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: 811-03599
Name of Registrant: The Royce Fund
Address of Registrant: 745 Fifth Avenue
New York, NY 10151
Name and address of agent for service: | John E. Denneen, Esq. |
745 Fifth Avenue | |
New York, NY 10151 |
Registrant's telephone number, including area code: (212) 508-4500
Date of fiscal year end: December 31, 2021
Date of reporting period: January 1, 2021 – June 30, 2021
Item 1. Reports to Shareholders.
The Royce Funds 2021 Semiannual
Review and Report to Shareholders
June 30, 2021
Royce Dividend Value Fund
Royce Global Financial Services Fund
Royce International Premier Fund
Royce Micro-Cap Fund
Royce Opportunity Fund
Royce Pennsylvania Mutual Fund
Royce Premier Fund
Royce Small-Cap Value Fund
Royce Smaller-Companies Growth Fund
Royce Special Equity Fund
Royce Total Return Fund
Table of Contents
Semiannual Review | |
Letter to Our Shareholders | 2 |
Performance and Expenses | 7 |
Semiannual Report to Shareholders | |
Managers’ Discussions of Fund Performance | |
Royce Dividend Value Fund | 8 |
Royce Global Financial Services Fund | 10 |
Royce International Premier Fund | 12 |
Royce Micro-Cap Fund | 14 |
Royce Opportunity Fund | 16 |
Royce Pennsylvania Mutual Fund | 18 |
Royce Premier Fund | 20 |
Royce Small-Cap Value Fund | 22 |
Royce Smaller-Companies Growth Fund | 24 |
Royce Special Equity Fund | 26 |
Royce Total Return Fund | 28 |
Schedules of Investments and Financial Statements | 30 |
Notes to Financial Statements | 72 |
Understanding Your Fund’s Expenses | 82 |
Trustees and Officers | 84 |
Liquidity Risk Management Program | 85 |
Notes to Performance and Other Important Information | 86 |
This page is not part of the The Royce Funds 2021 Semiannual Report to Shareholders | 1
WHY TWO MAXIMS ARE ESPECIALLY RELEVANT NOW
The first six months of 2021 offered an important reminder that the economy and the equity markets—small cap stocks included—advance at their own speeds. The first quarter of 2021 saw economic acceleration in the form of U.S. real GDP growth of 6.3%, a considerable increase from 4Q20’s also strong 4.3% mark. This growth continued into 2Q21, when real GDP came in at 6.5%, both quarters in line with current consensus estimates of 6-7% annual growth. Over the same period, small cap returns, as measured by the Russell 2000 Index, moved at the opposite pace, from 31.4% in 4Q20 to 12.7% in 1Q21, and finally to 4.3% for 2Q21.
Decelerating Market, Accelerating Economy
Russell 2000 Index Quarterly Returns vs. U.S. Real GDP Growth (annualized, quarter over quarter)
Source: Bloomberg
These seemingly disconnected results are actually more closely connected than they appear. They also provide us with the opportunity to remind investors of an important investment maxim: that it often makes sense to discount the relevance of current economic news when thinking about how to invest. The stock market has a well-founded reputation as a forward-looking force, often traveling six to 12 months ahead of economic results. This dynamic highlights why the best returns often come when current economic news seems dire or pedestrian. March 2020 provided just the latest example of this long-running phenomenon. And—as the direction of small-cap’s last three quarterly returns makes clear—the other side of this relationship is also frequently accurate: prospective equity returns can be far more subdued when the economy is most robust. (There is a silver lining for active managers to this market-economy dynamic, but more on that later.) Seen from this perspective, the first half’s simultaneous economic acceleration and small-cap deceleration was, in a period that continues to provide plenty of atypical behavior, reassuringly conventional.
The first half of the year also came to a close with nearly every trend established within the equity markets from the March 2020 troughs still firmly in place. To wit: small cap finished ahead of large cap for the year-to-date period ended 6/30/21, as measured by the Russell 2000 (+17.5%) and Russell 1000 (+15.0%) indexes, thus extending the leadership
2 | This page is not part of the The Royce Funds 2021 Semiannual Report to Shareholders | Past performance is no guarantee of future results. |
LETTER TO OUR SHAREHOLDERS
Our research delves into equity returns during previous periods of strong nominal GDP growth, current valuation levels, and historical small cap returns patterns, all of which have given us what we admit is an arguably paradoxical point of view: a strong sense of guarded optimism.
shift that began more than 15 months ago. Similarly, the Russell 2000 Value Index, which advanced 26.7%, solidified its nascent market cycle advantage over the Russell 2000 Growth Index—which rose 9.0%—following nearly a decade of underperformance—an unprecedented length of time for growth to outpace value since the inception of the style indexes. Also within small cap, cyclical sectors maintained a convincing lead over their defensive counterparts.
Will these trends continue? We think they will. What we flesh out in this letter, then, is our case for extended small-cap leadership and, within the asset class, ongoing outperformance for value. Our research delves into equity returns during previous periods of strong nominal GDP growth, current valuation levels, and historical small cap returns patterns, all of which have given us what we admit is an arguably paradoxical point of view: a strong sense of guarded optimism.
BE AWARE OF RECENCY BIAS
Some readers may think we are on shaky ground in arguing that small cap’s first-half leadership looks built to last. And there are reasons that might appear to support the notion that leadership has moved back to large caps. After its historic one-year rally through the end of March 2021—which included three consecutive quarters outperforming large caps—small cap’s advance moderated. The Russell 2000 also fell behind its large-cap sibling during the second quarter of 2021, up 4.3% versus 8.5% for the Russell 1000. And while the Russell 2000 established its latest all-time peak on March 15th, the Russell 1000 reached its latest peak as recently as July 26th, after making previous new highs several times toward the end of the second quarter. In this context, we suspect a certain amount
of recency bias may be preventing small-cap skeptics from seeing just how strong first-half performance was—and not just for small cap, but for cyclicals, small-cap value, and micro-cap stocks (which rose 29.0%, as measured by the Russell Microcap Index). For example, the Russell 2000’s 17.5% gain was well above the index’s rolling monthly average six-month return of 6.7% since its inception (12/31/78). History also shows that intra-cycle leadership shifts occur with some regularity during market cycles, as do changes in the tempo of performance. For example, after small caps experienced a very strong absolute and relative recovery in 2009, a digestion period followed in which returns were negative over the next six months before the asset class resumed a positive pace and held on to market leadership.
In addition, it’s worth noting that first-half returns being highest for the smallest capitalization asset classes (as well as being significantly in value’s favor) lines up exactly as we would expect during a period of widespread economic recovery. Equally important, we see little on the horizon in the economy, the market itself, or—and this is always most relevant to us—in our analysis of companies and conversations with management teams—to suggest that small cap’s leadership phase has run its course.
HAS SMALL-CAP’S RUN ONLY JUST BEGUN?
The growing economy underpins an important part of our optimism for small cap’s continued leadership over large cap. Notwithstanding ever-present sources of concern, our bottom-up view of the economy, which we glean from analyzing a wide swath of companies, shows that the U.S. in particular continues to skew heavily toward expansion. The U.S. consumer, whose spending comprises roughly 70% of our economy, is financially flush. With notably strong consumer balance sheets and low mortgage rates, the housing market remains healthy while also boasting favorable long-term demographic trends. Retail
Past performance is no guarantee of future results. | This page is not part of the The Royce Funds 2021 Semiannual Report to Shareholders | 3 |
LETTER TO OUR SHAREHOLDERS
And while past performance is no guarantee of future results, history is admirably clear about the pattern of U.S. equity leadership when the economy expanded. During prior periods of robust economic growth, small caps have enjoyed a decided performance edge over their large cap siblings. When nominal U.S. GDP growth exceeded 5% in year-over-year periods, the Russell 2000 beat the Russell 1000 65% of the time with an average annual return of 22.1% versus 17.0%. This is especially relevant to the current environment because consensus projections call for nominal GDP growth in the 8-10% range for 2021 and 5-7% for 2022.
