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 811-07896
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GAMCO Global Series Funds, Inc.
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(Exact name of registrant as specified in charter)
One Corporate Center
Rye, New York 10580-1422
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(Address of principal executive offices) (Zip code)
Bruce N. Alpert
Gabelli Funds, LLC
One Corporate Center
Rye, New York 10580-1422
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(Name and address of agent for service)
registrant's telephone number, including area code: 1-800-422-3554
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Date of fiscal year end: December 31
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Date of reporting period: June 30, 2007
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 100 F Street, NE,
Washington, DC 20549. The OMB has reviewed this collection of information under
the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
The Report to Shareholders is attached herewith.
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
SEMI-ANNUAL REPORT
JUNE 30, 2007
TO OUR SHAREHOLDERS,
During the second quarter of 2007, The GAMCO Global Convertible Securities
Fund (the "Fund") was up 2.3% while the Merrill Lynch Global 300 Convertible
Index rose 4.8%, the UBS Global Convertible Index gained 5.4% and the Morgan
Stanley Capital International ("MSCI") World Free Index advanced 6.5%. For the
six month period ended June 30, 2007, the Fund was up 5.7% versus increases of
8.3%, 8.5%, and 9.2% for the Merrill Lynch Global 300 Convertible Index, the UBS
Global Convertible Index and the MSCI World Free Index, respectively.
COMPARATIVE RESULTS
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AVERAGE ANNUAL RETURNS THROUGH JUNE 30, 2007 (A)
------------------------------------------------
Since
Year to Inception
Quarter Date 1 Year 3 Year 5 Year 10 Year (2/3/94)
- --------------------------------------------------------------------------------------------------------------------
GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
CLASS AAA ................................ 2.31% 5.67% 11.15% 10.02% 10.95% 6.42% 6.78%
Merrill Lynch Global 300 Convertible Index . 4.79 8.26 17.58 10.48 10.79 7.13 N/A*
UBS Global Convertible Index ............... 5.35 8.53 19.13 11.58 12.01 8.82 8.45
MSCI World Free Index ...................... 6.51 9.17 23.59 16.73 14.00 7.03 8.74
Class A .................................... 2.31 5.48 10.97 9.95 10.96 6.42 6.78
(3.57)(b) (0.59)(b) 4.59(b) 7.80(b) 9.66(b) 5.80(b) 6.31(b)
Class B .................................... 2.11 5.11 10.16 9.13 10.12 5.92 6.40
(2.89)(c) 0.11(c) 5.16(c) 8.28(c) 9.85(c) 5.92 6.40
Class C .................................... 2.07 5.02 10.22 9.13 10.15 6.00 6.46
1.07(d) 4.02(d) 9.22(d) 9.13 10.15 6.00 6.46
THE GROSS EXPENSE RATIO FOR CLASS AAA, A, B, AND C SHARES IS 2.14%, 2.14%,
2.89%, AND 2.89%, RESPECTIVELY. THE NET EXPENSE RATIO FOR THESE SHARE CLASSES
IS 2.02%, 2.02%, 2.77%, AND 2.77%, RESPECTIVELY. CLASS AAA SHARES DO NOT HAVE A
SALES CHARGE. THE MAXIMUM SALES CHARGE FOR CLASS A, B, AND C SHARES IS 5.75%,
5.00%, AND 1.00%, RESPECTIVELY.
(a) RETURNS REPRESENT PAST PERFORMANCE AND DO NOT GUARANTEE FUTURE RESULTS.
INVESTMENT RETURNS AND THE PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE.
TOTAL RETURNS AND AVERAGE ANNUAL RETURNS REFLECT CHANGES IN SHARE PRICE AND
REINVESTMENT OF DISTRIBUTIONS AND ARE NET OF EXPENSES. WHEN SHARES ARE
REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
PERFORMANCE RETURNS FOR PERIODS LESS THAN ONE YEAR ARE NOT ANNUALIZED.
CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE DATA
PRESENTED. VISIT WWW.GABELLI.COM FOR PERFORMANCE INFORMATION AS OF THE MOST
RECENT MONTH END. INVESTORS SHOULD CAREFULLY CONSIDER THE INVESTMENT
OBJECTIVES, RISKS, CHARGES, AND EXPENSES OF THE FUND BEFORE INVESTING. THE
PROSPECTUS CONTAINS MORE INFORMATION ABOUT THIS AND OTHER MATTERS AND
SHOULD BE READ CAREFULLY BEFORE INVESTING. INVESTING IN FOREIGN SECURITIES
INVOLVES RISKS NOT ORDINARILY ASSOCIATED WITH INVESTMENTS IN DOMESTIC
ISSUES, INCLUDING CURRENCY FLUCTUATION, ECONOMIC, AND POLITICAL RISKS.
THE CLASS AAA SHARES' NET ASSET VALUES ("NAV'S") PER SHARE ARE USED TO
CALCULATE PERFORMANCE FOR THE PERIODS PRIOR TO THE ISSUANCE OF CLASS A
SHARES, CLASS B SHARES, AND CLASS C SHARES ON MAY 2, 2001, MARCH 28, 2001,
AND NOVEMBER 26, 2001, RESPECTIVELY. THE ACTUAL PERFORMANCE FOR THE CLASS B
SHARES AND CLASS C SHARES WOULD HAVE BEEN LOWER DUE TO THE ADDITIONAL
EXPENSES ASSOCIATED WITH THESE CLASSES OF SHARES. THE UBS (FORMERLY WARBURG
DILLON REED) GLOBAL CONVERTIBLE INDEX, THE MERRILL LYNCH GLOBAL 300
CONVERTIBLE INDEX, AND THE MORGAN STANLEY CAPITAL INTERNATIONAL ("MSCI")
WORLD FREE INDEX ARE UNMANAGED INDICATORS OF INVESTMENT PERFORMANCE. YOU
CANNOT INVEST DIRECTLY IN AN INDEX.
(b) INCLUDES THE EFFECT OF THE MAXIMUM 5.75% SALES CHARGE AT THE BEGINNING OF
THE PERIOD.
(c) PERFORMANCE RESULTS INCLUDE THE DEFERRED SALES CHARGES FOR THE CLASS
B SHARES UPON REDEMPTION AT THE END OF THE QUARTER, YEAR TO DATE, ONE YEAR,
THREE YEAR, AND FIVE YEAR PERIODS OF 5%, 5%, 5%, 3%, AND 2%, RESPECTIVELY,
OF THE FUND'S NAV AT THE TIME OF PURCHASE OR SALE, WHICHEVER IS LOWER.
CLASS B SHARES ARE NOT AVAILABLE FOR NEW PURCHASES.
(d) PERFORMANCE RESULTS INCLUDE THE DEFERRED SALES CHARGES FOR THE CLASS
C SHARES UPON REDEMPTION AT THE END OF THE QUARTER, YEAR TO DATE, AND ONE
YEAR PERIODS OF 1% OF THE FUND'S NAV AT THE TIME OF PURCHASE OR SALE,
WHICHEVER IS LOWER.
* THERE IS NO DATA AVAILABLE FOR THE MERRILL LYNCH GLOBAL 300 CONVERTIBLE
INDEX PRIOR TO DECEMBER 31, 1994.
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We have separated the portfolio managers' commentary from the financial
statements and investment portfolio due to corporate governance regulations
stipulated by the Sarbanes-Oxley Act of 2002. We have done this to ensure that
the content of the portfolio managers' commentary is unrestricted. The
financial statements and investment portfolio are mailed separately from the
commentary. Both the commentary and the financial statements, including the
portfolio of investments, will be available on our website at
www.gabelli.com/funds.
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THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
DISCLOSURE OF FUND EXPENSES (UNAUDITED)
For the Six Month Period from January 1, 2007 through June 30, 2007
EXPENSE TABLE
================================================================================
We believe it is important for you to understand the impact of fees and expenses
regarding your investment. All mutual funds have operating expenses. As a
shareholder of a fund, you incur ongoing costs, which include costs for
portfolio management, administrative services, and shareholder reports (like
this one), among others. Operating expenses, which are deducted from a fund's
gross income, directly reduce the investment return of a fund. When a fund's
expenses are expressed as a percentage of its average net assets, this figure is
known as the expense ratio. The following examples are intended to help you
understand the ongoing costs (in dollars) of investing in your Fund and to
compare these costs with those of other mutual funds. The examples are based on
an investment of $1,000 made at the beginning of the period shown and held for
the entire period.
The Expense Table below illustrates your Fund's costs in two ways:
ACTUAL FUND RETURN: This section provides information about actual account
values and actual expenses. You may use this section to help you to estimate the
actual expenses that you paid over the period after any fee waivers and expense
reimbursements. The "Ending Account Value" shown is derived from the Fund's
ACTUAL return during the past six months, and the "Expenses Paid During Period"
shows the dollar amount that would have been paid by an investor who started
with $1,000 in the Fund. You may use this information, together with the amount
you invested, to estimate the expenses that you paid over the period.
To do so, simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
given for your Fund under the heading "Expenses Paid During Period" to estimate
the expenses you paid during this period.
HYPOTHETICAL 5% RETURN: This section provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio. It assumes a hypothetical annualized return of 5% before expenses during
the period shown. In this case - because the hypothetical return used is NOT the
Fund's actual return - the results do not apply to your investment and you
cannot use the hypothetical account value and expense to estimate the actual
ending account balance or expenses you paid for the period. This example is
useful in making comparisons of the ongoing costs of investing in the Fund and
other funds. To do so, compare this 5% hypothetical example with the 5%
hypothetical examples that appear in shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs such as sales
charges (loads), redemption fees, or exchange fees, if any, which are described
in the Prospectus. If these costs were applied to your account, your costs would
be higher. Therefore, the 5% hypothetical return is useful in comparing ongoing
costs only, and will not help you determine the relative total costs of owning
different funds.
Beginning Ending Annualized Expenses
Account Value Account Value Expense Paid During
01/01/07 06/30/07 Ratio Period*
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THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
- --------------------------------------------------------------------------------
ACTUAL FUND RETURN
Class AAA $1,000.00 $1,056.70 2.20% $11.28
Class A $1,000.00 $1,054.80 2.20% $11.27
Class B $1,000.00 $1,051.10 2.95% $15.09
Class C $1,000.00 $1,050.20 2.95% $15.08
HYPOTHETICAL 5% RETURN
Class AAA $1,000.00 $1,013.96 2.20% $11.05
Class A $1,000.00 $1,013.96 2.20% $11.05
Class B $1,000.00 $1,010.22 2.95% $14.78
Class C $1,000.00 $1,010.22 2.95% $14.78
* Expenses are equal to the Fund's annualized expense ratio for the last six
months multiplied by the average account value over the period, multiplied by
the number of days in the most recent fiscal half-year, then divided by 365.
2
SUMMARY OF PORTFOLIO HOLDINGS (UNAUDITED)
The following table presents portfolio holdings as a percent of total net assets
as of June 30, 2007:
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
Financial Services ................................ 16.2%
Health Care ....................................... 9.8%
Retail ............................................ 9.7%
Business Services ................................. 8.5%
Consumer Products ................................. 8.1%
Energy and Utilities .............................. 7.2%
Food and Beverage ................................. 6.5%
Computer Software and Services .................... 6.4%
Aerospace ......................................... 4.3%
Metals and Mining ................................. 3.8%
Telecommunications ................................ 3.2%
Hotels and Gaming ................................. 2.9%
Real Estate Investment Trusts ..................... 2.6%
Broadcasting ...................................... 2.4%
Entertainment ..................................... 2.1%
Electronics ....................................... 1.7%
Equipment and Supplies ............................ 1.4%
Other Assets and Liabilities (Net) ................ 3.2%
------
100.0%
======
THE FUND FILES A COMPLETE SCHEDULE OF PORTFOLIO HOLDINGS WITH THE SECURITIES AND
EXCHANGE COMMISSION (THE "SEC") FOR THE FIRST AND THIRD QUARTERS OF EACH FISCAL
YEAR ON FORM N-Q, THE LAST OF WHICH WAS FILED FOR THE QUARTER ENDED MARCH 31,
2007. SHAREHOLDERS MAY OBTAIN THIS INFORMATION AT WWW.GABELLI.COM OR BY CALLING
THE FUND AT 800-GABELLI (800-422-3554). THE FUND'S FORM N-Q IS AVAILABLE ON THE
SEC'S WEBSITE AT WWW.SEC.GOV AND MAY ALSO BE REVIEWED AND COPIED AT THE SEC'S
PUBLIC REFERENCE ROOM IN WASHINGTON, DC. INFORMATION ON THE OPERATION OF THE
PUBLIC REFERENCE ROOM MAY BE OBTAINED BY CALLING 1-800-SEC-0330.
PROXY VOTING
The Fund files Form N-PX with its complete proxy voting record for the 12 months
ended June 30th, no later than August 31st of each year. A description of the
Fund's proxy voting policies, procedures, and how the Fund voted proxies
relating to portfolio securities is available without charge, upon request, by
(i) calling 800-GABELLI (800-422-3554); (ii) writing to The Gabelli Funds at One
Corporate Center, Rye, NY 10580-1422; or (iii) visiting the SEC's website at
www.sec.gov.
3
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
SCHEDULE OF INVESTMENTS -- JUNE 30, 2007 (UNAUDITED)
================================================================================
PRINCIPAL MARKET
AMOUNT COST VALUE
--------- ---- ------
CONVERTIBLE CORPORATE BONDS -- 71.6%
AEROSPACE -- 4.3%
$ 200,000 Gencorp Inc., Sub. Deb. Cv.,
4.000%, 01/16/24 ............... $ 202,739 $ 207,750
180,000 Lockheed Martin Corp., Cv.,
5.110%, 08/15/33 (a) ........... 193,597 242,712
------------ ------------
396,336 450,462
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BUSINESS SERVICES -- 8.5%
100,000(b) Fugro NV, Cv.,
2.375%, 04/27/10 ............... 168,119 263,473
400,000 International Game
Technology, Cv.,
2.600%, 12/15/36 (c) ........... 394,107 391,500
520,000(b) Publicis Group SA, Cv.,
0.750%, 07/17/08 ............... 401,817 234,666
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964,043 889,639
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COMPUTER SOFTWARE AND SERVICES -- 6.4%
500,000 Midway Games Inc., Cv.,
6.000%, 09/30/25 ............... 484,097 491,875
20,000,000(d) Nomura Research
Institute Ltd., Cv.,
Zero Coupon, 03/31/14 .......... 180,788 180,792
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664,885 672,667
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CONSUMER PRODUCTS -- 8.1%
200,000 Church & Dwight Co. Inc.,
Deb. Cv.,
5.250%, 08/15/33 ............... 219,740 321,500
300,000 Eastman Kodak Co., Cv.,
3.375%, 10/15/33 ............... 307,892 316,500
200,000 Lifetime Brands Inc., Cv.,
4.750%, 07/15/11 ............... 207,219 205,000
------------ ------------
734,851 843,000
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ELECTRONICS -- 1.7%
200,000 Spansion Inc., Sub. Deb. Cv.,
2.250%, 06/15/16 (c) ........... 177,964 179,000
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ENERGY AND UTILITIES -- 7.2%
200,000 Scottish Power Finance Ltd.,
Sub. Deb. Cv.,
4.000%, 07/29/49 (a) ........... 252,985 453,350
200,000 Transocean Inc., Deb. Cv.,
1.500%, 05/15/21 ............... 208,587 296,500
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461,572 749,850
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FINANCIAL SERVICES -- 11.2%
CompuCredit Corp., Cv.,
200,000 3.625%, 05/30/25 ............... 214,726 207,750
200,000 5.875%, 11/30/35 ............... 187,072 188,750
PRINCIPAL MARKET
AMOUNT COST VALUE
--------- ---- ------
$ 200,000(b) Givaudan Nederland
Finance BV, Cv.,
5.375%, 03/01/10 ............... $ 174,694 $ 168,712
300,000 PrivateBancorp Inc., Cv.,
3.625%, 03/15/27 ............... 296,247 294,189
300,000 Prudential Financial Inc., Cv.,
2.960%, 12/12/36 (a) ........... 308,363 310,740
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1,181,102 1,170,141
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FOOD AND BEVERAGE -- 6.5%
100,000(b) Royal Numico NV, Sub. Deb. Cv.,
3.000%, 07/11/10 ............... 265,248 252,758
400,000 Wild Oats Markets Inc., Cv.
(STEP),
3.250%, 05/15/34 ............... 430,894 430,000
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696,142 682,758
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HEALTH CARE -- 5.7%
300,000 Advanced Medical Optics Inc.,
Sub. Deb. Cv.,
1.375%, 07/01/25 ............... 289,534 286,125
300,000 Edwards Lifesciences Corp., Cv.,
3.875%, 05/15/33 ............... 303,081 312,000
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592,615 598,125
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HOTELS AND GAMING -- 2.9%
200,000 Hilton Hotels Corp., Cv.,
3.375%, 04/15/23 ............... 297,931 302,250
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REAL ESTATE INVESTMENT TRUSTS -- 2.6%
300,000 Host Hotels & Resorts Inc., Cv.,
2.625%, 04/15/27 (c) ........... 285,034 276,000
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RETAIL -- 6.5%
300,000 Kellwood Co., Deb. Cv.
(STEP),
3.500%, 06/15/34 ............... 271,198 276,750
400,000 Pier 1 Imports Inc., Cv.
(STEP),
6.375%, 02/15/36 ............... 387,648 399,000
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658,846 675,750
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TOTAL CONVERTIBLE
CORPORATE BONDS ................ 7,111,321 7,489,642
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See accompanying notes to financial statements.
4
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
SCHEDULE OF INVESTMENTS (CONTINUED) -- JUNE 30, 2007 (UNAUDITED)
================================================================================
MARKET
SHARES COST VALUE
-------- ---- ------
CONVERTIBLE PREFERRED STOCKS -- 21.7%
BROADCASTING -- 2.4%
6,000 Emmis Communications Corp.,
6.250% Cv. Pfd., Ser. A ........ $ 276,300 $ 253,080
------------ ------------
FINANCIAL SERVICES -- 5.0%
5,000 New York Community
Capital Trust V,
6.000% Cv. Pfd. ................ 235,428 239,200
6,000 Sovereign Bancorp Inc.,
4.375% Cv. Pfd. ................ 273,000 282,000
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508,428 521,200
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HEALTH CARE -- 4.1%
3,000 Omnicare Inc.,
4.000% Cv. Pfd., Ser. B ........ 149,498 149,625
4,000 Schering-Plough Corp.,
6.000% Cv. Pfd. ................ 206,634 275,200
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356,132 424,825
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METALS AND MINING -- 3.8%
220 Freeport-McMoRan Copper
& Gold Inc.,
5.500% Cv. Pfd. ................ 221,450 401,665
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RETAIL -- 3.2%
300 Blockbuster Inc.,
7.500% Cv. Pfd. ................ 337,981 334,688
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TELECOMMUNICATIONS -- 3.2%
7,000 Cincinnati Bell Inc.,
6.750% Cv. Pfd., Ser. B ........ 280,315 334,950
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TOTAL CONVERTIBLE
PREFERRED STOCKS ............... 1,980,606 2,270,408
------------ ------------
COMMON STOCKS -- 3.5%
ENTERTAINMENT -- 2.1%
7,000 Aruze Corp. ...................... 247,155 217,746
------------ ------------
EQUIPMENT AND SUPPLIES -- 1.4%
20,000 Allen-Vanguard Corp. + ........... 98,577 144,379
------------ ------------
TOTAL COMMON STOCKS .............. 345,732 362,125
------------ ------------
TOTAL
INVESTMENTS -- 96.8% ........... $ 9,437,659 10,122,175
============
OTHER ASSETS AND LIABILITIES (NET) -- 3.2% ....... 332,146
------------
NET ASSETS -- 100.0% ............................. $ 10,454,321
============
- ----------------
(a) Floating rate security. The rate disclosed is that in effect at June 30,
2007.
(b) Principal amount denoted in Euros.
(c) Security exempt from registration under Rule 144A of the Securities Act of
1933, as amended. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers. At June 30,
2007, the market value of the Rule 144A securities amounted to $846,500 or
8.10% of total net assets. These securities have been deemed by the Board
of Directors to be liquid.
(d) Principal amount denoted in Japanese Yen.
+ Non-income producing security.
STEP Step coupon bond. The rate disclosed is that in effect at June 30, 2007.
% OF
MARKET MARKET
GEOGRAPHIC DIVERSIFICATION VALUE VALUE
- -------------------------- -------- -------
North America ......................... 84.1% $ 8,507,528
Europe ................................ 9.1 919,609
Japan ................................. 3.9 398,538
Latin America ......................... 2.9 296,500
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100.0% $10,122,175
====== ===========
See accompanying notes to financial statements.
5
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2007 (UNAUDITED)
================================================================================
ASSETS:
Investments, at value (cost $9,437,659) ................... $ 10,122,175
Foreign currency, at value (cost $4) ...................... 4
Cash ...................................................... 259,216
Receivable for Fund shares sold ........................... 47,966
Dividends and interest receivable ......................... 79,580
Prepaid expense ........................................... 868
Other assets .............................................. 1,054
------------
TOTAL ASSETS .............................................. 10,510,863
------------
LIABILITIES:
Payable for Fund shares redeemed .......................... 1,627
Payable for investment advisory fees ...................... 5,141
Payable for distribution fees ............................. 2,322
Payable for legal and audit fees .......................... 20,221
Payable for shareholder
communications expenses ................................. 13,202
Payable for custodian fees ................................ 6,193
Payable for shareholder services fees ..................... 4,338
Payable for registration fees ............................. 3,431
Payable for Directors' fees ............................... 67
------------
TOTAL LIABILITIES ......................................... 56,542
------------
NET ASSETS applicable to 1,827,695
shares outstanding ...................................... $ 10,454,321
============
NET ASSETS CONSIST OF:
Paid-in capital, each class at $0.001 par value ........... $ 9,609,124
Accumulated net investment loss ........................... (187,308)
Accumulated net realized gain on investments
and foreign currency transactions ....................... 347,943
Net unrealized appreciation on investments ................ 684,516
Net unrealized appreciation on foreign
currency translations ................................... 46
------------
NET ASSETS ................................................ $ 10,454,321
============
SHARES OF CAPITAL STOCK:
CLASS AAA:
Net Asset Value, offering and redemption price
per share ($10,209,952 / 1,782,992 shares
outstanding; 75,000,000 shares authorized) .............. $5.73
=====
CLASS A:
Net Asset Value and redemption price per share
($66,773 / 11,649 shares outstanding;
50,000,000 shares authorized) ........................... $5.73
=====
Maximum offering price per share (NAV / 0.9425,
based on maximum sales charge of 5.75%
of the offering price) .................................. $6.08
=====
CLASS B:
Net Asset Value and offering price per share
($39,000 / 7,356 shares outstanding;
25,000,000 shares authorized) ........................... $5.30(a)
=====
CLASS C:
Net Asset Value and offering price per share
($138,596 / 25,698 shares outstanding;
25,000,000 shares authorized) ........................... $5.39(a)
=====
- ------------
(a) Redemption price varies based on the length of time held.
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2007 (UNAUDITED)
================================================================================
INVESTMENT INCOME:
Dividends (net of foreign taxes of $12) ..................... $ 49,538
Interest .................................................... (5,641)
---------
TOTAL INVESTMENT INCOME ..................................... 43,897
---------
EXPENSES:
Investment advisory fees .................................... 52,084
Distribution fees - Class AAA ............................... 12,699
Distribution fees - Class A ................................. 86
Distribution fees - Class B ................................. 206
Distribution fees - Class C ................................. 738
Shareholder communications expenses ......................... 15,110
Legal and audit fees ........................................ 14,999
Registration expenses ....................................... 13,072
Interest expense ............................................ 10,406
Shareholder services fees ................................... 7,519
Custodian fees .............................................. 2,194
Directors' fees ............................................. 655
Miscellaneous expenses ...................................... 3,583
---------
TOTAL EXPENSES .............................................. 133,351
Less: Expense reimbursement (see Note 3) .................... (18,068)
---------
NET EXPENSES ................................................ 115,283
---------
NET INVESTMENT LOSS ......................................... (71,386)
---------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY:
Net realized gain on investments ............................ 410,108
Net realized gain on foreign
currency transactions ..................................... 47,102
---------
Net realized gain on investments and foreign
currency transactions ..................................... 457,210
---------
Net change in unrealized appreciation/
depreciation on investments ............................... 179,967
Net change in unrealized appreciation/
depreciation on foreign currency translations ............. (101)
---------
Net change in unrealized appreciation/
depreciation on investments and foreign
currency translations ..................................... 179,866
---------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY .......................... 637,076
---------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ........................................... $ 565,690
=========
See accompanying notes to financial statements.
6
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
STATEMENT OF CHANGES IN NET ASSETS
================================================================================
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
---------------- -----------------
OPERATIONS:
Net investment income (loss) ................................................. $ (71,386) $ 194,695
Net realized gain on investments and foreign currency transactions ........... 457,210 2,061,341
Net change in unrealized appreciation/depreciation on investments and
foreign currency translations .............................................. 179,866 (1,199,173)
----------- -----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ......................... 565,690 1,056,863
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income
Class AAA .................................................................. -- (253,454)
Class A .................................................................... -- (1,031)
Class B .................................................................... -- (967)
Class C .................................................................... -- (2,302)
----------- -----------
-- (257,754)
----------- -----------
Net realized gains
Class AAA .................................................................. (106,450)* (1,907,313)
Class A .................................................................... (696)* (8,497)
Class B .................................................................... (465)* (7,690)
Class C .................................................................... (1,612)* (29,949)
----------- -----------
(109,223) (1,953,449)
----------- -----------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS .......................................... (109,223) (2,211,203)
----------- -----------
CAPITAL SHARE TRANSACTIONS:
Class AAA .................................................................. (926,735) (1,967,425)
Class A .................................................................... 14,815 (39,957)
Class B .................................................................... (4,296) (26,216)
Class C .................................................................... (31,644) 41,588
----------- -----------
NET DECREASE IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS ................... (947,860) (1,992,010)
----------- -----------
REDEMPTION FEES .............................................................. 2 94
----------- -----------
NET DECREASE IN NET ASSETS ................................................... (491,391) (3,146,256)
NET ASSETS:
Beginning of period .......................................................... 10,945,712 14,091,968
----------- -----------
End of period (including undistributed net
investment income of $0 and $0, respectively) .............................. $10,454,321 $10,945,712
=========== ===========
- -----------------
*Based on fiscal year to date book income. Amounts are subject to change and
recharacterization at fiscal year end.
See accompanying notes to financial statements.
7
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
================================================================================
1. ORGANIZATION. The GAMCO Global Convertible Securities Fund (the "Fund"),
formerly, The Gabelli Global Convertible Securities Fund, a series of GAMCO
Global Series Funds, Inc. (the "Corporation"), formerly, Gabelli Global Series
Funds, Inc., was organized on July 16, 1993 as a Maryland corporation. The Fund
is a non-diversified open-end management investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), and one of four
separately managed portfolios (collectively, the "Portfolios") of the
Corporation. The Fund's primary objective is to obtain a high level of total
return through a combination of income and capital appreciation. The Fund
commenced investment operations on February 3, 1994.
2. SIGNIFICANT ACCOUNTING POLICIES. The preparation of financial statements in
accordance with United States ("U.S.") generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could differ
from those estimates. The following is a summary of significant accounting
policies followed by the Fund in the preparation of its financial statements.
SECURITY VALUATION. Portfolio securities listed or traded on a nationally
recognized securities exchange or traded in the U.S. over-the-counter market for
which market quotations are readily available are valued at the last quoted sale
price or a market's official closing price as of the close of business on the
day the securities are being valued. If there were no sales that day, the
security is valued at the average of the closing bid and asked prices or, if
there were no asked prices quoted on that day, then the security is valued at
the closing bid price on that day. If no bid or asked prices are quoted on such
day, the security is valued at the most recently available price or, if the
Board of Directors (the "Board") so determines, by such other method as the
Board shall determine in good faith to reflect its fair market value. Portfolio
securities traded on more than one national securities exchange or market are
valued according to the broadest and most representative market, as determined
by Gabelli Funds, LLC (the "Adviser").
Portfolio securities primarily traded on a foreign market are generally valued
at the preceding closing values of such securities on the relevant market, but
may be fair valued pursuant to procedures established by the Board if market
conditions change significantly after the close of the foreign market but prior
to the close of business on the day the securities are being valued. Debt
instruments with remaining maturities of 60 days or less that are not credit
impaired are valued at amortized cost, unless the Board determines such amount
does not reflect the securities' fair value, in which case these securities will
be fair valued as determined by the Board. Debt instruments having a maturity
greater than 60 days for which market quotations are readily available are
valued at the average of the latest bid and asked prices. If there were no asked
prices quoted on such day, the security is valued using the closing bid price.
Futures contracts are valued at the closing settlement price of the exchange or
board of trade on which the applicable contract is traded.
Securities and assets for which market quotations are not readily available are
fair valued as determined by the Board. Fair valuation methodologies and
procedures may include, but are not limited to: analysis and review of available
financial and non-financial information about the company; comparisons to the
valuation and changes in valuation of similar securities, including a comparison
of foreign securities to the equivalent U.S. dollar value American Depository
Receipt ("ADR") securities at the close of the U.S. exchange; and evaluation of
any other information that could be indicative of the value of the security.
8
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
In September 2006, the Financial Accounting Standards Board (the "FASB") issued
Statement of Financial Accounting Standards ("SFAS") 157, Fair Value
Measurements, which clarifies the definition of fair value and requires
companies to expand their disclosure about the use of fair value to measure
assets and liabilities in interim and annual periods subsequent to initial
recognition. Adoption of SFAS 157 requires the use of the price that would be
received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. SFAS 157 is
effective for financial statements issued for fiscal years beginning after
November 15, 2007, and interim periods within those fiscal years. At this time,
management is in the process of reviewing the requirements of SFAS 157 against
its current valuation policies to determine future applicability.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with
primary government securities dealers recognized by the Federal Reserve Board,
with member banks of the Federal Reserve System, or with other brokers or
dealers that meet credit guidelines established by the Adviser and reviewed by
the Board. Under the terms of a typical repurchase agreement, the Fund takes
possession of an underlying debt obligation subject to an obligation of the
seller to repurchase, and the Fund to resell, the obligation at an agreed-upon
price and time, thereby determining the yield during the Fund's holding period.
The Fund will always receive and maintain securities as collateral whose market
value, including accrued interest, will be at least equal to 102% of the dollar
amount invested by the Fund in each agreement. The Fund will make payment for
such securities only upon physical delivery or upon evidence of book entry
transfer of the collateral to the account of the custodian. To the extent that
any repurchase transaction exceeds one business day, the value of the collateral
is marked-to-market on a daily basis to maintain the adequacy of the collateral.
If the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited. At June 30,
2007, there were no open repurchase agreements.
FUTURES CONTRACTS. The Fund may engage in futures contracts for the purpose of
hedging against changes in the value of its portfolio securities and in the
value of securities it intends to purchase. Upon entering into a futures
contract, the Fund is required to deposit with the broker an amount of cash or
cash equivalents equal to a certain percentage of the contract amount. This is
known as the "initial margin". Subsequent payments ("variation margin") are made
or received by the Fund each day, depending on the daily fluctuations in the
value of the contract, which are included in unrealized
appreciation/depreciation on investments and futures contracts. The Fund
recognizes a realized gain or loss when the contract is closed.
There are several risks in connection with the use of futures contracts as a
hedging instrument. The change in value of futures contracts primarily
corresponds with the value of their underlying instruments, which may not
correlate with the change in value of the hedged investments. In addition, there
is the risk that the Fund may not be able to enter into a closing transaction
because of an illiquid secondary market. At June 30, 2007, there were no open
futures contracts.
FORWARD FOREIGN EXCHANGE CONTRACTS. The Fund may engage in forward foreign
exchange contracts for hedging a specific transaction with respect to either the
currency in which the transaction is denominated or another currency as deemed
appropriate by the Adviser. Forward foreign exchange contracts are valued at the
forward rate and are marked-to-market daily. The change in market value is
included in unrealized appreciation/depreciation on investments and foreign
currency translations. When the contract is closed, the Fund records a realized
gain or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
9
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
The use of forward foreign exchange contracts does not eliminate fluctuations in
the underlying prices of the Fund's portfolio securities, but it does establish
a rate of exchange that can be achieved in the future. Although forward foreign
exchange contracts limit the risk of loss due to a decline in the value of the
hedged currency, they also limit any potential gain that might result should the
value of the currency increase. In addition, the Fund could be exposed to risks
if the counterparties to the contracts are unable to meet the terms of their
contracts. At June 30, 2007, there were no open forward foreign exchange
contracts.
