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 811-4494
-------------
The Gabelli Asset 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 ASSET 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 ASSET FUND
PORTFOLIO OF INVESTMENTS -- JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
MARKET
SHARES COST VALUE
------ ---- ------
COMMON STOCKS -- 95.5%
AEROSPACE -- 1.1%
85,000 Boeing Co. .........$ 2,913,690 $ 2,917,200
163,000 Lockheed Martin
Corp. ............ 4,262,883 7,753,910
90,000 Northrop Grumman
Corp.+ ........... 5,536,641 7,766,100
-------------- --------------
12,713,214 18,437,210
-------------- --------------
AGRICULTURE -- 0.6%
700,000 Archer-Daniels-
Midland Co. ...... 9,730,743 9,009,000
15,000 Delta & Pine
Land Co. ......... 260,292 329,700
40,529 Monsanto Co. ....... 647,780 877,048
-------------- --------------
10,638,815 10,215,748
-------------- --------------
AUTOMOTIVE -- 0.5%
208,000 General Motors Corp. 8,851,652 7,488,000
30,000 Volkswagen AG ...... 1,246,577 1,268,115
-------------- --------------
10,098,229 8,756,115
-------------- --------------
AUTOMOTIVE: PARTS AND ACCESSORIES -- 4.0%
38,000 ArvinMeritor Inc. .. 901,978 766,840
62,000 BorgWarner Inc. .... 2,266,500 3,992,800
125,000 CLARCOR Inc. ....... 1,777,793 4,818,750
560,000 Dana Corp. ......... 8,736,797 6,473,600
210,000 Federal-Mogul Corp.+ 467,783 69,300
650,000 GenCorp Inc. ....... 2,404,331 5,778,500
500,000 Genuine Parts Co. .. 12,026,034 16,005,000
170,000 Johnson Controls ...
Inc. ............. 5,627,295 14,552,000
150,000 Midas Inc.+ ........ 1,867,183 1,818,000
305,000 Modine Manufacturing
Co. .............. 7,126,610 5,907,850
11,000 O'Reilly Automotive
Inc.+ ............ 332,140 367,290
198,000 Scheib (Earl) Inc.+ 1,389,293 543,510
210,000 Standard Motor
Products Inc. .... 3,040,437 2,331,000
70,000 Superior Industries
International Inc. 1,780,210 2,919,000
395,000 Tenneco Automotive
Inc.+ ............ 3,025,869 1,422,000
200,000 TI Automotive Ltd.+ 0 0
100,000 TransPro Inc.+ ..... 788,321 448,000
-------------- --------------
53,558,574 68,213,440
-------------- --------------
AVIATION: PARTS AND SERVICES -- 1.3%
70,000 Aviall Inc.+ ....... 686,212 795,900
136,200 Curtiss-Wright Corp. 1,668,462 8,607,840
33,500 Curtiss-Wright Corp.,
Cl. B ............ 2,209,093 2,087,050
180,000 Fairchild Corp.,
Cl. A+ ........... 1,176,982 725,400
95,000 Kaman Corp., Cl. A . 1,355,190 1,110,550
35,000 Precision Castparts
Corp. ............ 573,957 1,088,500
110,000 Sequa Corp., Cl. A+ 4,726,536 3,773,000
104,000 Sequa Corp., Cl. B+ 5,351,790 4,301,440
-------------- --------------
17,748,222 22,489,680
-------------- --------------
BROADCASTING -- 1.5%
20,000 Corus Entertainment
Inc., Cl. B+ ..... 64,982 334,867
MARKET
SHARES COST VALUE
------ ---- ------
50,000 Fisher Communications
Inc.+ ............$ 2,936,283 $ 2,445,500
230,000 Granite Broadcasting
Corp.+ ........... 1,109,343 703,800
207,000 Gray Television Inc. 2,661,209 2,566,800
23,000 Gray Television Inc.,
Cl. A ........... 271,331 282,900
165,000 Grupo Televisa SA,
ADR .............. 4,491,076 5,692,500
170,000 Liberty Corp. ...... 6,268,553 7,225,000
5,000 LIN TV Corp., Cl. A+ 110,000 117,750
155,000 Paxson Communications
Corp.+ ........... 1,614,014 928,450
400,000 Television Broadcasts
Ltd. ............. 1,815,551 1,433,677
222,000 Young Broadcasting Inc.,
Cl. A+ ........... 4,902,040 4,690,860
-------------- --------------
26,244,382 26,422,104
-------------- --------------
BUILDING AND CONSTRUCTION -- 0.0%
80,111 Huttig Building
Products Inc.+ ... 243,014 217,101
-------------- --------------
BUSINESS SERVICES -- 1.3%
560,000 Cendant Corp.+ ..... 6,160,813 10,259,200
200,000 Ecolab Inc. ........ 1,876,865 5,120,000
10,000 Imation Corp. ...... 203,344 378,200
66,500 Landauer Inc. ...... 412,456 2,781,695
140,000 Nashua Corp.+ ...... 2,015,422 1,246,000
50,000 Roto-Rooter Inc. ... 1,509,519 1,907,000
-------------- --------------
12,178,419 21,692,095
-------------- --------------
CABLE -- 3.5%
2,040,000 Cablevision Systems Corp.,
Cl. A+ ........... 21,390,515 42,350,400
30,000 Charter Communications
Inc., Cl. A+ ..... 138,876 119,100
367,000 Comcast Corp.,
Cl. A+ ........... 10,752,918 11,076,060
40,000 Comcast Corp., Cl. A,
Special+ ......... 306,462 1,153,200
60,000 Shaw Communications Inc.,
Cl. B ............ 164,952 802,797
80,000 Shaw Communications
Inc.,
Cl. B, Non-Voting 312,647 1,076,000
500,000 UnitedGlobalCom Inc.,
Cl. A+ ........... 4,107,680 2,585,000
-------------- --------------
37,174,050 59,162,557
-------------- --------------
CLOSED END FUNDS -- 0.1%
79,000 Royce Value Trust
Inc. ............. 912,541 1,180,260
-------------- --------------
COMMERCIAL SERVICES -- 0.1%
33,000 ChoicePoint Inc.+ .. 1,127,551 1,139,160
-------------- --------------
COMMUNICATIONS EQUIPMENT -- 0.8%
260,000 Allen Telecom Inc.+ 1,616,180 4,295,200
630,000 Corning Inc.+ ...... 4,776,337 4,655,700
865,000 Lucent Technologies
Inc.+ ............ 4,908,795 1,755,950
See accompanying notes to financial statements.