Small Caps Have Tended to Outpace Large Caps in Periods of High Economic Growth
Russell 2000 vs Russell 1000 Regimes from 6/30/01 to 6/30/21
Batting average refers to the percentage of 1-year periods in which the Russell 2000 outperformed the Russell 1000.
The state of valuations between small and large caps is also relevant. With more and more market observers expressing concern about share prices in the U.S. market being unsustainably elevated, we looked at the situation by dividing the market by capitalization. To gauge valuations, we used one of our preferred metrics, enterprise value divided by the last 12 months’ earnings before interest & taxes (“LTM EV/EBIT”), excluding companies with negative EBIT. Although small cap delivered a significant outperformance over large cap over
the past year (+62.0% vs. +43.1%), small-cap stocks are still relatively undervalued versus large caps when compared against their valuation range over the past 20 years.
Relative Valuations for Small Caps Are Near Their Lowest in 20 Years
Russell 2000 vs. Russell 1000 Median LTM EV/EBIT1 (ex. Negative EBIT Companies) from 6/30/01 to 6/30/21
1 Earnings before interest and taxes. Source: FactSet
We think that the combination of the asset class’s strong history in growing economies and its more attractive relative valuations make a powerful case for small cap’s ongoing leadership in the U.S. equity market.
SMALL-CAP VALUE’S ADVANTAGE
In addition to looking for small caps to continue posting attractive relative and solid absolute results, we also expect small-cap value to maintain leadership within small cap—and for the same two reasons as small cap’s relative advantage over large caps: 1) Small-cap value has enjoyed a pronounced tendency to outperform small-cap growth when nominal economic growth has been above average and 2) small-cap value’s relative valuation compared with its historic range also looks attractive. The rationale for small-cap value outperforming in periods of high nominal economic growth is rooted in the idea that small-cap value is both more cyclically sensitive than its growth sibling and a greater beneficiary of inflation for relative earnings growth and valuation.
Our research confirmed this relationship as we looked back over the past 20 years and found that in one-year periods with at least 5% nominal GDP growth, the Russell 2000 Pure Value Index outperformed the Russell 2000 Pure Growth Index 68% of the time by an average of 420 basis points. In contrast, when nominal GDP growth fell between 3-5%, the small-cap value
4 | This page is not part of the The Royce Funds 2021 Semiannual Report to Shareholders | Past performance is no guarantee of future results. |
LETTER TO OUR SHAREHOLDERS
index outperformed only 32% of the time and lagged small-cap growth by an average of 100 basis points. As noted earlier, with consensus projections for nominal GDP growth for 2021 and 2022 both in excess of 5%, the future environment seems well suited to continued outperformance for value.
Strong Economic Expansion Has Favored Value
Rolling 1-Year Returns for the Russell 2000 Pure Value vs Russell 2000 Pure Growth Indexes from 6/30/01 to 6/30/21
Batting average refers to the percentage of 1-year periods in which the Russell Pure Value outperformed the Russell Pure Growth Index. Source: Russell Investments
Despite these favorable conditions, some readers, in noting that small cap value has already beaten small-cap growth by a sizable margin over the last year (+73.3% versus +51.4%), may be wondering how much more outperformance value has left. We’d suggest that extending the time periods from the last one year to include the last three and five years reveals a starkly different picture. The Russell 2000 Value lagged its growth counterpart by more than 500 basis points for both the three-and five-year annualized periods ended 6/30/21. Given the depth of value’s underperformance over much of the past five years, then, the idea that value’s run might also be over seems ill founded to us.
Despite Leading from One Year, Value Trails by a Large Margin for Three- and Five-Year Periods
Russell 2000 Value vs Russell 2000 Growth Average Annual Total Returns as of 6/30/21
Current valuations add one final piece of the puzzle: just as small cap valuations finished June looking more attractive than those of large cap, small-cap value wound down 2021’s first half looking far more attractively valued than its growth counterpart—based on the same LTM EV/EBIT metric we used above. Indeed, even after accounting for its recent performance dominance, small-cap value stocks are as inexpensive compared to their small-cap growth cousins than at any time in the last 20 years. At the end of June 2021, the Russell 2000 Value Index had a relative valuation of 22% of the Russell 2000 Growth Index compared to a 20-year average of 85% This most recent relative valuation shows how much cheaper small-cap value stocks are compared with their historic relationship with valuations for small-cap growth stocks.
THE SECOND MAXIM
With all of the ups and downs the market has experienced since June 30, 2016, many investors may not realize that small caps have more than doubled over that five-year span. A multi-year period of moderately lower returns is to be expected after that high level of performance.
Which brings us to the aforementioned silver lining. The second investment maxim that is especially relevant to the current environment is that, perhaps paradoxically, active small-cap managers have actually added their greatest share of excess return when the Russell 2000 has delivered lower returns—single-digit results over five-year periods to be precise.
Monthly Rolling 5-Year U.S. Small Blend1 Average Excess Returns During Russell 2000 Return Ranges from 12/31/78 through 6/30/21
1 There were 514 US Fund Small Blend Funds tracked by Morningstar with at least five years of performance history as of 6/30/21. The excess return for a Morningstar category would be the category’s return for the period minus the Index return. Source: Morningstar
Past performance is no guarantee of future results. | This page is not part of the The Royce Funds 2021 Semiannual Report to Shareholders | 5 |
THE AGE OF ALPHA?
For most of the last decade, simply buying the market worked very well. The conditions were close to ideal for a market cap weighted, index-based approach. Large cap beat small cap, and mega caps beat large caps. The economy grew very slowly and with a good deal of volatility, while 10-year Treasury yields ended the period at less than half of the 3.2% at which they started it. This significant decline in yield fused with the scarcity of economic growth to drive outperformance for duration-sensitive mega-cap growth stocks. The behemoths in turn drove index returns. We would describe this roughly 10-year period as “the era of beta” because overall market returns were so much higher than economic and profit growth, making it difficult for active strategies to stand out. Yet we believe that what we’re calling the “age of alpha” is in front of us—alpha being the term that describes an investment approach’s ability to beat the market.
As we have outlined, there’s good reason to anticipate a period of above-average economic and profit growth that’s accompanied by more subdued market returns. We believe this kind of environment gives disciplined active managers, especially those with a quality bias, an excellent opportunity
to excel. A market in which there will be considerable differentiation is apt to reward the very fundamentals we focus on most. So while we anticipate lower overall U.S. equity returns than what the markets have given investors over the last 12-15 months, we also anticipate positive results—for small caps as an asset class and, more specifically, for small-cap value and select cyclicals.
There are always challenges, of course—and surprises, such as the Dow’s 500-point swoon on July 20th. It’s also true that small cap will almost definitely be contending with two countervailing forces over at least the next year or more: their fall through most of June and July notwithstanding, slowly rising rates seem likely to push down on valuations just as many companies are likely to be reporting healthy and growing earnings through at least the end of next year. These forces, however, will not affect all small-cap stocks equally. We believe that we offer our investors the requisite experience, discipline, and expertise to select those companies best positioned to benefit from the more challenging environment we see ahead—one that looks like a promising period for active small-cap management.