FOREIGN CURRENCY TRANSLATIONS. The books and records of the Fund are maintained
in U.S. dollars. Foreign currencies, investments, and other assets and
liabilities are translated into U.S. dollars at the current exchange rates.
Purchases and sales of investment securities, income, and expenses are
translated at the exchange rate prevailing on the respective dates of such
transactions. Unrealized gains and losses that result from changes in foreign
exchange rates and/or changes in market prices of securities have been included
in unrealized appreciation/depreciation on investments and foreign currency
translations. Net realized foreign currency gains and losses resulting from
changes in exchange rates include foreign currency gains and losses between
trade date and settlement date on investment securities transactions, foreign
currency transactions, and the difference between the amounts of interest and
dividends recorded on the books of the Fund and the amounts actually received.
The portion of foreign currency gains and losses related to fluctuation in
exchange rates between the initial trade date and subsequent sale trade date is
included in realized gain/(loss) on investments.
FOREIGN SECURITIES. The Fund may directly purchase securities of foreign
issuers. Investing in securities of foreign issuers involves special risks not
typically associated with investing in securities of U.S. issuers. The risks
include possible revaluation of currencies, the ability to repatriate funds,
less complete financial information about companies, and possible future adverse
political and economic developments. Moreover, securities of many foreign
issuers and their markets may be less liquid and their prices more volatile than
those of securities of comparable U.S. issuers.
FOREIGN TAXES. The Fund may be subject to foreign taxes on income, gains on
investments, or currency repatriation, a portion of which may be recoverable.
The Fund will accrue such taxes and recoveries as applicable, based upon its
current interpretation of tax rules and regulations that exist in the markets in
which it invests.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME. Securities transactions are
accounted for on the trade date with realized gain or loss on investments
determined by using the identified cost method. Interest income (including
amortization of premium and accretion of discount) is recorded on the accrual
basis. Premiums and discounts on debt securities are amortized using the
effective yield to maturity method. Dividend income is recorded on the
ex-dividend date except for certain dividends which are recorded as soon as the
Fund is informed of the dividend.
DETERMINATION OF NET ASSET VALUE AND CALCULATION OF EXPENSES. Certain
administrative expenses are common to, and allocated among, various affiliated
funds. Such allocations are made on the basis of each Fund's average net assets
or other criteria directly affecting the expenses as determined by the Adviser
pursuant to procedures established by the Board.
10
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
In calculating the NAV per share of each class, investment income, realized and
unrealized gains and losses, redemption fees, and expenses other than class
specific expenses are allocated daily to each class of shares based upon the
proportion of net assets of each class at the beginning of each day.
Distribution expenses are borne solely by the class incurring the expense.
CUSTODIAN FEE CREDITS AND INTEREST EXPENSE. When cash balances are maintained in
the custody account, the Fund receives credits which are used to offset
custodian fees. The gross expenses paid under the custody arrangement are
included in custodian fees in the Statement of Operations with the corresponding
expense offset, if any, shown as "custodian fee credits". When cash balances are
overdrawn, the Fund is charged an overdraft fee equal to 2.00% above the Federal
Funds rate on outstanding balances. This amount, if any, would be shown as
"interest expense" in the Statement of Operations.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions to shareholders are recorded on the
ex-dividend date. Distributions to shareholders are based on income and capital
gains as determined in accordance with federal income tax regulations, which may
differ from income and capital gains as determined under U.S. generally accepted
accounting principles. These differences are primarily due to differing
treatments of income and gains on various investment securities and foreign
currency transactions held by the Fund, timing differences, and differing
characterizations of distributions made by the Fund. Distributions from net
investment income include net realized gains on foreign currency transactions.
These book/tax differences are either temporary or permanent in nature. To the
extent these differences are permanent, adjustments are made to the appropriate
capital accounts in the period when the differences arise. These
reclassifications have no impact on the NAV of the Fund.
The tax character of distributions paid during the fiscal year ended December
31, 2006 was as follows:
DISTRIBUTIONS PAID FROM:
Ordinary income (inclusive of short-term
capital gains) ........................ $ 599,473
Long-term capital gains ................. 1,685,799
----------
Total distributions paid ................ $2,285,272
==========
The Fund has a fixed distribution policy. Under the policy, the Fund declares
and pays distributions quarterly in the amount of $0.03 per share and identifies
that portion of the distribution which is from net investment income, capital
gains, and paid-in capital. The actual source of the distribution is determined
after the end of the fiscal year. The Fund continues to evaluate its
distribution policy in light of ongoing economic and market conditions and may
change the amount of the quarterly distributions in the future. The Fund
currently intends to pay $0.03 per share on a quarterly basis in March, June,
September, and December.
PROVISION FOR INCOME TAXES. The Fund intends to continue to qualify as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended (the "Code"). It is the policy of the Fund to comply with the
requirements of the Code applicable to regulated investment companies and to
distribute substantially all of its net investment company taxable income and
net capital gains. Therefore, no provision for federal income taxes is required.
11
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
The following summarizes the tax cost of investments and related unrealized
appreciation/(depreciation) at June 30, 2007:
GROSS GROSS
UNREALIZED UNREALIZED NET UNREALIZED
COST APPRECIATION DEPRECIATION APPRECIATION
---- ------------ ------------ ------------
Investments .... $9,437,682 $953,259 $(268,766) $684,493
In July 2006, the FASB issued Interpretation No. 48, "Accounting for Uncertainty
in Income Taxes, an Interpretation of FASB Statement No. 109" ("the
Interpretation"). The Interpretation established for all entities, including
pass-through entities such as the Fund, a minimum threshold for financial
statement recognition of the benefit of positions taken in filing tax returns
(including whether an entity is taxable in a particular jurisdiction), and
required certain expanded tax disclosures. The Interpretation was implemented by
the Fund on June 29, 2007 and applied to all open tax years as of the effective
date. Management has evaluated the application of the Interpretation to the
Fund, and the adoption of the Interpretation had no impact on the amounts
reported in the financial statements.
3. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS. The Fund has entered
into an investment advisory agreement (the "Advisory Agreement") with the
Adviser which provides that the Fund will pay the Adviser a fee, computed daily
and paid monthly, at the annual rate of 1.00% of the value of its 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 Directors of the Fund who are affiliated
persons of the Adviser. The Adviser has voluntarily agreed to waive the
investment advisory fee of the Fund to the extent necessary to maintain the
annualized total net operating expenses (exclusive of brokerage, interest,
taxes, and extraordinary expenses) at no more than 2.00%, 2.00%, 2.75%, and
2.75% of average daily net assets for Class AAA, Class A, Class B, and Class C,
respectively. For the six months ended June 30, 2007, the Adviser reimbursed the
Fund in the amount of $18,068. Such amount is not recoverable in future fiscal
years.
If total net assets of the Corporation are in excess of $100 million, the
Corporation pays each Director that is not considered to be an affiliated person
an annual retainer of $3,000 plus $500 for each Board meeting attended and they
are reimbursed for any out of pocket expenses incurred in attending meetings. If
total net assets of the Corporation are below $100 million, the Corporation pays
each Independent Director an annual retainer of $1,500 plus $250 for each Board
meeting attended and they are reimbursed for any out of pocket expenses incurred
in attending meetings. All Board committee members receive $500 per meeting
attended. Directors who are directors or employees of the Adviser or an
affiliated company receive no compensation or expense reimbursement from the
Fund.
4. DISTRIBUTION PLAN. The Fund's Board has adopted a distribution plan (the
"Plan") for each class of shares pursuant to Rule 12b-1 under the 1940 Act.
Gabelli & Company, Inc. ("Gabelli & Company"), an affiliate of the Adviser,
serves as distributor of the Fund. Under the Class AAA, Class A, Class B, and
Class C Share Plans, payments are authorized to Gabelli & Company at annual
rates of 0.25%, 0.25%, 1.00%, and 1.00%, respectively, of the average daily net
assets of those classes, the annual limitations under each Plan. Such payments
are accrued daily and paid monthly.
12
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
5. PORTFOLIO SECURITIES. Purchases and proceeds from the sales of securities for
the six months ended June 30, 2007, other than short-term and U.S. Government
securities, aggregated $4,928,909 and $5,761,568, respectively.
6. TRANSACTIONS WITH AFFILIATES. During the six months ended June 30, 2007, the
Fund paid brokerage commissions of $560 to Gabelli & Company. Additionally,
Gabelli & Company informed the Fund that it received $511 from investors
representing commissions (sales charges and underwriting fees) on sales and
redemptions of Fund shares.
7. LINE OF CREDIT. Effective June 20, 2007, the Fund participates in an
unsecured line of credit of up to $75,000,000, and may borrow up to 10% of its
net assets from the custodian for temporary borrowing purposes. Prior to June
20, 2007, the line of credit was $25,000,000. Borrowings under this arrangement
bear interest at 0.75% above the Federal Funds rate on outstanding balances.
This amount, if any, would be shown as "interest expense" in the Statement of
Operations. At June 30, 2007, there were no borrowings outstanding under the
line of credit.
The average daily amount of borrowings outstanding from the line of credit
within the six months ended June 30, 2007 was $110,580 with a weighted average
interest rate of 6.06%. The maximum amount borrowed at any time during the six
months ended June 30, 2007 was $624,000.
8. CAPITAL STOCK TRANSACTIONS. The Fund currently offers four classes of shares
- - Class AAA Shares, Class A Shares, Class B Shares, and Class C Shares. Class
AAA Shares are offered only to investors who acquire them directly from Gabelli
& Company, or through selected broker/dealers, or the transfer agent without a
sales charge. Class A Shares are subject to a maximum front-end sales charge of
5.75%. Class B Shares are subject to a contingent deferred sales charge ("CDSC")
upon redemption within six years of purchase and automatically convert to Class
A Shares approximately eight years after the original purchase. The applicable
CDSC is equal to a declining percentage of the lesser of the NAV per share at
the date of the original purchase or at the date of redemption, based on the
length of time held. Class C Shares are subject to a 1.00% CDSC for one year
after purchase. Class B Shares are available only through exchange of Class B
Shares of other funds distributed by Gabelli & Company. The Board has approved
Class I Shares which have not been offered publicly.
The Fund imposes a redemption fee of 2.00% on Class AAA Shares, Class A Shares,
Class B Shares, and Class C Shares that are redeemed or exchanged on or before
the seventh day after the date of a purchase. The redemption fee is deducted
from the proceeds otherwise payable to the redeeming shareholders and is
retained by the Fund. The redemption fees retained by the Fund during the six
months ended June 30, 2007 and the fiscal year ended December 31, 2006 amounted
to $2 and $94, respectively.
The redemption fee does not apply to redemptions of shares where (i) the shares
were purchased through automatic reinvestment of dividends or other
distributions, (ii) the redemption was initiated by the Fund, (iii) the shares
were purchased through programs that collect the redemption fee at the program
level and remit them to the Fund, or (iv) the shares were purchased through
programs that the Adviser determines to have appropriate anti-short-term trading
policies in place or as to which the Adviser has received assurances that
look-through redemption fee procedures or effective anti-short-term trading
policies and procedures are in place.
13
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
Transactions in shares of capital stock were as follows:
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
-------------------------- -----------------------------
SHARES AMOUNT SHARES AMOUNT
-------- ----------- ---------- ------------
CLASS AAA CLASS AAA
-------------------------- -----------------------------
Shares sold ......................................... 160,791 $ 902,655 1,878,922 $ 12,070,875
Shares issued upon reinvestment of distributions .... 17,029 96,460 353,287 1,969,894
Shares redeemed ..................................... (344,877) (1,925,850) (2,496,862) (16,008,194)
-------- ----------- ---------- ------------
Net decrease ...................................... (167,057) $ (926,735) (264,653) $ (1,967,425)
======== =========== ========== ============
CLASS A CLASS A
-------------------------- -----------------------------
Shares sold ......................................... 4,425 $ 24,248 1,429 $ 8,999
Shares issued upon reinvestment of distributions .... 74 420 1,606 8,860
Shares redeemed ..................................... (1,750) (9,853) (9,066) (57,816)
-------- ----------- ---------- ------------
Net increase (decrease) ........................... 2,749 $ 14,815 (6,031) $ (39,957)
======== =========== ========== ============
CLASS B CLASS B
-------------------------- -----------------------------
Shares issued upon reinvestment of distributions .... 71 $ $ 374 1,588 $ 8,177
Shares redeemed ..................................... (880) (4,670) (5,758) (34,393)
-------- ----------- ---------- ------------
Net decrease ...................................... (809) $ (4,296) (4,170) $ (26,216)
======== =========== ========== ============
CLASS C CLASS C
-------------------------- -----------------------------
Shares sold ......................................... -- -- 7,874 $ 50,000
Shares issued upon reinvestment of distributions .... 207 $ 1,102 6,086 31,842
Shares redeemed ..................................... (6,204) (32,746) (6,542) (40,254)
-------- ----------- ---------- ------------
Net increase (decrease) ........................... (5,997) $ (31,644) 7,418 $ 41,588
======== =========== ========== ============
9. INDEMNIFICATIONS. The Fund enters into contracts that contain a variety of
indemnifications. The Fund's maximum exposure under these arrangements is
unknown. However, the Fund has not had prior claims or losses pursuant to these
contracts and expects the risk of loss to be remote.
10. OTHER MATTERS. The Adviser and/or affiliates received subpoenas from the
Attorney General of the State of New York and the SEC requesting information on
mutual fund share trading practices involving certain funds managed by the
Adviser. GAMCO Investors, Inc. ("GAMCO"), the Adviser's parent company,
responded to these requests for documents and testimony. In June 2006, GAMCO
began discussions with the SEC regarding a possible resolution of their inquiry.
In February 2007, the Adviser made an offer of settlement to the staff of the
SEC for communication to the Commission for its consideration to resolve this
matter. This offer of settlement is subject to agreement regarding the specific
language of the SEC's administrative order and other settlement documents. On a
separate matter, in September 2005, the Adviser was informed by the staff of the
SEC that the staff may recommend to the Commission that an administrative remedy
and a monetary penalty be sought from the Adviser in connection with the actions
of two of seven closed-end funds managed by the Adviser relating to Section
19(a) and Rule 19a-1 of the 1940 Act. These provisions require registered
investment companies to provide written statements to shareholders when a
dividend is made from a source other than net investment income. While the two
closed-end funds sent annual statements and provided other materials containing
this information, the funds did not send written statements to shareholders with
each distribution in 2002 and 2003. The Adviser believes that all of the funds
are now in compliance. The Adviser believes that these matters would have no
effect on the Fund or any material adverse effect on the Adviser or its ability
to manage the Fund.
14
THE GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
FINANCIAL HIGHLIGHTS
================================================================================
Selected data for a share of capital stock outstanding throughout each period:
INCOME
FROM INVESTMENT OPERATIONS DISTRIBUTIONS
-------------------------------------- -------------------------------------------------
Net
Net Asset Net Realized and Total Net
Period Value, Investment Unrealized from Net Realized Return
Ended Beginning Income Gain (Loss) on Investment Investment Gain on of Total
December 31, of Period (Loss)(a) Investments Operations Income Investments Capital Distributions
- ------------ --------- ---------- ------------- ---------- ---------- ----------- ------- -------------
CLASS AAA
2007(c) $5.48 $(0.04) $ 0.35 $ 0.31 -- $(0.06)* -- $(0.06)
2006 6.22 0.08 0.44 0.52 $(0.10) (1.16) -- (1.26)
2005 6.26 0.04 0.40 0.44 (0.17) (0.32) -- (0.49)
2004 6.77 0.07 0.62 0.69 (0.12) (0.38) $(0.70) (1.20)
2003 6.66 0.07 1.24 1.31 (0.11) -- (1.09) (1.20)
2002 8.29 0.07 (0.50) (0.43) (0.04) -- (1.16) (1.20)
CLASS A
2007(c) $5.49 $(0.04) $ 0.34 $ 0.30 -- $(0.06)* -- $(0.06)
2006 6.23 0.08 0.44 0.52 $(0.10) (1.16) -- (1.26)
2005 6.26 0.04 0.41 0.45 (0.17) (0.32) -- (0.49)
2004 6.77 0.09 0.60 0.69 (0.11) (0.36) $(0.73) (1.20)
2003 6.66 0.07 1.24 1.31 (0.11) -- (1.09) (1.20)
2002 8.28 0.07 (0.49) (0.42) (0.04) -- (1.16) (1.20)
CLASS B
2007(c) $5.10 $(0.06) $ 0.32 $ 0.26 -- $(0.06)* -- $(0.06)
2006 5.91 0.03 0.42 0.45 $(0.10) (1.16) -- (1.26)
2005 6.01 (0.01) 0.39 0.38 (0.17) (0.32) -- (0.49)
2004 6.59 0.03 0.59 0.62 (0.10) (0.34) $(0.76) (1.20)
2003 6.55 0.03 1.21 1.24 (0.07) -- (1.13) (1.20)
2002 8.23 0.02 (0.50) (0.48) (0.04) -- (1.16) (1.20)
CLASS C
2007(c) $5.19 $(0.06) $ 0.32 $ 0.26 -- $(0.06)* -- $(0.06)
2006 5.99 0.04 0.42 0.46 $(0.10) (1.16) -- (1.26)
2005 6.09 0.00(d) 0.38 0.38 (0.17) (0.32) -- (0.49)
2004 6.66 0.03 0.60 0.63 (0.10) (0.34) $(0.76) (1.20)
2003 6.61 0.03 1.22 1.25 (0.07) -- (1.13) (1.20)
2002 8.27 0.02 (0.48) (0.46) (0.04) -- (1.16) (1.20)
RATIOS TO AVERAGE
NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------------------------
Net Asset Net Assets Net Operating Operating
Period Value, End of Investment Expenses Expenses Portfolio
Ended Redemption End of Total Period Income Before Net of Turnover
December 31, Fees(a) Period Return+ (in 000's) (Loss) Reimbursement Reimbursement(b) Rate
- ------------ ---------- -------- ------- ---------- --------- ------------- ---------------- --------
CLASS AAA
2007(c) $0.00(d) $5.73 5.7% $10,210 (1.36)%(e) 2.55%(e) 2.20%(e) 48%
2006 0.00(d) 5.48 8.4 10,691 1.21 2.14 2.03(f) 130
2005 0.01 6.22 8.0 13,781 0.63 2.11 2.03(f) 58
2004 0.00(d) 6.26 11.7 20,350 1.06 2.06 2.01 60
2003 0.00(d) 6.77 21.5 17,281 1.12 2.07 2.01 54
2002 -- 6.66 (4.9) 9,316 0.97 2.83 2.83 33
CLASS A
2007(c) $0.00(d) $5.73 5.5% $ 67 (1.36)%(e) 2.55%(e) 2.20%(e) 48%
2006 0.00(d) 5.49 8.4 49 1.24 2.14 2.03(f) 130
2005 0.01 6.23 8.2 93 0.68 2.06 2.04(f) 58
2004 0.00(d) 6.26 11.6 598 1.41 2.06 2.01 60
2003 0.00(d) 6.77 21.5 86 1.12 2.07 2.01 54
2002 -- 6.66 (4.7) 2 0.97 2.83 2.83 33
CLASS B
2007(c) $0.00(d) $5.30 5.1% $ 39 (2.15)%(e) 3.30%(e) 2.95%(e) 48%
2006 0.00(d) 5.10 7.6 42 0.47 2.89 2.78(f) 130
2005 0.01 5.91 7.3 73 (0.13) 2.84 2.78(f) 58
2004 0.00(d) 6.01 10.8 133 0.45 2.81 2.76 60
2003 0.00(d) 6.59 20.7 68 0.37 2.82 2.76 54
2002 -- 6.55 (5.6) 24 0.22 3.58 3.58 33
CLASS C
2007(c) $0.00(d) $5.39 5.0% $ 139 (2.17)%(e) 3.30%(e) 2.95%(e) 48%
2006 0.00(d) 5.19 7.8 164 0.57 2.90 2.78(f) 130
2005 0.01 5.99 7.2 145 (0.01) 2.91 2.78(f) 58
2004 0.00(d) 6.09 10.9 95 0.44 2.81 2.76 60
2003 0.00(d) 6.66 20.7 39 0.37 2.82 2.76 54
2002 -- 6.61 (5.3) 13 0.22 3.58 3.58 33
- ------------
+ 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 distributions and does not reflect applicable
sales charges. Total return for a period of less than one year is not
annualized.
* Based on fiscal year to date book income. Amounts are subject to change and
recharacterization at fiscal year end.
(a) Per share amounts have been calculated using the average shares outstanding
method.
(b) The Fund incurred interest expense during six months ended June 30, 2007 and
the fiscal years ended December 31, 2006, 2005, 2004, 2003, and 2002. If
interest expense had not been incurred, the ratios of operating expenses to
average net assets would have been 2.00%, 2.00%, 2.00%, 2.00%, 2.00%, and
2.82% (Class AAA), 2.00%, 2.00%, 2.00%, 2.00%, 2.00%, and 2.82% (Class A),
2.75%, 2.75%, 2.75%, 2.75%, 2.75%, and 3.57% (Class B), and 2.75%, 2.75%,
2.75%, 2.75%, 2.75%, and 3.57% (Class C), respectively.
(c) For the period ended June 30, 2007, unaudited.
(d) Amount represents less than $0.005 per share.
(e) Annualized.
(f) The ratios do not include a reduction of expenses for custodian fee credits
on cash balances maintained with the custodian. Including such custodian fee
credits, the expense ratios for the fiscal years ended December 31, 2006 and
December 31, 2005 would have been 2.02% and 2.03% (Class AAA), 2.02% and
2.03% (Class A), 2.77% and 2.78% (Class B), and 2.77% and 2.78% (Class C),
respectively.
See accompanying notes to financial statements.
15
GAMCO Global Series Funds, Inc.
THE GAMCO GLOBAL CONVERTIBLE SECURITIES 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 per share available daily by calling
800-GABELLI after 6:00 P.M.
BOARD OF DIRECTORS
Mario J. Gabelli, CFA John D. Gabelli
CHAIRMAN AND CHIEF SENIOR VICE PRESIDENT
EXECUTIVE OFFICER GABELLI & COMPANY, INC.
GAMCO INVESTORS, INC.
E. Val Cerutti Werner J. Roeder, MD
CHIEF EXECUTIVE OFFICER MEDICAL DIRECTOR
CERUTTI CONSULTANTS, INC. LAWRENCE HOSPITAL
Anthony J. Colavita Anthonie C. van Ekris
ATTORNEY-AT-LAW CHAIRMAN
ANTHONY J. COLAVITA, P.C. BALMAC INTERNATIONAL, INC.
Arthur V. Ferrara Salvatore J. Zizza
FORMER CHAIRMAN AND CHAIRMAN
CHIEF EXECUTIVE OFFICER ZIZZA & CO., LTD.
GUARDIAN LIFE INSURANCE
COMPANY OF AMERICA
OFFICERS
Bruce N. Alpert James E. McKee
PRESIDENT SECRETARY
Agnes Mullady Peter D. Goldstein
TREASURER CHIEF COMPLIANCE OFFICER
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
GAMCO Global Convertible Securities Fund. It is not authorized for distribution
to prospective investors unless preceded or accompanied by an effective
prospectus.
- --------------------------------------------------------------------------------
GAB441Q207SR
GAMCO
THE
GAMCO
GLOBAL
CONVERTIBLE
SECURITIES
FUND
SEMI-ANNUAL REPORT
JUNE 30, 2007
THE GAMCO GLOBAL GROWTH FUND
SEMI-ANNUAL REPORT
JUNE 30, 2007
TO OUR SHAREHOLDERS,
During the second quarter of 2007, The GAMCO Global Growth Fund (the
"Fund") was up 6.7%, while the Morgan Stanley Capital International All Country
("MSCI AC") World Free Index and the Lipper Global Multi-Cap Core Fund Average
advanced 7.4% and 6.1%, respectively. For the six month period ended June 30,
2007, the Fund was up 9.8% versus gains of 10.2% and 8.9% for the MSCI AC World
Free Index and the Lipper Global Multi-Cap Core Fund Average, respectively.
COMPARATIVE RESULTS
- ---------------------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL RETURNS THROUGH JUNE 30, 2007 (A)
------------------------------------------------
Since
Year to Inception
Quarter Date 1 Year 3 Year 5 Year 10 Year (2/7/94)
- --------------------------------------------------------------------------------------------------------------------
GAMCO GLOBAL GROWTH FUND
CLASS AAA (B) ........................... 6.70% 9.77% 19.33% 16.46% 14.65% 10.11% 11.23%
MSCI AC World Free Index .................. 7.42 10.19 25.83 18.57 15.44 7.64 9.13
Lipper Global Multi-Cap Core Fund Average . 6.10 8.85 21.68 20.12 17.17 6.52 9.23
Class A ................................... 6.70 9.77 19.28 16.46 14.66 10.12 11.24
0.56(c) 3.46(c) 12.42(c) 14.18(c) 13.31(c) 9.47(c) 10.75(c)
Class B ................................... 6.52 9.39 18.40 15.59 13.81 9.55 10.81
1.52(d) 4.39(d) 13.40(d) 14.84(d) 13.57(d) 9.55 10.81
Class C ................................... 6.55 9.37 18.47 15.59 13.81 9.52 10.78
5.55(e) 8.37(e) 17.47(e) 15.59 13.81 9.52 10.78
THE CURRENT EXPENSE RATIO FOR CLASS AAA, A, B, AND C SHARES IS 1.78%, 1.78%,
2.53%, AND 2.53%, RESPECTIVELY. CLASS AAA SHARES DO NOT HAVE A SALES CHARGE.
THE MAXIMUM SALES CHARGE FOR CLASS A, B, AND C SHARES IS 5.75%, 5.00%, AND
1.00%, RESPECTIVELY.
(a) RETURNS REPRESENT PAST PERFORMANCE AND DO NOT GUARANTEE FUTURE RESULTS.
TOTAL RETURNS AND AVERAGE ANNUAL RETURNS REFLECT CHANGES IN SHARE PRICE AND
REINVESTMENT OF DISTRIBUTIONS AND ARE NET OF EXPENSES. INVESTMENT RETURNS
AND THE PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE. WHEN SHARES ARE
REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
PERFORMANCE RETURNS FOR PERIODS LESS THAN ONE YEAR ARE NOT ANNUALIZED.
CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE DATA
PRESENTED. VISIT WWW.GABELLI.COM FOR PERFORMANCE INFORMATION AS OF THE MOST
RECENT MONTH END. INVESTORS SHOULD CAREFULLY CONSIDER THE INVESTMENT
OBJECTIVES, RISKS, CHARGES, AND EXPENSES OF THE FUND BEFORE INVESTING. THE
PROSPECTUS CONTAINS MORE INFORMATION ABOUT THIS AND OTHER MATTERS AND
SHOULD BE READ CAREFULLY BEFORE INVESTING.
THE CLASS AAA SHARES' NET ASSET VALUES ("NAV'S") PER SHARE ARE USED TO
CALCULATE PERFORMANCE FOR THE PERIODS PRIOR TO THE ISSUANCE OF CLASS A
SHARES, CLASS B SHARES, AND CLASS C SHARES ON MARCH 2, 2000, MAY 5, 2000,
AND MARCH 12, 2000, RESPECTIVELY. THE ACTUAL PERFORMANCE FOR THE CLASS B
SHARES AND CLASS C SHARES WOULD HAVE BEEN LOWER DUE TO THE ADDITIONAL
EXPENSES ASSOCIATED WITH THESE CLASSES OF SHARES. INVESTING IN FOREIGN
SECURITIES INVOLVES RISKS NOT ORDINARILY ASSOCIATED WITH INVESTMENTS IN
DOMESTIC ISSUES, INCLUDING CURRENCY FLUCTUATION, ECONOMIC, AND POLITICAL
RISKS. THE MORGAN STANLEY CAPITAL INTERNATIONAL ALL COUNTRY WORLD FREE
INDEX (THE "MSCI AC WORLD FREE INDEX") IS AN UNMANAGED INDICATOR OF STOCK
MARKET PERFORMANCE, WHILE THE LIPPER GLOBAL MULTI-CAP CORE FUND AVERAGE
REFLECTS THE AVERAGE PERFORMANCE OF MUTUAL FUNDS CLASSIFIED IN THIS
PARTICULAR CATEGORY. DIVIDENDS ARE CONSIDERED REINVESTED. YOU CANNOT INVEST
DIRECTLY IN AN INDEX.
(b) EFFECTIVE FEBRUARY 15, 2007, CLASS AAA SHARES ARE OFFERED ONLY TO
INVESTORS WHO WERE SHAREHOLDERS IN ONE OR MORE OF THE REGISTERED FUNDS
DISTRIBUTED BY GABELLI & COMPANY, INC. PRIOR TO FEBRUARY 15, 2007.
(c) INCLUDES THE EFFECT OF THE MAXIMUM 5.75% SALES CHARGE AT THE BEGINNING OF
THE PERIOD.
(d) PERFORMANCE RESULTS INCLUDE THE DEFERRED SALES CHARGES FOR THE CLASS
B SHARES UPON REDEMPTION AT THE END OF THE QUARTER, YEAR TO DATE, ONE YEAR,
THREE YEAR, AND FIVE YEAR PERIODS OF 5%, 5%, 5%, 3%, AND 2%, RESPECTIVELY,
OF THE FUND'S NAV AT THE TIME OF PURCHASE OR SALE, WHICHEVER IS LOWER.
CLASS B SHARES ARE NOT AVAILABLE FOR NEW PURCHASES.
(e) PERFORMANCE RESULTS INCLUDE THE DEFERRED SALES CHARGES FOR THE CLASS
C SHARES UPON REDEMPTION AT THE END OF THE QUARTER, YEAR TO DATE, AND ONE
YEAR PERIODS OF 1% OF THE FUND'S NAV AT THE TIME OF PURCHASE OR SALE,
WHICHEVER IS LOWER.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
We have separated the portfolio managers' commentary from the financial
statements and investment portfolio due to corporate governance regulations
stipulated by the Sarbanes-Oxley Act of 2002. We have done this to ensure that
the content of the portfolio managers' commentary is unrestricted. The
financial statements and investment portfolio are mailed separately from the
commentary. Both the commentary and the financial statements, including the
portfolio of investments, will be available on our website at
www.gabelli.com/funds.
- --------------------------------------------------------------------------------
THE GAMCO GLOBAL GROWTH FUND
DISCLOSURE OF FUND EXPENSES (UNAUDITED)
For the Six Month Period from January 1, 2007 through June 30, 2007
EXPENSE TABLE
================================================================================
We believe it is important for you to understand the impact of fees and expenses
regarding your investment. All mutual funds have operating expenses. As a
shareholder of a fund, you incur ongoing costs, which include costs for
portfolio management, administrative services, and shareholder reports (like
this one), among others. Operating expenses, which are deducted from a fund's
gross income, directly reduce the investment return of a fund. When a fund's
expenses are expressed as a percentage of its average net assets, this figure is
known as the expense ratio. The following examples are intended to help you
understand the ongoing costs (in dollars) of investing in your Fund and to
compare these costs with those of other mutual funds. The examples are based on
an investment of $1,000 made at the beginning of the period shown and held for
the entire period.
The Expense Table below illustrates your Fund's costs in two ways:
ACTUAL FUND RETURN: This section provides information about actual account
values and actual expenses. You may use this section to help you to estimate the
actual expenses that you paid over the period after any fee waivers and expense
reimbursements. The "Ending Account Value" shown is derived from the Fund's
ACTUAL return during the past six months, and the "Expenses Paid During Period"
shows the dollar amount that would have been paid by an investor who started
with $1,000 in the Fund. You may use this information, together with the amount
you invested, to estimate the expenses that you paid over the period.
To do so, simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
given for your Fund under the heading "Expenses Paid During Period" to estimate
the expenses you paid during this period.