2
THE GABELLI ASSET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED) -- JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
MARKET
SHARES COST VALUE
------ ---- ------
COMMON STOCKS (CONTINUED)
COMMUNICATIONS EQUIPMENT (CONTINUED)
190,000 Motorola Inc. ......$ 2,013,581 $ 1,791,700
255,000 Nortel Networks
Corp.+ ........... 1,311,504 688,500
-------------- --------------
14,626,397 13,187,050
-------------- --------------
COMPUTER HARDWARE -- 0.0%
20,000 Hewlett-Packard Co. 531,198 426,000
35,000 Xerox Corp.+ ....... 446,352 370,650
-------------- --------------
977,550 796,650
-------------- --------------
COMPUTER SOFTWARE AND SERVICES -- 0.7%
30,000 Computer Associates
International Inc. 479,700 668,400
45,000 Electronic Data
Systems Corp. .... 623,544 965,250
240,000 EMC Corp.+ ......... 3,527,036 2,512,800
3,000 J.D. Edwards & Co.+ 39,694 42,990
48,000 Jupitermedia Corp.+ 241,259 192,000
395,000 PeopleSoft Inc.+ ... 7,132,376 6,948,050
-------------- --------------
12,043,609 11,329,490
-------------- --------------
CONSUMER PRODUCTS -- 5.4%
22,000 Alberto-Culver Co.,
Cl. A ............ 837,868 1,095,160
4,000 Alberto-Culver Co.,
Cl. B ............ 176,045 204,400
90,000 Altria Group Inc. .. 3,540,900 4,089,600
11,000 Christian Dior SA .. 307,335 439,838
195,000 Church & Dwight
Co. Inc. ......... 1,923,569 6,382,350
1,000 Clorox Co. ......... 30,050 42,650
60,000 Department 56 Inc.+ 651,832 919,800
90,000 Eastman Kodak Co. .. 2,684,409 2,461,500
375,000 Energizer Holdings
Inc.+ ............ 5,992,408 11,775,000
135,000 Fortune Brands Inc. 3,151,093 7,047,000
322,000 Gallaher Group plc,
ADR .............. 5,131,246 12,751,200
420,000 Gillette Co. ....... 12,453,913 13,381,200
1,500 Givaudan SA ........ 408,522 631,211
40,000 Harley-Davidson Inc. 100,750 1,594,400
40,000 International Flavors &
Fragrances Inc. .. 773,336 1,277,200
225,000 Mattel Inc. ........ 3,247,526 4,257,000
45,000 Maytag Corp. ....... 1,289,728 1,098,900
68,000 National Presto ....
Industries Inc. .. 2,314,244 2,148,800
200,000 Procter & Gamble Co. 13,978,541 17,836,000
10,000 Rothmans Inc. ...... 209,547 195,032
10,000 Syratech Corp.+ (a) 2,000 18,450
175,000 Wolverine World
Wide Inc. ........ 2,441,530 3,370,500
-------------- --------------
61,646,392 93,017,191
-------------- --------------
CONSUMER SERVICES -- 2.4%
400 eBay Inc.+ ......... 24,652 41,672
901,000 InterActive Corp.+ . 6,886,176 35,652,570
298,650 Rollins Inc. ....... 3,453,596 5,629,552
-------------- --------------
10,364,424 41,323,794
-------------- --------------
MARKET
SHARES COST VALUE
------ ---- ------
DIVERSIFIED INDUSTRIAL -- 5.0%
185,000 Acuity Brands Inc. .$ 3,155,451 $ 3,361,450
5,000 Anixter International
Inc.+ ............ 45,044 117,150
200,000 Cooper Industries Ltd.,
Cl. A ............ 8,199,845 8,260,000
450,000 Crane Co. .......... 7,083,259 10,183,500
105,000 Gardner Denver Inc.+ 1,537,250 2,148,300
250,000 GATX Corp. ......... 5,594,297 4,087,500
20,000 General Electric Co. 503,826 573,600
221,100 Greif Inc., Cl. A .. 4,775,892 5,085,300
30,000 Harbor Global Co.
Ltd.+ ............ 52,965 225,000
365,000 Honeywell
International Inc. 12,157,167 9,800,250
300,000 ITT Industries Inc. 9,410,611 19,638,000
150,000 Katy Industries
Inc.+ ............ 1,369,925 732,000
310,000 Lamson & Sessions
Co.+ ............. 1,697,032 1,494,200
29,000 MagneTek Inc.+ ..... 281,037 73,660
225,000 Myers Industries Inc. 1,557,014 2,137,500
55,000 Pentair Inc. ....... 1,531,265 2,148,300
305,000 Sensient Technologies
Corp. ............ 5,905,268 7,011,950
90,000 Smiths Group plc ... 1,005,041 1,044,059
1,500 Sulzer AG .......... 305,722 209,573
155,000 Thomas Industries
Inc. ............. 1,971,325 4,192,750
80,000 Trinity Industries
Inc. ............. 977,970 1,480,800
100,000 Tyco International
Ltd. ............. 1,356,063 1,898,000
-------------- --------------
70,473,269 85,902,842
-------------- --------------
ELECTRONICS -- 0.9%
485,019 Agere Systems Inc.,
Cl. B+ ........... 1,727,514 1,115,544
2,400 Fargo Electronics+ . 17,016 23,352
3,000 Hitachi Ltd., ADR .. 172,200 126,900
13,000 Kyocera Corp., ADR . 448,063 741,000
21,000 Molex Inc., Cl. A .. 623,830 486,759
390,000 Oak Technology Inc.+ 1,588,938 2,421,900
125,000 Sony Corp., ADR .... 5,136,652 3,500,000
178,000 Texas Instruments
Inc. ............. 4,601,535 3,132,800
300,000 Thomas & Betts
Corp.+ ........... 5,602,016 4,335,000
-------------- --------------
19,917,764 15,883,255
-------------- --------------
ENERGY AND UTILITIES -- 6.0%
170,000 AES Corp.+ ......... 699,247 1,079,500
125,000 AGL Resources Inc. . 2,196,411 3,180,000
240,000 BP plc, ADR ........ 6,441,908 10,084,800
38,000 Brown (Tom) Inc.+ .. 613,895 1,056,020
125,000 Burlington Resources
Inc. ............. 4,842,969 6,758,750
25,000 CH Energy Group Inc. 1,040,745 1,125,000
160,000 ChevronTexaco Corp. 8,618,042 11,552,000
93,540 ConocoPhillips ..... 5,458,676 5,125,992
20,000 Constellation Energy
Group Inc. ....... 484,262 686,000
62,000 Devon Energy Corp. . 1,695,494 3,310,800
75,000 DPL Inc. ........... 1,506,159 1,195,500
130,000 DQE Inc. ........... 2,002,812 1,959,100
18,000 DTE Energy Co. ..... 761,887 695,520
See accompanying notes to financial statements.
