-GABELLI
800-422-3554
FAX: 914-921-5118
WEBSITE: WWW.GABELLI.COM
E-MAIL: INFO@GABELLI.COM
Net Asset Value available daily by calling
800-GABELLI after 6:00 P.M.
BOARD OF TRUSTEES
Mario J. Gabelli, CFA Mary E. Hauck
CHAIRMAN AND CHIEF (RETIRED) SENIOR PORTFOLIO MANAGER
INVESTMENT OFFICER GABELLI-O'CONNOR FIXED INCOME
GABELLI ASSET MANAGEMENT INC. MUTUAL FUND MANAGEMENT CO.
Anthony J. Colavita Karl Otto Pohl
ATTORNEY-AT-LAW FORMER PRESIDENT
ANTHONY J. COLAVITA, P.C. DEUTSCHE BUNDESBANK
Vincent D. Enright Werner J. Roeder, MD
FORMER SENIOR VICE PRESIDENT VICE PRESIDENT/MEDICAL AFFAIRS
AND CHIEF FINANCIAL OFFICER LAWRENCE HOSPITAL CENTER
KEYSPAN ENERGY CORP.
OFFICERS
Bruce N. Alpert Gus Coutsouros
PRESIDENT VICE PRESIDENT AND TREASURER
James E. McKee
SECRETARY
DISTRIBUTOR
Gabelli & Company, Inc.
CUSTODIAN, TRANSFER AGENT AND DIVIDEND AGENT
State Street Bank and Trust Company
LEGAL COUNSEL
Skadden, Arps, Slate, Meagher & Flom LLP
- --------------------------------------------------------------------------------
This report is submitted for the general information of the shareholders of The
Gabelli Utilities Fund. It is not authorized for distribution to prospective
investors unless preceded or accompanied by an effective prospectus.
- --------------------------------------------------------------------------------
GAB470Q203SR
[GRAPHIC OMITTED]
PICTURE OF MARIO GABELLI
THE
GABELLI
UTILITIES
FUND
SEMI-ANNUAL REPORT
JUNE 30, 2003
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. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. [RESERVED]
ITEM 9. 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 Exchange Act
(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 last fiscal
half-year (the registrant's second fiscal half-year in the case of an
annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial
reporting.
ITEM 10. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Certifications pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002 are attached hereto.
(b) Certifications pursuant to 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 Utilities Fund
----------------------------
By (Signature and Title)* /s/ Bruce N. Alpert
----------------------------------------------
Bruce N. Alpert, Principal Executive Officer
Date 09/03/03
----------------------------------------------
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 09/03/03
----------------------------------------------
By (Signature and Title)* /s/ Gus A. Coutsouros
-----------------------------------------------
Gus A. Coutsouros, Principal Financial Officer
Date 09/03/03
----------------------------------------------
* Print the name and title of each signing officer under his or her signature.