Sincerely,
Charles M. Royce | Christopher D. Clark | Francis D. Gannon |
Chairman, Royce Investment Partners | Chief Executive Officer, and Co-Chief Investment Officer, Royce Investment Partners | Co-Chief Investment Officer, Royce Investment Partners |
July 30, 2021
6 | This page is not part of the The Royce Funds 2021 Semiannual Report to Shareholders | Past performance is no guarantee of future results. |
Performance and Expenses | |||||||||||
As of June 30, 2021 | AVERAGE ANNUAL TOTAL RETURNS (%) | ANNUAL OPERATING EXPENSES (%) | |||||||||
YTD1 | 1-YR | 3-YR | 5-YR | 10-YR | 15-YR | 20-YR | SINCE INCEPTION | INCEPTION DATE | GROSS | NET | |
Royce Dividend Value Fund | 16.88 | 44.66 | 10.65 | 12.47 | 9.23 | 8.65 | N/A | 9.18 | 5/3/04 | 1.60 | 1.34 |
Royce Global Financial Services Fund | 17.73 | 45.84 | 12.43 | 14.95 | 11.41 | 8.35 | N/A | 9.24 | 12/31/03 | 2.07 | 1.68 |
Royce International Premier Fund | 6.40 | 33.00 | 14.16 | 14.63 | 9.53 | N/A | N/A | 9.48 | 12/31/10 | 1.57 | 1.44 |
Royce Micro-Cap Fund | 25.27 | 76.47 | 16.01 | 16.95 | 7.29 | 7.38 | 8.95 | 11.52 | 12/31/91 | 1.29 | 1.24 |
Royce Opportunity Fund | 30.87 | 102.05 | 17.76 | 21.11 | 13.19 | 10.42 | 11.24 | 13.23 | 11/19/96 | 1.23 | 1.23 |
Royce Pennsylvania Mutual Fund | 16.60 | 53.88 | 12.89 | 15.75 | 10.55 | 8.86 | 9.87 | 13.321 | N/A | 0.95 | 0.95 |
Royce Premier Fund | 10.38 | 41.91 | 12.97 | 16.15 | 10.06 | 9.70 | 10.84 | 11.92 | 12/31/91 | 1.21 | 1.21 |
Royce Small-Cap Value Fund | 23.08 | 60.08 | 5.65 | 9.27 | 5.69 | 6.31 | 8.92 | 9.12 | 6/14/01 | 1.62 | 1.49 |
Royce Smaller-Companies Growth Fund | 18.90 | 73.78 | 21.31 | 21.34 | 13.08 | 9.73 | 12.85 | 13.12 | 6/14/01 | 1.54 | 1.49 |
Royce Special Equity Fund | 14.16 | 36.27 | 7.69 | 10.39 | 8.58 | 8.28 | 9.69 | 9.00 | 5/1/98 | 1.23 | 1.23 |
Royce Total Return Fund | 19.80 | 50.45 | 10.15 | 12.10 | 9.87 | 8.10 | 8.96 | 10.76 | 12/15/93 | 1.25 | 1.25 |
INDEX Russell 2000 |
17.54 |
62.03 |
13.52 |
16.47 |
12.34 |
9.51 |
9.26 |
N/A |
N/A |
N/A |
N/A |
Russell Microcap | 29.02 | 75.77 | 14.47 | 18.13 | 13.06 | 8.73 | 9.26 | N/A | N/A | N/A | N/A |
Russell 2000 Value | 26.69 | 73.28 | 10.27 | 13.62 | 10.85 | 7.90 | 9.17 | N/A | N/A | N/A | N/A |
Russell 2500 | 16.97 | 57.79 | 15.24 | 16.35 | 12.86 | 10.25 | 10.10 | N/A | N/A | N/A | N/A |
MSCI ACWI ex USA Small Cap | 12.24 | 47.04 | 9.78 | 11.97 | 7.02 | 6.65 | 9.50 | N/A | N/A | N/A | N/A |
MSCI ACWI Small Cap | 15.43 | 54.07 | 12.20 | 14.13 | 9.90 | 8.64 | 9.96 | N/A | N/A | N/A | N/A |
1 For Royce Pennsylvania Mutual Fund, the average annual total return shown is for the 45-year period ended 6/30/21.
Important Performance, Expense, and Risk Information
All performance information in this Review and Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Investment and Service Class shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund (2% for Royce International Premier Fund). Redemption fees are not reflected in the performance shown above; if they were, performance would be lower. Current performance may be higher or lower than performance quoted. Current month-end performance may be obtained at www.royceinvest.com. All performance and expense information reflects results of the Funds’ oldest share Class (Investment Class or Service Class, as the case may be). Price and total return information is based on net asset values calculated for shareholder transactions. Gross annual operating expenses reflect the Fund’s gross total annual operating expenses and include management fees, any 12b-1 distribution and service fees, other expenses, and any applicable acquired fund fees and expenses. Net annual operating expenses reflect contractual fee waivers and/or expense reimbursements. All expense information is reported as of the Fund’s most current prospectus. Royce & Associates has contractually agreed to waive fees and/or reimburse operating expenses, excluding brokerage commissions, taxes, interest, litigation expenses, acquired fund fees and expenses, and other expenses not borne in the ordinary course of business, to the extent necessary to maintain net operating expenses at or below: 1.24% for Royce Micro-Cap Fund; 1.34% for Royce Dividend Value Fund; 1.44% for Royce International Premier Fund; 1.49% for Royce Global Financial Services, Small-Cap Value, and Smaller-Companies Growth Funds through April 30, 2022. Acquired fund fees and expenses reflect the estimated amount of the fees and expenses incurred indirectly by the Fund through its investments in mutual funds, hedge funds, private equity funds, and other investment companies.
Service Class shares bear an annual distribution expense that is not borne by the Funds’ Investment Class. If such distribution expenses had been reflected for Funds showing Investment Class performance, returns would have been lower. Each series of The Royce Fund is subject to market risk–the possibility that common stock prices will decline, sometimes sharply and unpredictably, over short or extended periods of time. Such declines may be caused by various factors, including market, financial, and economic conditions, governmental or central bank actions, and other factors, such as the recent COVID-19 pandemic, that may not be directly related to the issuer of a security held by a Fund. This pandemic could adversely affect global market, financial, and economic conditions in ways that cannot necessarily be foreseen. Investments in securities of micro-cap, small-cap, and/or mid-cap companies may involve considerably more risk than investments in securities of larger-cap companies. (Please see “Primary Risks for Fund Investors” in the prospectus.) Certain Funds invest a significant portion of their respective assets in foreign companies that may be subject to different risks than investments in securities of U.S. companies, including adverse political, social, economic, or other developments that are unique to a particular country or region. (Please see “Investing in Foreign Securities” in the prospectus.) Therefore, the prices of securities of foreign companies in particular countries or regions may, at times, move in a different direction than those of securities of U.S. companies. (Please see “Primary Risk of Fund Investors” in the prospectus.) Certain Funds generally invest a significant portion of their assets in a limited number of stocks, which may involve considerably more risk than a more broadly diversified portfolio because a decline in the value of any of these stocks would cause their overall value to decline to a greater degree. A broadly diversified portfolio, however, does not ensure a profit or guarantee against loss. This Review and Report must be preceded or accompanied by a prospectus. Please read the prospectus carefully before investing or sending money. Source: MSCI. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indexes or any securities or financial products. This report is not approved, endorsed, reviewed or produced by MSCI. None of the MSCI data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Russell Investment Group is the source and owner of the trademarks, service marks, and copyrights related to the Russell Indexes. Russell® is a trademark of Russell Investment Group. The Russell 2000 Index is an unmanaged, capitalization-weighted index of domestic small-cap stocks. It measures the performance of the 2,000 smallest publicly traded U.S. companies in the Russell 3000 Index. The Russell Microcap Index includes 1,000 of the smallest securities in the small-cap Russell 2000 Index along with the next smallest eligible securities as determined by Russell. The Russell 2000 Value Index consists of the respective value stocks within the Russell 2000 as determined by Russell Investments. The Russell 2500 is an unmanaged, capitalization-weighted index of the 2,500 smallest publicly traded U.S. companies in the Russell 3000 index. The MSCI ACWI ex USA Small Cap Index is an unmanaged, capitalization-weighted index of global small-cap stocks, excluding the United States. The MSCI ACWI Small Cap Index is an unmanaged, capitalization-weighted index of global small-cap stocks. Index returns include net reinvested dividends and/or interest income. The performance of an index does not represent exactly any particular investment as you cannot invest directly in an index. Distributor: Royce Fund Services, LLC.