3
THE GABELLI ASSET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED) -- JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
MARKET
SHARES COST VALUE
------ ---- ------
COMMON STOCKS (CONTINUED)
ENERGY AND UTILITIES (CONTINUED)
590,000 Duke Energy Corp. ..$ 10,826,500 $ 11,770,500
6,000 Edison
International+ ... 100,620 98,580
250,000 El Paso Corp. ...... 2,889,537 2,020,000
285,000 El Paso Electric
Co.+ ............. 3,293,306 3,514,050
140,000 Energy East Corp. .. 2,829,372 2,906,400
15,000 ENSCO International
Inc. ............. 406,857 403,500
55,000 EOG Resources Inc. . 503,773 2,301,200
310,000 Exxon Mobil Corp. .. 6,624,170 11,132,100
4,000 FPL Group Inc. ..... 215,141 267,400
31,625 GlobalSantaFe Corp. 743,538 738,127
10,000 Halliburton Co. .... 104,525 230,000
54,000 Kerr-McGee Corp. ... 2,987,951 2,419,200
140,000 Mirant Corp.+ ...... 893,939 406,000
180,000 NiSource Inc.+ ..... 360,000 399,600
200,000 Northeast Utilities 3,859,076 3,348,000
100,000 Progress Energy
Inc., CVO+ ....... 52,000 10,500
25,000 Royal Dutch
Petroleum Co. .... 1,068,692 1,165,500
23,500 SJW Corp. .......... 2,329,983 2,003,375
325,000 Southwest Gas Corp. 5,939,311 6,883,500
7,500 Transocean Inc.+ ... 171,150 164,775
60,000 TXU Corp. .......... 1,117,420 1,347,000
13,000 UIL Holdings Corp. . 566,946 527,150
-------------- --------------
84,246,314 101,865,349
-------------- --------------
ENTERTAINMENT -- 8.5%
1,360,000 AOL Time Warner
Inc.+ ............ 17,720,008 21,882,400
18,000 Ascent Media Group Inc.,
Cl. A+ ........... 71,668 22,320
19,406 EMI Group plc ...... 75,408 39,068
200,000 EMI Group plc, ADR . 1,770,972 805,260
190,000 Fox Entertainment Group
Inc., Cl. A+ ..... 4,443,470 5,468,200
200,000 GC Companies Inc.+ . 218,000 30,000
400,000 Gemstar-TV Guide
International
Inc.+ ............ 1,667,924 2,036,000
4,650,000 Liberty Media Corp.,
Cl. A+ ........... 14,100,287 53,754,000
410,000 Metro-Goldwyn-Mayer
Inc.+ ............ 6,770,338 5,092,200
12,000 Regal Entertainment Group,
Cl. A ............ 228,000 282,960
255,000 Six Flags Inc.+ .... 2,153,592 1,728,900
475,000 The Walt Disney Co. 10,149,248 9,381,250
835,000 Viacom Inc., Cl. A+ 20,051,192 36,489,500
411,700 Vivendi Universal
SA, ADR+ ......... 8,976,978 7,591,748
60,000 World Wrestling
Entertainment Inc. 612,234 617,400
-------------- --------------
89,009,319 145,221,206
-------------- --------------
MARKET
SHARES COST VALUE
------ ---- ------
ENVIRONMENTAL SERVICES -- 1.2%
350,000 Allied Waste Industries
Inc.+ ............$ 3,121,796 $ 3,517,500
300,000 Republic Services
Inc.+ ............ 3,560,581 6,801,000
425,000 Waste Management
Inc. ............. 7,906,058 10,238,250
-------------- --------------
14,588,435 20,556,750
-------------- --------------
EQUIPMENT AND SUPPLIES -- 7.2%
295,000 AMETEK Inc. ........ 3,428,976 10,811,750
4,000 Amphenol Corp.,
Cl. A+ ........... 60,075 187,280
70,000 Caterpillar Inc. ... 927,858 3,896,200
105,000 CIRCOR International
Inc. ............. 907,143 1,872,150
190,000 Crown Holdings Inc.+ 856,577 1,356,600
150,000 CTS Corp. .......... 755,149 1,567,500
2,000 Danaher Corp. ...... 70,641 136,100
400,000 Deere & Co. ........ 6,703,065 18,280,000
5,500 DENTSPLY International
Inc. ............. 209,434 224,950
213,000 Donaldson Co. Inc. . 1,608,133 9,467,850
300,150 Fedders Corp. ...... 1,246,432 921,461
490,000 Flowserve Corp.+ ... 7,477,754 9,638,300
170,000 Gerber Scientific
Inc.+ ............ 1,650,756 1,132,200
212,000 GrafTech International
Ltd.+ ............ 3,298,103 1,155,400
446,000 IDEX Corp. ......... 3,995,972 16,163,040
2,000 Imagistics
International Inc.+ 39,950 51,600
12,000 Ingersoll-Rand Co.,
Cl. A ............ 501,720 567,840
800,000 Interpump Group SpA 3,321,141 3,242,920
100,000 Lufkin Industries Inc. 1,810,811 2,435,000
18,000 Manitowoc Co. Inc. . 131,305 401,400
28,000 Met-Pro Corp. ...... 338,094 404,320
580,000 Navistar International
Corp.+ ........... 11,108,472 18,925,400
30,000 PACCAR Inc. ........ 522,021 2,026,800
10,000 Sealed Air Corp.+ .. 168,679 476,600
215,000 SPS Technologies
Inc.+ ............ 4,117,801 5,813,600
150,000 Sybron Dental
Specialties Inc.+ 2,817,765 3,540,000
30,000 Valmont Industries
Inc. ............. 242,908 583,800
435,000 Watts Industries
Inc., Cl. A ...... 5,006,660 7,764,750
120,000 Weir Group plc ..... 504,947 462,376
-------------- --------------
63,828,342 123,507,187
-------------- --------------
FINANCIAL SERVICES -- 5.5%
28,040 Aegon NV, ADR ...... 443,483 281,522
1 Al-Zar Ltd.+ ....... 0 140
14,280 Alleghany Corp.+ ... 2,638,614 2,727,480
40,000 Allstate Corp. ..... 905,355 1,426,000
350,000 American Express Co. 7,411,655 14,633,500
64,000 Argonaut Group Inc. 1,687,181 789,120
60,000 Bank of New York Co.
Inc. ............. 2,076,956 1,725,000
65,000 Bank One Corp. ..... 1,844,977 2,416,700
220 Berkshire Hathaway Inc.,
Cl. A+ ........... 874,549 15,950,000
50,000 BKF Capital Group
Inc.+ ............ 933,375 1,091,500
See accompanying notes to financial statements.
