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:811-22819
ETFis Series Trust I
(Exact name of registrant as specified in charter)
1540 Broadway, 16th Floor
New York, NY 10036
(Address of principal executive offices) (Zip code)
ETFis Series Trust I
c/o Corporation Service Company
2711 Centerville Road, Suite 400
Wilmington, DE 19808
(Name and address of agent for service)
Registrant’s telephone number, including area code:(212) 593-4383
Date of fiscal year end:July 31
Date of reporting period:January 31, 2020
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. § 3507.
Item 1. Reports to Stockholders.
The Report to Shareholders is attached herewith.
SEMI-ANNUAL REPORT January 31, 2020 |
Table of Contents
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15 |
Shareholder Letter (unaudited)
President
Shareholder Expense Examples (unaudited)
Beginning Account Value 8/01/19 | Ending Account Value 1/31/20 | Annualized Expense Ratios | Expenses Paid During the Period(2) | |||||||||||||
Virtus Reaves Utilities ETF | ||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,129.00 | 0.49 | % | $2.62 | |||||||||
Hypothetical(1) | $ | 1,000.00 | $ | 1,022.67 | 0.49 | % | $2.49 |
(1) | Assuming 5% return before expenses. |
(2) | Expenses are calculated using the Fund’s annualized ratio, multiplied by the average account value for the period, multiplied by 184/366 (to reflect the six-month period). |
Schedule of Investments — Virtus Reaves Utilities ETF
Security Description | Shares | Value | ||||||||
COMMON STOCKS — 99.8% | ||||||||||
Utilities — 99.8% | ||||||||||
American Water Works Co., Inc. | 9,009 | $ | 1,227,026 | |||||||
Atmos Energy Corp. | 10,842 | 1,268,839 | ||||||||
Chesapeake Utilities Corp. | 6,939 | 667,601 | ||||||||
CMS Energy Corp. | 25,612 | 1,754,678 | ||||||||
Consolidated Edison, Inc. | 9,853 | 926,182 | ||||||||
Dominion Energy, Inc. | 5,552 | 476,084 | ||||||||
DTE Energy Co. | 11,552 | 1,531,911 | ||||||||
Edison International | 17,600 | 1,347,280 | ||||||||
Eversource Energy | 10,842 | 1,002,235 | ||||||||
Exelon Corp. | 12,800 | 609,152 | ||||||||
Fortis, Inc. (Canada) | 26,895 | 1,172,622 | ||||||||
New Jersey Resources Corp. | 15,253 | 630,254 | ||||||||
NextEra Energy Partners LP | 29,098 | 1,651,894 | ||||||||
NextEra Energy, Inc. | 24,671 | 6,616,762 | ||||||||
NiSource, Inc. | 57,566 | 1,687,259 | ||||||||
NRG Energy, Inc. | 20,916 | 771,591 | ||||||||
PG&E Corp.* | 25,412 | 386,517 | ||||||||
Pinnacle West Capital Corp. | 6,528 | 637,720 | ||||||||
PPL Corp. | 17,796 | 644,037 | ||||||||
Public Service Enterprise Group, Inc. | 30,974 | 1,833,661 | ||||||||
Sempra Energy | 11,974 | 1,923,503 | ||||||||
South Jersey Industries, Inc. | 37,545 | 1,156,386 | ||||||||
Southwest Gas Holdings, Inc. | 20,106 | 1,518,204 | ||||||||
Vistra Energy Corp. | 36,397 | 819,660 | ||||||||
WEC Energy Group, Inc. | 8,985 | 897,512 | ||||||||
Xcel Energy, Inc. | 18,092 | 1,251,786 | ||||||||
TOTAL INVESTMENTS — 99.8% | ||||||||||
(Cost $28,046,454) | 34,410,356 | |||||||||
Other Assets in Excess of Liabilities—0.2% | 81,779 | |||||||||
Net Assets — 100.0% | $ | 34,492,135 |
* | Non-income producing security. |
Portfolio Composition | ||||||||||||
January 31, 2020 (unaudited) |
Utilities | 99.8 | % | ||||
Other Assets in Excess of Liabilities | 0.2 | % | ||||
Total | 100.0 | % |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Asset Valuation Inputs | |||||||||||||||||
Common Stocks | $ | 34,410,356 | $ | — | $ | — | $ | 34,410,356 | |||||||||
Total | $ | 34,410,356 | $ | — | $ | — | $ | 34,410,356 |
The accompanying notes are an integral part of these financial statements.