This page is not part of the The Royce Funds 2021 Semiannual Report to Shareholders | 7
MANAGERS’ DISCUSSION (UNAUDITED)
Royce Dividend Value Fund (RDV)
Chuck Royce
Miles Lewis, CFA®
FUND PERFORMANCE
Royce Dividend Value Fund advanced 16.9% for the year-to-date period ended 6/30/21, very narrowly underperforming its benchmark, the Russell 2500 Index, which gained 17.0%, and trailing the Russell 2000 Index, which returned 17.5%, for the same period.
WHAT WORKED… AND WHAT DIDN’T
Seven of the Fund’s nine equity sectors finished the year-to-date period in the black. Industrials and Financials made by far the biggest positive impact, followed by Consumer Discretionary. Energy and Real Estate—among our lowest sector weights during the first half—were the only detractors while Consumer Staples made the smallest contribution. At the industry level, capital markets, from Financials, made an outsized positive impact, followed by professional services and machinery, each from the Industrials sector. Chemicals (Materials) detracted most, along with oil, gas & consumable fuels (Energy) and software (Information Technology).
The Fund’s top contributor at the position level was The Carlyle Group, which manages investment vehicles across four segments: corporate private equity, real assets, global credit, and investment solutions. The firm reported record levels of fee-related earnings with strong margins and a confident outlook in February. In late April, Carlyle then announced healthy fee-based and other earnings, increased net performance revenues, and a record high in assets under management, all of which helped its shares to rise. KBR, the portfolio’s next-best contributor, is a global engineering & construction company. The company made an acquisition in 2020 in order to move further into the aerospace & defense markets and in January 2021 signed an agreement with Mura Technology to offer an advanced plastics recycling process. KBR then announced strong 4Q20 results and optimistic guidance for 2021 in February. All of these developments helped lead its shares upward.
The biggest detractor at the position level was B3-Brasil, Bolsa, Balcao, a stock exchange located in São Paulo, Brazil. Its decline in the first half seems to have been a case of investors expecting more. Brazil’s economy and equity markets have been recovering in 2021, and the company reported slightly better-than-expected profits and earnings in May. We maintained our position at the end of June. Quaker Chemical develops and produces a range of formulated chemical products for heavy industrial and manufacturing applications. In February, the company reported a modest sales decline of 1% and lower sales volume for 2020’s fourth quarter, which proved more than enough to inspire a wave of selling even as Quaker also offered an optimistic view, reporting new business gains, improved market share, and business growth in the Asia Pacific region, all of which helped to offset the effects of the coronavirus in certain depressed end markets, such as aerospace. In May, Quaker announced strong first quarter results, with sales up 11% compared to 4Q20 and all of its regions and segments showing healthy revenue growth. These improvements did little to change investor’s minds, however, which may be due to management leaving its earlier, cautiously optimistic guidance unchanged. Confident that its stock can recover in the rebounding economy, we held shares at the end of June.
In 2021’s first half, the Fund’s narrow disadvantage versus the Russell 2500 came entirely from stock selection—sector allocation decisions were additive. On a sector level, both our lower exposure and stock picks hurt most in the resurgent Energy sector while the positive effect of our higher weighting in Materials could not overcome our stock selection miscues in the sector. Similarly, the additive impact of our higher weighting in Consumer Discretionary’s specialty retail group was not enough to compensate for ineffective stock selection throughout the entire sector. Conversely, both our higher weighting and stock selection helped in Industrials while stock picks and our lower weighting did the same in Information Technology. Relative results also got a boost from our substantially lower exposure to the lagging Health Care sector.
Top Contributors to Performance | Top Detractors from Performance | ||||||
Year-to-Date Through 6/30/21 (%)1 | Year-to-Date Through 6/30/21 (%)2 | ||||||
Carlyle Group | 1.65 | B3-Brasil, Bolsa, Balcao | -0.25 | ||||
KBR | 1.13 | Quaker Chemical | -0.19 | ||||
Lindsay Corporation | 0.96 | USS | -0.19 | ||||
Sprott | 0.94 | Gaztransport Et Technigaz | -0.17 | ||||
FLIR Systems | 0.91 | Ashmore Group | -0.16 | ||||
1 Includes dividends | 2 Net of dividends | ||||||
CURRENT POSITIONING AND OUTLOOK
While the market’s recent preoccupation with meme stocks may have dampened the attraction of more prosaic stocks—those that pay dividends, generate cash, and have low debt—we have been happy to hold positions in these consistent business models at what we believe are very attractive valuations. We remain especially constructive on Industrials and Financials. Our largest industry weight at the end of June remained capital markets, an industry with what we think are promising long-term prospects in a revived global economy. We also anticipate that our holdings in both machinery and professional services should reap the benefits of economic growth. In the first industry, our holdings focus on companies that innovate and/or help other companies to automate, while in the second our positions include staffing businesses that should benefit from the rapidly growing need for skilled professional workers. Finally, we continue to closely monitor inflation, which virtually all of our holdings are experiencing, and believe that the portfolio is well positioned for a period of rising prices in the U.S. economy.
8 | The Royce Funds 2021 Semiannual Report to Shareholders
PERFORMANCE AND PORTFOLIO REVIEW (UNAUDITED) | TICKER SYMBOLS RYDVX RDVIX RDIIX RDVCX |
Performance and Expenses
Average Annual Total Return (%) Through 6/30/21
JAN-JUN 20211 | 1-YR | 3-YR | 5-YR | 10-YR | 15-YR | SINCE INCEPTION (5/3/04) | |
RDV | 16.88 | 44.66 | 10.65 | 12.47 | 9.23 | 8.65 | 9.18 |
Annual Gross Operating Expenses: 1.60% Annual Net Operating Expenses: 1.34% | |||||||
1 Not annualized |
Morningstar Style Map™ As of 6/30/21
The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund’s investment strategy. The Morningstar Ownership Zone provides detail about a portfolio’s investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. Over time, the shape and location of a fund’s ownership zone may vary. See page 86 for additional information.
Value of $10,000
Invested on 5/3/04 as of 6/30/21 ($)
Top 10 Positions | |
% of Net Assets | |
Carlyle Group | 4.3 |
KBR | 3.9 |
HEICO Corporation Cl. A | 3.7 |
Lindsay Corporation | 3.7 |
AptarGroup | 3.7 |
Applied Industrial Technologies | 3.6 |
Worthington Industries | 3.5 |
Franco-Nevada | 3.4 |
Spirax-Sarco Engineering | 3.2 |
SEI Investments | 3.0 |
Portfolio Sector Breakdown | |
% of Net Assets | |
Industrials | 34.4 |
Financials | 27.3 |
Materials | 17.0 |
Consumer Discretionary | 6.6 |
Health Care | 3.2 |
Information Technology | 1.9 |
Energy | 1.3 |
Cash and Cash Equivalents | 8.3 |
Calendar Year Total Returns (%) | |
YEAR | RDV |
2020 | 4.5 |
2019 | 29.8 |
2018 | -16.2 |
2017 | 21.7 |
2016 | 16.4 |
2015 | -5.7 |
2014 | -2.1 |
2013 | 30.7 |
2012 | 16.9 |
2011 | -4.5 |
2010 | 30.1 |
2009 | 37.7 |
2008 | -31.5 |
2007 | -0.0 |
2006 | 19.9 |
Upside/Downside Capture Ratios | ||
Periods Ended 6/30/21 (%) | ||
UPSIDE | DOWNSIDE | |
10-Year | 86 | 102 |
From 6/30/04 (Start of Fund’s First Full Quarter) | 88 | 90 |
Portfolio Diagnostics | |
Fund Net Assets | $78 million |
Number of Holdings | 49 |
Turnover Rate | 0% |
Average Market Capitalization1 | $6,021 million |
Weighted Average P/E Ratio2,3 | 19.3x |
Weighted Average P/B Ratio2 | 3.5x |
Active Share4 | 98% |
U.S. Investments (% of Net Assets) | 65.5% |
Non-U.S. Investments (% of Net Assets) | 26.2% |
1 | Geometric Average. This weighted calculation uses each portfolio holding’s market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio’s center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median. |
2 | Harmonic Average. This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio’s share in the earnings or book value, as the case may be, of its underlying stocks. |
3 | The Fund’s P/E ratio calculation excludes companies with zero or negative earnings (3% of portfolio holdings as of 6/30/21). |
4 | Active Share is the sum of the absolute values of the different weightings of each holding in the Fund versus each holding in the benchmark, divided by two. |
Important Performance and Expense Information
All performance information in this Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. All performance and risk information reflects results of the Service Class (its oldest class). Gross operating expenses reflect the Fund’s total gross annual operating expenses for the Service Class and include management fees, 12b-1 distribution and service fees, and other expenses. Net operating expenses reflect contractual fee waivers and/or expense reimbursements. All expense information is reported as of the Fund’s most current prospectus. Royce & Associates has contractually agreed, without right of termination, to waive fees and/or reimburse expenses to the extent necessary to maintain the Service Class’s net annual operating expenses (excluding brokerage commissions, taxes, interest, litigation expenses, acquired fund fees and expenses, and other expenses not borne in the ordinary course of business) at or below 1.34% through April 30, 2022. Regarding the “Top Contributors” and “Top Detractors” tables shown above, the sum of all contributors to, and all detractors from, performance for all securities in the portfolio would approximate the Fund’s year-to-date performance for 2021. The Sharpe Ratio is calculated for a specified period by dividing a fund’s annualized excess returns by its annualized standard deviation. The higher the Sharpe ratio, the better the fund’s historical risk-adjusted performance. Upside Capture Ratio measures a manager’s performance in up markets relative to the Fund’s benchmark (Russell 2500). It is calculated by measuring the Fund’s performance in quarters when the benchmark went up and dividing it by the benchmark’s return in those quarters. Downside Capture Ratio measures a manager’s performance in down markets relative to the Fund’s benchmark. It is calculated by measuring the Fund’s performance in quarters when the benchmark goes down and dividing it by the benchmark’s return in those quarters.