4
THE GABELLI ASSET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED) -- JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
MARKET
SHARES COST VALUE
------ ---- ------
COMMON STOCKS (CONTINUED)
FINANCIAL SERVICES (CONTINUED)
25,000 Block (H&R) Inc. ...$ 478,832 $ 1,081,250
65,000 CIT Group Inc. ..... 1,289,268 1,602,250
35,000 Commerzbank AG ..... 624,519 489,538
112,000 Commerzbank AG, ADR 2,379,080 1,569,075
155,000 Deutsche Bank AG,
ADR .............. 7,004,175 9,985,100
15,000 FleetBoston Financial
Corp. ............ 314,250 445,650
40,000 Janus Capital
Group Inc. ....... 678,089 656,000
7,000 Lehman Brothers
Holdings Inc. .... 63,175 465,360
50,000 Leucadia National
Corp. ............ 1,330,044 1,856,000
100,000 Mellon Financial
Corp. ............ 3,451,608 2,775,000
26,000 Merrill Lynch &
Co. Inc. ......... 1,065,370 1,213,680
38,000 Metris Companies
Inc. ............. 347,786 210,900
397,000 Midland Co. ........ 2,038,203 8,817,370
10,000 MONY Group Inc. .... 256,395 269,500
200,000 Phoenix Companies
Inc. ............. 3,083,583 1,806,000
20,000 PNC Financial
Services
Group ............ 954,762 976,200
2,500 Prudential
Financial Inc. ... 68,750 84,125
22,000 Schwab (Charles)
Corp. ............ 274,010 221,980
60,000 St. Paul Companies
Inc. ............. 2,059,334 2,190,600
85,000 State Street Corp. . 661,975 3,349,000
20,000 SunTrust Banks Inc. 424,879 1,186,800
30,000 T. Rowe Price
Group Inc. ....... 1,012,984 1,132,500
18,000 Travelers Property Casualty
Corp., Cl. A ..... 291,000 286,200
3,000 UBS AG+ ............ 137,995 166,200
22,000 Unitrin Inc. ....... 649,341 596,640
8,500 Value Line Inc. .... 136,515 417,435
170,000 Wachovia Corp. ..... 5,352,893 6,793,200
70,000 Waddell & Reed Financial
Inc., Cl. A ...... 1,401,752 1,796,900
-------------- --------------
56,646,712 93,481,415
-------------- --------------
FOOD AND BEVERAGE -- 8.9%
13,000 Allied Domecq
plc, ADR ......... 298,053 294,970
16,700 Brau und Brunnen AG+ 221,760 1,654,045
177,000 Brown-Forman Corp.,
Cl. A ............ 8,628,418 14,248,500
16,000 Cadbury Schweppes plc,
ADR .............. 383,956 386,880
123,000 Campbell Soup Co. .. 3,385,011 3,013,500
105,000 Coca-Cola Co. ...... 3,236,639 4,873,050
10,000 Coca-Cola Enterprises
Inc. ............. 154,389 181,500
40,000 ConAgra Foods Inc. . 804,537 944,000
260,000 Corn Products International
Inc. ............. 6,678,348 7,807,800
160,587 Del Monte Foods Co.+ 1,314,335 1,419,589
318,000 Diageo plc, ADR .... 11,903,832 13,915,680
7,400 Farmer Brothers Co. 975,514 2,510,746
300,090 Flowers Foods Inc. . 2,817,060 5,929,778
MARKET
SHARES COST VALUE
------ ---- ------
240,000 General Mills Inc. .$ 6,475,473 $ 11,378,400
400,000 Grupo Bimbo SA de CV,
Ser. A ........... 815,358 671,526
10,000 Hain Celestial
Group Inc.+ ...... 141,134 159,900
195,000 Heinz (H.J.) Co. ... 7,076,965 6,431,100
57,000 Hershey Foods Corp. 1,937,482 3,970,620
365,000 Kellogg Co. ........ 8,834,861 12,545,050
100,000 Kerry Group plc,
Cl. A ............ 1,179,129 1,538,779
33,000 LVMH Moet Hennessy Louis
Vuitton SA+ ...... 1,150,670 1,636,699
7,000 Nestle SA .......... 1,452,953 1,444,402
1,070,000 PepsiAmericas Inc. . 13,525,957 13,439,200
395,000 PepsiCo Inc. ....... 10,153,249 17,577,500
145,600 Ralcorp Holdings
Inc.+ ............ 2,117,567 3,634,176
30,000 Sara Lee Corp. ..... 573,150 564,300
20,000 Smucker (J.M.) Co. . 547,733 797,800
147,517 Tootsie Roll
Industries Inc. .. 2,040,673 4,497,793
249,000 Wrigley (Wm.)
Jr. Co. .......... 7,564,004 14,001,270
-------------- --------------
106,388,210 151,468,553
-------------- --------------
HEALTH CARE -- 3.0%
16,000 Abbott Laboratories 592,700 700,160
48,000 Amgen Inc.+ ........ 220,320 3,189,120
3,000 ArthroCare Corp.+ .. 34,530 50,280
700 Bio-Rad Laboratories Inc.,
Cl. B ............ 25,810 39,039
40,000 Biogen Inc.+ ....... 422,530 1,520,000
4,000 Biomet Inc. ........ 120,840 114,640
170,000 Bristol-Myers
Squibb Co. ....... 5,098,156 4,615,500
5,000 Centerpulse AG+ .... 324,089 1,345,475
40,000 Chiron Corp.+ ...... 550,315 1,748,800
1,000 CONMED Corp.+ ...... 15,430 18,260
1,000 Exactech Inc.+ ..... 10,970 14,400
8,000 GlaxoSmithKline
plc, ADR ......... 437,520 324,320
12,000 Henry Schein Inc.+ . 584,789 628,080
1,000 Integra LifeSciences
Holdings+ ........ 19,480 26,380
10,000 Interpore
International Inc.+ 84,040 127,300
25,000 Inverness Medical
Innovations Inc.+ 424,748 482,500
57,520 Invitrogen Corp.+ .. 2,822,111 2,207,043
60,000 Johnson & Johnson .. 624,750 3,102,000
12,000 Lilly (Eli) & Co. .. 690,000 827,640
155,000 Merck & Co. Inc. ... 5,092,182 9,385,250
5,100 Orthofix International
NV+ .............. 142,338 166,974
4,000 OrthoLogic Corp.+ .. 13,880 18,360
4,000 Osteotech Inc.+ .... 26,900 54,360
15,000 Patterson Dental
Co.+ ............. 648,295 680,700
420,000 Pfizer Inc. ........ 6,847,753 14,343,000
100,000 Schering-Plough
Corp. ............ 2,282,730 1,860,000
1,000 Smith & Nephew
plc, ADR ......... 57,873 58,000
1,000 Stryker Corp. ...... 65,440 69,370
See accompanying notes to financial statements.