Statement of Assets and Liabilities
Virtus Reaves Utilities ETF | ||||||
Assets: | ||||||
Investments, at cost | $ | 28,046,454 | ||||
Investments, at value | 34,410,356 | |||||
Cash | 84,364 | |||||
Receivables: | ||||||
Dividends and interest | 11,399 | |||||
Total Assets | 34,506,119 | |||||
Liabilities: | ||||||
Payables: | ||||||
Sub-Advisory fees | 13,984 | |||||
Total Liabilities | 13,984 | |||||
Net Assets | $ | 34,492,135 | ||||
Net Assets Consist of: | ||||||
Paid-in capital | $ | 27,336,634 | ||||
Total distributable earnings (accumulated deficit) | 7,155,501 | |||||
Net Assets | $ | 34,492,135 | ||||
Shares outstanding (unlimited number of shares of beneficial interest authorized, no par value) | 800,004 | |||||
Net asset value per share | $ | 43.11 |
The accompanying notes are an integral part of these financial statements.
Statement of Operations
Virtus Reaves Utilities ETF | ||||||
Investment Income: | ||||||
Dividend income (net of foreign withholding taxes) | $ | 372,602 | ||||
Interest income | 943 | |||||
Total Investment Income | 373,545 | |||||
Expenses: | ||||||
Sub-Advisory fees | 70,954 | |||||
Tax expense | 57 | |||||
Total Expenses | 71,011 | |||||
Net Investment Income | 302,534 | |||||
Net Realized Gain (Loss) on: | ||||||
Investments | 44,083 | |||||
In-kind redemptions | 779,622 | |||||
Total Net Realized Gain | 823,705 | |||||
Change in Net Unrealized Appreciation (Depreciation) on: | ||||||
Investments | 2,445,755 | |||||
Total Change in Net Unrealized Appreciation | 2,445,755 | |||||
Net Realized and Change in Unrealized Gain | 3,269,460 | |||||
Net Increase in Net Assets Resulting from Operations | $ | 3,571,994 | ||||
Foreign withholding taxes | $ | 3,063 |
The accompanying notes are an integral part of these financial statements.
Statements of Changes in Net Assets
Virtus Reaves Utilities ETF | ||||||||||
For the Six Months Ended January 31, 2020 (unaudited) | For the Year Ended July 31, 2019 | |||||||||
Increase (Decrease) in Net Assets Resulting from Operations: | ||||||||||
Net investment income | $ | 302,534 | $ | 320,214 | ||||||
Net realized gain on investments | 823,705 | 123,924 | ||||||||
Net change in unrealized appreciation on investments | 2,445,755 | 2,017,617 | ||||||||
Net increase in net assets resulting from operations | 3,571,994 | 2,461,755 | ||||||||
Distributions to Shareholders | (302,502 | ) | (336,003 | ) | ||||||
Shareholder Transactions: | ||||||||||
Proceeds from shares sold | 10,215,839 | 7,612,327 | ||||||||
Cost of shares redeemed | (2,146,605 | ) | — | |||||||
Net increase in net assets resulting from shareholder transactions | 8,069,234 | 7,612,327 | ||||||||
Increase in net assets | 11,338,726 | 9,738,079 | ||||||||
Net Assets: | ||||||||||
Beginning of period/year | 23,153,409 | 13,415,330 | ||||||||
End of period/year | $ | 34,492,135 | $ | 23,153,409 | ||||||
Changes in Shares Outstanding: | ||||||||||
Shares outstanding, beginning of period/year | 600,004 | 400,004 | ||||||||
Shares sold | 250,000 | 200,000 | ||||||||
Shares redeemed | (50,000 | ) | — | |||||||
Shares outstanding, end of period/year | 800,004 | 600,004 |
The accompanying notes are an integral part of these financial statements.