The Royce Funds 2021 Semiannual Report to Shareholders | 9
MANAGER’S DISCUSSION (UNAUDITED)
Royce Global Financial Services Fund (RFS)
Chuck Royce
FUND PERFORMANCE
Royce Global Financial Services Fund enjoyed a strong first half on both an absolute and relative basis. The Fund advanced 17.7% for the year-to-date period ended 6/30/21, beating its global benchmark, the MSCI ACWI Small Cap Index, which rose 15.4%, and very narrowly outperforming the small-cap Russell 2000 Index, which was up 17.5%, for the same period. We were even more pleased that the Fund outpaced the MSCI ACWI Small Cap for the three-, five-, and 10-year periods ended 6/30/21.
WHAT WORKED… AND WHAT DIDN’T
Sprott, a Canadian asset manager with a specialty in precious metals, was the position that contributed most to results in the first half of 2021. Its shares peaked during 1Q21, no doubt boosted by the announcement of 2020 results in February, when the company reported an 88% increase in assets under management to an all-time record high that helped earnings considerably. Next came First Citizens BancShares, a financial holding company that we have long seen as a highly valuable bank franchise. It holds a dominant deposit market share in both North and South Carolina as well as a negligible cost of funds due to its strong client relationships. The company also has a history of successfully acquiring other banks. The major story for First Citizens over the past year has been its acquisition of CIT. We see significant value creation potential in the acquisition that lies in the considerable expansion in HOA (homeowner’s association) deposits for First Citizens as well as its own far lower cost of capital, which should allow it to compete much more effectively in some of CIT’s core verticals. The market has begun to recognize these benefits, leading its shares to rise in 2021’s first half.
The portfolio’s biggest detractor at the position level was MarketAxess Holdings, which operates an electronic trading platform for corporate bonds and other fixed-income securities. Its shares typically do best during periods of high trading volume and volatility. For example, fixed income instruments saw higher-than-usual volatility and trading activity throughout 2020 and into 1Q21, boosting the company’s revenues and earnings. However, its stock slipped in 2Q21 as volatility fell in the fixed-income space, trading activity slowed, and analysts re-rated its shares. Our next-largest detractor, Bottomline Technologies, markets and provides electronic payment and invoice solutions to corporations, banks, and other financial institutions. While the company has an enviable strategic position in two businesses that are benefiting from secular forces driving the increased adoption of B2B payments and spending on digital banking, executing the transition from potential to profits has been slow. Bottomline disappointed investors recently with a below expectation profit outlook for its next fiscal year that led its shares rapidly downward. We continue to hold a moderately sized position, watching for further operational improvements.
Top Contributors to Performance | Top Detractors from Performance | |||||
Year-to-Date Through 6/30/21 (%)1 | Year-to-Date Through 6/30/21 (%)2 | |||||
Sprott | 1.69 | MarketAxess Holdings | -0.45 | |||
First Citizens BancShares Cl. A | 1.52 | Bottomline Technologies | -0.43 | |||
Popular | 1.38 | B3-Brasil, Bolsa, Balcao | -0.30 | |||
KKR & Co. | 1.02 | Great Elm Group | -0.18 | |||
Carlyle Group | 0.96 | Ashmore Group | -0.17 | |||
1 Includes dividends | 2 Net of dividends | |||||
CURRENT POSITIONING AND OUTLOOK
During 2021’s first half, we marginally lowered our exposure to the U.S. and Canada, though they remain our two largest country weightings by a wide margin. We continue to lean heavily toward capital markets businesses, which again accounted for more than half of the Fund’s assets at the end of June. We see this industry as growing increasingly global and diverse, and as such have invested primarily in three sub-categories. First are those asset managers that offer conventional strategies and products in a specialized niche where they have demonstrated the ability to add long-term value, such as top-20 holdings Sprott, U.S. Global Investors, and Ashmore Group. Another sub-category would be alternative asset managers and/or those that offer private vehicles along with other important financial services. This cohort would include The Carlyle Group, Intermediate Capital Group, and KKR & Co. Finally, we see excellent prospects for both non-U.S. exchanges— such as Tel Aviv Stock Exchange and B3-Brasil, Bolsa, Balcao, and specialist trading platforms. We think that the secular trends in global finance and investment look more promising for these more specialized businesses than for many more traditional companies and/or business models.
10 | The Royce Funds 2021 Semiannual Report to Shareholders
PERFORMANCE AND PORTFOLIO REVIEW (UNAUDITED) | TICKER SYMBOLS RYFSX RGFIX |
Performance and Expenses
Average Annual Total Return (%) Through 6/30/21
JAN-JUN 20211 | 1-YR | 3-YR | 5-YR | 10-YR | 15-YR | SINCE INCEPTION (12/31/03) | |
RFS | 17.73 | 45.84 | 12.43 | 14.95 | 11.41 | 8.35 | 9.24 |
Annual Gross Operating Expenses: 2.07% Annual Net Operating Expenses: 1.68% | |||||||
1 Not annualized |
Morningstar Style Map™ As of 6/30/21
The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund’s investment strategy. The Morningstar Ownership Zone provides detail about a portfolio’s investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. Over time, the shape and location of a fund’s ownership zone may vary. See page 86 for additional information.