5
THE GABELLI ASSET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED) -- JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
MARKET
SHARES COST VALUE
------ ---- ------
COMMON STOCKS (CONTINUED)
HEALTH CARE (CONTINUED)
6,000 VISX Inc.+ .........$ 107,500 $ 104,100
70,000 Women First
HealthCare Inc.+ . 124,375 74,200
1,000 Wright Medical
Group Inc.+ ...... 16,460 19,000
55,000 Wyeth .............. 2,169,854 2,505,250
3,200 Zimmer Holdings
Inc.+ ............ 101,718 144,160
-------------- --------------
30,800,426 50,563,661
-------------- --------------
HOTELS AND GAMING -- 2.3%
84,300 Aztar Corp.+ ....... 815,374 1,358,073
100,000 Boca Resorts Inc.,
Cl. A+ ........... 930,944 1,300,000
410,000 Gaylord Entertainment
Co.+ ............. 10,874,285 8,023,700
40,000 GTECH Holdings
Corp.+ ........... 404,713 1,506,000
12,000 Harrah's Entertainment
Inc.+ ............ 113,002 482,880
2,750,000 Hilton Group plc ... 9,857,105 8,349,835
750,000 Hilton Hotels Corp. 8,484,470 9,592,500
65,000 Mandalay Resort
Group+ ........... 826,584 2,070,250
30,000 MGM Mirage+ ........ 755,882 1,025,400
220,000 Park Place Entertainment
Corp.+ ........... 1,231,329 1,999,800
120,000 Starwood Hotels & Resorts
Worldwide Inc. ... 3,103,980 3,430,800
60,000 Trump Hotels & Casino
Resorts Inc.+ .... 256,680 117,000
-------------- --------------
37,654,348 39,256,238
-------------- --------------
METALS AND MINING -- 1.5%
50,000 Alcoa Inc. ......... 1,349,157 1,275,000
259,000 Barrick Gold Corp. . 3,360,500 4,636,100
56,323 Kinross Gold Corp.+ 410,122 380,180
520,000 Newmont Mining Corp. 9,887,074 16,879,200
170,000 Placer Dome Inc. ... 1,576,428 2,085,900
250,000 Royal Oak Mines ....
Inc.+ ............ 654,847 1,000
-------------- --------------
17,238,128 25,257,380
-------------- --------------
PAPER AND FOREST PRODUCTS -- 0.3%
190,000 MeadWestvaco Corp. . 5,262,902 4,693,000
15,000 Rayonier Inc. ...... 465,432 495,000
-------------- --------------
5,728,334 5,188,000
-------------- --------------
PUBLISHING -- 5.3%
225,000 Belo Corp., Cl. A .. 4,060,533 5,031,000
22,000 Dow Jones & Co. Inc. 1,000,419 946,660
20,000 EMAP plc ........... 224,148 282,343
50,000 Lee Enterprises Inc. 1,152,425 1,876,500
60,000 McClatchy Co., Cl. A 1,240,718 3,457,200
140,000 McGraw-Hill Companies
Inc. ............. 2,576,918 8,680,000
380,000 Media General Inc.,
Cl. A ............ 10,681,115 21,736,000
80,000 Meredith Corp. ..... 1,650,283 3,520,000
132,000 New York Times Co.,
Cl. A ............ 1,094,267 6,006,000
14,000 News Corp. Ltd., ADR 246,049 423,780
550,000 PRIMEDIA Inc.+ ..... 2,697,107 1,677,500
135,000 Pulitzer Inc. ...... 5,877,329 6,671,700
MARKET
SHARES COST VALUE
------ ---- ------
240,000 Reader's Digest
Association Inc. .$ 4,591,770 $ 3,235,200
124,000 Scripps (E.W.) Co.,
Cl. A ............ 7,804,763 11,001,280
94,640 Seat-Pagine
Gialle SpA+ ...... 198,816 65,751
120,000 Thomas Nelson Inc.+ 1,535,734 1,500,000
290,000 Tribune Co. ........ 10,098,557 14,007,000
-------------- --------------
56,730,951 90,117,914
-------------- --------------
REAL ESTATE -- 1.3%
365,000 Catellus Development
Corp.+ ........... 3,615,876 8,030,000
48,000 Florida East Coast
Industries Inc.,
Cl. A ............ 631,838 1,226,400
72,082 Florida East Coast
Industries Inc.,
Cl. B ............ 1,224,423 1,794,842
88,000 Griffin Land &
Nurseries Inc.+ .. 1,143,929 1,214,840
3,961 HomeFed Corp.+ ..... 709 10,893
312,000 St. Joe Co. ........ 2,376,837 9,734,400
-------------- --------------
8,993,612 22,011,375
-------------- --------------
RETAIL -- 2.5%
23,000 Aaron Rents Inc. ... 98,609 593,400
27,000 Aaron Rents Inc.,
Cl. A ............ 287,231 656,100
195,000 Albertson's Inc. ... 4,223,842 3,744,000
450,000 AutoNation Inc.+ ... 4,523,837 7,074,000
16,000 Blockbuster Inc.,
Cl. A ............ 160,166 269,600
150,000 Burlington Coat Factory
Warehouse Corp. .. 1,734,823 2,685,000
6,000 Coldwater
Creek Inc.+ ...... 50,700 73,980
5,000 Gucci Group NV, ADR 480,598 490,000
140,000 Kroger Co.+ ........ 818,000 2,335,200
170,000 Lillian Vernon
Corp.+ ........... 2,444,554 1,229,100
660,000 Neiman Marcus Group Inc.,
Cl. B+ ........... 15,984,491 22,770,000
30,000 Safeway Inc.+ ...... 601,600 613,800
-------------- --------------
31,408,451 42,534,180
-------------- --------------
SATELLITE -- 0.2%
300,000 General Motors Corp.,
Cl. H+ ........... 6,156,705 3,843,000
40,000 Loral Space &
Communications
Ltd.+ ............ 472,595 122,000
-------------- --------------
6,629,300 3,965,000
-------------- --------------
SPECIALTY CHEMICALS -- 1.4%
434,000 Ferro Corp. ........ 7,006,970 9,778,020
120,000 Fuller (H.B.) Co. .. 2,014,683 2,642,400
116,000 General Chemical
Group Inc.+ ...... 498,224 29,000
150,000 Great Lakes
Chemical Corp. ... 4,162,527 3,060,000
340,000 Hercules Inc.+ ..... 5,483,446 3,366,000
211,800 Material Sciences
Corp.+ ........... 1,867,425 2,054,460
650,000 Omnova Solutions
Inc.+ ............ 2,051,888 2,626,000
-------------- --------------
23,085,163 23,555,880
-------------- --------------
See accompanying notes to financial statements.