HYPOTHETICAL 5% RETURN: This section provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio. It assumes a hypothetical annualized return of 5% before expenses during
the period shown. In this case - because the hypothetical return used is NOT the
Fund's actual return - the results do not apply to your investment and you
cannot use the hypothetical account value and expense to estimate the actual
ending account balance or expenses you paid for the period. This example is
useful in making comparisons of the ongoing costs of investing in the Fund and
other funds. To do so, compare this 5% hypothetical example with the 5%
hypothetical examples that appear in shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs such as sales
charges (loads), redemption fees, or exchange fees, if any, which are described
in the Prospectus. If these costs were applied to your account, your costs would
be higher. Therefore, the 5% hypothetical return is useful in comparing ongoing
costs only, and will not help you determine the relative total costs of owning
different funds.
Beginning Ending Annualized Expenses
Account Value Account Value Expense Paid During
01/01/07 06/30/07 Ratio Period*
- --------------------------------------------------------------------------------
THE GAMCO GLOBAL GROWTH FUND
- --------------------------------------------------------------------------------
ACTUAL FUND RETURN
Class AAA $1,000.00 $1,097.70 1.76% $ 9.20
Class A $1,000.00 $1,097.70 1.76% $ 9.20
Class B $1,000.00 $1,093.90 2.51% $13.10
Class C $1,000.00 $1,093.70 2.50% $13.05
HYPOTHETICAL 5% RETURN
Class AAA $1,000.00 $1,016.16 1.76% $ 8.85
Class A $1,000.00 $1,016.16 1.76% $ 8.85
Class B $1,000.00 $1,012.42 2.51% $12.59
Class C $1,000.00 $1,012.47 2.50% $12.54
* Expenses are equal to the Fund's annualized expense ratio for the last six
months multiplied by the average account value over the period, multiplied by
the number of days in the most recent fiscal half-year, then divided by 365.
2
SUMMARY OF PORTFOLIO HOLDINGS (UNAUDITED)
The following table presents portfolio holdings as a percent of total net assets
as of June 30, 2007:
THE GAMCO GLOBAL GROWTH FUND
Financial Services ................................ 15.4%
Energy and Utilities .............................. 9.9%
Health Care ....................................... 9.2%
Food and Beverage ................................. 8.4%
Computer Software and Services .................... 7.8%
Metals and Mining ................................. 5.8%
Telecommunications ................................ 5.5%
Retail ............................................ 5.5%
Exchange Traded Funds ............................. 4.2%
Consumer Products ................................. 4.1%
Diversified Industrial ............................ 3.6%
Aerospace ......................................... 3.1%
Electronics ....................................... 2.8%
Hotels and Gaming ................................. 2.8%
Entertainment ..................................... 2.2%
Building and Construction ......................... 1.9%
Equipment and Supplies ............................ 1.6%
Cable and Satellite ............................... 1.3%
Chemicals and Allied Products ..................... 0.9%
Automotive ........................................ 0.9%
Business Services ................................. 0.7%
Broadcasting ...................................... 0.7%
U.S. Government Obligations ....................... 0.6%
Environmental Services ............................ 0.5%
Transportation .................................... 0.4%
Wireless Communications ........................... 0.3%
Other Assets and Liabilities (Net) ................ (0.1)%
-------
100.0%
=======
THE FUND FILES A COMPLETE SCHEDULE OF PORTFOLIO HOLDINGS WITH THE SECURITIES AND
EXCHANGE COMMISSION (THE "SEC") FOR THE FIRST AND THIRD QUARTERS OF EACH FISCAL
YEAR ON FORM N-Q, THE LAST OF WHICH WAS FILED FOR THE QUARTER ENDED MARCH 31,
2007. SHAREHOLDERS MAY OBTAIN THIS INFORMATION AT WWW.GABELLI.COM OR BY CALLING
THE FUND AT 800-GABELLI (800-422-3554). THE FUND'S FORM N-Q IS AVAILABLE ON THE
SEC'S WEBSITE AT WWW.SEC.GOV AND MAY ALSO BE REVIEWED AND COPIED AT THE SEC'S
PUBLIC REFERENCE ROOM IN WASHINGTON, DC. INFORMATION ON THE OPERATION OF THE
PUBLIC REFERENCE ROOM MAY BE OBTAINED BY CALLING 1-800-SEC-0330.
PROXY VOTING
The Fund files Form N-PX with its complete proxy voting record for the 12 months
ended June 30th, no later than August 31st of each year. A description of the
Fund's proxy voting policies, procedures, and how the Fund voted proxies
relating to portfolio securities is available without charge, upon request, by
(i) calling 800-GABELLI (800-422-3554); (ii) writing to The Gabelli Funds at One
Corporate Center, Rye, NY 10580-1422; or (iii) visiting the SEC's website at
www.sec.gov.
3
THE GAMCO GLOBAL GROWTH FUND
SCHEDULE OF INVESTMENTS -- JUNE 30, 2007 (UNAUDITED)
================================================================================
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS -- 99.5%
AEROSPACE -- 3.1%
5,000 General Dynamics Corp. ........... $ 345,708 $ 391,100
6,000 L-3 Communications
Holdings Inc. .................. 463,245 584,340
9,000 Rockwell Collins Inc. ............ 516,913 635,760
90,000 Rolls-Royce Group plc+ ........... 751,339 969,076
5,328,000 Rolls-Royce Group plc, Cl. B ..... 10,439 10,913
9,000 United Technologies Corp. ........ 442,069 638,370
------------ ------------
2,529,713 3,229,559
------------ ------------
AUTOMOTIVE -- 0.9%
7,000 Honda Motor Co. Ltd., ADR ........ 271,473 254,030
5,000 Toyota Motor Corp., ADR .......... 668,331 629,400
------------ ------------
939,804 883,430
------------ ------------
BROADCASTING -- 0.7%
5,200 Nippon Television Network
Corp. .......................... 771,307 709,631
------------ ------------
BUILDING AND CONSTRUCTION -- 1.9%
5,000 CRH plc, Dublin .................. 120,555 247,096
15,000 CRH plc, London .................. 361,664 738,539
4,000 Fomento de Construcciones
y Contratas SA ................. 138,679 359,873
8,000 Technip SA ....................... 266,839 661,220
------------ ------------
887,737 2,006,728
------------ ------------
BUSINESS SERVICES -- 0.7%
16,000 Secom Co. Ltd. ................... 620,342 754,830
------------ ------------
CABLE AND SATELLITE -- 1.3%
17,250 Comcast Corp., Cl. A+ ............ 450,975 485,070
20,000 Rogers Communications Inc.,
Cl. B .......................... 648,227 849,800
------------ ------------
1,099,202 1,334,870
------------ ------------
CHEMICALS AND ALLIED PRODUCTS -- 0.9%
10,000 E.I. du Pont de Nemours & Co. .... 527,437 508,400
50,000 Tokai Carbon Co. Ltd. ............ 205,108 467,814
------------ ------------
732,545 976,214
------------ ------------
COMPUTER SOFTWARE AND SERVICES -- 7.8%
17,000 Adobe Systems Inc.+ .............. 565,398 682,550
7,000 Akamai Technologies Inc.+ ........ 379,685 340,480
6,000 Apple Inc.+ ...................... 531,198 732,240
28,000 Cisco Systems Inc.+ .............. 604,820 779,800
15,000 eBay Inc.+ ....................... 542,820 482,700
5,700 Google Inc., Cl. A+ .............. 1,781,911 2,983,266
23,000 Microsoft Corp. .................. 634,700 677,810
4,700 Research In Motion Ltd.+ ......... 684,660 939,953
17,000 Yahoo! Inc.+ ..................... 607,440 461,210
------------ ------------
6,332,632 8,080,009
------------ ------------
MARKET
SHARES COST VALUE
------ ---- -------
CONSUMER PRODUCTS -- 4.1%
7,000 Christian Dior SA ................ $ 438,852 $ 905,850
15,314 Compagnie Financiere
Richemont SA, Cl. A ............ 443,000 915,337
1,500 Nintendo Co. Ltd. ................ 448,147 547,265
12,500 Procter & Gamble Co. ............. 698,207 764,875
4,000 Swatch Group AG .................. 464,406 1,136,277
------------ ------------
2,492,612 4,269,604
------------ ------------
DIVERSIFIED INDUSTRIAL -- 3.6%
10,000 Bouygues SA ...................... 343,461 837,853
15,000 Emerson Electric Co. ............. 635,717 702,000
39,000 General Electric Co. ............. 1,395,696 1,492,920
10,000 ITT Corp. ........................ 440,031 682,800
------------ ------------
2,814,905 3,715,573
------------ ------------
ELECTRONICS -- 2.8%
3,700 Fanuc Ltd. ....................... 325,019 381,889
21,000 Intel Corp. ...................... 467,600 498,960
9,000 MEMC Electronic Materials
Inc.+ .......................... 497,238 550,080
10,000 Microchip Technology Inc. ........ 287,500 370,400
10,000 NVIDIA Corp.+ .................... 351,282 413,100
20,000 Texas Instruments Inc. ........... 508,831 752,600
------------ ------------
2,437,470 2,967,029
------------ ------------
ENERGY AND UTILITIES -- 9.9%
12,000 Apache Corp. ..................... 857,509 979,080
13,500 Canadian Natural
Resources Ltd. ................. 705,109 895,725
5,672 Devon Energy Corp. ............... 278,827 444,061
9,000 EnCana Corp. ..................... 433,151 553,050
6,000 GlobalSantaFe Corp. .............. 347,693 433,500
9,000 Hess Corp. ....................... 433,185 530,640
6,900 Imperial Oil Ltd. ................ 253,504 321,212
5,500 National Oilwell Varco Inc.+ ..... 391,704 573,320
9,000 Noble Corp. ...................... 652,726 877,680
23,000 Occidental Petroleum Corp. ....... 1,061,833 1,331,240
10,000 Saipem SpA ....................... 240,421 341,205
5,200 Sasol Ltd. ....................... 238,250 195,228
2,000 Sasol Ltd., ADR .................. 76,260 75,080
5,000 Schlumberger Ltd. ................ 158,943 424,700
10,900 Suncor Energy Inc. ............... 829,274 980,128
7,000 Transocean Inc.+ ................. 361,090 741,860
10,000 XTO Energy Inc. .................. 473,259 601,000
------------ ------------
7,792,738 10,298,709
------------ ------------
ENTERTAINMENT -- 2.2%
36,000 Publishing and
Broadcasting Ltd. .............. 180,793 596,580
17,000 Time Warner Inc. ................. 357,610 357,680
12,300 Viacom Inc., Cl. B+ .............. 478,662 512,049
20,180 Vivendi .......................... 436,833 868,098
------------ ------------
1,453,898 2,334,407
------------ ------------
See accompanying notes to financial statements.
4
THE GAMCO GLOBAL GROWTH FUND
SCHEDULE OF INVESTMENTS (CONTINUED) -- JUNE 30, 2007 (UNAUDITED)
================================================================================
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
ENVIRONMENTAL SERVICES -- 0.5%
6,500 Veolia Environnement ............. $ 495,362 $ 510,516
------------ ------------
EQUIPMENT AND SUPPLIES -- 1.6%
5,500 Canon Inc. ....................... 302,383 322,536
4,000 Canon Inc., ADR .................. 219,051 234,560
3,900 Keyence Corp. .................... 791,420 852,000
11,000 Nikon Corp. ...................... 247,210 306,342
------------ ------------
1,560,064 1,715,438
------------ ------------
EXCHANGE TRADED FUNDS -- 4.2%
15,500 iShares MSCI Emerging
Markets Index Fund ............. 1,563,036 2,040,575
25,500 Vanguard Emerging
Markets ETF .................... 1,934,860 2,327,895
------------ ------------
3,497,896 4,368,470
------------ ------------
FINANCIAL SERVICES -- 15.4%
5,000 Affiliated Managers
Group Inc.+ .................... 483,000 643,800
5,500 Allianz SE ....................... 704,835 1,289,942
15,500 American Express Co. ............. 842,758 948,290
50,000 Anglo Irish Bank Corp. plc ....... 117,562 1,026,173
30,000 Australia & New Zealand
Banking Group Ltd. ............. 505,275 736,835
30,000 Aviva plc ........................ 320,646 445,342
29,039 Bank of Ireland, Ireland ......... 280,065 586,601
10,000 Bank of Ireland, London .......... 159,392 201,468
50,000 Barclays plc ..................... 655,833 695,646
1,533 China Life Insurance
Co. Ltd., ADR .................. 35,142 82,276
7,400 Julius Baer Holding Ltd. AG ...... 353,875 529,468
5,895 Merrill Lynch & Co. Inc. ......... 334,931 492,704
9,000 Millea Holdings Inc., ADR ........ 333,118 369,360
40 Mitsubishi UFJ Financial
Group Inc. ..................... 486,680 440,828
4,000 Moody's Corp. .................... 272,988 248,800
6,000 Morgan Stanley ................... 502,729 503,280
14,000 Nomura Holdings Inc. ............. 280,168 271,927
22,000 Nomura Holdings Inc., ADR ........ 484,875 427,240
8,200 Royal Bank of Canada ............. 351,545 435,845
42,700 Standard Chartered plc ........... 878,245 1,392,762
7,000 State Street Corp. ............... 338,771 478,800
10,000 T. Rowe Price Group Inc. ......... 408,771 518,900
5,000 The Goldman Sachs
Group Inc. ..................... 805,381 1,083,750
6,250 Toronto-Dominion Bank ............ 353,908 427,482
9,000 UBS AG, New York ................. 370,335 540,090
4,000 UBS AG, Switzerland .............. 136,647 239,217
44,500 Westpac Banking Corp. ............ 703,450 966,307
------------ ------------
11,500,925 16,023,133
------------ ------------
MARKET
SHARES COST VALUE
------ ---- -------
FOOD AND BEVERAGE -- 8.4%
33,000 Ajinomoto Co. Inc. ............... $ 382,303 $ 380,102
60,000 Cadbury Schweppes plc ............ 592,403 814,345
16,996 Coca-Cola Hellenic Bottling
Co. SA ......................... 358,399 782,113
90,000 Davide Campari-Milano SpA ........ 418,375 942,284
70,000 Diageo plc ....................... 891,438 1,454,944
12,000 Groupe Danone .................... 669,806 969,194
3,000 Nestle SA ........................ 850,228 1,139,921
9,000 PepsiCo Inc. ..................... 495,029 583,650
4,515 Pernod-Ricard SA ................. 401,452 996,855
10,000 Starbucks Corp.+ ................. 301,870 262,400
46,000 Tesco plc ........................ 395,588 384,868
------------ ------------
5,756,891 8,710,676
------------ ------------
HEALTH CARE -- 9.2%
4,000 Alcon Inc. ....................... 452,343 539,640
7,000 Celgene Corp.+ ................... 425,664 401,310
5,700 Genentech Inc.+ .................. 324,270 431,262
9,800 Gilead Sciences Inc.+ ............ 316,355 379,946
20,000 GlaxoSmithKline plc .............. 423,287 521,000
16,000 Hisamitsu Pharmaceutical
Co. Inc. ....................... 331,635 441,484
15,000 Novartis AG ...................... 615,193 842,109
10,000 Novo Nordisk A/S, ADR ............ 797,927 1,086,600
4,300 Roche Holding AG ................. 343,824 761,902
18,000 Schering-Plough Corp. ............ 453,841 547,920
9,000 St. Jude Medical Inc.+ ........... 380,450 373,410
2,400 Straumann Holding AG ............. 504,079 672,805
8,300 Stryker Corp. .................... 393,639 523,647
4,800 Synthes Inc. ..................... 398,130 577,258
10,000 Takeda Pharmaceutical
Co. Ltd. ....................... 445,295 646,014
7,000 UnitedHealth Group Inc. .......... 371,826 357,980
6,000 Zimmer Holdings Inc.+ ............ 496,447 509,340
------------ ------------
7,474,205 9,613,627
------------ ------------
HOTELS AND GAMING -- 2.8%
50 Greek Organization of
Football Prognostics SA ........ 821 1,767
12,000 Hilton Hotels Corp. .............. 317,652 401,640
31,054 InterContinental Hotels
Group plc ...................... 759,700 771,395
71,803 Ladbrokes plc .................... 723,006 620,759
5,000 Las Vegas Sands Corp.+ ........... 402,372 381,950
7,000 Marriott International
Inc., Cl. A .................... 266,140 302,680
6,000 Starwood Hotels &
Resorts Worldwide Inc. ......... 365,386 402,420
------------ ------------
2,835,077 2,882,611
------------ ------------
See accompanying notes to financial statements.
5
THE GAMCO GLOBAL GROWTH FUND
SCHEDULE OF INVESTMENTS (CONTINUED) -- JUNE 30, 2007 (UNAUDITED)
================================================================================
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
METALS AND MINING -- 5.8%
4,000 Allegheny Technologies Inc. ...... $ 300,030 $ 419,520
15,000 Anglo American plc ............... 546,531 880,677
20,000 BHP Billiton plc ................. 317,858 555,577
10,500 Commercial Metals Co. ............ 235,905 354,585
7,200 Companhia Vale do Rio
Doce, ADR ...................... 270,562 320,760
9,000 Lonmin plc ....................... 545,871 722,523
5,228 Peabody Energy Corp. ............. 66,790 252,930
16,000 Rio Tinto plc .................... 587,295 1,224,061
14,000 Titanium Metals Corp.+ ........... 434,402 446,600
14,666 Xstrata plc ...................... 376,296 873,111
------------ ------------
3,681,540 6,050,344
------------ ------------
RETAIL -- 5.5%
9,000 Coach Inc.+ ...................... 258,847 426,510
11,000 CVS Caremark Corp. ............... 387,900 400,950
12,150 Hennes & Mauritz AB, Cl. B ....... 512,220 718,381
6,000 Kohl's Corp.+ .................... 390,884 426,180
15,000 Next plc ......................... 507,851 602,209
7,000 Nordstrom Inc. ................... 372,399 357,840
24,000 Seven & I Holdings Co. Ltd. ...... 813,032 686,049
9,000 Tiffany & Co. .................... 290,462 477,540
10,000 Walgreen Co. ..................... 410,654 435,400
8,000 Whole Foods Market Inc. .......... 399,510 306,400
39,100 Woolworths Ltd. .................. 607,675 893,549
------------ ------------
4,951,434 5,731,008
------------ ------------
TELECOMMUNICATIONS -- 5.5%
18,000 America Movil SAB de CV,
Cl. L, ADR ..................... 814,388 1,114,740
19,000 AT&T Inc. ........................ 694,095 788,500
15,000 China Mobile Ltd., ADR ........... 729,144 808,500
10,000 Harris Corp. ..................... 491,370 545,500
85 KDDI Corp. ....................... 432,573 629,683
30,000 NTT DoCoMo Inc., ADR ............. 551,431 474,000
13,000 Verizon Communications Inc. ...... 456,054 535,210
25,000 Vodafone Group plc, ADR .......... 737,433 840,750
------------ ------------
4,906,488 5,736,883
------------ ------------
TRANSPORTATION -- 0.4%
10,000 Expeditors International of
Washington Inc. ................ 426,255 413,000
------------ ------------
WIRELESS COMMUNICATIONS -- 0.3%
8,000 QUALCOMM Inc. .................... 361,680 347,120
------------ ------------
TOTAL COMMON STOCKS .............. 78,352,722 103,663,419
------------ ------------
PRINICPAL MARKET
AMOUNT COST VALUE
------ ---- -------
U.S. GOVERNMENT OBLIGATIONS -- 0.6%
$642,000 U.S. Treasury Bills,
4.599% to 4.911%++,
07/19/07 to 09/20/07 ........... $ 636,438 $ 636,267
------------ ------------
TOTAL
INVESTMENTS -- 100.1% .......... $ 78,989,160 104,299,686
============
OTHER ASSETS AND LIABILITIES (NET) -- (0.1)% ..... (72,302)
------------
NET ASSETS -- 100.0% ............................. $104,227,384
============
- ----------------
+ Non-income producing security.
++ Represents annualized yield at date of purchase.
ADR American Depository Receipt
% OF
MARKET MARKET
GEOGRAPHIC DIVERSIFICATION VALUE VALUE
- -------------------------- -------- -------
North America ........................ 48.5% $ 50,636,755
Europe ............................... 33.7 35,168,352
Japan ................................ 9.8 10,226,984
Asia/Pacific ......................... 3.9 4,084,047
Latin America ........................ 3.8 3,913,240
South Africa ......................... 0.3 270,308
------ ------------
100.0% $104,299,686
====== ============
See accompanying notes to financial statements.
6
THE GAMCO GLOBAL GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2007 (UNAUDITED)
================================================================================
ASSETS:
Investments, at value (cost $78,989,160) ...... $ 104,299,686
Foreign currency, at value (cost $12,356) ..... 11,834
Cash .......................................... 2,087
Deposit at broker ............................. 58
Receivable for Fund shares sold ............... 5,430
Dividends and interest receivable ............. 254,621
Prepaid expense ............................... 2,381
-------------
TOTAL ASSETS .................................. 104,576,097
-------------
LIABILITIES:
Payable for Fund shares redeemed .............. 87,344
Payable for investment advisory fees .......... 88,909
Payable for distribution fees ................. 22,581
Payable for legal and audit fees .............. 55,706
Payable for shareholder
communications expenses ..................... 40,953
Payable for shareholder services fees ......... 34,720
Payable for accounting fees ................... 3,872
Other accrued expenses ........................ 14,628
-------------
TOTAL LIABILITIES ............................. 348,713
-------------
NET ASSETS applicable to 4,142,438
shares outstanding .......................... $ 104,227,384
=============
NET ASSETS CONSIST OF:
Paid-in capital, each class at $0.001 par value $ 129,112,347
Accumulated net investment income ............. 141,696
Accumulated net realized loss on investments
and foreign currency transactions ........... (50,342,136)
Net unrealized appreciation on investments .... 25,310,526
Net unrealized appreciation on foreign
currency translations ....................... 4,951
-------------
NET ASSETS .................................... $ 104,227,384
=============
SHARES OF CAPITAL STOCK:
CLASS AAA:
Net Asset Value, offering and redemption price
per share ($101,957,934 / 4,051,256 shares
outstanding; 75,000,000 shares authorized) .. $25.17
======
CLASS A:
Net Asset Value and redemption price
per share ($1,767,235 / 70,204 shares
outstanding; 50,000,000 shares authorized) .. $25.17
======
Maximum offering price per share (NAV / .9425,
based on maximum sales charge of 5.75%
of the offering price) ...................... $26.71
======
CLASS B:
Net Asset Value and offering price per share
($252,949 / 10,541 shares outstanding;
25,000,000 shares authorized) ............... $24.00(a)
======
CLASS C:
Net Asset Value and offering price per share
($249,266 / 10,437 shares outstanding
25,000,000 shares authorized) ............... $23.88(a)
======
- -------------------
(a) Redemption price varies based on the length of time held.
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2007 (UNAUDITED)
================================================================================
INVESTMENT INCOME:
Dividends (net of foreign taxes of $36,058) ........... $ 1,017,147
Interest .............................................. 20,926
-----------
TOTAL INVESTMENT INCOME ............................... 1,038,073
-----------
EXPENSES:
Investment advisory fees .............................. 510,400
Distribution fees - Class AAA ......................... 125,186
Distribution fees - Class A ........................... 1,762
Distribution fees - Class B ........................... 1,175
Distribution fees - Class C ........................... 1,431
Shareholder services fees ............................. 76,483
Shareholder communications expenses ................... 59,356
Legal and audit fees .................................. 35,886
Accounting fees ....................................... 22,621
Custodian fees ........................................ 20,334
Registration expenses ................................. 17,701
Directors' fees ....................................... 5,121
Interest expense ...................................... 604
Miscellaneous expenses ................................ 20,988
-----------
TOTAL EXPENSES ........................................ 899,048
Less: Custodian fee credits ........................... (2)
-----------
NET EXPENSES .......................................... 899,046
-----------
NET INVESTMENT INCOME ................................. 139,027
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCY:
Net realized gain on investments ...................... 3,892,481
Net realized gain on foreign
currency transactions ............................... 3,842
-----------
Net realized gain on investments and
foreign currency transactions ....................... 3,896,323
-----------
Net change in unrealized appreciation/
depreciation on investments ......................... 5,481,029
Net change in unrealized appreciation/
depreciation on foreign currency translations ....... (3,968)
-----------
Net change in unrealized appreciation/
depreciation on investments and
foreign currency translations ....................... 5,477,061
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCY ................. 9,373,384
-----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ..................................... $ 9,512,411
===========
See accompanying notes to financial statements.
7
THE GAMCO GLOBAL GROWTH FUND
STATEMENT OF CHANGES IN NET ASSETS
================================================================================
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
--------------- -----------------
OPERATIONS:
Net investment income ............................................ $ 139,027 $ 277,720
Net realized gain on investments and foreign currency transactions 3,896,323 14,070,539
Net change in unrealized appreciation/depreciation on investments
and foreign currency translations .............................. 5,477,061 (1,920,801)
------------- -------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ............. 9,512,411 12,427,458
------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income:
Class AAA ...................................................... -- (272,763)
Class A ........................................................ -- (3,545)
------------- -------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS .............................. -- (276,308)
------------- -------------
CAPITAL SHARE TRANSACTIONS:
Class AAA ...................................................... (8,261,054) (19,507,826)
Class A ........................................................ 343,263 (2,805)
Class B ........................................................ 6,654 (60)
Class C ........................................................ (50,711) 14,905
------------- -------------
NET DECREASE IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS ....... (7,961,848) (19,495,786)
------------- -------------
REDEMPTION FEES .................................................. 26 148
------------- -------------
NET INCREASE (DECREASE) IN NET ASSETS ............................ 1,550,589 (7,344,488)
NET ASSETS:
Beginning of period .............................................. 102,676,795 110,021,283
------------- -------------
End of period (including undistributed net investment income
of $141,696 and $2,669, respectively) .......................... $ 104,227,384 $ 102,676,795
============= =============
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
================================================================================
1. ORGANIZATION. The GAMCO Global Growth Fund (the "Fund"), formerly The Gabelli
Global Growth Fund, a series of GAMCO Global Series Funds, Inc. (the
"Corporation"), formerly Gabelli Global Series Funds, Inc., was organized on
July 16, 1993 as a Maryland corporation. The Fund is a non-diversified open-end
management investment company registered under the Investment Company Act of
1940, as amended (the "1940 Act"), and one of four separately managed portfolios
(collectively, the "Portfolios") of the Corporation. The Fund's primary
objective is capital appreciation. The Fund commenced investment operations on
February 7, 1994.
2. SIGNIFICANT ACCOUNTING POLICIES. The preparation of financial statements in
accordance with United States ("U.S.") generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could differ
from those estimates. The following is a summary of significant accounting
policies followed by the Fund in the preparation of its financial statements.
SECURITY VALUATION. Portfolio securities listed or traded on a nationally
recognized securities exchange or traded in the U.S. over-the-counter market for
which market quotations are readily available are valued at the last quoted sale
price or a market's official closing price as of the close of business on the
day the securities are being valued. If there were no sales that day, the
security is valued at the average of the closing bid and asked prices or, if
there were no asked prices quoted on that day, then the security is valued at
the closing bid
8
THE GAMCO GLOBAL GROWTH FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
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
Directors (the "Board") so determines, by such other method as the Board shall
determine in good faith to reflect its fair market value. Portfolio securities
traded on more than one national securities exchange or market are valued
according to the broadest and most representative market, as determined by
Gabelli Funds, LLC (the "Adviser").
Portfolio securities primarily traded on a foreign market are generally valued
at the preceding closing values of such securities on the relevant market, but
may be fair valued pursuant to procedures established by the Board if market
conditions change significantly after the close of the foreign market but prior
to the close of business on the day the securities are being valued. Debt
instruments with remaining maturities of 60 days or less that are not credit
impaired are valued at amortized cost, unless the Board determines such amount
does not reflect the securities' fair value, in which case these securities will
be fair valued as determined by the Board. Debt instruments having a maturity
greater than 60 days for which market quotations are readily available are
valued at the average of the latest bid and asked prices. If there were no asked
prices quoted on such day, the security is valued using the closing bid price.
Futures contracts are valued at the closing settlement price of the exchange or
board of trade on which the applicable contract is traded.
Securities and assets for which market quotations are not readily available are
fair valued as determined by the Board. Fair valuation methodologies and
procedures may include, but are not limited to: analysis and review of available
financial and non-financial information about the company; comparisons to the
valuation and changes in valuation of similar securities, including a comparison
of foreign securities to the equivalent U.S. dollar value ADR securities at the
close of the U.S. exchange; and evaluation of any other information that could
be indicative of the value of the security.
In September 2006, the Financial Accounting Standards Board (the "FASB") issued
Statement of Financial Accounting Standards ("SFAS") 157, Fair Value
Measurements, which clarifies the definition of fair value and requires
companies to expand their disclosure about the use of fair value to measure
assets and liabilities in interim and annual periods subsequent to initial
recognition. Adoption of SFAS 157 requires the use of the price that would be
received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. SFAS 157 is
effective for financial statements issued for fiscal years beginning after
November 15, 2007, and interim periods within those fiscal years. At this time,
management is in the process of reviewing the requirements of SFAS 157 against
its current valuation policies to determine future applicability.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with
primary government securities dealers recognized by the Federal Reserve Board,
with member banks of the Federal Reserve System, or with other brokers or
dealers that meet credit guidelines established by the Adviser and reviewed by
the Board. Under the terms of a typical repurchase agreement, the Fund takes
possession of an underlying debt obligation subject to an obligation of the
seller to repurchase, and the Fund to resell, the obligation at an agreed-upon
price and time, thereby determining the yield during the Fund's holding period.
The Fund will always receive and maintain securities as collateral whose market
value, including accrued interest, will be at least equal to 102% of the dollar
amount invested by the Fund in each agreement. The Fund will make payment for
such securities only upon physical delivery or upon evidence of book entry
transfer of the collateral to the account of the custodian. To the extent that
any repurchase transaction exceeds one business day, the value of the collateral
is marked-to-market on a daily basis to maintain the adequacy of the collateral.
If the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited. At June 30,
2007, there were no open repurchase agreements.
9
THE GAMCO GLOBAL GROWTH FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
FUTURES CONTRACTS. The Fund may engage in futures contracts for the purpose of
hedging against changes in the value of its portfolio securities and in the
value of securities it intends to purchase. Upon entering into a futures
contract, the Fund is required to deposit with the broker an amount of cash or
cash equivalents equal to a certain percentage of the contract amount. This is
known as the "initial margin". Subsequent payments ("variation margin") are made
or received by the Fund each day, depending on the daily fluctuations in the
value of the contract, which are included in unrealized
appreciation/depreciation on investments and futures contracts. The Fund
recognizes a realized gain or loss when the contract is closed.
There are several risks in connection with the use of futures contracts as a
hedging instrument. The change in value of futures contracts primarily
corresponds with the value of their underlying instruments, which may not
correlate with the change in value of the hedged investments. In addition, there
is the risk that the Fund may not be able to enter into a closing transaction
because of an illiquid secondary market. At June 30, 2007, there were no open
futures contracts.
SECURITIES SOLD SHORT. The Fund may enter into short sale transactions. Short
selling involves selling securities that may or may not be owned and, at times,
borrowing the same securities for delivery to the purchaser, with an obligation
to replace such borrowed securities at a later date. The proceeds received from
short sales are recorded as liabilities and the Fund records an unrealized gain
or loss to the extent of the difference between the proceeds received and the
value of an open short position on the day of determination. The Fund records a
realized gain or loss when the short position is closed out. By entering into a
short sale, the Fund bears the market risk of an unfavorable change in the price
of the security sold short. Dividends on short sales are recorded as an expense
by the Fund on the ex-dividend date and interest expense is recorded on the
accrual basis. The Fund did not hold any short positions as of June 30, 2007.