Value of $10,000
Invested on 12/31/03 as of 6/30/21 ($)
Top 10 Positions
% of Net Assets
Tel Aviv Stock Exchange | 3.9 |
Sprott | 3.7 |
First Citizens BancShares Cl. A | 3.6 |
Popular | 3.5 |
FirstService | 3.4 |
Franco-Nevada | 3.2 |
Canaccord Genuity Group | 2.9 |
E-L Financial | 2.9 |
Intermediate Capital Group | 2.7 |
KKR & Co. | 2.7 |
Portfolio Industry Breakdown
% of Net Assets
Capital Markets | 46.2 |
Banks | 14.5 |
Real Estate Management & Development | 7.9 |
Insurance | 7.0 |
Metals & Mining | 3.2 |
IT Services | 2.8 |
Software | 2.3 |
Diversified Financial Services | 2.2 |
Thrifts & Mortgage Finance | 1.0 |
Closed-End Funds | 0.7 |
Professional Services | 0.7 |
Health Care Providers & Services | 0.6 |
Transportation Infrastructure | 0.0 |
Cash and Cash Equivalents | 10.9 |
Upside/Downside Capture Ratios
Periods Ended 6/30/21 (%)
UPSIDE | DOWNSIDE | |
10-Year | 99 | 85 |
Fund’s First Full Quarter (12/31/03) | 87 | 84 |
Calendar Year Total Returns (%) | |
YEAR | RFS |
2020 | 15.3 |
2019 | 24.2 |
2018 | -13.4 |
2017 | 22.5 |
2016 | 12.9 |
2015 | -4.7 |
2014 | 3.5 |
2013 | 42.0 |
2012 | 20.7 |
2011 | -11.3 |
2010 | 18.5 |
2009 | 32.1 |
2008 | -35.4 |
2007 | -4.7 |
2006 | 24.8 |
Portfolio Country Breakdown 1,2 | |
% of Net Assets | |
United States | 44.6 |
Canada | 21.0 |
United Kingdom | 5.6 |
Israel | 3.9 |
Bermuda | 3.0 |
New Zealand | 1.9 |
India | 1.6 |
¹ Represents countries that are 1.5% or more of net assets.
² Securities are categorized by the country of their headquarters.
Portfolio Diagnostics
Fund Net Assets | $43 million |
Number of Holdings | 61 |
Turnover Rate | 3% |
Average Market Capitalization 1 | $3,243 million |
Weighted Average P/E Ratio 2,3 | 11.4x |
Weighted Average P/B Ratio 2 | 2.0x |
Active Share 4 | 99% |
1 | Geometric Average. This weighted calculation uses each portfolio holding’s market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio’s center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median. |
2 | Harmonic Average. This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio’s share in the earnings or book value, as the case may be, of its underlying stocks. |
3 | The Fund’s P/E ratio calculation excludes companies with zero or negative earnings (7% of portfolio holdings as of 6/30/21). |
4 | Active Share is the sum of the absolute values of the different weightings of each holding in the Fund versus each holding in the benchmark, divided by two. |
Important Performance and Expense Information
All performance information in this Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. Gross operating expenses reflect the Fund’s gross total annual operating expenses for the Service Class and include management fees, 12b-1 distribution and service fees, other expenses and acquired fund fees and expenses. Net operating expenses reflect contractual fee waivers and/or expense reimbursements. All expense information is reported as of the Fund’s most current prospectus. Royce & Associates has contractually agreed to waive fees and/or reimburse expenses to the extent necessary to maintain the Fund’s net annual operating expenses, (excluding brokerage commissions, taxes, interest, litigation expenses, acquired fund fees and expenses, and other expenses not borne in the ordinary course of business), at or below 1.49% through April 30, 2022. Acquired fund fees and expenses reflect the estimated amount of the fees and expenses incurred indirectly by the Fund through its investments in mutual funds, hedge funds, private equity funds, and other investment companies. Regarding the “Top Contributors” and “Top Detractors” tables shown above, the sum of all contributors to, and all detractors from, performance for all securities in the portfolio would approximate the Fund’s year-to-date performance for 2021. Upside Capture Ratio measures a manager’s performance in up markets relative to the Fund’s benchmark (MSCI ACWI SC). It is calculated by measuring the Fund’s performance in quarters when the benchmark went up and dividing it by the benchmark’s return in those quarters. Downside Capture Ratio measures a manager’s performance in down markets relative to the Fund’s benchmark. It is calculated by measuring the Fund’s performance in quarters when the benchmark goes down and dividing it by the benchmark’s return in those quarters.
The Royce Funds 2021 Semiannual Report to Shareholders | 11
MANAGERS’ DISCUSSION (UNAUDITED)
Royce International Premier Fund (RIP)
Mark Rayner, CA
Mark Fischer
FUND PERFORMANCE
Royce International Premier Fund advanced 6.4% for the year-to-date period ended 6/30/21, lagging its benchmark, the MSCI ACWI ex-USA Small Cap Index, which rose 12.2% for the same period. However, the Fund beat the benchmark for the three-, five-, 10-year, and since inception (12/31/10) periods ended 6/30/21.
WHAT WORKED… AND WHAT DIDN’T
Five of the nine equity sectors in which the Fund held investments contributed to 2021’s first half performance, led by Industrials, Information Technology, and Materials. Energy, Communication Services, and Consumer Discretionary had the biggest negative effect of the four sectors that detracted.
Australia’s Hansen Technologies, a leading global provider of billing software and customer care technologies for utilities and the telecom industry, was the top-contributing position in 2021’s first half. Hansen reported stronger-than-expected first half of 2021 earnings, announced in late February. Then in early June, Hansen’s share price again gained sharply after the company received an unsolicited proposal from private equity firm BGH Capital to acquire 100% of the company’s outstanding shares at a 25% premium. The next top contributor was Marlowe, a firm based in and focused on the United Kingdom that provides a range of commercial services and software in four areas: Health and Safety, Fire Safety, Water Safety, and Air Quality. We like the company’s position in essential, critical, and/or mandated services in growing markets, each with a highly fragmented customer base. Marlowe is also an acquisition-led consolidator of its large and fragmented markets, which enables it to re-deploy its cash flows into M&A and breeds cross-selling opportunities and scale advantages. The second quarter saw a steady flow of positive news, including M&A announcements and the release of final results at the end of June that showed improved revenue and earnings.
The two positions that detracted most for 2021’s first half were also 2020’s top two contributors. TKC Corporation is a Japanese firm that provides tax-related software and services to smaller companies and their tax accountants. 2021 has so far seen no material events that would reverse its previous positive trajectory. In fact, first-half results published in May showed operating profits that were well ahead of TKC’s projections. Its recent share price weakness seems to have resulted from profit taking off its surging stock price in 2020. Japan’s Daifuku is the globe’s leading manufacturer of material handling and distribution solutions, covering a wide range of markets from automated warehousing to semiconductor manufacturing. We like the longevity of its customer relationships, which typically last 15-20 years. During the first half, its shares fell, in our view, due to profit-taking, the company’s seemingly underwhelming medium-term business plan (announced in February), and the broader unwinding of thematic buying as Daifuku was associated with Japan’s shift to online consumption. Our calls with management, however, confirmed that its medium-range targets are conservatively based on highly visible project pipelines, reaffirming our view that Daifuku is in a favorable position to grow its installation base and widen its deep customer relationships.
Relative to the MSCI ACWI ex USA Small Cap in 2021’s first half, underperformance came entirely from stock selection—sector allocation was modestly additive. At the sector level, both stock selection and, to a lesser extent, our larger portfolio weightings in Information Technology and Health Care hurt relative results most while ineffective stock picking also detracted in Materials. By contrast, savvy stock selection and a significantly lower weighting in Real Estate helped relative results, as did having no exposure to the lagging Consumer Staples and Utilities sectors.
Top Contributors to Perf ormance | Top Detractors from P erformance | ||||||
Year-to-Date Through 6/30/21 (%)1 | Year-to-Date Through 6/30/21 (%)2 | ||||||
Hansen Technologies | 1.54 | TKC Corporation | -0.62 | ||||
Marlowe | 0.68 | Daifuku | -0.36 | ||||
IPH | 0.63 | As One | -0.35 | ||||
IMCD | 0.61 | Karnov Group | -0.31 | ||||
dormakaba Holding | 0.50 | NSD | -0.30 | ||||
1 Includes dividends | 2 Net of dividends | ||||||
CURRENT POSITIONING AND OUTLOOK
In 2021’s first quarter, we identified the peculiar contrast between the Fund’s relative underperformance and our conviction that our holdings had likely never possessed higher quality, an anomaly we ascribed to the market’s fixation on investing in short run ‘thematics’ (in this case, related to the pandemic) at the expense of long run ‘mathematics’—that is, a company’s ability to create shareholder value. We were therefore very pleased with the Fund’s improved performance in 2Q21, which suggested to us that the global stock market—forward looking by nature—may have started to look past the effects of COVID-19 to a return to something resembling normality. Given our own focus on companies with sustainably high returns on operating capital and strong balance sheets, a return to investing in business fundamentals should benefit the Fund’s performance. There has also been much debate over the last few months regarding inflation. While not explicitly positioning the Fund for such an outcome, we do believe that the portfolio is well positioned for an inflationary environment as a happy byproduct of our investment style. Central to our strategy is the desire to invest only in companies whose customers lack either the incentive or ability to be price aggressive—or the incentive or ability to easily leave. This, we think, gives our companies the requisite pricing power to pass on any cost pressures they may see in their businesses.