6
THE GABELLI ASSET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED) -- JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
MARKET
SHARES COST VALUE
------ ---- ------
COMMON STOCKS (CONTINUED)
TELECOMMUNICATIONS -- 7.3%
90,000 ALLTEL Corp. .......$ 2,757,227 $ 4,339,800
205,000 AT&T Corp. ......... 6,593,899 3,946,250
240,000 BCE Inc. ........... 5,898,910 5,546,400
130,000 BellSouth Corp. .... 4,484,684 3,461,900
14,000 Brasil Telecom
Participacoes
SA, ADR .......... 810,959 524,300
300,000 BT Group plc ....... 1,190,878 1,008,663
30,000 BT Group plc, ADR .. 1,146,994 1,009,800
525,000 CenturyTel Inc. .... 6,423,670 18,296,250
555,000 Cincinnati
Bell Inc.+ ....... 4,923,272 3,718,500
360,000 Citizens Communications
Co.+ ............. 3,651,435 4,640,400
273,500 Commonwealth Telephone
Enterprises Inc.+ 4,884,206 12,025,795
40,000 Commonwealth Telephone
Enterprises Inc.,
Cl. B+ ........... 541,245 1,840,000
100,000 Deutsche Telekom
AG, ADR+ ......... 1,389,261 1,520,000
45,000 France Telecom
SA, ADR .......... 938,617 1,109,250
2,520,000 Qwest Communications
International
Inc.+ ............ 11,050,238 12,045,600
10,000 RCN Corp.+ ......... 70,251 19,800
10,000 Rogers Communications
Inc., Cl. B ...... 77,553 159,338
430,000 Rogers Communications
Inc., Cl. B, ADR . 4,257,815 6,901,500
198,000 SBC Communications
Inc. ............. 6,613,907 5,058,900
420,000 Sprint Corp. -
FON Group ........ 6,101,769 6,048,000
10,000 Swisscom AG, ADR ... 304,000 283,400
75,403 Tele Norte Leste
Participacoes
SA, ADR .......... 1,032,454 880,707
500,000 Telecom Italia SpA . 1,032,880 4,524,471
96,500 Telecom Italia
SpA, ADR ......... 2,156,052 8,746,760
96,649 Telefonica SA, ADR+ 3,545,912 3,341,156
12,567 Telefonica SA, BDR+ 152,274 145,862
20,000 Telefonos de Mexico SA de
CV, Cl. L, ADR ... 171,746 628,400
37,500 TELUS Corp. ........ 658,391 659,890
21,500 TELUS Corp., ADR ... 385,712 378,337
285,000 Verizon
Communications Inc. 9,170,405 11,243,250
-------------- --------------
92,416,616 124,052,679
-------------- --------------
TRANSPORTATION -- 0.1%
85,000 AMR Corp.+ ......... 1,245,603 935,000
50,000 Grupo TMM SA de CV,
Cl. A, ADR+ ...... 391,821 110,000
4,000 Kansas City
Southern+ ........ 7,317 48,120
4,000 Providence & Worcester
Railroad Co. ..... 44,669 28,080
1,000 Ryder System Inc. .. 19,238 25,620
-------------- --------------
1,708,648 1,146,820
-------------- --------------
MARKET
SHARES COST VALUE
------ ---- ------
WIRELESS COMMUNICATIONS -- 3.8%
75,000 America Movil SA de CV,
Cl. L, ADR .......$ 1,171,749 $ 1,406,250
470,000 AT&T Wireless
Services Inc.+ ... 5,782,745 3,858,700
75,000 Leap Wireless International
Inc.+ ............ 17,985 3,750
350,000 mm02 plc+ .......... 408,010 327,764
150,000 mm02 plc, ADR+ ..... 1,656,011 1,384,500
265,000 Nextel Communications Inc.,
Cl. A+ ........... 3,868,834 4,791,200
90,000 Nextel Partners Inc.,
Cl. A+ ........... 971,733 657,000
65,000 Price Communications
Corp.+ ........... 1,101,180 839,150
240,000 Rogers Wireless
Communications Inc.,
Cl. B+ ........... 3,999,040 4,056,000
700,000 Sprint Corp. -
PCS Group+ ....... 7,064,375 4,025,000
6,750 Tele Celular Sul
Participacoes
SA, ADR .......... 107,916 56,227
22,500 Tele Centro Oeste Celular
Participacoes
SA, ADR .......... 67,448 130,050
1,350 Tele Leste Celular
Participacoes
SA, ADR+ ......... 36,110 10,422
3,375 Tele Nordeste Celular
Participacoes
SA, ADR .......... 49,807 54,506
1,350 Tele Norte Celular
Participacoes
SA, ADR+ ......... 20,857 9,045
1,800,000 Telecom Italia
Mobile SpA ....... 1,661,796 8,867,504
3,375 Telemig Celular
Participacoes
SA, ADR .......... 97,539 70,943
692,000 Telephone & Data
Systems Inc. ..... 25,835,813 34,392,400
25,000 Telesp Celular Participacoes
SA, ADR+ ......... 562,136 97,500
22,000 Vodafone Group
plc, ADR ......... 325,457 432,300
-------------- --------------
54,806,541 65,470,211
-------------- --------------
TOTAL COMMON
STOCKS ........... 1,154,594,266 1,628,585,630
-------------- --------------
PREFERRED STOCKS -- 3.6%
AEROSPACE -- 0.2%
30,000 Northrop Grumman Corp.,
7.000% Cv.
Pfd., Ser. B ..... 3,495,600 3,690,000
-------------- --------------
METALS AND MINING -- 0.0%
15,000 Freeport-McMoRan Copper
& Gold Inc.,
7.000% Cv. Pfd. .. 272,500 362,100
-------------- --------------
PUBLISHING -- 3.3%
2,235,000 News Corp. Ltd.,
Pfd., ADR ........ 31,814,487 55,986,750
-------------- --------------
See accompanying notes to financial statements.