FORWARD FOREIGN EXCHANGE CONTRACTS. The Fund may engage in forward foreign
exchange contracts for hedging a specific transaction with respect to either the
currency in which the transaction is denominated or another currency as deemed
appropriate by the Adviser. Forward foreign exchange contracts are valued at the
forward rate and are marked-to-market daily. The change in market value is
included in unrealized appreciation/depreciation on investments and foreign
currency translations. When the contract is closed, the Fund records a realized
gain or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
The use of forward foreign exchange contracts does not eliminate fluctuations in
the underlying prices of the Fund's portfolio securities, but it does establish
a rate of exchange that can be achieved in the future. Although forward foreign
exchange contracts limit the risk of loss due to a decline in the value of the
hedged currency, they also limit any potential gain that might result should the
value of the currency increase. In addition, the Fund could be exposed to risks
if the counterparties to the contracts are unable to meet the terms of their
contracts. At June 30, 2007, there were no open forward foreign exchange
contracts.
FOREIGN CURRENCY TRANSLATIONS. The books and records of the Fund are maintained
in U.S. dollars. Foreign currencies, investments, and other assets and
liabilities are translated into U.S. dollars at the current exchange rates.
Purchases and sales of investment securities, income, and expenses are
translated at the exchange rate prevailing on the respective dates of such
transactions. Unrealized gains and losses that result from changes in foreign
exchange rates and/or changes in market prices of securities have been included
in unrealized appreciation/depreciation on investments and foreign currency
translations. Net realized foreign currency gains and losses resulting from
changes in exchange rates include foreign currency gains and losses between
trade date and settlement date on investment securities transactions, foreign
currency transactions, and the
10
THE GAMCO GLOBAL GROWTH FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
difference between the amounts of interest and dividends recorded on the books
of the Fund and the amounts actually received. The portion of foreign currency
gains and losses related to fluctuation in exchange rates between the initial
trade date and subsequent sale trade date is included in realized gain/(loss) on
investments.
FOREIGN SECURITIES. The Fund may directly purchase securities of foreign
issuers. Investing in securities of foreign issuers involves special risks not
typically associated with investing in securities of U.S. issuers. The risks
include possible revaluation of currencies, the ability to repatriate funds,
less complete financial information about companies, and possible future adverse
political and economic developments. Moreover, securities of many foreign
issuers and their markets may be less liquid and their prices more volatile than
those of securities of comparable U.S. issuers.
FOREIGN TAXES. The Fund may be subject to foreign taxes on income, gains on
investments, or currency repatriation, a portion of which may be recoverable.
The Fund will accrue such taxes and recoveries as applicable, based upon its
current interpretation of tax rules and regulations that exist in the markets in
which it invests.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME. Securities transactions are
accounted for on the trade date with realized gain or loss on investments
determined by using the identified cost method. Interest income (including
amortization of premium and accretion of discount) is recorded on the accrual
basis. Premiums and discounts on debt securities are amortized using the
effective yield to maturity method. Dividend income is recorded on the
ex-dividend date except for certain dividends which are recorded as soon as the
Fund is informed of the dividend.
DETERMINATION OF NET ASSET VALUE AND CALCULATION OF EXPENSES. Certain
administrative expenses are common to, and allocated among, various affiliated
funds. Such allocations are made on the basis of each Fund's average net assets
or other criteria directly affecting the expenses as determined by the Adviser
pursuant to procedures established by the Board.
In calculating the NAV per share of each class, investment income, realized and
unrealized gains and losses, redemption fees, and expenses other than class
specific expenses are allocated daily to each class of shares based upon the
proportion of net assets of each class at the beginning of each day.
Distribution expenses are borne solely by the class incurring the expense.
CUSTODIAN FEE CREDITS AND INTEREST EXPENSE. When cash balances are maintained in
the custody account, the Fund receives credits which are used to offset
custodian fees. The gross expenses paid under the custody arrangement are
included in custodian fees in the Statement of Operations with the corresponding
expense offset, if any, shown as "custodian fee credits". When cash balances are
overdrawn, the Fund is charged an overdraft fee equal to 2.00% above the Federal
Funds rate on outstanding balances. This amount, if any, would be shown as
"interest expense" in the Statement of Operations.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions to shareholders are recorded on the
ex-dividend date. Distributions to shareholders are based on income and capital
gains as determined in accordance with federal income tax regulations, which may
differ from income and capital gains as determined under U.S. generally accepted
accounting principles. These differences are primarily due to differing
treatments of income and gains on various investment securities and foreign
currency transactions held by the Fund, timing differences, and differing
characterizations of distributions made by the Fund. Distributions from net
investment income include net realized gains on foreign currency transactions.
These book/tax differences are either temporary or permanent in nature. To the
extent these differences are permanent, adjustments are made to the appropriate
capital accounts in the period when the differences arise. These
reclassifications have no impact on the NAV of the Fund.
11
THE GAMCO GLOBAL GROWTH FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
The tax character of distributions paid during the fiscal year ended December
31, 2006 was $276,308 of ordinary income.
At December 31, 2006, the Fund had net capital loss carryforwards for federal
income tax purposes of $54,218,953, which are available to reduce future
required distributions of net capital gains to shareholders. $12,969,766 is
available through 2009; $39,969,419 is available through 2010; and $1,279,768 is
available through 2011.
PROVISION FOR INCOME TAXES. The Fund intends to continue to qualify as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended (the "Code"). It is the policy of the Fund to comply with the
requirements of the Code applicable to regulated investment companies and to
distribute substantially all of its net investment company taxable income and
net capital gains. Therefore, no provision for federal income taxes is required.
The following summarizes the tax cost of investments and the related unrealized
appreciation/(depreciation) at June 30, 2007:
GROSS GROSS
UNREALIZED UNREALIZED NET UNREALIZED
COST APPRECIATION DEPRECIATION APPRECIATION
---- ------------ ------------ ------------
Investments ...... $78,989,813 $26,433,657 $(1,123,784) $25,309,873
In July 2006, the FASB issued Interpretation No. 48, "Accounting for Uncertainty
in Income Taxes, an Interpretation of FASB Statement No. 109" ("the
Interpretation"). The Interpretation established for all entities, including
pass-through entities such as the Fund, a minimum threshold for financial
statement recognition of the benefit of positions taken in filing tax returns
(including whether an entity is taxable in a particular jurisdiction), and
required certain expanded tax disclosures. The Interpretation was implemented by
the Fund on June 29, 2007 and applied to all open tax years as of the effective
date. Management has evaluated the application of the Interpretation to the
Fund, and the adoption of the Interpretation had no impact on the amounts
reported in the financial statements.
3. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS. The Fund has entered
into an investment advisory agreement (the "Advisory Agreement") with the
Adviser which provides that the Fund will pay the Adviser a fee, computed daily
and paid monthly, at the annual rate of 1.00% of the value of its 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 Directors of the Fund who are affiliated
persons of the Adviser.
If total net assets of the Corporation are in excess of $100 million, the
Corporation pays each Director that is not considered to be an affiliated person
an annual retainer of $3,000 plus $500 for each Board meeting attended and they
are reimbursed for any out of pocket expenses incurred in attending meetings. If
total net assets of the Corporation are below $100 million, the Corporation pays
each Independent Director an annual retainer of $1,500 plus $250 for each Board
meeting attended and they are reimbursed for any out of pocket expenses incurred
in attending meetings. All Board committee members receive $500 per meeting
attended. Directors who are directors or employees of the Adviser or an
affiliated company receive no compensation or expense reimbursement from the
Fund.
4. DISTRIBUTION PLAN. The Fund's Board has adopted a distribution plan (the
"Plan") for each class of shares pursuant to Rule 12b-1 under the 1940 Act.
Gabelli & Company, Inc. ("Gabelli & Company"), an affiliate of the Adviser,
serves as distributor of the Fund. Under the Class AAA, Class A, Class B, and
Class C Share Plans, payments are authorized to Gabelli & Company at annual
rates of 0.25%, 0.25%, 1.00%, and 1.00%, respectively, of the average daily net
assets of those classes, the annual limitations under each Plan. Such payments
are accrued daily and paid monthly.
12
THE GAMCO GLOBAL GROWTH FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
5. PORTFOLIO SECURITIES. Purchases and proceeds from the sales of securities for
the six months ended June 30, 2007, other than short-term and U.S. Government
Securities, aggregated $23,341,629 and $26,801,316, respectively.
6. TRANSACTIONS WITH AFFILIATES. During the six months ended June 30, 2007, the
Fund paid brokerage commissions of $11,400 to Gabelli & Company. Additionally,
Gabelli & Company informed the Fund that it received $2,582 from investors
representing commissions (sales charges and underwriting fees) on sales and
redemptions of Fund shares.
The cost of calculating the Fund's NAV per share is a Fund expense pursuant to
the Advisory Agreement between the Fund and the Adviser. During the six months
ended June 30, 2007, the Fund paid or accrued $22,621 to the Adviser in
connection with the cost of computing the Fund's NAV.
7. LINE OF CREDIT. Effective June 20, 2007, the Fund participates in an
unsecured line of credit of up to $75,000,000, and may borrow up to 10% of its
net assets from the custodian for temporary borrowing purposes. Prior to June
20, 2007, the line of credit was $25,000,000. Borrowings under this arrangement
bear interest at 0.75% above the Federal Funds rate on outstanding balances.
This amount, if any, would be shown as "interest expense" in the Statement of
Operations. At June 30, 2007, there were no borrowings outstanding under the
line of credit.
The average daily amount of borrowings outstanding from the line of credit
within the six months ended June 30, 2007, was $3,674 with a weighted average
interest rate of 6.02%. The maximum amount borrowed at any time during this
period was $251,000.
8. CAPITAL STOCK TRANSACTIONS. The Fund currently offers four classes of shares
- - Class AAA Shares, Class A Shares, Class B Shares, and Class C Shares.
Effective February 15, 2007, Class AAA Shares are offered only to investors who
were shareholders prior to that date in one or more of the registered funds
distributed by Gabelli & Company. Class AAA Shares are offered to these
investors only through selected broker/dealers, or the transfer agent without a
sales charge. Class A Shares are subject to a maximum front-end sales charge of
5.75%. Class B Shares are subject to a contingent deferred sales charge ("CDSC")
upon redemption within six years of purchase and automatically convert to Class
A Shares approximately eight years after the original purchase. The applicable
CDSC is equal to a declining percentage of the lesser of the NAV per share at
the date of the original purchase or at the date of redemption, based on the
length of time held. Class C Shares are subject to a 1.00% CDSC for one year
after purchase. Class B Shares are available only through exchange of Class B
Shares of other funds distributed by Gabelli & Company. The Board has approved
Class I Shares which have not been offered publicly.
The Fund imposes a redemption fee of 2.00% on Class AAA Shares, Class A Shares,
Class B Shares, and Class C Shares that are redeemed or exchanged on or before
the seventh day after the date of a purchase. The redemption fee is deducted
from the proceeds otherwise payable to the redeeming shareholders and is
retained by the Fund. The redemption fees retained by the Fund during the six
months ended June 30, 2007 and the fiscal year ended December 31, 2006 amounted
to $26 and $148, respectively.
The redemption fee does not apply to redemptions of shares where (i) the shares
were purchased through automatic reinvestment of dividends or other
distributions, (ii) the redemption was initiated by the Fund, (iii) the shares
were purchased through programs that collect the redemption fee at the program
level and remit them to the Fund, or (iv) the shares were purchased through
programs that the Adviser determines to have appropriate anti-short-term trading
policies in place or as to which the Adviser has received assurances that
look-through redemption fee procedures or effective anti-short-term trading
policies and procedures are in place.
13
THE GAMCO GLOBAL GROWTH FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
Transactions in shares of capital stock were as follows:
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
-------------------------- -----------------------------
SHARES AMOUNT SHARES AMOUNT
-------- ----------- ---------- ------------
CLASS AAA CLASS AAA
-------------------------- -----------------------------
Shares sold .......................................... 58,048 $ 1,379,905 263,640 $ 5,632,563
Shares issued upon reinvestment of distributions ..... -- -- 11,428 262,618
Shares redeemed ...................................... (406,396) (9,640,959) (1,183,208) (25,403,007)
-------- ----------- ---------- ------------
Net decrease ....................................... (348,348) $(8,261,054) (908,140) $(19,507,826)
======== =========== ========== ============
CLASS A CLASS A
-------------------------- -----------------------------
Shares sold .......................................... 22,591 $ 552,048 8,807 $ 187,766
Shares issued upon reinvestment of distributions ..... -- -- 126 2,895
Shares redeemed ...................................... (8,820) (208,785) (8,777) (193,466)
-------- ----------- ---------- ------------
Net increase (decrease) ............................ 13,771 $ 343,263 156 $ (2,805)
======== =========== ========== ============
CLASS B CLASS B
-------------------------- -----------------------------
Shares sold .......................................... 646 $ 14,664 -- $ --
Shares redeemed ...................................... (366) (8,010) (2) (60)
-------- ----------- ---------- ------------
Net increase (decrease) ............................ 280 $ 6,654 (2) $ (60)
======== =========== ========== ============
CLASS C CLASS C
-------------------------- -----------------------------
Shares sold .......................................... 968 $ 21,973 9,832 $ 202,102
Shares redeemed ...................................... (3,107) (72,684) (9,339) (187,197)
-------- ----------- ---------- ------------
Net increase (decrease) ............................ (2,139) $ (50,711) 493 $ 14,905
======== =========== ========== ============
9. INDEMNIFICATIONS. The Fund enters into contracts that contain a variety of
indemnifications. The Fund's maximum exposure under these arrangements is
unknown. However, the Fund has not had prior claims or losses pursuant to these
contracts and expects the risk of loss to be remote.
10. OTHER MATTERS. The Adviser and/or affiliates received subpoenas from the
Attorney General of the State of New York and the SEC requesting information on
mutual fund share trading practices involving certain funds managed by the
Adviser. GAMCO Investors, Inc. ("GAMCO"), the Adviser's parent company,
responded to these requests for documents and testimony. In June 2006, GAMCO
began discussions with the SEC regarding a possible resolution of their inquiry.
In February 2007, the Adviser made an offer of settlement to the staff of the
SEC for communication to the Commission for its consideration to resolve this
matter. This offer of settlement is subject to agreement regarding the specific
language of the SEC's administrative order and other settlement documents. On a
separate matter, in September 2005, the Adviser was informed by the staff of the
SEC that the staff may recommend to the Commission that an administrative remedy
and a monetary penalty be sought from the Adviser in connection with the actions
of two of seven closed-end funds managed by the Adviser relating to Section
19(a) and Rule 19a-1 of the 1940 Act. These provisions require registered
investment companies to provide written statements to shareholders when a
dividend is made from a source other than net investment income. While the two
closed-end funds sent annual statements and provided other materials containing
this information, the funds did not send written statements to shareholders with
each distribution in 2002 and 2003. The Adviser believes that all of the funds
are now in compliance. The Adviser believes that these matters would have no
effect on the Fund or any material adverse effect on the Adviser or its ability
to manage the Fund.
14
THE GAMCO GLOBAL GROWTH FUND
FINANCIAL HIGHLIGHTS
================================================================================
Selected data for a share of capital stock outstanding throughout each period:
INCOME
FROM INVESTMENT OPERATIONS DISTRIBUTIONS
-------------------------------------- ---------------------------
Net
Net Asset Net Realized and Total
Period Value, Investment Unrealized from Net
Ended Beginning Income Gain (Loss) on Investment Investment Total
December 31, of Period (Loss)(a) Investments Operations Income Distributions
- ------------ --------- ---------- ------------- ---------- ---------- -------------
CLASS AAA
2007(c) $22.93 $ 0.03 $ 2.21 $ 2.24 -- --
2006 20.43 0.06 2.50 2.56 $(0.06) $(0.06)
2005 17.98 0.02 2.45 2.47 (0.02) (0.02)
2004 16.43 (0.05) 1.60 1.55 -- --
2003 11.62 (0.06) 4.86 4.80 -- --
2002 15.45 (0.08) (3.75) (3.83) -- --
CLASS A
2007(c) $22.93 $ 0.04 $ 2.20 $ 2.24 -- --
2006 20.43 0.06 2.50 2.56 $(0.06) $(0.06)
2005 18.01 0.01 2.45 2.46 (0.04) (0.04)
2004 16.45 (0.05) 1.61 1.56 -- --
2003 11.63 (0.06) 4.87 4.81 -- --
2002 15.47 (0.08) (3.76) (3.84) -- --
CLASS B
2007(c) $21.94 $(0.05) $ 2.11 $ 2.06 -- --
2006 19.65 (0.10) 2.39 2.29 -- --
2005 17.41 (0.12) 2.36 2.24 -- --
2004 16.02 (0.17) 1.56 1.39 -- --
2003 11.42 (0.16) 4.75 4.59 -- --
2002 15.30 (0.17) (3.71) (3.88) -- --
CLASS C
2007(c) $21.87 $(0.05) $ 2.06 $ 2.01 -- --
2006 19.58 (0.09) 2.38 2.29 -- --
2005 17.35 (0.16) 2.39 2.23 -- --
2004 15.97 (0.19) 1.57 1.38 -- --
2003 11.38 (0.16) 4.74 4.58 -- --
2002 15.26 (0.17) (3.71) (3.88) -- --
RATIOS TO AVERAGE
NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------
Net Asset Net Assets Net
Period Value, End of Investment Portfolio
Ended Redemption End of Total Period Income Operating Turnover
December 31, Fees(a) Period Return+ (in 000's) (Loss) Expenses (b) Rate
- ------------ ---------- -------- ------- ---------- --------- ------------ --------
CLASS AAA
2007(c) $0.00(d) $25.17 9.8% $101,958 0.28%(e) 1.76%(e) 23%
2006 0.00(d) 22.93 12.5 100,883 0.26 1.78 46
2005 0.00(d) 20.43 13.7 108,433 0.11 1.79(f) 33
2004 0.00(d) 17.98 9.4 114,011 (0.30) 1.82 100
2003 0.01 16.43 41.4 132,886 (0.45) 1.71 63
2002 -- 11.62 (24.8) 105,034 (0.58) 1.75 82
CLASS A
2007(c) $0.00(d) $25.17 9.8% $ 1,767 0.30%(e) 1.76%(e) 23%
2006 0.00(d) 22.93 12.5 1,294 0.28 1.78 46
2005 0.00(d) 20.43 13.7 1,150 0.03 1.79(f) 33
2004 0.00(d) 18.01 9.5 493 (0.29) 1.82 100
2003 0.01 16.45 41.4 426 (0.45) 1.71 63
2002 -- 11.63 (24.8) 176 (0.58) 1.75 82
CLASS B
2007(c) $0.00(d) $24.00 9.4% $ 253 (0.45)%(e) 2.51%(e) 23%
2006 0.00(d) 21.94 11.7 225 (0.49) 2.53 46
2005 0.00(d) 19.65 12.9 202 (0.67) 2.54(f) 33
2004 0.00(d) 17.41 8.7 183 (1.05) 2.57 100
2003 0.01 16.02 40.3 211 (1.20) 2.46 63
2002 -- 11.42 (25.4) 86 (1.33) 2.50 82
CLASS C
2007(c) $0.00(d) $23.88 9.4% $ 249 (0.44)%(e) 2.50%(e) 23%
2006 0.00(d) 21.87 11.7 275 (0.42) 2.53 46
2005 0.00(d) 19.58 12.9 236 (0.90) 2.52(f) 33
2004 0.00(d) 17.35 8.6 52 (1.17) 2.57 100
2003 0.01 15.97 40.3 207 (1.20) 2.46 63
2002 -- 11.38 (25.4) 101 (1.33) 2.50 82
- ------------
+ 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 distributions and does not reflect applicable
sales charges. Total return for a period of less than one year is not
annualized.
(a) Per share amounts have been calculated using the average shares outstanding
method.
(b) The Fund incurred interest expense during the years ended December 31, 2004
and 2002. If interest expense had not been incurred, the ratios of operating
expenses to average net assets would have been 1.81% and 1.70%, (Class AAA),
1.81% and 1.70%, (Class A), 2.56% and 2.45%, (Class B), and 2.56% and 2.45%,
(Class C), respectively.
(c) For the period ended June 30, 2007, unaudited.
(d) Amount represents less than $0.005 per share.
(e) Annualized.
(f) The ratios do not include a reduction of expenses for custodian fee credits
on cash balances maintained with the custodian. Including such custodian fee
credits, the expense ratios for the year ended December 31, 2005 would have
been 1.79%, 1.79%, 2.53%, and 2.52% for Class AAA, Class A, Class B, and
Class C, respectively.
See accompanying notes to financial statements.
15
GAMCO Global Series Funds, Inc.
THE GAMCO GLOBAL GROWTH 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 per share available daily by calling
800-GABELLI after 6:00 P.M.
BOARD OF DIRECTORS
Mario J. Gabelli, CFA John D. Gabelli
CHAIRMAN AND CHIEF SENIOR VICE PRESIDENT
EXECUTIVE OFFICER GABELLI & COMPANY, INC.
GAMCO INVESTORS, INC.
E. Val Cerutti Werner J. Roeder, MD
CHIEF EXECUTIVE OFFICER MEDICAL DIRECTOR
CERUTTI CONSULTANTS, INC. LAWRENCE HOSPITAL
Anthony J. Colavita Anthonie C. van Ekris
ATTORNEY-AT-LAW CHAIRMAN
ANTHONY J. COLAVITA, P.C. BALMAC INTERNATIONAL, INC.
Arthur V. Ferrara Salvatore J. Zizza
FORMER CHAIRMAN AND CHAIRMAN
CHIEF EXECUTIVE OFFICER ZIZZA & CO., LTD.
GUARDIAN LIFE INSURANCE
COMPANY OF AMERICA
OFFICERS
Bruce N. Alpert James E. McKee
PRESIDENT SECRETARY
Agnes Mullady Peter D. Goldstein
TREASURER CHIEF COMPLIANCE OFFICER
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
GAMCO Global Growth Fund. It is not authorized for distribution to prospective
investors unless preceded or accompanied by an effective prospectus.
- --------------------------------------------------------------------------------
GAB442Q207SR
GAMCO
THE
GAMCO
GLOBAL
GROWTH
FUND
SEMI-ANNUAL REPORT
JUNE 30, 2007
THE GAMCO GLOBAL OPPORTUNITY FUND
SEMI-ANNUAL REPORT
JUNE 30, 2007
TO OUR SHAREHOLDERS,
During the second quarter of 2007, The GAMCO Global Opportunity Fund (the
"Fund") advanced 6.5% while the Morgan Stanley Capital International All Country
("MSCI AC") World Free Index and the Lipper Global Multi-Cap Growth Fund Average
were up 7.4% and 8.0%, respectively. For the six month period ended June 30,
2007, the Fund gained 11.0% versus returns of 10.2% and 11.3% for the MSCI AC
World Free Index and the Lipper Global Multi-Cap Growth Fund Average,
respectively.
COMPARATIVE RESULTS
- ---------------------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL RETURNS THROUGH JUNE 30, 2007 (A)
------------------------------------------------
Since
Year to Inception
Quarter Date 1 Year 3 Year 5 Year (5/11/98)
- ----------------------------------------------------------------------------------------------------------------------
GAMCO GLOBAL OPPORTUNITY FUND CLASS AAA ............. 6.47% 11.03% 19.09% 18.82% 16.33% 10.37%
MSCI AC World Free Index ............................ 7.42 10.19 25.83 18.57 15.44 6.84
Lipper Global Multi-Cap Growth Fund Average ......... 7.97 11.31 25.93 18.28 13.91 7.02
Class A ............................................. 6.44 11.01 18.98 18.83 16.36 10.37
0.32(b) 4.62(b) 12.14(b) 16.50(b) 14.99(b) 9.66(b)
Class B ............................................. 6.22 10.56 18.07 17.91 15.48 9.78
1.22(c) 5.56(c) 13.07(c) 17.18(c) 15.25(c) 9.78
Class C ............................................. 6.25 10.57 18.12 18.18 16.10 10.28
5.25(d) 9.57(d) 17.12(d) 18.18 16.10 10.28
THE CURRENT EXPENSE RATIO FOR CLASS AAA, A, B, AND C SHARES IS 1.95%, 1.95%,
2.70%, AND 2.70%, RESPECTIVELY. CLASS AAA SHARES DO NOT HAVE A SALES CHARGE.
THE MAXIMUM SALES CHARGE FOR CLASS A, B, AND C SHARES IS 5.75%, 5.00%, AND
1.00%, RESPECTIVELY.
(a) RETURNS REPRESENT PAST PERFORMANCE AND DO NOT GUARANTEE FUTURE RESULTS.
TOTAL RETURNS AND AVERAGE ANNUAL RETURNS REFLECT CHANGES IN SHARE PRICE AND
REINVESTMENT OF DISTRIBUTIONS AND ARE NET OF EXPENSES. INVESTMENT RETURNS
AND THE PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE. WHEN SHARES ARE
REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
PERFORMANCE RETURNS FOR PERIODS LESS THAN ONE YEAR ARE NOT ANNUALIZED.
CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE DATA
PRESENTED. VISIT WWW.GABELLI.COM FOR PERFORMANCE INFORMATION AS OF THE MOST
RECENT MONTH END. INVESTORS SHOULD CAREFULLY CONSIDER THE INVESTMENT
OBJECTIVES, RISKS, CHARGES, AND EXPENSES OF THE FUND BEFORE INVESTING. THE
PROSPECTUS CONTAINS MORE INFORMATION ABOUT THIS AND OTHER MATTERS AND
SHOULD BE READ CAREFULLY BEFORE INVESTING. INVESTING IN FOREIGN SECURITIES
INVOLVES RISKS NOT ORDINARILY ASSOCIATED WITH INVESTMENTS IN DOMESTIC
ISSUES, INCLUDING CURRENCY FLUCTUATION, ECONOMIC, AND POLITICAL RISKS.
THE CLASS AAA SHARES' NET ASSET VALUES ("NAV'S") PER SHARE ARE USED TO
CALCULATE PERFORMANCE FOR THE PERIODS PRIOR TO THE ISSUANCE OF CLASS A
SHARES, CLASS B SHARES, AND CLASS C SHARES ON MARCH 12, 2000, AUGUST 16,
2000, AND NOVEMBER 23, 2001, RESPECTIVELY. THE ACTUAL PERFORMANCE FOR THE
CLASS B SHARES AND CLASS C SHARES WOULD HAVE BEEN LOWER FOR THE PERIODS
STARTING PRIOR TO AUGUST 16, 2000 AND NOVEMBER 23, 2001, RESPECTIVELY, DUE
TO THE ADDITIONAL EXPENSES ASSOCIATED WITH THESE CLASSES OF SHARES. RETURNS
WOULD HAVE BEEN LOWER HAD THE ADVISER NOT REIMBURSED CERTAIN EXPENSES OF
THE FUND. THE MSCI AC WORLD FREE INDEX IS AN UNMANAGED INDICATOR OF STOCK
MARKET PERFORMANCE, WHILE THE LIPPER AVERAGE REFLECTS THE AVERAGE
PERFORMANCE OF MUTUAL FUNDS CLASSIFIED IN THIS PARTICULAR CATEGORY.
DIVIDENDS ARE CONSIDERED REINVESTED. YOU CANNOT INVEST DIRECTLY IN AN
INDEX.
(b) INCLUDES THE EFFECT OF THE MAXIMUM 5.75% SALES CHARGE AT THE BEGINNING OF
THE PERIOD.
(c) PERFORMANCE RESULTS INCLUDE THE DEFERRED SALES CHARGES FOR THE CLASS
B SHARES UPON REDEMPTION AT THE END OF THE QUARTER, YEAR TO DATE, ONE YEAR,
THREE YEAR, AND FIVE YEAR PERIODS OF 5%, 5%, 5%, 3%, AND 2%, RESPECTIVELY,
OF THE FUND'S NAV AT THE TIME OF PURCHASE OR SALE, WHICHEVER IS LOWER.
CLASS B SHARES ARE NOT AVAILABLE FOR NEW PURCHASES.
(d) PERFORMANCE RESULTS INCLUDE THE DEFERRED SALES CHARGES FOR THE CLASS
C SHARES UPON REDEMPTION AT THE END OF THE QUARTER, YEAR TO DATE, AND ONE
YEAR PERIODS OF 1% OF THE FUND'S NAV AT THE TIME OF PURCHASE OR SALE,
WHICHEVER IS LOWER.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
We have separated the portfolio managers' commentary from the financial
statements and investment portfolio due to corporate governance regulations
stipulated by the Sarbanes-Oxley Act of 2002. We have done this to ensure that
the content of the portfolio managers' commentary is unrestricted. The
financial statements and investment portfolio are mailed separately from the
commentary. Both the commentary and the financial statements, including the
portfolio of investments, will be available on our website at
www.gabelli.com/funds.
- --------------------------------------------------------------------------------
THE GAMCO GLOBAL OPPORTUNITY FUND
DISCLOSURE OF FUND EXPENSES (UNAUDITED)
For the Six Month Period from January 1, 2007 through June 30, 2007
EXPENSE TABLE
================================================================================
We believe it is important for you to understand the impact of fees and expenses
regarding your investment. All mutual funds have operating expenses. As a
shareholder of a fund, you incur ongoing costs, which include costs for
portfolio management, administrative services, and shareholder reports (like
this one), among others. Operating expenses, which are deducted from a fund's
gross income, directly reduce the investment return of a fund. When a fund's
expenses are expressed as a percentage of its average net assets, this figure is
known as the expense ratio. The following examples are intended to help you
understand the ongoing costs (in dollars) of investing in your Fund and to
compare these costs with those of other mutual funds. The examples are based on
an investment of $1,000 made at the beginning of the period shown and held for
the entire period.
The Expense Table below illustrates your Fund's costs in two ways:
ACTUAL FUND RETURN: This section provides information about actual account
values and actual expenses. You may use this section to help you to estimate the
actual expenses that you paid over the period after any fee waivers and expense
reimbursements. The "Ending Account Value" shown is derived from the Fund's
ACTUAL return during the past six months, and the "Expenses Paid During Period"
shows the dollar amount that would have been paid by an investor who started
with $1,000 in the Fund. You may use this information, together with the amount
you invested, to estimate the expenses that you paid over the period.
To do so, simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
given for your Fund under the heading "Expenses Paid During Period" to estimate
the expenses you paid during this period.
HYPOTHETICAL 5% RETURN: This section provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio. It assumes a hypothetical annualized return of 5% before expenses during
the period shown. In this case - because the hypothetical return used is NOT the
Fund's actual return - the results do not apply to your investment and you
cannot use the hypothetical account value and expense to estimate the actual
ending account balance or expenses you paid for the period. This example is
useful in making comparisons of the ongoing costs of investing in the Fund and
other funds. To do so, compare this 5% hypothetical example with the 5%
hypothetical examples that appear in shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs such as sales
charges (loads), redemption fees, or exchange fees, if any, which are described
in the Prospectus. If these costs were applied to your account, your costs would
be higher. Therefore, the 5% hypothetical return is useful in comparing ongoing
costs only, and will not help you determine the relative total costs of owning
different funds.
Beginning Ending Annualized Expenses
Account Value Account Value Expense Paid During
01/01/07 06/30/07 Ratio Period*
- --------------------------------------------------------------------------------
THE GAMCO GLOBAL OPPORTUNITY FUND
- --------------------------------------------------------------------------------
ACTUAL FUND RETURN
Class AAA $1,000.00 $1,110.30 2.03% $10.68
Class A $1,000.00 $1,110.10 2.03% $10.68
Class B $1,000.00 $1,105.60 2.78% $14.59
Class C $1,000.00 $1,105.70 2.78% $14.59
HYPOTHETICAL 5% RETURN
Class AAA $1,000.00 $1,014.81 2.03% $10.20
Class A $1,000.00 $1,014.81 2.03% $10.20
Class B $1,000.00 $1,011.07 2.78% $13.94
Class C $1,000.00 $1,011.07 2.78% $13.94
* Expenses are equal to the Fund's annualized expense ratio for the last six
months multiplied by the average account value over the period, multiplied by
the number of days in the most recent fiscal half-year, then divided by 365.