12 | The Royce Funds 2021 Semiannual Report to Shareholders
PERFORMANCE AND PORTFOLIO REVIEW (UNAUDITED) | TICKER SYMBOLS RYIPX RIPNX RINPX RIPIX |
Performance and Expenses
Average Annual Total Return (%) Through 6/30/21
JAN-JUN 20211 | 1-YR | 3-YR | 5-YR | 10-YR | SINCE INCEPTION (12/31/10) | |
RIP | 6.40 | 33.00 | 14.16 | 14.63 | 9.53 | 9.48 |
Annual Gross Operating Expenses: 1.57% Annual Net Operating Expenses: 1.44% | ||||||
1 Not annualized |
Relative Returns: Monthly Rolling Average Annual Return Periods
Since Inception Through 6/30/21
On a monthly rolling basis, The Fund outperformed the MSCI ACWI x USA SC in 100% of all 10-year periods; 100% of all 5-year periods; and 70% of all 1-year periods.
PERIODS BEATING THE INDEX | FUND AVG (%)1 | INDEX AVG (%)1 | ||||
10-year | 7/7 | 100% | 9.1 | 6.4 | ||
5-year | 67/67 | 100% | 9.5 | 6.1 | ||
1-year | 81/115 | 70% | 10.1 | 7.4 |
1Average of monthly rolling average annual total returns over the speciied periods.
Morningstar Style Map™ As of 6/30/21
The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund’s investment strategy. The Morningstar Ownership Zone provides detail about a portfolio’s investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. Over time, the shape and location of a fund’s ownership zone may vary. See page 86 for additional information.
Value of $10,000
Invested on 12/31/10 as of 6/30/21 ($)
Top 10 Positions | |
% of Net Assets | |
IPH | 3.3 |
Hansen Technologies | 2.8 |
TKC Corporation | 2.8 |
Bravura Solutions | 2.5 |
Victrex | 2.5 |
Meitec Corporation | 2.5 |
IMCD | 2.4 |
Marlowe | 2.4 |
Intertrust | 2.3 |
Croda International | 2.3 |
Portfolio Sector Breakdown | |
% of Net Assets | |
Industrials | 43.2 |
Information Technology | 22.7 |
Health Care | 10.5 |
Materials | 7.8 |
Financials | 4.2 |
Communication Services | 3.5 |
Consumer Discretionary | 1.4 |
Real Estate | 1.2 |
Preferred Stock | 1.8 |
Cash and Cash Equivalents | 3.7 |
Upside/Downside Capture Ratios | ||
Periods Ended 6/30/21 (%) | ||
UPSIDE | DOWNSIDE | |
10-Year | 100 | 82 |
Fund’s First Full Quarter (12/31/10) | 101 | 80 |
Calendar Year Total Returns (%) | |
YEAR | RIP |
2020 | 15.7 |
2019 | 34.2 |
2018 | -12.8 |
2017 | 39.8 |
2016 | -1.1 |
2015 | 16.2 |
2014 | -8.2 |
2013 | 18.3 |
2012 | 23.4 |
2011 | -16.8 |
Portfolio Country Breakdown1,2 | |
% of Net Assets | |
United Kingdom | 18.6 |
Japan | 17.2 |
Australia | 11.2 |
Sweden | 8.8 |
Switzerland | 7.7 |
Germany | 6.9 |
Netherlands | 4.7 |
Italy | 4.2 |
Canada | 3.9 |
¹ Represents countries that are 3% or more of net assets.
² Securities are categorized by the country of their headquarters.
Portfolio Diagnostics
Fund Net Assets | $1,277 million |
Number of Holdings | 61 |
Turnover Rate | 11% |
Average Market Capitalization 1 | $2,539 million |
Weighted Average P/E Ratio 2,3 | 36.8x |
Weighted Average P/B Ratio 2 | 4.3x |
Active Share 4 | 98% |
1 | Geometric Average. This weighted calculation uses each portfolio holding’s market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio’s center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median. |
2 | Harmonic Average. This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio’s share in the earnings or book value, as the case may be, of its underlying stocks. |
3 | The Fund’s P/E ratio calculation excludes companies with zero or negative earnings (4% of portfolio holdings as of 6/30/21). |
4 | Active Share is the sum of the absolute values of the different weightings of each holding in the Fund versus each holding in the benchmark, divided by two. |
Important Performance and Expense Information
All performance information in this Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 2% redemption fee payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. All performance and risk information reflects results of the Service Class (its oldest class). Price and total return information is based on net asset values for shareholder transactions. Certain immaterial adjustments were made to the net assets of Royce International Premier Fund at 12/31/19 and 12/31/20 for financial reporting purposes, and as a result the calendar year total returns based on those net asset values differ from the adjusted net asset values and calendar year total returns reported in the Financial Highlights. Gross operating expenses reflect total gross annual operating expenses for the Service Class and include management fees, 12b-1 distribution and service fees, and other expenses. Net operating expenses reflect contractual fee waivers and/or expense reimbursements. All expense information is reported as of the Fund’s most current prospectus. Royce & Associates has contractually agreed to waive its fees and/or reimburse operating expenses to the extent necessary to maintain the Fund’s net annual operating expenses, (excluding brokerage commissions, taxes, interest, litigation expenses, acquired fund fees and expenses, and other expenses not borne in the ordinary course of business), at or below 1.44% through April 30, 2022. Regarding the “Top Contributors” and “Top Detractors” tables shown above, the sum of all contributors to, and all detractors from, performance for all securities in the portfolio would approximate the Fund’s year-to-date performance for 2021. Upside Capture Ratio measures a manager’s performance in up markets relative to the Fund’s benchmark (MSCI ACWI x USA SC). It is calculated by measuring the Fund’s performance in quarters when the benchmark went up and dividing it by the benchmark’s return in those quarters. Downside Capture Ratio measures a manager’s performance in down markets relative to the Fund’s benchmark. It is calculated by measuring the Fund’s performance in quarters when the benchmark goes down and dividing it by the benchmark’s return in those quarters.
The Royce Funds 2021 Semiannual Report to Shareholders | 13
MANAGERS’ DISCUSSION (UNAUDITED)
Jim Stoefel
Brendan Hartman
FUND PERFORMANCE
Royce Micro-Cap Fund rose 25.3% for the year-to-date period ended 6/30/21, lagging the Russell Microcap Index (+29.0%), its primary benchmark, while outpacing the Russell 2000 (+17.5%) Index. The Fund also outperformed both indexes for the one- and three-year periods ended 6/30/21.
WHAT WORKED… AND WHAT DIDN’T
All 10 of the equity sectors in which the Fund held investments made positive contributions to performance for the year-to-date period ended 6/30/21. Information Technology made the most sizable positive impact, followed by Industrials and Consumer Discretionary. Conversely, Consumer Staples, Real Estate, and Energy made the smallest positive contributions.