7
THE GABELLI ASSET FUND
PORTFOLIO OF INVESTMENTS (CONTINUED) -- JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
MARKET
SHARES COST VALUE
------ ---- ------
PREFERRED STOCKS (CONTINUED)
TELECOMMUNICATIONS -- 0.1%
20,000 Citizens Communications Co.,
5.000% Cv. Pfd. ..$ 996,562 $ 1,060,000
-------------- --------------
WIRELESS COMMUNICATIONS -- 0.0%
7,686,101 Telesp Celular Participacoes
SA, Pfd.+ ........ 60,929 11,948
-------------- --------------
TOTAL PREFERRED
STOCKS ........... 36,640,078 61,110,798
-------------- --------------
PRINCIPAL
AMOUNT
---------
CORPORATE BONDS -- 0.3%
AUTOMOTIVE: PARTS AND ACCESSORIES -- 0.1%
$ 1,000,000 Standard Motor Products Inc.,
Sub. Deb. Cv.,
6.750%, 07/15/09 . 904,996 865,000
-------------- --------------
CABLE -- 0.0%
1,000,000 Charter Communications
Inc., Cv.,
4.750%, 06/01/06 . 588,000 665,000
-------------- --------------
ELECTRONICS -- 0.2%
2,500,000 Agere Systems Inc.,
Sub. Deb. Cv.,
6.500%, 12/15/09 . 2,413,964 2,875,000
500,000 Oak Industries Inc.,
Sub. Deb. Cv.,
4.875%, 03/01/08 . 327,013 480,000
-------------- --------------
2,740,977 3,355,000
-------------- --------------
TOTAL CORPORATE
BONDS ............ 4,233,973 4,885,000
-------------- --------------
PRINCIPAL MARKET
AMOUNT COST VALUE
-------- ---- ------
U.S. GOVERNMENT OBLIGATIONS -- 0.6%
$11,092,000 U.S. Treasury Bills++,
0.813% to 1.108%,
07/03/03 to
12/26/03 .........$ 11,079,455 $ 11,079,643
-------------- --------------
TOTAL INVESTMENTS --
100.0% ...........$1,206,547,772 1,705,661,071
==============
OTHER ASSETS AND
LIABILITIES (NET) -- 0.0% ....... (590,183)
--------------
NET ASSETS -- 100.0% ..............$1,705,070,888
==============
- ------------------
For Federal tax purposes:
Aggregate cost ....................$1,206,547,772
==============
Gross unrealized appreciation .....$ 583,808,954
Gross unrealized depreciation ..... (84,695,654)
--------------
Net unrealized appreciation .......$ 499,113,300
==============
- -------------------
(a) Security fair valued under procedures established by the Board of
Trustees.
+ Non-income producing security.
++ Represents annualized yield at date of purchase.
ADR - American Depository Receipt.
BDR - Brazilian Depository Receipt.
CVO - Contingent Value Obligation.
See accompanying notes to financial statements.
8
THE GABELLI ASSET FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
ASSETS:
Investments, at value (cost $1,206,547,772) ... $1,705,661,071
Dividends and interest receivable ............. 1,875,632
Receivable for investments sold ............... 841
Receivable for Fund shares sold ............... 682,208
Other assets .................................. 3,274
--------------
TOTAL ASSETS .................................. 1,708,223,026
--------------
LIABILITIES:
Payable for investments purchased ............. 571,570
Payable for Fund shares redeemed .............. 122,876
Due to custodian .............................. 94,499
Payable for investment advisory fees .......... 1,411,914
Payable for distribution fees ................. 352,455
Payable for shareholder services fees ......... 357,211
Payable for custody fees ...................... 55,553
Other accrued expenses ........................ 186,060
--------------
TOTAL LIABILITIES ............................. 3,152,138
--------------
NET ASSETS applicable to 54,142,587
shares outstanding .......................... $1,705,070,888
==============
NET ASSETS CONSIST OF:
Shares of beneficial interest, at par value ... $ 541,426
Additional paid-in capital .................... 1,202,529,867
Accumulated net investment income ............. 1,159,135
Accumulated net realized gain/(loss) on
investments and foreign currency transactions 1,723,887
Net unrealized appreciation/(depreciation) on
investments and foreign currency transactions 499,116,573
--------------
TOTAL NET ASSETS .............................. $1,705,070,888
==============
NET ASSET VALUE, offering and redemption
price per share ($1,705,070,888 (DIVIDE)
54,142,587 shares outstanding;
unlimited number of shares authorized of
$0.01 par value) ........................... $31.49
======
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2003 (UNAUDITED)
- --------------------------------------------------------------------------------
INVESTMENT INCOME:
Dividends (net of foreign taxes of $315,036) ................... $ 11,372,179
Interest ....................................................... 304,859
Other .......................................................... 73,287
------------
TOTAL INVESTMENT INCOME ........................................ 11,750,325
------------
EXPENSES:
Investment advisory fees ....................................... 7,593,997
Distribution fees .............................................. 1,898,903
Shareholder services fees ...................................... 621,898
Custodian fees ................................................. 157,839
Shareholder communications expenses ............................ 154,155
Interest expense ............................................... 46,271
Trustees' fees ................................................. 28,209
Legal and audit fees ........................................... 27,070
Registration expenses .......................................... 22,881
Miscellaneous expenses ......................................... 66,967
------------
TOTAL EXPENSES ................................................. 10,618,190
------------
NET INVESTMENT INCOME .......................................... 1,132,135
------------
NET REALIZED AND UNREALIZED GAIN/(LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain/(loss) on investments and
foreign currency transactions ................................ 21,207,243
Net change in unrealized appreciation/
(depreciation) on investments and foreign
currency transactions ........................................ 153,780,270
------------
NET REALIZED AND UNREALIZED GAIN/(LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS ................................................. 174,987,513
------------
NET INCREASE/DECREASE IN NET ASSETS
RESULTING FROM OPERATIONS .................................... $176,119,648
============
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
SIX MONTHS ENDED
JUNE 30, 2003 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2002
--------------- -----------------
OPERATIONS:
Net investment income/(loss) .................................. $ 1,132,135 $ 654,868
Net realized gain/(loss) on investments and
foreign currency transactions ............................... 21,207,243 (13,133,504)
Net change in unrealized appreciation/(depreciation)
on investments and foreign
currency transactions ....................................... 153,780,270 (263,964,124)
--------------- ---------------
NET INCREASE/(DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 176,119,648 (276,442,760)
--------------- ---------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income ......................................... -- (638,198)
Net realized short-term gain on investments ................... -- (42,547)
Net realized long-term gain on investments .................... -- (200,099)
--------------- ---------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS ........................... -- (880,844)
--------------- ---------------
CAPITAL SHARE TRANSACTIONS:
Net increase/(decrease) in net assets from shares
of beneficial interest transactions .......................... 27,531,208 (132,263,045)
--------------- ---------------
NET INCREASE/(DECREASE) IN NET ASSETS ......................... 203,650,856 (409,586,649)
--------------- ---------------
NET ASSETS:
Beginning of period ........................................... 1,501,420,032 1,911,006,681
--------------- ---------------
End of period ................................................. $ 1,705,070,888 $ 1,501,420,032
=============== ===============
See accompanying notes to financial statements.
9
THE GABELLI ASSET FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
1. ORGANIZATION. The Gabelli Asset Fund (the "Fund") was organized on November
25, 1985 as a Massachusetts 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's primary objective is growth of
capital. The Fund commenced investment operations on March 3, 1986.
2. SIGNIFICANT ACCOUNTING POLICIES. The preparation of financial statements in
accordance with 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 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.
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 transactions. 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/(loss) 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.