2
SUMMARY OF PORTFOLIO HOLDINGS (UNAUDITED)
The following table presents portfolio holdings as a percent of total net assets
as of June 30, 2007:
THE GAMCO GLOBAL OPPORTUNITY FUND
Energy and Utilities .......................... 13.2%
Consumer Products ............................. 12.1%
Health Care ................................... 11.5%
Financial Services ............................ 10.6%
Metals and Mining ............................. 9.3%
Food and Beverage ............................. 7.2%
Computer Software and Services ................ 4.7%
Diversified Industrial ........................ 3.6%
Aerospace ..................................... 3.3%
Telecommunications ............................ 3.3%
Aviation: Parts and Services .................. 3.2%
Machinery ..................................... 3.2%
Building and Construction ..................... 3.1%
Hotels and Gaming ............................. 2.3%
Broadcasting .................................. 1.9%
Entertainment ................................. 1.8%
Wireless Communications ....................... 1.7%
Cable and Satellite ........................... 1.0%
Electronics ................................... 0.9%
Publishing .................................... 0.8%
U.S. Treasury Bills ........................... 0.8%
Retail ........................................ 0.7%
Other Assets and Liabilities (Net) ............ (0.2)%
-------
100.0%
======
THE FUND FILES A COMPLETE SCHEDULE OF PORTFOLIO HOLDINGS WITH THE SECURITIES AND
EXCHANGE COMMISSION (THE "SEC") FOR THE FIRST AND THIRD QUARTERS OF EACH FISCAL
YEAR ON FORM N-Q, THE LAST OF WHICH WAS FILED FOR THE QUARTER ENDED MARCH 31,
2007. SHAREHOLDERS MAY OBTAIN THIS INFORMATION AT WWW.GABELLI.COM OR BY CALLING
THE FUND AT 800-GABELLI (800-422-3554). THE FUND'S FORM N-Q IS AVAILABLE ON THE
SEC'S WEBSITE AT WWW.SEC.GOV AND MAY ALSO BE REVIEWED AND COPIED AT THE SEC'S
PUBLIC REFERENCE ROOM IN WASHINGTON, DC. INFORMATION ON THE OPERATION OF THE
PUBLIC REFERENCE ROOM MAY BE OBTAINED BY CALLING 1-800-SEC-0330.
PROXY VOTING
The Fund files Form N-PX with its complete proxy voting record for the 12 months
ended June 30th, no later than August 31st of each year. A description of the
Fund's proxy voting policies, procedures, and how the Fund voted proxies
relating to portfolio securities is available without charge, upon request, by
(i) calling 800-GABELLI (800-422-3554); (ii) writing to The Gabelli Funds at One
Corporate Center, Rye, NY 10580-1422; or (iii) visiting the SEC's website at
www.sec.gov.
3
THE GAMCO GLOBAL OPPORTUNITY FUND
SCHEDULE OF INVESTMENTS -- JUNE 30, 2007 (UNAUDITED)
================================================================================
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS -- 99.4%
AEROSPACE -- 3.3%
3,000 L-3 Communications
Holdings Inc. .................. $ 127,720 $ 292,170
5,500 Lockheed Martin Corp. ............ 135,166 517,715
------------ ------------
262,886 809,885
------------ ------------
AVIATION: PARTS AND SERVICES -- 3.2%
6,400 Precision Castparts Corp. ........ 94,880 776,704
------------ ------------
BROADCASTING -- 1.9%
20,000 Mediaset SpA ..................... 195,380 206,598
4,000 Modern Times Group MTG
AB, Cl. B ...................... 140,956 257,809
------------ ------------
336,336 464,407
------------ ------------
BUILDING AND CONSTRUCTION -- 3.1%
4,125 CRH plc, Dublin .................. 47,794 203,854
11,000 CRH plc, London .................. 139,783 541,596
------------ ------------
187,577 745,450
------------ ------------
CABLE AND SATELLITE -- 1.0%
7,000 Cablevision Systems Corp.,
Cl. A+ ........................ 67,535 253,330
------------ ------------
COMPUTER SOFTWARE AND SERVICES -- 4.7%
5,000 eBay Inc.+ ....................... 175,275 160,900
700 Google Inc., Cl. A+ .............. 220,948 366,366
11,500 Microsoft Corp. .................. 301,125 338,905
5,000 Square Enix Co. Ltd. ............. 121,465 126,288
5,000 Yahoo! Inc.+ ..................... 169,373 135,650
------------ ------------
988,186 1,128,109
------------ ------------
CONSUMER PRODUCTS -- 12.1%
5,000 Altadis SA ....................... 153,235 330,447
10,000 Assa Abloy AB, Cl. B ............. 189,995 220,051
4,000 Christian Dior SA ................ 227,736 517,629
11,000 Compagnie Financiere
Richemont SA, Cl. A ............ 231,884 657,484
8,500 Escada AG+ ....................... 207,340 372,766
4,000 Fortune Brands Inc. .............. 328,419 329,480
4,000 Procter & Gamble Co. ............. 221,128 244,760
5,000 UST Inc. ......................... 244,216 268,550
------------ ------------
1,803,953 2,941,167
------------ ------------
DIVERSIFIED INDUSTRIAL -- 3.6%
6,000 Bouygues SA ...................... 216,198 502,712
9,500 General Electric Co. ............. 320,183 363,660
------------ ------------
536,381 866,372
------------ ------------
ELECTRONICS -- 0.9%
1,000 Fanuc Ltd. ....................... 101,607 103,213
500 Keyence Corp. .................... 112,873 109,231
------------ ------------
214,480 212,444
------------ ------------
MARKET
SHARES COST VALUE
------ ---- -------
ENERGY AND UTILITIES -- 13.2%
7,000 Connecticut Water
Service Inc. ................... $ 158,291 $ 170,590
6,600 Imperial Oil Ltd. ................ 222,619 307,246
30,000 Kanto Natural Gas
Development Co. Ltd. ........... 153,608 204,486
9,000 Mueller Water Products Inc.,
Cl. B .......................... 137,238 135,000
3,500 Petroleo Brasileiro SA, ADR ...... 105,807 424,445
10,000 Saipem SpA ....................... 210,831 341,204
7,200 Schlumberger Ltd. ................ 238,374 611,568
3,000 Suncor Energy Inc. ............... 101,766 269,760
35,000 Tokai Carbon Co. Ltd. ............ 152,714 327,470
4,000 Transocean Inc.+ ................. 164,064 423,920
------------ ------------
1,645,312 3,215,689
------------ ------------
ENTERTAINMENT -- 1.8%
20,000 Publishing and
Broadcasting Ltd. .............. 98,225 331,434
5,000 Time Warner Inc. ................. 85,437 105,200
------------ ------------
183,662 436,634
------------ ------------
FINANCIAL SERVICES -- 10.6%
4,500 American Express Co. ............. 260,351 275,310
15,000 Bank of Ireland .................. 92,773 302,203
25,000 Capitalia SpA .................... 262,025 247,998
9,750 Julius Baer Holding Ltd. AG ...... 347,201 697,610
1,600 Legg Mason Inc. .................. 141,880 157,408
1,500 Partners Group ................... 212,041 201,272
20,000 The Shizuoka Bank Ltd. ........... 203,072 202,934
8,000 UBS AG ........................... 336,926 480,080
------------ ------------
1,856,269 2,564,815
------------ ------------
FOOD AND BEVERAGE -- 7.2%
19,000 Cadbury Schweppes plc ............ 187,570 257,876
6,000 Cermaq ASA ....................... 93,252 104,161
5,000 General Mills Inc. ............... 248,004 292,100
5,000 Heineken Holding NV .............. 233,716 258,537
175,000 Marine Harvest+ .................. 195,506 188,965
5,000 PepsiCo Inc. ..................... 261,500 324,250
1,500 Pernod-Ricard SA ................. 301,572 331,181
------------ ------------
1,521,120 1,757,070
------------ ------------
HEALTH CARE -- 11.5%
6,000 Cochlear Ltd. .................... 246,988 309,810
4,208 GlaxoSmithKline plc .............. 126,084 109,618
6,000 Novartis AG ...................... 232,122 336,844
3,500 Roche Holding AG ................. 305,337 620,153
5,000 St. Jude Medical Inc.+ ........... 192,663 207,450
1,200 Straumann Holding AG ............. 254,333 336,402
2,500 Synthes Inc. ..................... 255,485 300,655
See accompanying notes to financial statements.
4
THE GAMCO GLOBAL OPPORTUNITY FUND
SCHEDULE OF INVESTMENTS (CONTINUED) -- JUNE 30, 2007 (UNAUDITED)
================================================================================
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
HEALTH CARE (CONTINUED)
4,200 Takeda Pharmaceutical
Co. Ltd. ....................... $ 263,783 $ 271,326
3,000 William Demant Holding
A/S+ ........................... 141,483 297,126
------------ ------------
2,018,278 2,789,384
------------ ------------
HOTELS AND GAMING -- 2.3%
8,392 InterContinental Hotels
Group plc ...................... 207,348 208,463
15,000 Ladbrokes plc .................... 121,994 129,680
100,000 Mandarin Oriental
International Ltd. ............. 221,081 223,000
------------ ------------
550,423 561,143
------------ ------------
MACHINERY -- 3.2%
3,000 Bobst Group AG ................... 196,729 188,392
4,500 CNH Global NV .................... 129,912 229,905
4,000 Outotec Oyj ...................... 213,475 219,540
1,000 SMC Corp. ........................ 124,201 132,925
------------ ------------
664,317 770,762
------------ ------------
METALS AND MINING -- 9.3%
17,726 Andsberg Ltd.+ (a) ............... 8,277 15,754
73,630 Antofagasta plc .................. 88,100 902,408
43,000 Gold Fields Ltd., ADR ............ 186,535 675,100
10,000 Harmony Gold Mining
Co. Ltd.+ ...................... 56,555 142,086
24,000 Harmony Gold Mining Co.
Ltd., ADR+ .................... 130,306 342,480
3,500 Peabody Energy Corp. ............. 179,978 169,330
------------ ------------
649,751 2,247,158
------------ ------------
PUBLISHING -- 0.8%
40,000 Independent News &
Media plc ...................... 98,736 202,749
------------ ------------
RETAIL -- 0.7%
6,300 Seven & I Holdings Co. Ltd. ...... 218,236 180,088
------------ ------------
TELECOMMUNICATIONS -- 3.3%
3,000 Alltel Corp. ..................... 128,045 202,650
15,675 Sprint Nextel Corp. .............. 255,701 324,629
2,300 Telephone & Data Systems
Inc. ........................... 45,066 143,911
2,300 Telephone & Data Systems
Inc., Special .................. 41,599 132,365
------------ ------------
470,411 803,555
------------ ------------
WIRELESS COMMUNICATIONS -- 1.7%
4,500 United States Cellular Corp.+ .... 254,809 407,700
------------ ------------
TOTAL COMMON STOCKS .............. 14,623,538 24,134,615
------------ ------------
PRINCIPAL MARKET
AMOUNT COST VALUE
-------- ---- -------
CORPORATE BONDS -- 0.0%
TELECOMMUNICATIONS -- 0.0%
$200,000 Williams Communications
Group Inc., Escrow,
10.875%, 10/01/09+ (a)(b) ...... $ 0 $ 0
------------ ------------
U.S. GOVERNMENT OBLIGATIONS -- 0.8%
199,000 U.S. Treasury Bill,
4.886%++, 08/16/07 ............. 197,817 197,817
------------ ------------
TOTAL
INVESTMENTS -- 100.2% .......... $ 14,821,355 24,332,432
============
OTHER ASSETS AND LIABILITIES (NET) -- (0.2)% ..... (51,026)
------------
NET ASSETS -- 100.0% ............................. $ 24,281,406
============
- ----------------
(a) Security fair valued under procedures established by the Board of
Directors. The procedures may include reviewing available financial
information about the company and reviewing valuation of comparable
securities and other factors on a regular basis. At June 30, 2007, the
market value of fair valued securities amounted to $15,754 or 0.06% of
total net assets.
(b) Security is in default.
+ Non-income producing security.
++ Represents annualized yield at date of purchase.
ADR American Depository Receipt
% OF
MARKET MARKET
GEOGRAPHIC DIVERSIFICATION VALUE VALUE
- -------------------------- -------- -------
Europe ................................ 44.4% $10,789,163
North America ......................... 34.5 8,401,466
Latin America ......................... 6.9 1,682,933
Japan ................................. 6.8 1,657,960
South Africa .......................... 4.8 1,159,666
Asia/Pacific .......................... 2.6 641,244
------ -----------
100.0% $24,332,432
====== ===========
See accompanying notes to financial statements.
5
THE GAMCO GLOBAL OPPORTUNITY FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2007 (UNAUDITED)
================================================================================
ASSETS:
Investments, at value (cost $14,821,355) ...... $ 24,332,432
Foreign currency, at value (cost $31,823) ..... 32,109
Dividends receivable .......................... 31,613
Receivable for Fund shares sold ............... 5,867
Prepaid expense ............................... 1,067
------------
TOTAL ASSETS .................................. 24,403,088
------------
LIABILITIES:
Payable to custodian .......................... 46,511
Payable for Fund shares redeemed .............. 2,020
Payable for investment advisory fees .......... 22,678
Payable for distribution fees ................. 5,181
Payable for legal and audit fees .............. 20,303
Payable for shareholder
communications expenses ..................... 12,785
Payable for shareholder services fees ......... 6,302
Payable for Directors' fees ................... 17
Other accrued expenses ........................ 5,885
------------
TOTAL LIABILITIES ............................. 121,682
------------
NET ASSETS applicable to 1,200,511
shares outstanding .......................... $ 24,281,406
============
NET ASSETS CONSIST OF:
Paid-in capital, each class at $0.001 par value $ 19,444,542
Accumulated distributions in excess of
net investment income ....................... (27,359)
Accumulated net realized loss on investments
and foreign currency transactions ........... (4,647,542)
Net unrealized appreciation on investments .... 9,511,077
Net unrealized appreciation on foreign
currency translations ....................... 688
------------
NET ASSETS .................................... $ 24,281,406
============
SHARES OF CAPITAL STOCK:
CLASS AAA:
Net Asset Value, offering and redemption price
per share ($24,087,622 / 1,190,897 shares
outstanding; 75,000,000 shares authorized) .. $20.23
======
CLASS A:
Net Asset Value and redemption price per share
($183,240 / 9,083 shares outstanding;
50,000,000 shares authorized) ............... $20.17
======
Maximum offering price per share (NAV / 0.9425,
based on maximum sales charge of 5.75% of
the offering price) ......................... $21.40
======
CLASS B:
Net Asset Value and offering price per share
($6,030 / 309.7 shares outstanding;
25,000,000 shares authorized) ............... $19.47(a)
======
CLASS C:
Net Asset Value and offering price per share
($4,514 / 221.3 shares outstanding;
25,000,000 shares authorized) ............... $20.40(a)
======
- ---------------
(a) Redemption price varies based on the length of time held.
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2007 (UNAUDITED)
================================================================================
INVESTMENT INCOME:
Dividends (net of foreign taxes of $12,727) ... $ 263,750
Interest ...................................... 9,257
-----------
TOTAL INVESTMENT INCOME ....................... 273,007
-----------
EXPENSES:
Investment advisory fees ...................... 115,946
Distribution fees - Class AAA ................. 28,703
Distribution fees - Class A ................... 260
Distribution fees - Class B ................... 73
Distribution fees - Class C ................... 21
Shareholder communications expenses ........... 15,233
Legal and audit fees .......................... 14,472
Registration expenses ......................... 14,202
Shareholder services fees ..................... 11,177
Custodian fees ................................ 8,209
Recovery of reimbursed expenses (see Note 3) .. 5,638
Interest expense .............................. 3,143
Directors' fees ............................... 1,278
Miscellaneous expenses ........................ 16,751
-----------
TOTAL EXPENSES ................................ 235,106
-----------
NET INVESTMENT INCOME ......................... 37,901
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY:
Net realized gain on investments .............. 1,354,728
Net realized loss on foreign
currency transactions ....................... (799)
-----------
Net realized gain on investments and
foreign currency transactions ............... 1,353,929
-----------
Net change in unrealized appreciation/
depreciation on investments ................. 959,697
Net change in unrealized appreciation/
depreciation on foreign currency translations 64
-----------
Net change in unrealized appreciation/
depreciation on investments and
foreign currency translations ............... 959,761
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCY ......... 2,313,690
-----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ............................. $ 2,351,591
===========
See accompanying notes to financial statements.
6
THE GAMCO GLOBAL OPPORTUNITY FUND
STATEMENT OF CHANGES IN NET ASSETS
================================================================================
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
------------ -----------------
OPERATIONS:
Net investment income (loss) ........................................ $ 37,901 $ (101,772)
Net realized gain on investments and foreign currency transactions .. 1,353,929 1,180,871
Net change in unrealized appreciation/depreciation on investments and
foreign currency translations ..................................... 959,761 1,986,484
------------ ------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ................ 2,351,591 3,065,583
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income
Class AAA ......................................................... -- (3,855)
Class A ........................................................... -- (124)
------------ ------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS ................................. -- (3,979)
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Class AAA ......................................................... (1,666,365) (1,022,036)
Class A ........................................................... (58,873) (57,936)
Class B ........................................................... (20,354) (27,495)
------------ ------------
NET DECREASE IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS .......... (1,745,592) (1,107,467)
------------ ------------
REDEMPTION FEES ..................................................... 11 499
------------ ------------
NET INCREASE IN NET ASSETS .......................................... 606,010 1,954,636
NET ASSETS:
Beginning of period ................................................. 23,675,396 21,720,760
------------ ------------
End of period (including undistributed net investment income of
$0 and $0, respectively) .......................................... $ 24,281,406 $ 23,675,396
============ ============
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
================================================================================
1. ORGANIZATION. The GAMCO Global Opportunity Fund (the "Fund"), formerly, The
Gabelli Global Opportunity Fund, a series of GAMCO Global Series Funds, Inc.
(the "Corporation"), formerly, Gabelli Global Series Funds, Inc., was organized
on July 16, 1993 as a Maryland corporation. The Fund is a non-diversified
open-end management investment company registered under the Investment Company
Act of 1940, as amended (the "1940 Act"), and one of four separately managed
portfolios (collectively, the "Portfolios") of the Corporation. The Fund's
primary objective is capital appreciation. The Fund commenced investment
operations on May 11, 1998.
2. SIGNIFICANT ACCOUNTING POLICIES. The preparation of financial statements in
accordance with United States ("U.S.") generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could differ
from those estimates. The following is a summary of significant accounting
policies followed by the Fund in the preparation of its financial statements.
SECURITY VALUATION. Portfolio securities listed or traded on a nationally
recognized securities exchange or traded in the U.S. over-the-counter market for
which market quotations are readily available are valued at the last quoted sale
price or a market's official closing price as of the close of business on the
day the securities are being valued. If there were no sales that day, the
security is valued at the average of the closing bid and asked prices or, if
there were no asked prices quoted on that day, then the security is valued at
the closing bid price on that day. If no bid
7
THE GAMCO GLOBAL OPPORTUNITY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
or asked prices are quoted on such day, the security is valued at the most
recently available price or, if the Board of Directors (the "Board") so
determines, by such other method as the Board shall determine in good faith to
reflect its fair market value. Portfolio securities traded on more than one
national securities exchange or market are valued according to the broadest and
most representative market, as determined by Gabelli Funds, LLC (the "Adviser").
Portfolio securities primarily traded on a foreign market are generally valued
at the preceding closing values of such securities on the relevant market, but
may be fair valued pursuant to procedures established by the Board if market
conditions change significantly after the close of the foreign market but prior
to the close of business on the day the securities are being valued. Debt
instruments with remaining maturities of 60 days or less that are not credit
impaired are valued at amortized cost, unless the Board determines such amount
does not reflect the securities' fair value, in which case these securities will
be fair valued as determined by the Board. Debt instruments having a maturity
greater than 60 days for which market quotations are readily available are
valued at the average of the latest bid and asked prices. If there were no asked
prices quoted on such day, the security is valued using the closing bid price.
Futures contracts are valued at the closing settlement price of the exchange or
board of trade on which the applicable contract is traded.
Securities and assets for which market quotations are not readily available are
fair valued as determined by the Board. Fair valuation methodologies and
procedures may include, but are not limited to: analysis and review of available
financial and non-financial information about the company; comparisons to the
valuation and changes in valuation of similar securities, including a comparison
of foreign securities to the equivalent U.S. dollar value ADR securities at the
close of the U.S. exchange; and evaluation of any other information that could
be indicative of the value of the security.
In September 2006, the Financial Accounting Standards Board (the "FASB") issued
Statement of Financial Accounting Standards ("SFAS") 157, Fair Value
Measurements, which clarifies the definition of fair value and requires
companies to expand their disclosure about the use of fair value to measure
assets and liabilities in interim and annual periods subsequent to initial
recognition. Adoption of SFAS 157 requires the use of the price that would be
received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. SFAS 157 is
effective for financial statements issued for fiscal years beginning after
November 15, 2007, and interim periods within those fiscal years. At this time,
management is in the process of reviewing the requirements of SFAS 157 against
its current valuation policies to determine future applicability.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with
primary government securities dealers recognized by the Federal Reserve Board,
with member banks of the Federal Reserve System, or with other brokers or
dealers that meet credit guidelines established by the Adviser and reviewed by
the Board. Under the terms of a typical repurchase agreement, the Fund takes
possession of an underlying debt obligation subject to an obligation of the
seller to repurchase, and the Fund to resell, the obligation at an agreed-upon
price and time, thereby determining the yield during the Fund's holding period.
The Fund will always receive and maintain securities as collateral whose market
value, including accrued interest, will be at least equal to 102% of the dollar
amount invested by the Fund in each agreement. The Fund will make payment for
such securities only upon physical delivery or upon evidence of book entry
transfer of the collateral to the account of the custodian. To the extent that
any repurchase transaction exceeds one business day, the value of the collateral
is marked-to-market on a daily basis to maintain the adequacy of the collateral.
If the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited. At June,
2007, there were no open repurchase agreements.
8
THE GAMCO GLOBAL OPPORTUNITY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
SECURITIES SOLD SHORT. The Fund may enter into short sale transactions. Short
selling involves selling securities that may or may not be owned and, at times,
borrowing the same securities for delivery to the purchaser, with an obligation
to replace such borrowed securities at a later date. The proceeds received from
short sales are recorded as liabilities and the Fund records an unrealized gain
or loss to the extent of the difference between the proceeds received and the
value of an open short position on the day of determination. The Fund records a
realized gain or loss when the short position is closed out. By entering into a
short sale, the Fund bears the market risk of an unfavorable change in the price
of the security sold short. Dividends on short sales are recorded as an expense
by the Fund on the ex-dividend date and interest expense is recorded on the
accrual basis. The Fund did not hold any short positions as of June 30, 2007.
FORWARD FOREIGN EXCHANGE CONTRACTS. The Fund may engage in forward foreign
exchange contracts for hedging a specific transaction with respect to either the
currency in which the transaction is denominated or another currency as deemed
appropriate by the Adviser. Forward foreign exchange contracts are valued at the
forward rate and are marked-to-market daily. The change in market value is
included in unrealized appreciation/depreciation on investments and foreign
currency translations. When the contract is closed, the Fund records a realized
gain or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
The use of forward foreign exchange contracts does not eliminate fluctuations in
the underlying prices of the Fund's portfolio securities, but it does establish
a rate of exchange that can be achieved in the future. Although forward foreign
exchange contracts limit the risk of loss due to a decline in the value of the
hedged currency, they also limit any potential gain that might result should the
value of the currency increase. In addition, the Fund could be exposed to risks
if the counterparties to the contracts are unable to meet the terms of their
contracts. At June 30, 2007, there were no open forward foreign exchange
contracts.
FOREIGN CURRENCY TRANSLATIONS. The books and records of the Fund are maintained
in U.S. dollars. Foreign currencies, investments, and other assets and
liabilities are translated into U.S. dollars at the current exchange rates.
Purchases and sales of investment securities, income, and expenses are
translated at the exchange rate prevailing on the respective dates of such
transactions. Unrealized gains and losses that result from changes in foreign
exchange rates and/or changes in market prices of securities have been included
in unrealized appreciation/depreciation on investments and foreign currency
translations. Net realized foreign currency gains and losses resulting from
changes in exchange rates include foreign currency gains and losses between
trade date and settlement date on investment securities transactions, foreign
currency transactions, and the difference between the amounts of interest and
dividends recorded on the books of the Fund and the amounts actually received.
The portion of foreign currency gains and losses related to fluctuation in
exchange rates between the initial trade date and subsequent sale trade date is
included in realized gain/(loss) on investments.
FOREIGN SECURITIES. The Fund may directly purchase securities of foreign
issuers. Investing in securities of foreign issuers involves special risks not
typically associated with investing in securities of U.S. issuers. The risks
include possible revaluation of currencies, the ability to repatriate funds,
less complete financial information about companies, and possible future adverse
political and economic developments. Moreover, securities of many foreign
issuers and their markets may be less liquid and their prices more volatile than
those of securities of comparable U.S. issuers.
9
THE GAMCO GLOBAL OPPORTUNITY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
FOREIGN TAXES. The Fund may be subject to foreign taxes on income, gains on
investments, or currency repatriation, a portion of which may be recoverable.
The Fund will accrue such taxes and recoveries as applicable, based upon its
current interpretation of tax rules and regulations that exist in the markets in
which it invests.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME. Securities transactions are
accounted for on the trade date with realized gain or loss on investments
determined by using the identified cost method. Interest income (including
amortization of premium and accretion of discount) is recorded on the accrual
basis. Premiums and discounts on debt securities are amortized using the
effective yield to maturity method. Dividend income is recorded on the
ex-dividend date except for certain dividends which are recorded as soon as the
Fund is informed of the dividend.
DETERMINATION OF NET ASSET VALUE AND CALCULATION OF EXPENSES. Certain
administrative expenses are common to, and allocated among, various affiliated
funds. Such allocations are made on the basis of each Fund's average net assets
or other criteria directly affecting the expenses as determined by the Adviser
pursuant to procedures established by the Board.
In calculating the NAV per share of each class, investment income, realized and
unrealized gains and losses, redemption fees, and expenses other than class
specific expenses are allocated daily to each class of shares based upon the
proportion of net assets of each class at the beginning of each day.
Distribution expenses are borne solely by the class incurring the expense.
CUSTODIAN FEE CREDITS AND INTEREST EXPENSE. When cash balances are maintained in
the custody account, the Fund receives credits which are used to offset
custodian fees. The gross expenses paid under the custody arrangement are
included in custodian fees in the Statement of Operations with the corresponding
expense offset, if any, shown as "custodian fee credits". When cash balances are
overdrawn, the Fund is charged an overdraft fee equal to 2.00% above the Federal
Funds rate on outstanding balances. This amount, if any, would be shown as
"interest expense" in the Statement of Operations.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions to shareholders are recorded on the
ex-dividend date. Distributions to shareholders are based on income and capital
gains as determined in accordance with federal income tax regulations, which may
differ from income and capital gains as determined under U.S. generally accepted
accounting principles. These differences are primarily due to differing
treatments of income and gains on various investment securities and foreign
currency transactions held by the Fund, timing differences, and differing
characterizations of distributions made by the Fund. Distributions from net
investment income include net realized gains on foreign currency transactions.
These book/tax differences are either temporary or permanent in nature. To the
extent these differences are permanent, adjustments are made to the appropriate
capital accounts in the period when the differences arise. These
reclassifications have no impact on the NAV of the Fund.
The tax character of distributions paid during the fiscal year ended December
31, 2006 was $3,979 of ordinary income.
PROVISION FOR INCOME TAXES. The Fund intends to continue to qualify as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended (the "Code"). It is the policy of the Fund to comply with the
requirements of the Code applicable to regulated investment companies and to
distribute substantially all of its net investment company taxable income and
net capital gains. Therefore, no provision for federal income taxes is required.
10
THE GAMCO GLOBAL OPPORTUNITY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
At December 31, 2006, The Fund had net capital loss carryforwards for federal
income tax purposes of $6,001,443, which are available to reduce future required
distributions of net capital gains to shareholders. $1,119,397 of the loss
carryforward is available through 2009; $1,904,804 is available through 2010;
$1,776,091 is available through 2011; and $1,201,151 is available through 2012.
The following summarizes the tax cost of investments and the related unrealized
appreciation/(depreciation) at June 30, 2007:
GROSS GROSS
UNREALIZED UNREALIZED NET UNREALIZED
COST APPRECIATION DEPRECIATION APPRECIATION
---- ------------ ------------ ------------
Investments ...... $14,821,382 $9,670,130 $(159,080) $9,511,050
In July 2006, the FASB issued Interpretation No. 48, "Accounting for Uncertainty
in Income Taxes, an Interpretation of FASB Statement No. 109" ("the
Interpretation"). The Interpretation established for all entities, including
pass-through entities such as the Fund, a minimum threshold for financial
statement recognition of the benefit of positions taken in filing tax returns
(including whether an entity is taxable in a particular jurisdiction), and
required certain expanded tax disclosures. The Interpretation was implemented by
the Fund on June 29, 2007 and applied to all open tax years as of the effective
date. Management has evaluated the application of the Interpretation to the
Fund, and the adoption of the Interpretation had no impact on the amounts
reported in the financial statements.
3. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS. The Fund has entered
into an investment advisory agreement (the "Advisory Agreement") with the
Adviser which provides that the Fund will pay the Adviser a fee, computed daily
and paid monthly, at the annual rate of 1.00% of the value of its 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 Directors of the Fund who are affiliated
persons of the Adviser. Effective January 1, 2007, the Adviser has contractually
agreed to waive its investment advisory fee and/or to reimburse expenses of the
Fund to the extent necessary to maintain the annualized total operating expenses
of the Fund (excluding brokerage, interest, taxes, and extraordinary expenses)
at no more than 2.00%, 2.00%, 2.75%, and 2.75% of the value of the Fund's
average daily net assets for Class AAA, Class A, Class B, and Class C,
respectively. In addition, the Fund has agreed, during the two year period
following any waiver or reimbursement by the Adviser, to repay such amount to
the extent, that after giving the effect to the repayment, such adjusted
annualized total operating expenses of the Fund would not exceed 2.00%, 2.00%,
2.75%, and 2.75% of the value of the Fund's average daily net assets for Class
AAA, Class A, Class B, and Class C, respectively. The cumulative amount which
the Fund may repay the Adviser is $20,594. For the six months ended June 30,
2007, the Fund repaid the Adviser $5,638.
If total net assets of the Corporation are in excess of $100 million, the
Corporation pays each Director that is not considered to be an affiliated person
an annual retainer of $3,000 plus $500 for each Board meeting attended and they
are reimbursed for any out of pocket expenses incurred in attending meetings. If
total net assets of the Corporation are below $100 million, the Corporation pays
each Independent Director an annual retainer of $1,500 plus $250 for each Board
meeting attended and they are reimbursed for any out of pocket expenses incurred
in attending meetings. All Board committee members receive $500 per meeting
attended. Directors who are directors or employees of the Adviser or an
affiliated company receive no compensation or expense reimbursement from the
Fund.
11
THE GAMCO GLOBAL OPPORTUNITY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
4. DISTRIBUTION PLAN. The Fund's Board has adopted a distribution plan (the
"Plan") for each class of shares pursuant to Rule 12b-1 under the 1940 Act.
Gabelli & Company, Inc. ("Gabelli & Company"), an affiliate of the Adviser,
serves as distributor of the Fund. Under the Class AAA, Class A, Class B, and
Class C Share Plans, payments are authorized to Gabelli & Company at annual
rates of 0.25%, 0.25%, 1.00%, and 1.00%, respectively, of the average daily net
assets of those classes, the annual limitations 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, 2007, other than short-term securities, aggregated
$3,474,776 and $4,991,598, respectively.
6. TRANSACTIONS WITH AFFILIATES. During the six months ended June 30, 2007, the
Fund paid brokerage commissions of $1,352 to Gabelli & Company. Additionally,
Gabelli & Company informed the Fund that it received $14 from investors
representing commissions (sales charges and underwriting fees) on sales and
redemptions of Fund shares.
7. LINE OF CREDIT. Effective June 20, 2007, the Fund participates in an
unsecured line of credit of up to $75,000,000, and may borrow up to 10% of its
net assets from the custodian for temporary borrowing purposes. Prior to June
20, 2007, the line of credit was $25,000,000. Borrowings under this arrangement
bear interest at 0.75% above the Federal Funds rate on outstanding balances.
This amount, if any, would be shown as "interest expense" in the Statement of
Operations. At June 30, 2007, there were no borrowings outstanding under the
line of credit.
The average daily amount of borrowings outstanding from the line of credit
within the six months ended June 30, 2007 was $89,331 with a related weighted
average interest rate of 6.03%. The maximum amount borrowed at any time during
this period was $1,097,000.