Financial Highlights
Virtus Reaves Utilities ETF | |||||||||||||||||||||
For the Six Months Ended January 31, 2020 (unaudited) | For the Year Ended July 31, 2019 | For the Year Ended July 31, 2018 | For the Year Ended July 31, 2017 | For the Period September 23, 2015(1) Through July 31, 2016 | |||||||||||||||||
Per Share Data for a Share Outstanding throughout each period presented: | |||||||||||||||||||||
Net asset value, beginning of period | $ | 38.59 | $ | 33.54 | $ | 33.48 | $ | 32.30 | $ | 25.00 | |||||||||||
Investment operations: | |||||||||||||||||||||
Net investment income(2) | 0.43 | 0.74 | 0.66 | 0.69 | 0.47 | ||||||||||||||||
Net realized and unrealized gain | 4.52 | 5.06 | 0.32 | 1.63 | 7.19 | ||||||||||||||||
Total from investment operations | 4.95 | 5.80 | 0.98 | 2.32 | 7.66 | ||||||||||||||||
Less Distributions from: | |||||||||||||||||||||
Net investment income | (0.43 | ) | (0.75 | ) | (0.72 | ) | (0.70 | ) | (0.36 | ) | |||||||||||
Net realized gains | — | — | (0.20 | ) | (0.44 | ) | — | ||||||||||||||
Total distributions | (0.43 | ) | (0.75 | ) | (0.92 | ) | (1.14 | ) | (0.36 | ) | |||||||||||
Net Asset Value, End of period | $ | 43.11 | $ | 38.59 | $ | 33.54 | $ | 33.48 | $ | 32.30 | |||||||||||
Net Asset Value Total Return(3) | 12.90 | % | 17.47 | % | 3.05 | % | 7.59 | % | 30.85 | % | |||||||||||
Net assets, end of period (000’s omitted) | $ | 34,492 | $ | 23,153 | $ | 13,415 | $ | 15,068 | $ | 12,918 | |||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||||
Ratios to Average Net Assets: | |||||||||||||||||||||
Expenses | 0.49 | %(4)(5) | 0.76 | %(5) | 0.95 | % | 0.95 | %(5) | 0.95 | %(4)(5) | |||||||||||
Net investment income | 2.09 | %(4) | 2.04 | % | 2.02 | % | 2.23 | % | 1.89 | %(4) | |||||||||||
Portfolio turnover rate(6) | 7 | %(7) | 28 | % | 29 | % | 33 | % | 46 | %(7) |
(1) | Commencement of operations. |
(2) | Based on average shares outstanding. |
(3) | Net Asset Value Total Return is calculated assuming an initial investment made at the net asset value on the first day of the period, reinvestment of dividends and distributions at net asset value during the period, and redemptions at net asset value on the last day of the period. Total return calculated for a period of less than one year is not annualized. |
(4) | Annualized. |
(5) | The ratios of expenses to average net assets includes tax expense fees of less than 0.01%. |
(6) | Portfolio turnover excludes the value of portfolio securities received or delivered as a result of in-kind creations or redemptions of the Fund’s capital shares. |
(7) | Not annualized. |
The accompanying notes are an integral part of these financial statements.
Notes to Financial Statements (unaudited)
• | Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access. |
• | Level 2 — Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. |
Notes to Financial Statements (unaudited) (continued)
• | Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available; representing the Fund’s own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. |
Notes to Financial Statements (unaudited) (continued)
Notes to Financial Statements (unaudited) (continued)
Federal Tax Cost of Investments | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Net Unrealized Appreciation (Depreciation) | |||||||||
$19,090,122 | $ | 4,084,499 | $(169,932) | $ | 3,914,567 |
Short-Term No Expiration | Long-Term No Expiration | Total | ||||
$28,558 | $ — | $28,558 |
Purchases | Sales | Subscriptions In-Kind | Redemptions In-Kind | |||||||||
$2,363,538 | $ | 2,116,089 | $ | 10,031,054 | $ | 2,142,297 |
% of Shares Outstanding | Number of Accounts | |
68% | 3 |
Approval of Advisory Agreements & Board Considerations (unaudited)
Approval of Advisory Agreements & Board Considerations (unaudited) (continued)
Approval of Advisory Agreements & Board Considerations (unaudited) (continued)
of the amount received by the Sub-Adviser under the unified fee. Accordingly, the Board concluded that, in light of the current AUM for the Fund, it was not necessary to consider economies of scale at this time.
Supplemental Information (unaudited)
c/o VP Distributors, LLC
Hartford, Connecticut 06103
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. Investments.
(a) | 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. |
(b) | Not applicable. |
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 trustees, 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 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. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not applicable.
Item 13. 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.
(a)(4) | 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) | ETFis Series Trust I |
By (Signature and Title)* | /s/ William J. Smalley |
William J. Smalley, President and Principal Executive Officer | |
(Principal Executive Officer) |
Date | 4/8/2020 |
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/ William J. Smalley |
William J. Smalley, President and Principal Executive Officer | |
(Principal Executive Officer) |
Date | 4/8/2020 |
By (Signature and Title)* | /s/ Brinton W. Frith |
Brinton W. Frith, Treasurer and Principal Financial Officer | |
(Principal Financial Officer) |
Date | 4/8/2020 |
* Print the name and title of each signing officer under his or her signature.