10
THE GABELLI ASSET FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The books and records of the Fund are maintained
in United States (U.S.) dollars. Foreign currencies, investments and other
assets and liabilities are translated into U.S. dollars at the exchange rates
prevailing at the end of the period, and 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, which
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 transactions. 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.
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.
Dividends and interest from non-U.S. sources received by the Fund are generally
subject to non-U.S. withholding taxes at rates ranging up to 30%. Such
withholding taxes may be reduced or eliminated under the terms of applicable
U.S. income tax treaties, and the Fund intends to undertake any procedural steps
required to claim the benefits of such treaties.
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 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.
4. DISTRIBUTION PLAN. The Fund's Board of Trustees has adopted a distribution
plan (the "Plan") 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 $1,898,903 or 0.25% of average
daily net assets, the annual limitation under the Plan. Such payments are
accrued daily and paid monthly.
11
THE GABELLI ASSET FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
- --------------------------------------------------------------------------------
5. PORTFOLIO SECURITIES. Purchases and sales of securities for the six months
ended June 30, 2003, other than short-term securities, aggregated $56,495,885
and $53,395,929, respectively.
6. TRANSACTIONS WITH AFFILIATES. During the six months ended June 30, 2003, the
Fund paid brokerage commissions of $189,796 to Gabelli & Company, Inc. and its
affiliates.
The cost of calculating the Fund's net asset value per share is a Fund expense
pursuant to the Investment Advisory Agreement between the Fund and the Adviser.
During the six months ended June 30, 2003, the Gabelli Asset Fund reimbursed the
Adviser $17,400 in connection with the cost of computing the Fund's net asset
value.
7. LINE OF CREDIT. The Fund has access to an unsecured line of credit up to
$25,000,000 from the custodian for temporary borrowing purposes. Borrowings
under this arrangement bear interest at 0.75% above the Federal Funds rate on
outstanding balances. There were no outstanding borrowings against the line of
credit at June 30, 2003.
The average daily amount of borrowings outstanding during the six months ended
June 30, 2003, was $2,124,197 with a related weighted average interest rate of
2.03%. The maximum amount borrowed under this line of credit at any time during
the six months ended June 30, 2003 was $25,000,000.
8. SHARES OF BENEFICIAL INTEREST. Transactions in shares of beneficial interest
were as follows:
SIX MONTHS ENDED YEAR ENDED
JUNE 30, 2003 DECEMBER 31, 2002
-------------------------- ---------------------------
SHARES AMOUNT SHARES AMOUNT
--------- ------------ ----------- -------------
Shares sold ......................................... 5,726,627 $160,901,379 9,646,239 $ 299,285,909
Shares issued upon reinvestment of dividends ........ -- -- 29,507 825,063
Shares redeemed ..................................... 4,722,482 133,370,171 (14,490,845) (432,374,017)
--------- ------------ ----------- -------------
Net increase/(decrease) ............................. 1,004,145 $ 27,531,208 (4,815,099) $(132,263,045)
========= ============ =========== =============
12
THE GABELLI ASSET FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Selected data for a share of beneficial interest outstanding throughout each
period:
SIX MONTHS ENDED YEAR ENDED DECEMBER 31,
JUNE 30, 2003 -------------------------------------------------------------
(UNAUDITED) 2002 2001 2000 1999 1998
---------------- -------- -------- ------- ------- -------
OPERATING PERFORMANCE:
Net asset value, beginning of period ...$ 28.25 $ 32.97 $ 33.90 $ 40.84 $ 35.47 $ 31.85
---------- ---------- ---------- ----------- ---------- ----------
Net investment income (loss) ........... 0.02 0.02 (0.00)(a) 0.31 (0.06) 0.02
Net realized and unrealized gain (loss)
on investments ....................... 3.22 (4.72) 0.05 (1.37) 10.06 5.02
---------- ---------- ---------- ----------- ---------- ----------
TOTAL FROM INVESTMENT OPERATIONS ....... 3.24 (4.70) 0.05 (1.06) 10.00 5.04
---------- ---------- ---------- ----------- ---------- ----------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income .................. -- (0.02) -- (0.31) -- (0.02)
Net realized gain on investments ....... -- (0.00)(a) (0.98) (5.57) (4.63) (1.40)
---------- ---------- ---------- ----------- ---------- ----------
TOTAL DISTRIBUTIONS .................... -- (0.02) (0.98) (5.88) (4.63) (1.42)
---------- ---------- ---------- ----------- ---------- ----------
NET ASSET VALUE, END OF PERIOD .........$ 31.49 $ 28.25 $ 32.97 $ 33.90 $ 40.84 $ 35.47
========== ========== ========== =========== ========== ==========
TOTAL RETURN+ .......................... 11.5% (14.3)% 0.2% (2.4)% 28.5% 15.9%
========== ========== ========== =========== ========== ==========
RATIOS TO AVERAGE NET ASSETS AND
SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) ...$1,705,071 $1,501,420 $1,911,007 $1,906,095 $1,993,875 $1,575,976
Ratio of net investment income (loss)
to average net assets ............... 0.15% 0.04% (0.00)% 0.77% (0.10)% 0.06%
Ratio of operating expenses
to average net assets ................ 1.40% 1.38% 1.36% 1.36% 1.37% 1.36%
Portfolio turnover rate ................ 3% 8% 15% 48% 32% 21%
- ------------------------
+ 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.
(a) Amount represents less than $0.005 per share.
See accompanying notes to financial statements.
13
THE GABELLI ASSET 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 Anthony R. Pustorino
CHAIRMAN AND CHIEF CERTIFIED PUBLIC ACCOUNTANT
INVESTMENT OFFICER PROFESSOR EMERITUS
GABELLI ASSET MANAGEMENT INC. PACE UNIVERSITY
Anthony J. Colavita Werner J. Roeder, MD
ATTORNEY-AT-LAW VICE PRESIDENT/MEDICAL AFFAIRS
ANTHONY J. COLAVITA, P.C. LAWRENCE HOSPITAL CENTER
James P. Conn Anthonie C. van Ekris
FORMER CHIEF INVESTMENT OFFICER MANAGING DIRECTOR
FINANCIAL SECURITY ASSURANCE BALMAC INTERNATIONAL, INC.
HOLDINGS LTD.
John D. Gabelli Salvatore J. Zizza
SENIOR VICE PRESIDENT CHAIRMAN
GABELLI & COMPANY, INC. HALLMARK ELECTRICAL SUPPLIES
CORP.
Karl Otto Pohl
FORMER PRESIDENT
DEUTSCHE BUNDESBANK
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 Asset Fund. It is not authorized for distribution to prospective
investors unless preceded or accompanied by an effective prospectus.
- --------------------------------------------------------------------------------
GAB405Q203SR
[GRAPHIC OMITTED]
PICTURE OF MARIO GABELLI
THE
GABELLI
ASSET
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 Asset 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.