8. CAPITAL STOCK TRANSACTIONS. The Fund currently offers four classes of shares
- - Class AAA Shares, Class A Shares, Class B Shares, and Class C Shares. Class
AAA Shares are offered only to investors who acquire them directly from Gabelli
& Company, or through selected broker/dealers, or the transfer agent without a
sales charge. Class A Shares are subject to a maximum front-end sales charge of
5.75%. Class B Shares are subject to a contingent deferred sales charge ("CDSC")
upon redemption within six years of purchase and automatically convert to Class
A Shares approximately eight years after the original purchase. The applicable
CDSC is equal to a declining percentage of the lesser of the NAV per share at
the date of the original purchase or at the date of redemption, based on the
length of time held. Class C Shares are subject to a 1.00% CDSC for one year
after purchase. Class B Shares are available only through exchange of Class B
Shares of other funds distributed by Gabelli & Company. The Board has approved
Class I Shares which have not been offered publicly.
The Fund imposes a redemption fee of 2.00% on Class AAA Shares, Class A Shares,
Class B Shares, and Class C Shares that are redeemed or exchanged on or before
the seventh day after the date of a purchase. The redemption fee is deducted
from the proceeds otherwise payable to the redeeming shareholders and is
retained by the Fund. The redemption fees retained by the Fund during the six
months ended June 30, 2007 and the fiscal year ended December 31, 2006 amounted
to $11 and $499, respectively.
The redemption fee does not apply to redemptions of shares where (i) the shares
were purchased through automatic reinvestment of dividends or other
distributions, (ii) the redemption was initiated by the Fund, (iii) the shares
were purchased through programs that collect the redemption fee at the program
level and remit them to the Fund, or (iv) the shares were purchased through
programs that the Adviser determines to have appropriate anti-short-term trading
policies in place or as to which the Adviser has received assurances that
look-through redemption fee procedures or effective anti-short-term trading
policies and procedures are in place.
12
THE GAMCO GLOBAL OPPORTUNITY FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
Transactions in shares of capital stock were as follows:
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
-------------------------- -----------------------------
SHARES AMOUNT SHARES AMOUNT
-------- ----------- ---------- ------------
CLASS AAA CLASS AAA
-------------------------- -----------------------------
Shares sold .......................................... 170,897 $ 3,345,354 283,265 $ 4,840,122
Shares issued upon reinvestment of distributions ..... -- -- 206 3,759
Shares redeemed ...................................... (265,482) (5,011,719) (344,742) (5,865,917)
-------- ----------- ---------- ------------
Net decrease ....................................... (94,585) $(1,666,365) (61,271) $ (1,022,036)
======== =========== ========== ============
CLASS A CLASS A
-------------------------- -----------------------------
Shares sold .......................................... 499 $ 9,905 3,963 $ 67,574
Shares issued upon reinvestment of distributions ..... -- -- 5 97
Shares redeemed ...................................... (3,518) (68,778) (7,241) (125,607)
-------- ----------- ---------- ------------
Net decrease ....................................... (3,019) $ (58,873) (3,273) $ (57,936)
======== =========== ========== ============
CLASS B CLASS B
-------------------------- -----------------------------
Shares redeemed ...................................... (1,112) $ (20,354) (1,701) $ (27,495)
-------- ----------- ---------- ------------
Net decrease ....................................... (1,112) $ (20,354) (1,701) $ (27,495)
======== =========== ========== ============
9. INDEMNIFICATIONS. The Fund enters into contracts that contain a variety of
indemnifications. The Fund's maximum exposure under these arrangements is
unknown. However, the Fund has not had prior claims or losses pursuant to these
contracts and expects the risk of loss to be remote.
10. OTHER MATTERS. The Adviser and/or affiliates received subpoenas from the
Attorney General of the State of New York and the SEC requesting information on
mutual fund share trading practices involving certain funds managed by the
Adviser. GAMCO Investors, Inc. ("GAMCO"), the Adviser's parent company,
responded to these requests for documents and testimony. In June 2006, GAMCO
began discussions with the SEC regarding a possible resolution of their inquiry.
In February 2007, the Adviser made an offer of settlement to the staff of the
SEC for communication to the Commission for its consideration to resolve this
matter. This offer of settlement is subject to agreement regarding the specific
language of the SEC's administrative order and other settlement documents. On a
separate matter, in September 2005, the Adviser was informed by the staff of the
SEC that the staff may recommend to the Commission that an administrative remedy
and a monetary penalty be sought from the Adviser in connection with the actions
of two of seven closed-end funds managed by the Adviser relating to Section
19(a) and Rule 19a-1 of the 1940 Act. These provisions require registered
investment companies to provide written statements to shareholders when a
dividend is made from a source other than net investment income. While the two
closed-end funds sent annual statements and provided other materials containing
this information, the funds did not send written statements to shareholders with
each distribution in 2002 and 2003. The Adviser believes that all of the funds
are now in compliance. The Adviser believes that these matters would have no
effect on the Fund or any material adverse effect on the Adviser or its ability
to manage the Fund.
13
THE GAMCO GLOBAL OPPORTUNITY FUND
FINANCIAL HIGHLIGHTS
================================================================================
Selected data for a share of capital stock outstanding throughout each period:
INCOME
FROM INVESTMENT OPERATIONS DISTRIBUTIONS
-------------------------------------- ---------------------------
Net
Net Asset Net Realized and Total
Period Value, Investment Unrealized from Net
Ended Beginning Income Gain (Loss) on Investment Investment Total Redemption
December 31, of Period (Loss)(a) Investments Operations Income Distributions Fees(a)
- ------------ --------- ---------- ------------- ---------- ---------- ------------- ----------
CLASS AAA
2007(d) $18.22 $ 0.03 $ 1.98 $ 2.01 -- -- $0.00(e)
2006 15.91 (0.08) 2.39 2.31 $(0.00)(e) $(0.00)(e) 0.00(e)
2005 13.84 0.01 2.08 2.09 (0.02) (0.02) 0.00(e)
2004 12.18 0.03 1.68 1.71 (0.05) (0.05) 0.00(e)
2003 8.87 0.00(e) 3.29 3.29 (0.01) (0.01) 0.03
2002 10.02 0.00(e) (1.15) (1.15) -- -- --
CLASS A
2007(d) $18.17 $ 0.02 $ 1.98 $ 2.00 -- -- $0.00(e)
2006 15.87 (0.08) 2.39 2.31 $(0.01) $(0.01) 0.00(e)
2005 13.81 0.01 2.09 2.10 (0.04) (0.04) 0.00(e)
2004 12.16 0.03 1.67 1.70 (0.05) (0.05) 0.00(e)
2003 8.86 0.00(e) 3.28 3.28 (0.01) (0.01) 0.03
2002 9.99 0.00(e) (1.13) (1.13) -- -- --
CLASS B
2007(d) $17.61 $(0.08) $ 1.94 $ 1.86 -- -- $0.00(e)
2006 15.49 (0.19) 2.31 2.12 -- -- 0.00(e)
2005 13.56 (0.08) 2.01 1.93 -- -- 0.00(e)
2004 12.00 (0.07) 1.66 1.59 $(0.03) $(0.03) 0.00(e)
2003 8.80 (0.07) 3.24 3.17 -- -- 0.03
2002 10.00 (0.07) (1.13) (1.20) -- -- --
CLASS C
2007(d) $18.45 $(0.04) $ 1.99 $ 1.95 -- -- $0.00(e)
2006 16.22 (0.21) 2.44 2.23 -- -- 0.00(e)
2005 14.17 (0.10) 2.15 2.05 -- -- 0.00(e)
2004 12.39 0.07 1.71 1.78 -- -- 0.00(e)
2003 9.00 (0.07) 3.43 3.36 -- -- 0.03
2002 10.11 (0.07) (1.04) (1.11) -- -- --
RATIOS TO AVERAGE
NET ASSETS/SUPPLEMENTAL DATA
------------------------------------------------------------------
Net Asset Net Assets Net Operating Operating
Period Value, End of Investment Expenses Expenses Portfolio
Ended End of Total Period Income Before Net of Turnover
December 31, Period Return+ (in 000's) (Loss) Reimbursement Reimbursement(b)(c) Rate
- ------------ -------- ------- ---------- --------- ------------- ------------------- --------
CLASS AAA
2007(d) $20.23 11.0% $24,088 0.33% 2.03%(f)(g) 2.03%(f) 15%
2006 18.22 14.5 23,426 (0.44) 2.02(g) 2.02(h) 15
2005 15.91 15.1 21,425 0.10 2.04 1.85(h) 26
2004 13.84 14.0 21,033 0.25 2.00 1.50 35
2003 12.18 37.4 19,305 0.04 1.83 1.52 13
2002 8.87 (11.5) 15,000 (0.05) 2.39 1.59 0
CLASS A
2007(d) $20.17 11.0% $ 183 0.24% 2.03%(f)(g) 2.03%(f) 15%
2006 18.17 14.5 220 (0.45) 2.02(g) 2.02(h) 15
2005 15.87 15.2 244 0.05 2.06 1.87(h) 26
2004 13.81 14.0 106 0.26 2.00 1.50 35
2003 12.16 37.4 67 0.04 1.83 1.52 13
2002 8.86 (11.3) 36 (0.05) 2.39 1.59 0
CLASS B
2007(d) $19.47 10.6% $ 6 (0.92)% 2.78%(f)(g) 2.78%(f) 15%
2006 17.61 13.7 25 (1.14) 2.77(g) 2.77(h) 15
2005 15.49 14.2 48 (0.60) 2.79 2.58(h) 26
2004 13.56 13.2 52 (0.53) 2.75 2.25 35
2003 12.00 36.4 12 (0.71) 2.58 2.27 13
2002 8.80 (12.0) 9 (0.80) 3.14 2.34 0
CLASS C
2007(d) $20.40 10.6% $ 5 (0.41)% 2.78%(f)(g) 2.78%(f) 15%
2006 18.45 13.8 4 (1.20) 2.77(g) 2.77(h) 15
2005 16.22 14.5 4 (0.66) 2.79 2.68(h) 26
2004 14.17 14.4 0.1 0.58 2.75 2.25 35
2003 12.39 37.7 0.1 (0.71) 2.58 2.27 13
2002 9.00 (11.0) 0.1 (0.80) 3.14 2.34 0
- ----------
+ 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 distributions and does not reflect applicable
sales charges. Total return for a period of less than one year is not
annualized.
(a) Per share data is calculated using the average shares outstanding method.
(b) The Fund incurred interest expense during the fiscal years ended December
31, 2004, 2003, and 2002. If interest expense had not been incurred, the
ratios of operating expenses to average net assets would have been 1.50%,
1.50%, 2.25% and 2.25% for Class AAA, Class A, Class B, and Class C,
respectively for each year.
(c) The Fund incurred interest expense during the six months ended June 30, 2007
and the fiscal years ended December 31, 2006 and 2005. If interest expense
had not been incurred, the ratios of operating expenses to average net
assets would have been 2.00%, 2.00%, and 1.84% (Class AAA), 2.00%, 2.00%,
and 1.86% (Class A), 2.75%, 2.75%, and 2.57% (Class B), and 2.75%, 2.75% and
2.68% (Class C), respectively.
(d) For the period ended June 30, 2007, unaudited.
(e) Amount represents less than $0.005 per share.
(f) Annualized.
(g) Under an expense deferral agreement with the Adviser, the Fund repaid the
Adviser $5,638 during the six months ended June 30, 2007 and $14,200 during
2006, representing previously reimbursed expenses from the Adviser. During
the six months ended June 30, 2007 and the fiscal year ended December 31,
2006, had such payment not been made, the expense ratio would have been
1.98% and 1.95% (Class AAA), 1.98% and 1.95% (Class A), 2.73% and 2.70%
(Class B), and 2.73% and 2.70% (Class C), respectively.
(h) The ratios do not include a reduction of expenses for custodian fee credits
on cash balances maintained with the custodian. Including such custodian fee
credits, the expense ratios for the fiscal year ended December 31, 2005
would have been 1.84%, 1.87%, 2.58%, and 2.68% for Class AAA, Class A, Class
B, and Class C, respectively. For the fiscal year ended December 31, 2006,
the effect of the custodian fee credits was minimal.
See accompanying notes to financial statements.
14
- --------------------------------------------------------------------------------
GABELLI/GAMCO FUNDS AND YOUR PERSONAL PRIVACY
================================================================================
WHO ARE WE?
The Gabelli/GAMCO Funds are investment companies registered with the
Securities and Exchange Commission under the Investment Company Act of
1940. We are managed by Gabelli Funds, LLC and Gabelli Advisers, Inc.,
which are affiliated with GAMCO Investors, Inc. GAMCO Investors, Inc. is a
publicly held company that has subsidiaries that provide investment
advisory or brokerage services for a variety of clients.
WHAT KIND OF NON-PUBLIC INFORMATION DO WE COLLECT ABOUT YOU IF YOU BECOME A
SHAREHOLDER?
If you apply to open an account directly with us, you will be giving us
some non-public information about yourself. The non-public information we
collect about you is:
o INFORMATION YOU GIVE US ON YOUR APPLICATION FORM. This could include
your name, address, telephone number, social security number, bank
account number, and other information.
o INFORMATION ABOUT YOUR TRANSACTIONS WITH US, ANY TRANSACTIONS WITH OUR
AFFILIATES, AND TRANSACTIONS WITH THE ENTITIES WE HIRE TO PROVIDE
SERVICES TO YOU. This would include information about the shares that
you buy or redeem. If we hire someone else to provide services--like a
transfer agent--we will also have information about the transactions
that you conduct through them.
WHAT INFORMATION DO WE DISCLOSE AND TO WHOM DO WE DISCLOSE IT?
We do not disclose any non-public personal information about our customers
or former customers to anyone other than our affiliates, our service
providers who need to know such information, and as otherwise permitted by
law. If you want to find out what the law permits, you can read the privacy
rules adopted by the Securities and Exchange Commission. They are in volume
17 of the Code of Federal Regulations, Part 248. The Commission often posts
information about its regulations on its web site, www.sec.gov.
WHAT DO WE DO TO PROTECT YOUR PERSONAL INFORMATION?
We restrict access to non-public personal information about you to the
people who need to know that information in order to provide services to
you or the Fund and to ensure that we are complying with the laws governing
the securities business. We maintain physical, electronic, and procedural
safeguards to keep your personal information confidential.
- --------------------------------------------------------------------------------
GAMCO Global Series Funds, Inc.
THE GAMCO GLOBAL OPPORTUNITY 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 per share available daily by calling
800-GABELLI after 6:00 P.M.
BOARD OF DIRECTORS
Mario J. Gabelli, CFA John D. Gabelli
CHAIRMAN AND CHIEF SENIOR VICE PRESIDENT
EXECUTIVE OFFICER GABELLI & COMPANY, INC.
GAMCO INVESTORS, INC.
E. Val Cerutti Werner J. Roeder, MD
CHIEF EXECUTIVE OFFICER MEDICAL DIRECTOR
CERUTTI CONSULTANTS, INC. LAWRENCE HOSPITAL
Anthony J. Colavita Anthonie C. van Ekris
ATTORNEY-AT-LAW CHAIRMAN
ANTHONY J. COLAVITA, P.C. BALMAC INTERNATIONAL, INC.
Arthur V. Ferrara Salvatore J. Zizza
FORMER CHAIRMAN AND CHAIRMAN
CHIEF EXECUTIVE OFFICER ZIZZA & CO., LTD.
GUARDIAN LIFE INSURANCE
COMPANY OF AMERICA
OFFICERS
Bruce N. Alpert James E. McKee
PRESIDENT SECRETARY
Agnes Mullady Peter D. Goldstein
TREASURER CHIEF COMPLIANCE OFFICER
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
GAMCO Global Opportunity Fund. It is not authorized for distribution to
prospective investors unless preceded or accompanied by an effective prospectus.
- --------------------------------------------------------------------------------
GAB403Q207SR
GAMCO
THE
GAMCO
GLOBAL
OPPORTUNITY
FUND
SEMI-ANNUAL REPORT
JUNE 30, 2007
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
SEMI-ANNUAL REPORT
JUNE 30, 2007
TO OUR SHAREHOLDERS,
During the second quarter of 2007, The GAMCO Global Telecommunications
Fund (the "Fund") rose 9.0%, while the Morgan Stanley Capital International All
Country ("MSCI AC") World Telecommunication Services Index was up 10.3% and the
MSCI AC World Free Index advanced 7.4%. For the six month period ended June 30,
2007, the Fund was up 14.1% versus gains of 14.7% and 10.2% for the MSCI AC
World Telecommunication Services Index and the MSCI AC World Free Index,
respectively.
COMPARATIVE RESULTS
- ---------------------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL RETURNS THROUGH JUNE 30, 2007 (A)
------------------------------------------------
Since
Year to Inception
Quarter Date 1 Year 3 Year 5 Year 10 Year (11/1/93)
- ---------------------------------------------------------------------------------------------------------------------
GAMCO GLOBAL TELECOMMUNICATIONS FUND
CLASS AAA .............................. 8.97% 14.07% 40.01% 21.96% 22.47% 11.96% 11.72%
MSCI AC World Telecommunication
Services Index* ........................ 10.30 14.70 43.70 -- -- -- --
MSCI AC World Free Index ................. 7.42 10.19 25.83 18.57 15.44 7.64 9.46
Class A .................................. 9.03 14.13 40.14 21.97 22.48 11.97 11.73
2.76(b) 7.57(b) 32.08(b) 19.58(b) 21.04(b) 11.31(b) 11.24(b)
Class B .................................. 8.74 13.61 38.99 21.04 21.54 11.38 11.29
3.74(c) 8.61(c) 33.99(c) 20.35(c) 21.36(c) 11.38 11.29
Class C .................................. 8.71 13.56 38.94 21.02 21.54 11.37 11.28
7.71(d) 12.56(d) 37.94(d) 21.02 21.54 11.37 11.28
THE CURRENT EXPENSE RATIO FOR CLASS AAA, A, B, AND C SHARES IS 1.56%, 1.56%,
2.31%, AND 2.31%, RESPECTIVELY. CLASS AAA SHARES DO NOT HAVE A SALES CHARGE.
THE MAXIMUM SALES CHARGE FOR CLASS A, B, AND C SHARES IS 5.75%, 5.00%, AND
1.00%, RESPECTIVELY.
(a) RETURNS REPRESENT PAST PERFORMANCE AND DO NOT GUARANTEE FUTURE RESULTS.
TOTAL RETURNS AND AVERAGE ANNUAL RETURNS REFLECT CHANGES IN SHARE PRICE AND
REINVESTMENT OF DISTRIBUTIONS AND ARE NET OF EXPENSES. INVESTMENT RETURNS
AND THE PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE. WHEN SHARES ARE
REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
PERFORMANCE RETURNS FOR PERIODS LESS THAN ONE YEAR ARE NOT ANNUALIZED.
CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE DATA
PRESENTED. VISIT WWW.GABELLI.COM FOR PERFORMANCE INFORMATION AS OF THE MOST
RECENT MONTH END. INVESTORS SHOULD CAREFULLY CONSIDER THE INVESTMENT
OBJECTIVES, RISKS, CHARGES, AND EXPENSES OF THE FUND BEFORE INVESTING. THE
PROSPECTUS CONTAINS MORE INFORMATION ABOUT THIS AND OTHER MATTERS AND
SHOULD BE READ CAREFULLY BEFORE INVESTING. THE CLASS AAA SHARES' NET ASSET
VALUES ("NAV'S") PER SHARE ARE USED TO CALCULATE PERFORMANCE FOR THE
PERIODS PRIOR TO THE ISSUANCE OF CLASS A SHARES, CLASS B SHARES, AND CLASS
C SHARES ON MARCH 12, 2000, MARCH 13, 2000, AND JUNE 2, 2000, RESPECTIVELY.
THE ACTUAL PERFORMANCE FOR THE CLASS B SHARES AND CLASS C SHARES WOULD HAVE
BEEN LOWER DUE TO THE ADDITIONAL EXPENSES ASSOCIATED WITH THESE CLASSES OF
SHARES. INVESTING IN FOREIGN SECURITIES INVOLVES RISKS NOT ORDINARILY
ASSOCIATED WITH INVESTMENTS IN DOMESTIC ISSUES, INCLUDING CURRENCY
FLUCTUATION, ECONOMIC, AND POLITICAL RISKS. THE MSCI AC WORLD
TELECOMMUNICATION SERVICES INDEX AND THE MSCI AC WORLD FREE INDEX ARE
UNMANAGED INDICATORS OF GLOBAL STOCK MARKET PERFORMANCE. DIVIDENDS ARE
CONSIDERED REINVESTED. YOU CANNOT INVEST DIRECTLY IN AN INDEX.
(b) INCLUDES THE EFFECT OF THE MAXIMUM 5.75% SALES CHARGE AT THE BEGINNING
OF THE PERIOD.
(c) PERFORMANCE RESULTS INCLUDE THE DEFERRED SALES CHARGES FOR THE CLASS B
SHARES UPON REDEMPTION AT THE END OF THE QUARTER, YEAR TO DATE, ONE YEAR,
THREE YEAR, AND FIVE YEAR PERIODS OF 5%, 5%, 5%, 3%, AND 2%, RESPECTIVELY,
OF THE FUND'S NAV AT THE TIME OF PURCHASE OR SALE, WHICHEVER IS LOWER.
CLASS B SHARES ARE NOT AVAILABLE FOR NEW PURCHASES.
(d) PERFORMANCE RESULTS INCLUDE THE DEFERRED SALES CHARGES FOR THE CLASS
C SHARES UPON REDEMPTION AT THE END OF THE QUARTER, YEAR TO DATE, AND ONE
YEAR PERIODS OF 1% OF THE FUND'S NAV AT THE TIME OF PURCHASE OR SALE,
WHICHEVER IS LOWER.
* NOT USED AS A BENCHMARK INDEX PRIOR TO JUNE 30, 2006.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
We have separated the portfolio managers' commentary from the financial
statements and investment portfolio due to corporate governance regulations
stipulated by the Sarbanes-Oxley Act of 2002. We have done this to ensure that
the content of the portfolio managers' commentary is unrestricted. The
financial statements and investment portfolio are mailed separately from the
commentary. Both the commentary and the financial statements, including the
portfolio of investments, will be available on our website at
www.gabelli.com/funds.
- --------------------------------------------------------------------------------
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
DISCLOSURE OF FUND EXPENSES (UNAUDITED)
For the Six Month Period from January 1, 2007 through June 30, 2007
EXPENSE TABLE
================================================================================
We believe it is important for you to understand the impact of fees and expenses
regarding your investment. All mutual funds have operating expenses. As a
shareholder of a fund, you incur ongoing costs, which include costs for
portfolio management, administrative services, and shareholder reports (like
this one), among others. Operating expenses, which are deducted from a fund's
gross income, directly reduce the investment return of a fund. When a fund's
expenses are expressed as a percentage of its average net assets, this figure is
known as the expense ratio. The following examples are intended to help you
understand the ongoing costs (in dollars) of investing in your Fund and to
compare these costs with those of other mutual funds. The examples are based on
an investment of $1,000 made at the beginning of the period shown and held for
the entire period.
The Expense Table below illustrates your Fund's costs in two ways:
ACTUAL FUND RETURN: This section provides information about actual account
values and actual expenses. You may use this section to help you to estimate the
actual expenses that you paid over the period after any fee waivers and expense
reimbursements. The "Ending Account Value" shown is derived from the Fund's
ACTUAL return during the past six months, and the "Expenses Paid During Period"
shows the dollar amount that would have been paid by an investor who started
with $1,000 in the Fund. You may use this information, together with the amount
you invested, to estimate the expenses that you paid over the period.
To do so, simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
given for your Fund under the heading "Expenses Paid During Period" to estimate
the expenses you paid during this period.
HYPOTHETICAL 5% RETURN: This section provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio. It assumes a hypothetical annualized return of 5% before expenses during
the period shown. In this case - because the hypothetical return used is NOT the
Fund's actual return - the results do not apply to your investment and you
cannot use the hypothetical account value and expense to estimate the actual
ending account balance or expenses you paid for the period. This example is
useful in making comparisons of the ongoing costs of investing in the Fund and
other funds. To do so, compare this 5% hypothetical example with the 5%
hypothetical examples that appear in shareholder reports of other funds. Please
note that the expenses shown in the table are meant to highlight your ongoing
costs only and do not reflect any transactional costs such as sales charges
(loads), redemption fees, or exchange fees, if any, which are described in the
Prospectus. If these costs were applied to your account, your costs would be
higher. Therefore, the 5% hypothetical return is useful in comparing ongoing
costs only, and will not help you determine the relative total costs of owning
different funds.
Beginning Ending Annualized Expenses
Account Value Account Value Expense Paid During
01/01/07 06/30/07 Ratio Period*
- --------------------------------------------------------------------------------
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
- --------------------------------------------------------------------------------
ACTUAL FUND RETURN
Class AAA $1,000.00 $1,140.70 1.49% $ 7.95
Class A $1,000.00 $1,141.30 1.49% $ 7.95
Class B $1,000.00 $1,136.10 2.24% $11.93
Class C $1,000.00 $1,135.60 2.24% $11.93
HYPOTHETICAL 5% RETURN
Class AAA $1,000.00 $1,017.50 1.49% $ 7.49
Class A $1,000.00 $1,017.50 1.49% $ 7.49
Class B $1,000.00 $1,013.76 2.24% $11.25
Class C $1,000.00 $1,013.76 2.24% $11.25
* Expenses are equal to the Fund's annualized expense ratio for the last six
months multiplied by the average account value over the period, multiplied by
the number of days in the most recent fiscal half-year, then divided by 365.
2
SUMMARY OF PORTFOLIO HOLDINGS (UNAUDITED)
The following table presents portfolio holdings as a percent of total net assets
as of June 30, 2007:
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND:
Diversified Telecommunications Services ....... 39.2%
Wireless Telecommunications Services .......... 33.8%
Other ......................................... 18.9%
U.S. Government Obligations ................... 8.9%
Other Assets and Liabilities (Net) ............ (0.8)%
-------
100.0%
======
THE FUND FILES A COMPLETE SCHEDULE OF PORTFOLIO HOLDINGS WITH THE SECURITIES AND
EXCHANGE COMMISSION (THE "SEC") FOR THE FIRST AND THIRD QUARTERS OF EACH FISCAL
YEAR ON FORM N-Q, THE LAST OF WHICH WAS FILED FOR THE QUARTER ENDED MARCH 31,
2007. SHAREHOLDERS MAY OBTAIN THIS INFORMATION AT WWW.GABELLI.COM OR BY CALLING
THE FUND AT 800-GABELLI (800-422-3554). THE FUND'S FORM N-Q IS AVAILABLE ON THE
SEC'S WEBSITE AT WWW.SEC.GOV AND MAY ALSO BE REVIEWED AND COPIED AT THE SEC'S
PUBLIC REFERENCE ROOM IN WASHINGTON, DC. INFORMATION ON THE OPERATION OF THE
PUBLIC REFERENCE ROOM MAY BE OBTAINED BY CALLING 1-800-SEC-0330.
PROXY VOTING
The Fund files Form N-PX with its complete proxy voting record for the 12 months
ended June 30th, no later than August 31st of each year. A description of the
Fund's proxy voting policies, procedures, and how the Fund voted proxies
relating to portfolio securities is available without charge, upon request, by
(i) calling 800-GABELLI (800-422-3554); (ii) writing to The Gabelli Funds at One
Corporate Center, Rye, NY 10580-1422; or (iii) visiting the SEC's website at
www.sec.gov.
3
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
SCHEDULE OF INVESTMENTS -- JUNE 30, 2007 (UNAUDITED)
================================================================================
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS -- 91.7%
DIVERSIFIED TELECOMMUNICATIONS SERVICES -- 39.2%
ASIA/PACIFIC -- 3.3%
20,000 Asia Satellite
Telecommunications
Holdings Ltd., ADR ............. $ 431,039 $ 406,500
170,000 First Pacific Co. Ltd. ........... 92,079 122,839
20,000 First Pacific Co. Ltd., ADR ...... 30,145 72,270
10 Korea Thrunet Co. Ltd.+ (a) ...... 5,250 0
10,000 KT Corp., ADR .................... 183,666 234,600
2,000 Pakistan Telecommunications
Co. Ltd., GDR (b) .............. 155,765 188,523
100,000 PCCW Ltd. ........................ 81,405 61,515
72,000 Philippine Long Distance
Telephone Co., ADR ............. 1,383,105 4,118,400
18,360 PT Telekomunikasi
Indonesia, ADR ................. 165,504 791,316
874,000 Singapore
Telecommunications Ltd. ........ 701,513 1,941,271
25,000 Telecom Corp. of New
Zealand Ltd., ADR .............. 515,375 698,000
350,000 Telekom Malaysia Berhad .......... 1,547,135 1,044,171
8,000 Telkom SA Ltd. ................... 193,801 201,938
2,400 Telstra Corp. Ltd., ADR .......... 47,304 46,730
8,075 Thai Telephone & Telecom,
GDR+ (b)(c) .................... 100,542 727
1,000,000 True Corp. Public Co. Ltd.+ ...... 687,194 228,096
------------ ------------
6,320,822 10,156,896
------------ ------------
EUROPE -- 16.4%
39,000 BT Group plc, ADR ................ 1,474,439 2,596,620
300,000 Cable & Wireless plc ............. 544,359 1,171,734
8,960 Colt Telecom Group SA+ ........... 39,631 26,449
370,000 Deutsche Telekom AG, ADR ......... 4,629,240 6,811,700
175,000 Elisa Oyj, Cl. A ................. 2,162,268 4,789,199
38,000 France Telecom SA, ADR ........... 1,021,948 1,044,240
17,500 Golden Telecom Inc. .............. 183,065 962,675
5,507 Hellenic Telecommunications
Organization SA ................ 86,065 170,685
36,000 Hellenic Telecommunications
Organization SA, ADR ........... 218,770 559,800
18,000 Hungarian Telephone &
Cable Corp.+ ................... 139,278 360,180
500 Magyar Telekom
Telecommunications
plc, ADR ....................... 9,650 13,930
42,000 Maroc Telecom .................... 660,247 654,287
15,000 Metromedia International
Group Inc.+ .................... 59,576 19,950
65,000 Neuf Cegetel+ .................... 1,906,725 2,554,781
20,000 Portugal Telecom SGPS SA ......... 235,355 276,917
68,000 Portugal Telecom SGPS
SA, ADR ........................ 277,645 944,520
MARKET
SHARES COST VALUE
------ ---- -------
10,000 Rostelecom, ADR .................. $ 79,578 $ 570,000
57,000 Royal KPN NV, ADR ................ 472,195 946,770
90,000 Sistema JSFC, GDR (b) ............ 1,714,268 2,556,000
98,000 Swisscom AG, ADR ................. 2,548,286 3,341,800
2,120,000 Telecom Italia SpA ............... 4,155,401 5,824,728
27,000 Telecom Italia SpA, ADR .......... 621,934 741,420
100,000 Telefonica SA, ADR ............... 2,634,654 6,676,000
6,361 Telefonica SA, BDR ............... 108,406 140,146
101,000 Telekom Austria AG ............... 1,753,734 2,528,930
15,000 Telenor ASA+ ..................... 278,729 294,432
650,000 TeliaSonera AB ................... 2,791,663 4,799,538
------------ ------------
30,807,109 51,377,431
------------ ------------
JAPAN -- 0.5%
237 Nippon Telegraph &
Telephone Corp. ................ 1,207,105 1,052,905
22,000 Nippon Telegraph &
Telephone Corp., ADR ........... 622,716 487,740
------------ ------------
1,829,821 1,540,645
------------ ------------
LATIN AMERICA -- 4.3%
33,250 Atlantic Tele-Network Inc. ....... 112,178 952,280
12,000 Brasil Telecom Participacoes
SA, ADR ........................ 595,898 725,520
44 Brasil Telecom SA, Preference 474 319
17,415,054 Cable & Wireless
Jamaica Ltd.+ .................. 406,745 226,021
148,000 Compania de
Telecomunicaciones de
Chile SA, ADR .................. 2,049,285 1,407,480
25,693 Tele Norte Leste
Participacoes SA, ADR .......... 357,296 487,396
205,000 Telecom Argentina SA, ADR+ ....... 751,529 5,108,600
55,000 Telefonica de Argentina
SA, ADR ........................ 348,883 1,070,300
87,000 Telefonos de Mexico SAB de
CV, Cl. L, ADR ................. 643,919 3,296,430
3,355 Telemar Norte Leste SA,
Preference, Cl. A .............. 148,531 92,702
------------ ------------
5,414,738 13,367,048
------------ ------------
NORTH AMERICA -- 14.7%
165,000 AT&T Inc. ........................ 4,777,613 6,847,500
220,000 BCE Inc. ......................... 6,264,669 8,313,800
47,836 Bell Aliant Regional
Communications Income
Fund ........................... 882,832 1,407,800
39,371 Bell Aliant Regional
Communications Income
Fund+ (a)(b)(c) ................ 726,607 1,158,689
13,000 CenturyTel Inc. .................. 396,150 637,650
500,000 Cincinnati Bell Inc.+ ............ 3,124,004 2,890,000
65,000 Citizens Communications Co. ...... 857,408 992,550
10,000 Covad Communications
Group Inc.+ .................... 15,401 9,000
See accompanying notes to financial statements.
4
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
SCHEDULE OF INVESTMENTS (CONTINUED) -- JUNE 30, 2007 (UNAUDITED)
================================================================================
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
DIVERSIFIED TELECOMMUNICATIONS SERVICES (CONTINUED)
NORTH AMERICA (CONTINUED)
90,060 D&E Communications Inc. .......... $ 1,210,418 $ 1,651,700
10,000 E.Spire Communications Inc.+ ..... 50,000 9
3,230 EarthLink Inc.+ .................. 45,250 24,128
20,000 Embarq Corp. ..................... 492,315 1,267,400
55,000 FairPoint Communications,
Inc. ........................... 1,135,892 976,250
80,000 General Communication
Inc., Cl. A+ ................... 376,995 1,024,800
10,000 Manitoba Telecom
Services Inc. .................. 371,015 440,178
22,422 McLeodUSA Inc., Cl. A+ ........... 78,431 110
130,000 McLeodUSA Inc., Cl. A,
Escrow+ (a) .................... 0 0
3,000 New Ulm Telecom Inc. ............. 39,216 39,390
1,000 North Pittsburgh
Systems Inc. ................... 19,772 21,250
20,000 NorthPoint Communications
Group Inc.+ .................... 11,250 36
120,000 Price Communications Corp. ....... 1,858,269 2,667,600
285,000 Qwest Communications
International Inc.+ ............ 996,478 2,764,500
11,000 Shenandoah
Telecommunications Co. ......... 138,825 559,130
45,000 TELUS Corp. ...................... 873,965 2,693,875
33,057 TELUS Corp., Non-Voting .......... 827,048 1,947,268
8,943 TELUS Corp., Non-Voting,
ADR ............................ 396,587 527,542
120,000 Time Warner Telecom Inc.,
Cl. A+ ......................... 2,273,301 2,412,000
100,000 Verizon Communications Inc. ...... 3,737,255 4,117,000
43,000 Windstream Corp. ................. 305,536 634,680
------------ ------------
32,282,502 46,025,835
------------ ------------
TOTAL DIVERSIFIED
TELECOMMUNICATIONS
SERVICES ....................... 76,654,992 122,467,855
------------ ------------
WIRELESS TELECOMMUNICATIONS SERVICES -- 33.6%
ASIA/PACIFIC -- 2.7%
80,000 China Mobile Ltd., ADR ........... 1,165,904 4,312,000
75,000 China Unicom Ltd., ADR ........... 628,819 1,292,250
666 Hutchison
Telecommunications
International Ltd. ............. 519 859
8,000 PT Indosat Tbk, ADR .............. 78,652 290,000
90,000 SK Telecom Co. Ltd., ADR ......... 1,068,189 2,461,500
------------ ------------
2,942,083 8,356,609
------------ ------------
EUROPE -- 6.3%
56,000 Bouygues SA ...................... 1,573,032 4,713,595
20,000 Millicom International
Cellular SA+ ................... 1,498,087 1,832,800
800 Mobile TeleSystems
OJSC, ADR ...................... 29,612 48,456
MARKET
SHARES COST VALUE
------ ---- -------
10,000 Orascom Telecom Holding
SAE, GDR ....................... $ 653,276 $ 649,000
60,000 Vimpel-Communications,
ADR ............................ 639,115 6,321,600
100,000 Vivendi .......................... 2,087,247 4,318,874
54,100 Vodafone Group plc, ADR .......... 1,419,746 1,819,383
------------ ------------
7,900,115 19,703,708
------------ ------------
JAPAN -- 2.6%
600 KDDI Corp. ....................... 3,016,473 4,449,137
2,400 NTT DoCoMo Inc. .................. 5,827,909 3,801,015
------------ ------------
8,844,382 8,250,152
------------ ------------
LATIN AMERICA -- 4.5%
208,000 America Movil SAB de
CV, Cl. L, ADR ................. 1,103,854 12,881,440
17,500 Grupo Iusacell SA de CV+ ......... 29,040 257,555
460 Tele Norte Celular
Participacoes SA, ADR+ ......... 7,079 5,032
1,150 Telemig Celular
Participacoes SA, ADR .......... 30,497 57,891
14,900 Tim Participacoes SA, ADR ........ 438,054 513,603
3,020 Vivo Participacoes SA+ ........... 6,747 24,079
23,976 Vivo Participacoes SA, ADR ....... 316,130 120,120
13,024 Vivo Participacoes SA,
Preference ..................... 159,589 64,749
------------ ------------
2,090,990 13,924,469
------------ ------------
NORTH AMERICA -- 17.5%
150,000 Alltel Corp. ..................... 8,440,679 10,132,500
35,000 Centennial Communications
Corp.+ ......................... 182,988 332,150
25,000 Clearwire Corp., Cl. A+ .......... 559,253 610,750
40,000 Dobson Communications
Corp., Cl. A+ .................. 129,100 444,400
11,000 MetroPCS Communications
Inc.+ .......................... 264,614 363,440
50,000 Nextwave Wireless Inc.+ .......... 586,479 417,500
300,000 Rogers Communications
Inc., Cl. B .................... 1,563,179 12,747,000
42,000 Rural Cellular Corp., Cl. A+ ..... 410,550 1,840,020
440,000 Sprint Nextel Corp. .............. 5,808,751 9,112,400
1,000 SunCom Wireless Holdings
Inc., Cl. A+ ................... 27,348 18,500
68,000 Telephone & Data
Systems Inc. ................... 1,472,304 4,254,760
60,000 Telephone & Data
Systems Inc., Special .......... 1,278,136 3,453,000
120,000 United States Cellular Corp.+ .... 5,744,690 10,872,000
------------ ------------
26,468,071 54,598,420
------------ ------------
TOTAL WIRELESS
TELECOMMUNICATIONS
SERVICES ....................... 48,245,641 104,833,358
------------ ------------
See accompanying notes to financial statements.
5
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
SCHEDULE OF INVESTMENTS (CONTINUED) -- JUNE 30, 2007 (UNAUDITED)
================================================================================
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
OTHER -- 18.9%
ASIA/PACIFIC -- 0.2%
38,000 ABC Communications
Holdings Ltd. .................. $ 19,234 $ 3,645
19,065 Austar United
Communications Ltd.+ ........... 38,877 26,831
100,000 Champion Technology
Holdings Ltd. .................. 87,982 22,381
10,000 China Education Ltd.+ ............ 9,532 3,984
70,000 CP Pokphand Co. Ltd., ADR+ ....... 58,725 80,584
26,000 Himachal Futuristic
Communications Ltd.,
GDR+ (a)(b) .................... 141,200 58,877
50,000 Hutchison Whampoa Ltd. ........... 487,170 496,534
300,000 Time Engineering Berhad+ ......... 316,448 61,260
------------ ------------
1,159,168 754,096
------------ ------------
EUROPE -- 1.7%
10,000 Alcatel-Lucent, ADR .............. 162,822 140,000
1,500 British Sky Broadcasting
Group plc, ADR ................. 36,400 77,370
3,600 Carlisle Group Ltd.+ ............. 5,790 9,651
3,000 E.ON AG .......................... 126,255 504,663
59,500 G4S plc .......................... 0 252,706
98,000 GN Store Nord A/S+ ............... 533,809 1,158,519
3,200 L. M. Ericsson Telephone
Co., Cl. B, ADR ................ 40,907 127,648
28,000 Nokia Corp., ADR ................. 67,091 787,080
15,428 Seat Pagine Gialle SpA ........... 30,784 9,282
750 Siemens AG, ADR .................. 23,625 107,295
5,852 Telecom Italia Media SpA+ ........ 4,669 2,150
25,000 Telegraaf Media Groep NV ......... 541,844 879,745
7,000 ThyssenKrupp AG .................. 128,725 418,096
15,000 TNT NV, ADR ...................... 198,277 677,232
1,000 Via Net.Works Inc.+ .............. 2,625 5
------------ ------------
1,903,623 5,151,442
------------ ------------
JAPAN -- 0.3%
75,000 The Furukawa Electric
Co. Ltd. ....................... 381,079 414,822
20,000 Tokyo Broadcasting
System Inc. .................... 657,598 612,386
------------ ------------
1,038,677 1,027,208
------------ ------------
LATIN AMERICA -- 0.0%
9,000 BB Holdings Ltd.+ ................ 36,940 46,575
1,400 Claxson Interactive Group
Inc.+ .......................... 2,240 16,100
25,693 Contax Participacoes SA,
ADR ............................ 11,050 31,615
562 OneSource Services Inc.+ ......... 5,515 7,251
------------ ------------
55,745 101,541
------------ ------------
MARKET
SHARES COST VALUE
------ ---- -------
NORTH AMERICA -- 16.7%
80,000 Adelphia Communications
Corp., Cl. A+ .................. $ 74,756 $ 1,600
80,000 Adelphia Communications
Corp., Cl. A Escrow+ ........... 0 0
80,000 Adelphia Recovery Trust+ ......... 0 0
17,000 Alliance Data Systems Corp.+ ..... 1,331,446 1,313,760
2,000 America Online Latin
America Inc., Cl. A+ (a) ....... 840 4
2,000 Amphenol Corp., Cl. A ............ 8,184 71,300
3,000 Andrew Corp.+ .................... 8,535 43,320
10,000 aQuantive Inc.+ .................. 636,795 638,000
10,000 Avaya Inc.+ ...................... 166,683 168,400
130,000 Cablevision Systems
Corp., Cl. A+ .................. 3,071,729 4,704,700
42,000 California Micro
Devices Corp.+ ................. 245,297 170,100
23,566 CanWest Global
Communications Corp.+ .......... 322,321 219,635
35,434 CanWest Global
Communications
Corp., Cl. A+ .................. 407,389 310,017
300,000 Charter Communications
Inc., Cl. A+ ................... 1,161,344 1,215,000
210,000 Clear Channel
Communications Inc. ............ 8,060,700 7,942,200
10,000 Cogeco Inc. ...................... 195,069 373,715
100,000 Comcast Corp., Cl. A,
Special+ ....................... 2,086,440 2,796,000
25,000 Communications
Systems Inc. ................... 237,711 277,750
4,000 Convergys Corp.+ ................. 53,716 96,960
28,000 Covansys Corp.+ .................. 942,508 950,040
42,000 Discovery Holding Co.,
Cl. A+ ......................... 270,887 965,580
90,000 EchoStar Communications
Corp., Cl. A+ .................. 1,831,302 3,903,300
6,000 Fisher Communications
Inc.+ .......................... 270,822 304,740
395,000 Gemstar-TV Guide
International Inc.+ ............ 1,763,796 1,943,400
1,000 Geoworks Corp.+ .................. 1,375 31
1,000 Google Inc., Cl. A+ .............. 346,423 523,380
4,250 Idearc Inc. ...................... 130,063 150,153
45,000 IDT Corp. ........................ 424,047 452,250
40,000 IDT Corp., Cl. B ................. 309,786 412,800
1,600 JDS Uniphase Corp.+ .............. 30,931 21,488
1,000 L-3 Communications
Holdings Inc. .................. 11,000 97,390
60,732 Liberty Global Inc., Cl. A+ ...... 1,330,262 2,492,441
50,000 Liberty Global Inc., Cl. C+ ...... 1,219,998 1,965,000
24,000 Liberty Media Corp. -
Capital, Cl. A+ ................ 1,095,117 2,824,320
See accompanying notes to financial statements.
6
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
SCHEDULE OF INVESTMENTS (CONTINUED) -- JUNE 30, 2007 (UNAUDITED)
================================================================================
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
OTHER (CONTINUED)
NORTH AMERICA (CONTINUED)
70,000 Liberty Media Corp. -
Interactive, Cl. A+ ............ $ 634,221 $ 1,563,100
1,000 Lockheed Martin Corp. ............ 22,787 94,130
20,000 LSI Corp.+ ....................... 150,104 150,200
20,000 Mediacom Communications
Corp., Cl. A+ .................. 177,215 193,800
55,000 Motorola Inc. .................... 454,388 973,500
8,000 News Corp., Cl. A ................ 116,400 169,680
2,000 News Corp., Cl. B ................ 21,050 45,880
63,000 Nortel Networks Corp.+ ........... 1,838,467 1,515,150
2,524 Orbital Sciences Corp.+ .......... 16,208 53,029
4,000 R. H. Donnelley Corp.+ ........... 53,608 303,120
10,000 SCANA Corp. ...................... 264,594 382,900
5,000 SJW Corp. ........................ 78,585 166,500
105,000 The DIRECTV Group Inc.+ .......... 2,165,652 2,426,550
20,000 Time Warner Cable Inc.,
Cl. A+ ......................... 770,906 783,400
189,000 Time Warner Inc. ................. 3,285,561 3,976,560
2,000 TiVo Inc.+ ....................... 11,105 11,580
1,000 Vishay Intertechnology Inc.+ ..... 22,908 15,820
47 Xanadoo Co.+ ..................... 23,394 12,549
68,000 Yahoo! Inc.+ ..................... 2,152,349 1,844,840
------------ ------------
40,306,774 52,031,062
------------ ------------
TOTAL OTHER ...................... 44,463,987 59,065,349
------------ ------------
TOTAL COMMON STOCKS .............. 169,364,620 286,366,562
------------ ------------
RIGHTS -- 0.0%
DIVERSIFIED TELECOMMUNICATIONS SERVICES -- 0.0%
ASIA/PACIFIC -- 0.0%
315,789 True Corp. plc,
expire 04/03/08+ (a) ........... 0 7,903
------------ ------------
WARRANTS -- 0.2%
WIRELESS TELECOMMUNICATIONS SERVICES -- 0.2%
ASIA/PACIFIC -- 0.2%
35,000 Bharti Airtel Ltd.,
expire 12/15/16+ (b) ........... 715,209 690,014
------------ ------------
OTHER -- 0.0%
ASIA/PACIFIC -- 0.0%
22,741 Champion Technology
Holdings Ltd.,
expire 03/08/08+ ............... 0 1,425
------------ ------------
EUROPE -- 0.0%
1,473 Alcatel-Lucent,
expire 12/10/07+ ............... 2,445 251
------------ ------------
TOTAL OTHER ...................... 2,445 1,676
------------ ------------
TOTAL WARRANTS ................... 717,654 691,690
------------ ------------
PRINCIPAL MARKET
AMOUNT COST VALUE
------ ---- -------
U.S. GOVERNMENT OBLIGATIONS -- 8.9%
$27,763,000 U.S. Treasury Bills,
4.351% to 5.126%++,
07/12/07 to 09/27/07 ........... $ 27,628,200 $ 27,626,441
------------ ------------
TOTAL
INVESTMENTS -- 100.8% .......... $197,710,474 314,692,596
============
OTHER ASSETS AND LIABILITIES (NET) -- (0.8)% ..... (2,353,922)
------------
NET ASSETS -- 100.0% ............................. $312,338,674
============
- ----------------
(a) Security fair valued under procedures established by the Board of
Directors. The procedures may include reviewing available financial
information about the company and reviewing valuation of comparable
securities and other factors on a regular basis. At June 30, 2007, the
market value of fair valued securities amounted to $1,225,473 or 0.39% of
total net assets.
(b) Security exempt from registration under Rule 144A of the Securities Act of
1933, as amended. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers. At June 30,
2007, the market value of Rule 144A securities amounted to $4,652,830 or
1.49% of total net assets. Except as noted in (c), these securities are
liquid.
(c) At June 30, 2007, the Fund held investments in restricted and illiquid
securities amounting to $1,159,416 or 0.37% of total net assets, which
were valued under methods approved by the Board, as follows:
06/30/07
ACQUISITION CARRYING
SHARES/ ACQUISITION ACQUISITION VALUE
UNITS ISSUER DATE COST PER UNIT
-------- ------ ----------- ----------- --------
39,371 Bell Aliant Regional
Communications
Income Fund ............... 12/29/06 $726,607 $29.4300
8,075 Thai Telephone &
Telecom, GDR .............. 03/31/94 100,542 0.0900
+ Non-income producing security.
++ Represents annualized yield at date of purchase.
ADR American Depository Receipt
BDR Brazilian Depository Receipt
GDR Global Depository Receipt
OJSC Open Joint Stock Company
% OF
MARKET MARKET
GEOGRAPHIC DIVERSIFICATION VALUE VALUE
- -------------------------- -------- -------
North America ......................... 57.3% $180,281,758
Europe ................................ 24.0 75,583,832
Latin America ......................... 8.7 27,393,058
Asia/Pacific .......................... 6.6 20,615,943
Japan ................................. 3.4 10,818,005
------ ------------
100.0% $314,692,596
====== ============
See accompanying notes to financial statements.
7
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2007 (UNAUDITED)
================================================================================
ASSETS:
Investments at value (cost $197,710,474) ...... $ 314,692,596
Cash .......................................... 13,414
Receivable for Fund shares sold ............... 899,514
Receivable for investments sold ............... 144,134
Dividends and interest receivable ............. 536,180
Prepaid expense ............................... 4,187
-------------
TOTAL ASSETS .................................. 316,290,025
-------------
LIABILITIES:
Payable for Fund shares redeemed .............. 255,624
Payable for investments purchased ............. 3,255,305
Payable for investment advisory fees .......... 261,929
Payable for distribution fees ................. 68,060
Payable for accounting fees ................... 3,872
Payable for Directors' fees ................... 62
Other accrued expenses ........................ 106,499
-------------
TOTAL LIABILITIES ............................. 3,951,351
-------------
NET ASSETS applicable to 12,199,433
shares outstanding .......................... $ 312,338,674
=============
NET ASSETS CONSIST OF:
Paid-in capital, each class at $0.001 par value $ 235,440,831
Accumulated net investment income ............. 1,925,449
Accumulated net realized loss on investments
and foreign currency transactions ........... (42,015,904)
Net unrealized appreciation on investments .... 116,982,122
Net unrealized appreciation on foreign
currency translations ....................... 6,176
-------------
NET ASSETS .................................... $ 312,338,674
=============
SHARES OF CAPITAL STOCK:
CLASS AAA:
Net Asset Value, offering and redemption price
per share ($304,768,971 / 11,898,060 shares
outstanding; 75,000,000 shares authorized) .. $25.62
======
CLASS A:
Net Asset Value and redemption price per share
($3,476,296 / 135,801 shares outstanding;
50,000,000 shares authorized ) .............. $25.60
======
Maximum offering price per share (NAV / 0.9425,
based on maximum sales charge of 5.75%
of the offering price ) .................... $27.16
======
CLASS B:
Net Asset Value and offering price per share
($292,108 / 11,743 shares outstanding;
25,000,000 shares authorized) ............... $24.88(a)
======
CLASS C:
Net Asset Value and offering price per share
($3,801,299 / 153,829 shares outstanding;
25,000,000 shares authorized) ............... $24.71(a)
======
(a) Redemption price varies based on the length of time held.
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2007 (UNAUDITED)
================================================================================
INVESTMENT INCOME:
Dividends (net of foreign taxes of $473,615) .. $ 3,598,615
Interest ...................................... 516,752
------------
TOTAL INVESTMENT INCOME ....................... 4,115,367
------------
EXPENSES:
Investment advisory fees ...................... 1,296,202
Distribution fees - Class AAA ................. 318,939
Distribution fees - Class A ................... 2,461
Distribution fees - Class B ................... 1,487
Distribution fees - Class C ................... 9,111
Shareholder services fees ..................... 115,414
Shareholder communications expenses ........... 69,806
Custodian fees ................................ 31,558
Legal and audit fees .......................... 25,726
Accounting fees ............................... 22,621
Registration expenses ......................... 20,369
Directors' fees ............................... 12,180
Interest expense .............................. 90
Miscellaneous expenses ........................ 13,487
------------
TOTAL EXPENSES ................................ 1,939,451
Less: Custodian fee credits ................... (3,200)
------------
NET EXPENSES .................................. 1,936,251
------------
NET INVESTMENT INCOME ......................... 2,179,116
------------
NET REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENTS AND FOREIGN CURRENCY:
Net realized gain on investments .............. 3,107,812
Net realized loss on foreign
currency transactions ....................... (22,088)
------------
Net realized gain on investments and
foreign currency transactions ............... 3,085,724
------------
Net change in unrealized appreciation/
depreciation on investments ................. 28,378,757
Net change in unrealized appreciation/
depreciation on foreign currency translations 3,162
------------
Net change in unrealized appreciation/
depreciation on investments and foreign
currency translations ....................... 28,381,919
------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY ............ 31,467,643
------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ............................. $ 33,646,759
============
See accompanying notes to financial statements.
8
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
STATEMENT OF CHANGES IN NET ASSETS
================================================================================
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
------------- -----------------
OPERATIONS:
Net investment income ............................................... $ 2,179,116 $ 1,213,397
Net realized gain on investments and foreign currency transactions .. 3,085,724 16,183,622
Net change in unrealized appreciation/depreciation on investments
and foreign currency translations ................................. 28,381,919 33,122,636
------------- -------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ................ 33,646,759 50,519,655
------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income
Class AAA ......................................................... -- (1,296,097)
Class A ........................................................... -- (7,802)
Class C ........................................................... -- (692)
------------- -------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS ................................. -- (1,304,591)
------------- -------------
CAPITAL SHARE TRANSACTIONS:
Class AAA ......................................................... 57,181,494 (20,313,616)
Class A ........................................................... 2,065,471 237,838
Class B ........................................................... (37,810) (210,652)
Class C ........................................................... 3,231,960 94,168
------------- -------------
NET INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS 62,441,115 (20,192,262)
------------- -------------
REDEMPTION FEES ..................................................... 2,656 589
------------- -------------
NET INCREASE IN NET ASSETS .......................................... 96,090,530 29,023,391
NET ASSETS:
Beginning of period ................................................. 216,248,144 187,224,753
------------- -------------
End of period (including undistributed net investment income of
$1,925,449 and $0, respectively) .................................. $ 312,338,674 $ 216,248,144
============= =============
See accompanying notes to financial statements.
9
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
================================================================================
1. ORGANIZATION. The GAMCO Global Telecommunications Fund (the "Fund"),
formerly, The Gabelli Global Telecommunications Fund, a series of GAMCO Global
Series Funds, Inc. (the "Corporation"), formerly, Gabelli Global Series Funds,
Inc., was organized on July 16, 1993 as a Maryland corporation. The Fund is a
non-diversified open-end management investment company registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), and one of four
separately managed portfolios (collectively, the "Portfolios") of the
Corporation. The Fund's primary objective is capital appreciation. The Fund
commenced investment operations on November 1, 1993.
2. SIGNIFICANT ACCOUNTING POLICIES. The preparation of financial statements in
accordance with United States ("U.S.") generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could differ
from those estimates. The following is a summary of significant accounting
policies followed by the Fund in the preparation of its financial statements.
SECURITY VALUATION. Portfolio securities listed or traded on a nationally
recognized securities exchange or traded in the U.S. over-the-counter market for
which market quotations are readily available are valued at the last quoted sale
price or a market's official closing price as of the close of business on the
day the securities are being valued. If there were no sales that day, the
security is valued at the average of the closing bid and asked prices or, if
there were no asked prices quoted on that day, then the security is valued at
the closing bid price on that day. If no bid or asked prices are quoted on such
day, the security is valued at the most recently available price or, if the
Board of Directors (the "Board") so determines, by such other method as the
Board shall determine in good faith to reflect its fair market value. Portfolio
securities traded on more than one national securities exchange or market are
valued according to the broadest and most representative market, as determined
by Gabelli Funds, LLC (the "Adviser").
Portfolio securities primarily traded on a foreign market are generally valued
at the preceding closing values of such securities on the relevant market, but
may be fair valued pursuant to procedures established by the Board if market
conditions change significantly after the close of the foreign market but prior
to the close of business on the day the securities are being valued. Debt
instruments with remaining maturities of 60 days or less that are not credit
impaired are valued at amortized cost, unless the Board determines such amount
does not reflect the securities' fair value, in which case these securities will
be fair valued as determined by the Board. Debt instruments having a maturity
greater than 60 days for which market quotations are readily available are
valued at the average of the latest bid and asked prices. If there were no asked
prices quoted on such day, the security is valued using the closing bid price.
Futures contracts are valued at the closing settlement price of the exchange or
board of trade on which the applicable contract is traded.
Securities and assets for which market quotations are not readily available are
fair valued as determined by the Board. Fair valuation methodologies and
procedures may include, but are not limited to: analysis and review of available
financial and non-financial information about the company; comparisons to the
valuation and changes in valuation of similar securities, including a comparison
of foreign securities to the equivalent U.S. dollar value ADR securities at the
close of the U.S. exchange; and evaluation of any other information that could
be indicative of the value of the security.
In September 2006, the Financial Accounting Standards Board (the "FASB") issued
Statement of Financial Accounting Standards ("SFAS") 157, Fair Value
Measurements, which clarifies the definition of fair value and
10
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
requires companies to expand their disclosure about the use of fair value to
measure assets and liabilities in interim and annual periods subsequent to
initial recognition. Adoption of SFAS 157 requires the use of the price that
would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. SFAS 157 is
effective for financial statements issued for fiscal years beginning after
November 15, 2007, and interim periods within those fiscal years. At this time,
management is in the process of reviewing the requirements of SFAS 157 against
its current valuation policies to determine future applicability.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with
primary government securities dealers recognized by the Federal Reserve Board,
with member banks of the Federal Reserve System, or with other brokers or
dealers that meet credit guidelines established by the Adviser and reviewed by
the Board. Under the terms of a typical repurchase agreement, the Fund takes
possession of an underlying debt obligation subject to an obligation of the
seller to repurchase, and the Fund to resell, the obligation at an agreed-upon
price and time, thereby determining the yield during the Fund's holding period.
The Fund will always receive and maintain securities as collateral whose market
value, including accrued interest, will be at least equal to 102% of the dollar
amount invested by the Fund in each agreement. The Fund will make payment for
such securities only upon physical delivery or upon evidence of book entry
transfer of the collateral to the account of the custodian. To the extent that
any repurchase transaction exceeds one business day, the value of the collateral
is marked-to-market on a daily basis to maintain the adequacy of the collateral.
If the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited. At June 30,
2007, there were no open repurchase agreements.
FUTURES CONTRACTS. The Fund may engage in futures contracts for the purpose of
hedging against changes in the value of its portfolio securities and in the
value of securities it intends to purchase. Upon entering into a futures
contract, the Fund is required to deposit with the broker an amount of cash or
cash equivalents equal to a certain percentage of the contract amount. This is
known as the "initial margin". Subsequent payments ("variation margin") are made
or received by the Fund each day, depending on the daily fluctuations in the
value of the contract, which are included in unrealized
appreciation/depreciation on investments and futures contracts. The Fund
recognizes a realized gain or loss when the contract is closed.
There are several risks in connection with the use of futures contracts as a
hedging instrument. The change in value of futures contracts primarily
corresponds with the value of their underlying instruments, which may not
correlate with the change in value of the hedged investments. In addition, there
is the risk that the Fund may not be able to enter into a closing transaction
because of an illiquid secondary market. At June 30, 2007, there were no open
futures contracts.
SECURITIES SOLD SHORT. The Fund may enter into short sale transactions. Short
selling involves selling securities that may or may not be owned and, at times,
borrowing the same securities for delivery to the purchaser, with an obligation
to replace such borrowed securities at a later date. The proceeds received from
short sales are recorded as liabilities and the Fund records an unrealized gain
or loss to the extent of the difference between the proceeds received and the
value of an open short position on the day of determination. The Fund records a
realized gain or loss when the short position is closed out. By entering into a
short sale, the Fund bears the market risk of an unfavorable change in the price
of the security sold short. Dividends on short sales are recorded as an expense
by the Fund on the ex-dividend date and interest expense is recorded on the
accrual basis. The Fund did not hold any short positions as of June 30, 2007.
11
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
FORWARD FOREIGN EXCHANGE CONTRACTS. The Fund may engage in forward foreign
exchange contracts for hedging a specific transaction with respect to either the
currency in which the transaction is denominated or another currency as deemed
appropriate by the Adviser. Forward foreign exchange contracts are valued at the
forward rate and are marked-to-market daily. The change in market value is
included in unrealized appreciation/depreciation on investments and foreign
currency translations. When the contract is closed, the Fund records a realized
gain or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
The use of forward foreign exchange contracts does not eliminate fluctuations in
the underlying prices of the Fund's portfolio securities, but it does establish
a rate of exchange that can be achieved in the future. Although forward foreign
exchange contracts limit the risk of loss due to a decline in the value of the
hedged currency, they also limit any potential gain that might result should the
value of the currency increase. In addition, the Fund could be exposed to risks
if the counterparties to the contracts are unable to meet the terms of their
contracts. At June 30, 2007, there were no open forward foreign exchange
contracts.
FOREIGN CURRENCY TRANSLATIONS. The books and records of the Fund are maintained
in U.S. dollars. Foreign currencies, investments, and other assets and
liabilities are translated into U.S. dollars at the current exchange rates.
Purchases and sales of investment securities, income, and expenses are
translated at the exchange rate prevailing on the respective dates of such
transactions. Unrealized gains and losses that result from changes in foreign
exchange rates and/or changes in market prices of securities have been included
in unrealized appreciation/depreciation on investments and foreign currency
translations. Net realized foreign currency gains and losses resulting from
changes in exchange rates include foreign currency gains and losses between
trade date and settlement date on investment securities transactions, foreign
currency transactions, and the difference between the amounts of interest and
dividends recorded on the books of the Fund and the amounts actually received.
The portion of foreign currency gains and losses related to fluctuation in
exchange rates between the initial trade date and subsequent sale trade date is
included in realized gain/(loss) on investments.
FOREIGN SECURITIES. The Fund may directly purchase securities of foreign
issuers. Investing in securities of foreign issuers involves special risks not
typically associated with investing in securities of U.S. issuers. The risks
include possible revaluation of currencies, the ability to repatriate funds,
less complete financial information about companies, and possible future adverse
political and economic developments. Moreover, securities of many foreign
issuers and their markets may be less liquid and their prices more volatile than
those of securities of comparable U.S. issuers.
FOREIGN TAXES. The Fund may be subject to foreign taxes on income, gains on
investments, or currency repatriation, a portion of which may be recoverable.
The Fund will accrue such taxes and recoveries as applicable, based upon its
current interpretation of tax rules and regulations that exist in the markets in
which it invests.
RESTRICTED AND ILLIQUID SECURITIES. The Fund may invest up to 15% of its net
assets in securities for which the markets are illiquid. Illiquid securities
include securities the disposition of which is subject to substantial legal or
contractual restrictions. The sale of illiquid securities often requires more
time and results in higher brokerage charges or dealer discounts and other
selling expenses than does the sale of securities eligible for trading on
national securities exchanges or in the over-the-counter markets. Restricted
securities may sell at a price lower than similar securities that are not
subject to restrictions on resale. Securities freely saleable among qualified
institutional investors under special rules adopted by the SEC may be treated as
liquid if they satisfy liquidity
12
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
standards established by the Board. The continued liquidity of such securities
is not as well assured as that of publicly traded securities, and accordingly
the Board will monitor their liquidity.
CONCENTRATION RISKS. The Fund may invest a high percentage of its assets in
specific sectors of the market in order to achieve a potentially greater
investment return. As a result, the Fund may be more susceptible to economic,
political, and regulatory developments in a particular sector of the market,
positive or negative, and may experience increased volatility to the Fund's NAV
and a magnified effect in its total return.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME. Securities transactions are
accounted for on the trade date with realized gain or loss on investments
determined by using the identified cost method. Interest income (including
amortization of premium and accretion of discount) is recorded on the accrual
basis. Premiums and discounts on debt securities are amortized using the
effective yield to maturity method. Dividend income is recorded on the
ex-dividend date except for certain dividends which are recorded as soon as the
Fund is informed of the dividend.
DETERMINATION OF NET ASSET VALUE AND CALCULATION OF EXPENSES. Certain
administrative expenses are common to, and allocated among, various affiliated
funds. Such allocations are made on the basis of each Fund's average net assets
or other criteria directly affecting the expenses as determined by the Adviser
pursuant to procedures established by the Board.
In calculating the NAV per share of each class, investment income, realized and
unrealized gains and losses, redemption fees, and expenses other than class
specific expenses are allocated daily to each class of shares based upon the
proportion of net assets of each class at the beginning of each day.
Distribution expenses are borne solely by the class incurring the expense.
CUSTODIAN FEE CREDITS AND INTEREST EXPENSE. When cash balances are maintained in
the custody account, the Fund receives credits which are used to offset
custodian fees. The gross expenses paid under the custody arrangement are
included in custodian fees in the Statement of Operations with the corresponding
expense offset, if any, shown as "custodian fee credits". When cash balances are
overdrawn, the Fund is charged an overdraft fee equal to 2.00% above the Federal
Funds rate on outstanding balances. This amount, if any, would be shown as
"interest expense" in the Statement of Operations.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions to shareholders are recorded on the
ex-dividend date. Distributions to shareholders are based on income and capital
gains as determined in accordance with federal income tax regulations, which may
differ from income and capital gains as determined under U.S. generally accepted
accounting principles. These differences are primarily due to differing
treatments of income and gains on various investment securities and foreign
currency transactions held by the Fund, timing differences, and differing
characterizations of distributions made by the Fund. Distributions from net
investment income include net realized gains on foreign currency transactions.
These book/tax differences are either temporary or permanent in nature. To the
extent these differences are permanent, adjustments are made to the appropriate
capital accounts in the period when the differences arise. These
reclassifications have no impact on the NAV of the Fund.
The tax character of distributions paid during the fiscal year ended December
31, 2006 was $1,304,591 of ordinary income.
PROVISION FOR INCOME TAXES. The Fund intends to continue to qualify as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended (the "Code"). It is the policy of the
13
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
Fund to comply with the requirements of the Code applicable to regulated
investment companies and to distribute substantially all of its net investment
company taxable income and net capital gains. Therefore, no provision for
federal income taxes is required.
At December 31, 2006, the Fund had net capital loss carryforwards for federal
income tax purposes of $38,567,402, which are available to reduce future
required distributions of net capital gains to shareholders. $23,342,608 of the
loss carryforward is available through 2010; $11,910,139 is available through
2011; and $3,314,655 is available through 2012.
The following summarizes the tax cost of investments and related unrealized
appreciation/(depreciation) at June 30, 2007:
GROSS GROSS
UNREALIZED UNREALIZED NET UNREALIZED
COST APPRECIATION DEPRECIATION APPRECIATION
---- ------------ ------------ -------------
Investments ....... $204,160,153 $124,088,542 $(13,556,099) $110,532,443
In July 2006, the FASB issued Interpretation No. 48, "Accounting for Uncertainty
in Income Taxes, an Interpretation of FASB Statement No. 109" ("the
Interpretation"). The Interpretation established for all entities, including
pass-through entities such as the Fund, a minimum threshold for financial
statement recognition of the benefit of positions taken in filing tax returns
(including whether an entity is taxable in a particular jurisdiction), and
required certain expanded tax disclosures. The Interpretation was implemented by
the Fund on June 29, 2007 and applied to all open tax years as of the effective
date. Management has evaluated the application of the Interpretation to the
Fund, and the adoption of the Interpretation had no impact on the amounts
reported in the financial statements.
3. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS. The Fund has entered
into an investment advisory agreement (the "Advisory Agreement") with the
Adviser which provides that the Fund will pay the Adviser a fee, computed daily
and paid monthly, at the annual rate of 1.00% of the value of its 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 Directors of the Fund who are affiliated
persons of the Adviser.
If total net assets of the Corporation are in excess of $100 million, the
Corporation pays each Director that is not considered to be an affiliated person
an annual retainer of $3,000 plus $500 for each Board meeting attended and they
are reimbursed for any out of pocket expenses incurred in attending meetings. If
total net assets of the Corporation are below $100 million, the Corporation pays
each Independent Director an annual retainer of $1,500 plus $250 for each Board
meeting attended and they are reimbursed for any out of pocket expenses incurred
in attending meetings. All Board committee members receive $500 per meeting
attended. Directors who are directors or employees of the Adviser or an
affiliated company receive no compensation or expense reimbursement from the
Fund.
4. DISTRIBUTION PLAN. The Fund's Board has adopted a distribution plan (the
"Plan") for each class of shares pursuant to Rule 12b-1 under the 1940 Act.
Gabelli & Company, Inc. ("Gabelli & Company"), an affiliate of the Adviser,
serves as distributor of the Fund. Under the Class AAA, Class A, Class B, and
Class C Share Plans, payments are authorized to Gabelli & Company at annual
rates of 0.25%, 0.25%, 1.00%, and 1.00%, respectively, of the average daily net
assets of those classes, the annual limitations under each Plan. Such payments
are accrued daily and paid monthly.
14
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
5. PORTFOLIO SECURITIES. Purchases and proceeds from the sales of securities for
the six months ended June 30, 2007, other than short-term and U.S. Government
securities, aggregated $56,497,278 and $6,390,120, respectively.
6. TRANSACTIONS WITH AFFILIATES. During the six months ended June 30, 2007, the
Fund paid brokerage commissions of $39,127 to Gabelli & Company. Additionally,
Gabelli & Company informed the Fund that it received $8,256 from investors
representing commissions (sales charges and underwriting fees) on sales and
redemptions of Fund shares.
The cost of calculating the Fund's NAV per share is a Fund expense pursuant to
the Advisory Agreement between the Fund and the Adviser. During the six months
ended June 30, 2007, the Fund paid or accrued $22,621 to the Adviser in
connection with the cost of computing the Fund's NAV.
7. LINE OF CREDIT. Effective June 20, 2007, the Fund participates in an
unsecured line of credit of up to $75,000,000 and may borrow up to 10% of its
net assets from the custodian for temporary borrowing purposes. Prior to June
20, 2007, the line of credit was $25,000,000. Borrowings under this arrangement
bear interest at 0.75% above the Federal Funds rate on outstanding balances.
This amount, if any, would be shown as "interest expense" in the Statement of
Operations. During the six months ended June 30, 2007, there were no borrowings
under the line of credit.
8. CAPITAL STOCK TRANSACTIONS. The Fund currently offers four classes of shares
- - Class AAA Shares, Class A Shares, Class B Shares, and Class C Shares. Class
AAA Shares are offered only to investors who acquire them directly from Gabelli
& Company, or through selected broker/dealers, or the transfer agent without a
sales charge. Class A Shares are subject to a maximum front-end sales charge of
5.75%. Class B Shares are subject to a contingent deferred sales charge ("CDSC")
upon redemption within six years of purchase and automatically convert to Class
A Shares approximately eight years after the original purchase. The applicable
CDSC is equal to a declining percentage of the lesser of the NAV per share at
the date of the original purchase or at the date of redemption, based on the
length of time held. Class C Shares are subject to a 1.00% CDSC for one year
after purchase. Class B Shares are available only through exchange of Class B
Shares of other funds distributed by Gabelli & Company. The Board has approved
Class I Shares which have not been offered publicly.
The Fund imposes a redemption fee of 2.00% on Class AAA Shares, Class A Shares,
Class B Shares, and Class C Shares that are redeemed or exchanged on or before
the seventh day after the date of a purchase. The redemption fee is deducted
from the proceeds otherwise payable to the redeeming shareholders and is
retained by the Fund. The redemption fees retained by the Fund during the six
months ended June 30, 2007 and the fiscal year ended December 31, 2006 amounted
to $2,656 and $589, respectively.
The redemption fee does not apply to redemptions of shares where (i) the shares
were purchased through automatic reinvestment of dividends or other
distributions, (ii) the redemption was initiated by the Fund, (iii) the shares
were purchased through programs that collect the redemption fee at the program
level and remit them to the Fund, or (iv) the shares were purchased through
programs that the Adviser determines to have appropriate anti-short-term trading
policies in place or as to which the Adviser has received assurances that
look-through redemption fee procedures or effective anti-short-term trading
policies and procedures are in place.
15
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
================================================================================
Transactions in shares of capital stock were as follows:
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
-------------------------- -----------------------------
SHARES AMOUNT SHARES AMOUNT
-------- ----------- ---------- ------------
CLASS AAA CLASS AAA
--------------------------- -----------------------------
Shares sold ......................................... 3,293,205 $ 79,522,420 1,918,009 $ 37,710,107
Shares issued upon reinvestment of distributions .... -- -- 55,184 1,236,136
Shares redeemed ..................................... (940,495) (22,340,926) (3,033,740) (59,259,859)
--------- ------------ ---------- ------------
Net increase (decrease) ........................... 2,352,710 $ 57,181,494 (1,060,547) $(20,313,616)
========= ============ ========== ============
CLASS A CLASS A
--------------------------- -----------------------------
Shares sold ......................................... 104,066 $ 2,540,572 22,898 $ 474,817
Shares issued upon reinvestment of distributions .... -- -- 303 6,781
Shares redeemed ..................................... (20,420) (475,101) (13,041) (243,760)
--------- ------------ ---------- ------------
Net increase ...................................... 83,646 $ 2,065,471 10,160 $ 237,838
========= ============ ========== ============
CLASS B CLASS B
--------------------------- -----------------------------
Shares redeemed ..................................... (1,565) $ (37,810) (11,513) $ (210,652)
--------- ------------ ---------- ------------
Net decrease ...................................... (1,565) $ (37,810) (11,513) $ (210,652)
========= ============ ========== ============
CLASS C CLASS C
--------------------------- -----------------------------
Shares sold ......................................... 140,940 $ 3,308,666 8,244 $ 162,900
Shares issued upon reinvestment of distributions .... -- -- 32 691
Shares redeemed ..................................... (3,223) (76,706) (3,583) (69,423)
--------- ------------ ---------- ------------
Net increase ...................................... 137,717 $ 3,231,960 4,693 $ 94,168
========= ============ ========== ============
9. INDEMNIFICATIONS. The Fund enters into contracts that contain a variety of
indemnifications. The Fund's maximum exposure under these arrangements is
unknown. However, the Fund has not had prior claims or losses pursuant to these
contracts and expects the risk of loss to be remote.
10. OTHER MATTERS. The Adviser and/or affiliates received subpoenas from the
Attorney General of the State of New York and the SEC requesting information on
mutual fund share trading practices involving certain funds managed by the
Adviser. GAMCO Investors, Inc. ("GAMCO"), the Adviser's parent company,
responded to these requests for documents and testimony. In June 2006, GAMCO
began discussions with the SEC regarding a possible resolution of their inquiry.
In February 2007, the Adviser made an offer of settlement to the staff of the
SEC for communication to the Commission for its consideration to resolve this
matter. This offer of settlement is subject to agreement regarding the specific
language of the SEC's administrative order and other settlement documents. On a
separate matter, in September 2005, the Adviser was informed by the staff of the
SEC that the staff may recommend to the Commission that an administrative remedy
and a monetary penalty be sought from the Adviser in connection with the actions
of two of seven closed-end funds managed by the Adviser relating to Section
19(a) and Rule 19a-1 of the 1940 Act. These provisions require registered
investment companies to provide written statements to shareholders when a
dividend is made from a source other than net investment income. While the two
closed-end funds sent annual statements and provided other materials containing
this information, the funds did not send written statements to shareholders with
each distribution in 2002 and 2003. The Adviser believes that all of the funds
are now in compliance. The Adviser believes that these matters would have no
effect on the Fund or any material adverse effect on the Adviser or its ability
to manage the Fund.
16
THE GAMCO GLOBAL TELECOMMUNICATIONS FUND
FINANCIAL HIGHLIGHTS
================================================================================
Selected data for a share of capital stock outstanding throughout each period:
INCOME
FROM INVESTMENT OPERATIONS DISTRIBUTIONS
-------------------------------------- ---------------------------
Net
Net Asset Net Realized and Total
Period Value, Investment Unrealized from Net
Ended Beginning Income Gain (Loss) on Investment Investment Total Redemption
December 31, of Period (Loss)(a) Investments Operations Income Distributions Fees(a)
- ------------ --------- ---------- ------------- ---------- ---------- ------------- ----------
CLASS AAA
2007(c) $22.46 $ 0.20 $ 2.96 $ 3.16 -- -- $0.00(d)
2006 17.53 0.12 4.95 5.07 $(0.14) $(0.14) 0.00(d)
2005 17.23 0.16 0.33 0.49 (0.19) (0.19) 0.00(d)
2004 14.03 0.07 3.21 3.28 (0.08) (0.08) 0.00(d)
2003 9.83 (0.04) 4.24 4.20 -- -- 0.00(d)
2002 13.96 (0.01) (4.12) (4.13) -- -- --
CLASS A
2007(c) $22.43 $ 0.21 $ 2.96 $ 3.17 -- -- $0.00(d)
2006 17.51 0.12 4.95 5.07 $(0.15) $(0.15) 0.00(d)
2005 17.22 0.14 0.35 0.49 (0.20) (0.20) 0.00(d)
2004 14.03 0.08 3.19 3.27 (0.08) (0.08) 0.00(d)
2003 9.83 (0.04) 4.24 4.20 -- -- 0.00(d)
2002 13.95 (0.00)(d) (4.12) (4.12) -- -- --
CLASS B
2007(c) $21.90 $ 0.10 $ 2.88 $ 2.98 -- -- $0.00(d)
2006 17.11 (0.03) 4.82 4.79 -- -- 0.00(d)
2005 16.77 0.01 0.33 0.34 -- -- 0.00(d)
2004 13.69 (0.04) 3.12 3.08 -- -- 0.00(d)
2003 9.67 (0.13) 4.15 4.02 -- -- 0.00(d)
2002 13.83 (0.08) (4.08) (4.16) -- -- --
CLASS C
2007(c) $21.76 $ 0.13 $ 2.82 $ 2.95 -- -- $0.00(d)
2006 17.03 0.00(d) 4.77 4.77 $(0.04) $(0.04) 0.00(d)
2005 16.71 0.04 0.29 0.33 (0.01) (0.01) 0.00(d)
2004 13.68 (0.06) 3.14 3.08 (0.05) (0.05) 0.00(d)
2003 9.66 (0.16) 4.18 4.02 -- -- 0.00(d)
2002 13.82 (0.08) (4.08) (4.16) -- -- --
RATIOS TO AVERAGE
NET ASSETS/SUPPLEMENTAL DATA
-------------------------------------------------
Net Asset Net Assets Net
Period Value, End of Investment Portfolio
Ended End of Total Period Income Operating Turnover
December 31, Period Return+ (in 000's) (Loss) Expenses(b) Rate
- ------------ -------- ------- ---------- --------- ------------ --------
CLASS AAA
2007(c) $25.62 14.1% $304,769 1.69%(e) 1.49%(e) 3%
2006 22.46 28.9 214,436 0.63 1.56 7
2005 17.53 2.8 185,870 0.92 1.59 4
2004 17.23 23.4 209,043 0.49 1.62 15
2003 14.03 42.7 185,719 (0.38) 1.62 11
2002 9.83 (29.6) 139,455 (0.05) 1.66 8
CLASS A
2007(c) $25.60 14.1% $ 3,476 1.70%(e) 1.49%(e) 3%
2006 22.43 29.0 1,170 0.64 1.56 7
2005 17.51 2.8 735 0.83 1.59 4
2004 17.22 23.3 598 0.52 1.62 15
2003 14.03 42.7 421 (0.38) 1.62 11
2002 9.83 (29.5) 372 (0.05) 1.66 8
CLASS B
2007(c) $24.88 13.6% $ 292 0.87%(e) 2.24%(e) 3%
2006 21.90 28.0 291 (0.17) 2.31 7
2005 17.11 2.0 425 0.09 2.33 4
2004 16.77 22.5 855 (0.25) 2.37 15
2003 13.69 41.6 817 (1.13) 2.37 11
2002 9.67 (30.1) 610 (0.80) 2.41 8
CLASS C
2007(c) $24.71 13.6% $ 3,802 1.12%(e) 2.24%(e) 3%
2006 21.76 28.0 351 (0.02) 2.31 7
2005 17.03 2.0 195 0.26 2.34 4
2004 16.71 22.5 249 (0.44) 2.37 15
2003 13.68 41.6 94 (1.13) 2.37 11
2002 9.66 (30.1) 252 (0.80) 2.41 8
- ------------
+ 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 and does not reflect applicable sales
charges. Total return for a period of less than one year is not annualized.
(a) Per share amounts have been calculated using the average shares outstanding
method.
(b) The Fund incurred interest expense during the fiscal years ended December
31, 2005, 2004, 2003, and 2002. If interest expense had not been incurred,
the ratio of operating expenses to average net assets would have been 1.58%,
1.61%, 1.61%, and 1.64% (Class AAA), 1.59%, 1.61%, 1.61%, and 1.64% (Class
A), 2.33%, 2.36%, 2.36%, and 2.39% (Class B), and 2.34%, 2.36%, 2.36%, and
2.39% (Class C), respectively. For the six months ended June 30, 2007 and
the fiscal year ended December 31, 2006, interest expense was minimal.
(c) For the period ended June 30, 2007, unaudited.
(d) Amount represents less than $0.005 per share.
(e) Annualized.
See accompanying notes to financial statements.
17
- --------------------------------------------------------------------------------
GABELLI/GAMCO FUNDS AND YOUR PERSONAL PRIVACY
================================================================================
WHO ARE WE?
The Gabelli/GAMCO Funds are investment companies registered with the
Securities and Exchange Commission under the Investment Company Act of
1940. We are managed by Gabelli Funds, LLC and Gabelli Advisers, Inc.,
which are affiliated with GAMCO Investors, Inc. GAMCO Investors, Inc. is a
publicly held company that has subsidiaries that provide investment
advisory or brokerage services for a variety of clients.
WHAT KIND OF NON-PUBLIC INFORMATION DO WE COLLECT ABOUT YOU IF YOU BECOME A
SHAREHOLDER?
If you apply to open an account directly with us, you will be giving us
some non-public information about yourself. The non-public information we
collect about you is:
o INFORMATION YOU GIVE US ON YOUR APPLICATION FORM. This could include
your name, address, telephone number, social security number, bank
account number, and other information.
o INFORMATION ABOUT YOUR TRANSACTIONS WITH US, ANY TRANSACTIONS WITH OUR
AFFILIATES, AND TRANSACTIONS WITH THE ENTITIES WE HIRE TO PROVIDE
SERVICES TO YOU. This would include information about the shares that
you buy or redeem. If we hire someone else to provide services--like a
transfer agent--we will also have information about the transactions
that you conduct through them.
WHAT INFORMATION DO WE DISCLOSE AND TO WHOM DO WE DISCLOSE IT?
We do not disclose any non-public personal information about our customers
or former customers to anyone other than our affiliates, our service
providers who need to know such information, and as otherwise permitted by
law. If you want to find out what the law permits, you can read the privacy
rules adopted by the Securities and Exchange Commission. They are in volume
17 of the Code of Federal Regulations, Part 248. The Commission often posts
information about its regulations on its web site, www.sec.gov.
WHAT DO WE DO TO PROTECT YOUR PERSONAL INFORMATION?
We restrict access to non-public personal information about you to the
people who need to know that information in order to provide services to
you or the Fund and to ensure that we are complying with the laws governing
the securities business. We maintain physical, electronic, and procedural
safeguards to keep your personal information confidential.
- --------------------------------------------------------------------------------
GABELLI FAMILY OF FUNDS
VALUE _______________________________________
GABELLI ASSET FUND
Seeks to invest primarily in a diversified portfolio of common stocks selling at
significant discounts to their private market value. The Fund's primary
objective is growth of capital. (MULTICLASS)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI BLUE CHIP VALUE FUND
Seeks long term growth of capital through investment primarily in the common
stocks of established companies which are temporarily out of favor. The fund's
objective is to identify a catalyst or sequence of events that will return the
company to a higher value.
(MULTICLASS) PORTFOLIO MANAGER: BARBARA MARCIN, CFA
GAMCO WESTWOOD EQUITY FUND
Seeks to invest primarily in the common stock of well seasoned companies that
have recently reported positive earnings surprises and are trading below
Westwood's proprietary growth rate estimates. The Fund's primary objective is
capital appreciation.
(MULTICLASS) PORTFOLIO MANAGER: SUSAN M. BYRNE
FOCUSED VALUE _______________________________
GABELLI VALUE FUND
Seeks to invest in securities of companies believed to be undervalued. The
Fund's primary objective is long-term capital appreciation. (MULTICLASS)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
SMALL CAP VALUE _____________________________
GABELLI SMALL CAP FUND
Seeks to invest primarily in common stock of smaller companies (market
capitalizations at the time of investment of $2 billion or less) believed to
have rapid revenue and earnings growth potential. The Fund's primary objective
is capital appreciation.
(MULTICLASS) PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GAMCO WESTWOOD SMALLCAP EQUITY FUND
Seeks to invest primarily in smaller capitalization equity securities - market
caps of $2.5 billion or less. The Fund's primary objective is long-term capital
appreciation. (MULTICLASS) PORTFOLIO MANAGER: ELIZABETH M. LILLY, CFA
GABELLI WOODLAND SMALL CAP VALUE FUND
Seeks to invest primarily in the common stocks of smaller companies (market
capitalizations generally less than $3.0 billion) believed to be undervalued
with shareholder oriented management teams that are employing strategies to grow
the company's value. The Fund's primary objective is capital appreciation.
(MULTICLASS) PORTFOLIO MANAGER: ELIZABETH M. LILLY, CFA
GROWTH ______________________________________
GAMCO GROWTH FUND
Seeks to invest primarily in large cap stocks believed to have favorable, yet
undervalued, prospects for earnings growth. The Fund's primary objective is
capital appreciation. (MULTICLASS) PORTFOLIO MANAGER: HOWARD F. WARD, CFA
GAMCO INTERNATIONAL GROWTH FUND
Seeks to invest in the equity securities of foreign issuers with long-term
capital appreciation potential. The Fund offers investors global
diversification. (MULTICLASS) PORTFOLIO MANAGER: CAESAR BRYAN
AGGRESSIVE GROWTH ___________________________
GAMCO GLOBAL GROWTH FUND
Seeks capital appreciation through a disciplined investment program focusing on
the globalization and interactivity of the world's marketplace. The Fund invests
in companies at the forefront of accelerated growth. The Fund's primary
objective is capital appreciation. (MULTICLASS) TEAM MANAGED
MICRO-CAP ___________________________________
GAMCO WESTWOOD MIGHTY MITES(SM) FUND
Seeks to invest in micro-cap companies that have market capitalizations of $300
million or less. The Fund's primary objective is long-term capital appreciation.
(MULTICLASS) TEAM MANAGED
EQUITY INCOME _______________________________
GABELLI EQUITY INCOME FUND
Seeks to invest primarily in equity securities with above average market yields.
The Fund pays monthly dividends and seeks a high level of total return with an
emphasis on income. (MULTICLASS) PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GAMCO WESTWOOD BALANCED FUND
Seeks to invest in a balanced and diversified portfolio of stocks and bonds. The
Fund's primary objective is both capital appreciation and current income.
(MULTICLASS) CO-PORTFOLIO MANAGERS: SUSAN M. BYRNE
MARK FREEMAN, CFA
GAMCO WESTWOOD INCOME FUND
Seeks to provide a high level of current income as well as long-term capital
appreciation by investing in income producing equity and fixed income
securities. (MULTICLASS) PORTFOLIO MANAGER: BARBARA MARCIN, CFA
SPECIALTY EQUITY ____________________________
GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
Seeks to invest principally in bonds and preferred stocks which are convertible
into common stock of foreign and domestic companies. The Fund's primary
objective is total return through a combination of current income and capital
appreciation. (MULTICLASS) TEAM MANAGED
GAMCO GLOBAL OPPORTUNITY FUND
Seeks to invest in common stock of companies which have rapid growth in revenues
and earnings and potential for above average capital appreciation or are
undervalued. The Fund's primary objective is capital appreciation.
(MULTICLASS) TEAM MANAGED
GABELLI SRI FUND
Seeks to invest in common and preferred stocks of companies that meet the Fund's
guidelines for social responsibility at the time of investment, looking to avoid
companies in tobacco, alcohol, and gaming, defense/weapons contractors, and
manufacturers of abortifacients. The Fund's primary objective is capital
appreciation. (MULTICLASS) PORTFOLIO MANAGER: CHRISTOPHER C. DESMARAIS
SECTOR ______________________________________
GAMCO GLOBAL TELECOMMUNICATIONS FUND
Seeks to invest in telecommunications companies throughout the world - targeting
undervalued companies with strong earnings and cash flow dynamics. The Fund's
primary objective is capital appreciation. (MULTICLASS) TEAM MANAGED
GAMCO GOLD FUND
Seeks to invest in a global portfolio of equity securities of gold mining and
related companies. The Fund's objective is long-term capital appreciation.
Investment in gold stocks is considered speculative and is affected by a variety
of worldwide economic, financial, and political factors. (MULTICLASS)
PORTFOLIO MANAGER: CAESAR BRYAN
GABELLI UTILITIES FUND
Seeks to provide a high level of total return through a combination of capital
appreciation and current income. (MULTICLASS) TEAM MANAGED
MERGER AND ARBITRAGE ________________________
GABELLI ABC FUND
Seeks to invest in securities with attractive opportunities for appreciation or
investment income. The Fund's primary objective is total return in various
market conditions without excessive risk of capital loss.
(NO-LOAD) PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
CONTRARIAN __________________________________
GAMCO MATHERS FUND
Seeks long-term capital appreciation in various market conditions without
excessive risk of capital loss. (NO-LOAD)
PORTFOLIO MANAGER: HENRY VAN DER EB, CFA
COMSTOCK CAPITAL VALUE FUND
Seeks capital appreciation and current income. The Fund may use either long or
short positions to achieve its objective.
(MULTICLASS) PORTFOLIO MANAGER: MARTIN WEINER, CFA
COMSTOCK STRATEGY FUND
The Fund emphasizes investments in debt securities, which maximize total return
in light of credit risk, interest rate risk, and the risk associated with the
length of maturity of debt instruments. (MULTICLASS)
PORTFOLIO MANAGER: MARTIN WEINER, CFA
FIXED INCOME ________________________________
GAMCO WESTWOOD INTERMEDIATE BOND FUND
Seeks to invest in a diversified portfolio of bonds with various maturities. The
Fund's primary objective is total return.
(MULTICLASS) PORTFOLIO MANAGER: MARK FREEMAN, CFA
CASH MANAGEMENT-MONEY MARKET ________________
GABELLI U.S. TREASURY MONEY MARKET FUND
Seeks to invest exclusively in short-term U.S. Treasury securities. The Fund's
primary objective is to provide high current income consistent with the
preservation of principal and liquidity. (NO-LOAD)
PORTFOLIO MANAGER: JUDITH A. RANERI
AN INVESTMENT IN THE ABOVE MONEY MARKET FUND IS NEITHER INSURED NOR GUARANTEED
BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY GOVERNMENT AGENCY. ALTHOUGH
THE FUND SEEKS TO PRESERVE THE VALUE OF YOUR INVESTMENT AT $1.00 PER SHARE, IT
IS POSSIBLE TO LOSE MONEY BY INVESTING IN THE FUND.
THE FUNDS MAY INVEST IN FOREIGN SECURITIES WHICH INVOLVE RISKS NOT ORDINARILY
ASSOCIATED WITH INVESTMENTS IN DOMESTIC ISSUES, INCLUDING CURRENCY FLUCTUATION,
ECONOMIC, AND POLITICAL RISKS.
TO RECEIVE A PROSPECTUS, CALL 800-GABELLI (422-3554). INVESTORS SHOULD CAREFULLY
CONSIDER THE INVESTMENT OBJECTIVES, RISKS, CHARGES, AND EXPENSES OF THE FUND
BEFORE INVESTING. THE PROSPECTUS CONTAINS MORE INFORMATION
ABOUT THIS AND OTHER MATTERS AND SHOULD BE READ CAREFULLY BEFORE INVESTING.
GAMCO Global Series Funds, Inc.
THE GAMCO GLOBAL TELECOMMUNICATIONS 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 per share available daily by calling
800-GABELLI after 6:00 P.M.
BOARD OF DIRECTORS
Mario J. Gabelli, CFA John D. Gabelli
CHAIRMAN AND CHIEF SENIOR VICE PRESIDENT
EXECUTIVE OFFICER GABELLI & COMPANY, INC.
GAMCO INVESTORS, INC.
E. Val Cerutti Werner J. Roeder, MD
CHIEF EXECUTIVE OFFICER MEDICAL DIRECTOR
CERUTTI CONSULTANTS, INC. LAWRENCE HOSPITAL
Anthony J. Colavita Anthonie C. van Ekris
ATTORNEY-AT-LAW CHAIRMAN
ANTHONY J. COLAVITA, P.C. BALMAC INTERNATIONAL, INC.
Arthur V. Ferrara Salvatore J. Zizza
FORMER CHAIRMAN AND CHAIRMAN
CHIEF EXECUTIVE OFFICER ZIZZA & CO., LTD.
GUARDIAN LIFE INSURANCE
COMPANY OF AMERICA
OFFICERS
Bruce N. Alpert James E. McKee
PRESIDENT SECRETARY
Agnes Mullady Peter D. Goldstein
TREASURER CHIEF COMPLIANCE OFFICER
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
GAMCO Global Telecommunications Fund. It is not authorized for distribution to
prospective investors unless preceded or accompanied by an effective prospectus.
- --------------------------------------------------------------------------------
GAB401Q207SR
[GRAPHIC OMITTED] E P
Gabelli Triangle P M
MANAGEMENT S V
CASH FLOW
RESEARCH
THE
GAMCO
GLOBAL
TELECOMMUNICATIONS
FUND
SEMI-ANNUAL REPORT
JUNE 30, 2007
ITEM 2. CODE OF ETHICS.
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Schedule of Investments in securities of unaffiliated issuers as of the close of
the reporting period is included as part of the report to shareholders filed
under Item 1 of this form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's Board of Directors, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR
229.407) (as required by Item 22(b)(15) of Schedule 14A (17 CFR 240.14a-101)),
or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial
officers, or persons performing similar functions, have concluded
that the registrant's disclosure controls and procedures (as defined
in Rule 30a-3(c) under the Investment Company Act of 1940, as
amended (the "1940 Act") (17 CFR 270.30a-3(c))) are effective, as of
a date within 90 days of the filing date of the report that includes
the disclosure required by this paragraph, based on their evaluation
of these controls and procedures required by Rule 30a-3(b) under the
1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b)
under the Securities Exchange Act of 1934, as amended (17 CFR
240.13a-15(b) or 240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act
(17 CFR 270.30a-3(d)) that occurred during the registrant's second
fiscal quarter of the period covered by this report that has
materially affected, or is reasonably likely to materially affect,
the registrant's internal control over financial reporting.
ITEM 12. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and
Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.
(a)(3) Not applicable.
(b) Certifications pursuant to Rule 30a-2(b) under the 1940 Act and
Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(registrant) GAMCO Global Series Funds, Inc.
--------------------------------------------------------------------
By (Signature and Title)* /s/ Bruce N. Alpert
-------------------------------------------------------
Bruce N. Alpert, Principal Executive Officer
Date August 31, 2007
----------------------------------------------------------------------------
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 August 31, 2007
----------------------------------------------------------------------------
By (Signature and Title)* /s/ Agnes Mullady
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Agnes Mullady, Principal Financial Officer
& Treasurer
Date August 31, 2007
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* Print the name and title of each signing officer under his or her signature.