At the position level, B. Riley Financial, a diversified financial services firm that boasts operations spanning from investment banking to retailer bankruptcy liquidations, contributed most. Many of the company’s end markets experienced record activity levels, including investment banking and capital markets business, which benefited the company’s earnings. B. Riley Financial also paid a special dividend. Citi Trends, which is a retail clothing chain selling discounted products targeted primarily at urban customers, was also additive. Additional technology, such as merchandise planning software, proved helpful as it allowed the company to effectively target regional taste differences. Refining its demographic focus also benefited the company, whose returns on capital have increased substantially over the last five years to 33%. Lastly, Harvard Bioscience positively impacted performance during the year-to-date period ended 6/30/21. The company develops, manufactures, and markets life sciences equipment to support research and drug discovery. An acquisition significantly expanded its addressable market, sparking a turnaround. Harvard Bioscience also restructured its management team, and the new operational structure had a positive effect. We maintained our position as we believe the company is relatively early in recognizing the benefits of its significant restructuring activities.
Conversely, Motorsport Games, an international media and technology company that develops gaming software, detracted most for the year-to-date period ended 6/30/21. The disconnect between its recent IPO and the release of its forthcoming key product, NASCAR NXT, caused a drag on performance. While we added it to our portfolio, we remain cognizant of the inherent risks that a small company faces when it’s highly dependent on one software title. We will reevaluate our position as we begin to see gaming influencers provide feedback on NASCAR NXT. LightPath Technologies also detracted from performance. The company creates optics, photonics, and infrared solutions for the defense, industrial testing and measurement, telecommunications, and medical industries. A decline in order backlog caused by a lack of renewals of major contracts and fewer new orders hindered the position—its inventory levels are tied to the next phase of the 5G rollout. We maintained our position in the shares as we view the price and fundamental volatility as typical of a small company serving very large markets. CIRCOR International—which is a designer, manufacturer, and distributor for flow and motion control products—was the third largest detractor. The company’s 1Q21 earnings failed to meet expectations, raising concerns about guidance for the rest of the year. We view the shortfall as typical in an environment associated with the rapid reopening of the economy.
Relative to the Russell Microcap Index in 2021, performance was hurt entirely by stock selection. Consumer Discretionary and Industrials were hampered by ineffective stock picks and sector allocation decisions, with the former caused by our underweight and the latter due to our overweight. The portfolio’s cash position also had a negative impact on performance. On the other hand, our lower weightings and savvy stock selection benefited Health Care, Financials, and Consumer Staples.
Top Contributors to Performance | Top Detractors from Performance | |||||
Year-to-Date Through 6/30/21 (%)1 | Year-to-Date Through 6/30/21 (%)2 | |||||
B. Riley Financial | 1.00 | Motorsport Games Cl. A | -0.30 | |||
Citi Trends | 0.99 | LightPath Technologies Cl. A | -0.28 | |||
Harvard Bioscience | 0.86 | CIRCOR International | -0.20 | |||
Shoe Carnival | 0.83 | Profound Medical | -0.18 | |||
Ultra Clean Holdings | 0.81 | American Superconductor | -0.18 | |||
1 Includes dividends | 2 Net of dividends | |||||
CURRENT POSITIONING AND OUTLOOK
We’ve seen a significant change in market leadership away from growth stocks, which are weighted in Information Technology and Health Care, to value stocks. This is reflected in the relatively weak performance in these two sectors compared to the strong performance in Financials, Energy, and Consumer Discretionary. We believe this shift from growth to value has been caused by the reopening of the economy. Even as current market dynamics appear to us to be focused primarily on fears of slower economic growth prospects due to new COVID variants and whether the Fed policy maintains its commitment to managing the effects of inflation, we remain constructive on the economy and growth prospects as the world recovers from lockdowns. We also believe many recent commodity price spikes will prove short lived, which we have already seen with lumber prices, as the supply base responds to strong demand. In our belief, many of the transformations caused by the digitalization of the global economy were accelerated by the pandemic, and this is likely to result in a permanent behavioral change. We have positioned our portfolio to reflect this outlook. Our portfolio continues to have a cyclical lean due to our value approach, which we believe is best suited in the current environment.
14 | The Royce Funds 2021 Semiannual Report to Shareholders
PERFORMANCE AND PORTFOLIO REVIEW (UNAUDITED) | TICKER SYMBOLS RYOTX RMCFX RYMCX |
Performance and Expenses
Average Annual Total Return (%) Through 6/30/21
JAN-JUN 20211 | 1-YR | 3-YR | 5-YR | 10-YR | 15-YR | 20-YR | 25-YR | SINCE INCEPTION (12/31/91) | |
RMC | 25.27 | 76.47 | 16.01 | 16.95 | 7.29 | 7.38 | 8.95 | 10.22 | 11.52 |
Annual Gross Operating Expenses: 1.29% Annual Net Operating Expenses: 1.24%
1 Not annualized
Morningstar Style Map™ As of 6/30/21
The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund’s investment strategy. The Morningstar Ownership Zone provides detail about a portfolio’s investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. Over time, the shape and location of a fund’s ownership zone may vary. See page 86 for additional information.
Value of $10,000
Invested on 6/30/00 (Russell Microcap Index Inception) as of 6/30/21 ($)
Top 10 Positions
% of Net Assets
Harvard Bioscience | 1.5 |
Transcat | 1.2 |
Agilysys | 1.2 |
Century Casinos | 1.1 |
Aspen Aerogels | 1.1 |
Cutera | 1.1 |
Major Drilling Group International | 1.1 |
Shoe Carnival | 1.1 |
B. Riley Financial | 1.1 |
Camtek | 1.1 |
Portfolio Sector Breakdown
% of Net Assets
Information Technology | 24.3 |
Industrials | 22.2 |
Financials | 13.7 |
Health Care | 13.3 |
Consumer Discretionary | 10.9 |
Communication Services | 4.4 |
Materials | 3.5 |
Energy | 3.0 |
Real Estate | 0.4 |
Cash and Cash Equivalents | 4.3 |
Calendar Year Total Returns (%) | |
YEAR | RMC |
2020 | 24.5 |
2019 | 21.2 |
2018 | -8.9 |
2017 | 5.4 |
2016 | 19.7 |
2015 | -13.3 |
2014 | -4.1 |
2013 | 21.3 |
2012 | 8.0 |
2011 | -12.1 |
2010 | 30.1 |
2009 | 55.7 |
2008 | -40.9 |
2007 | 7.1 |
2006 | 22.3 |
Upside/Downside Capture Ratios | |||
Periods Ended 6/30/21 (%) | |||
UPSIDE | DOWNSIDE | ||
10-Year | 77 | 97 | |
From 6/30/00 (Russell Microcap Index Inception) | 91 | 83 |
Portfolio Diagnostics | ||
Fund Net Assets | $418 million | |
Number of Holdings | 131 | |
Turnover Rate | 13% | |
Average Market Capitalization 1 | $622 million | |
Weighted Average P/B Ratio 2 | 2.4x | |
Active Share 3 | 92% | |
U.S. Investments (% of Net Assets) | 84.6% | |
Non-U.S. Investments (% of Net Assets) | 11.1% |
1 | Geometric Average. This weighted calculation uses each portfolio holding’s market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio’s center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median. |
2 | Harmonic Average. This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio’s share in the earnings or book value, as the case may be, of its underlying stocks. |
3 | Active Share is the sum of the absolute values of the different weightings of each holding in the Fund versus each holding in the benchmark, divided by two. |
Important Performance and Expense Information
All performance information in this Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. All performance and risk information reflects results of the Investment Class (its oldest class). Price and total return information is based on net asset values calculated for shareholder transactions. Certain immaterial adjustments were made to the net assets of Royce Micro-Cap Fund at 12/31/17 for financial reporting purposes, and as a result the calendar year total returns based on those net asset values differ from the adjusted net asset values and calendar year total returns reported in the Financial Highlights. Gross operating expenses reflect the Fund’s total gross annual operating expenses for the Investment Class and include management fee and other expenses. Net operating expenses reflect contractual fee waivers and/or expense reimbursements. All expense information is reported as of the Fund’s most current prospectus. Royce & Associates has contractually agreed, without right of termination, to waive fees and/or reimburse expenses to the extent necessary to maintain the Investment Class’s net annual operating expenses (excluding brokerage commissions, taxes, interest, litigation expenses, acquired fund fees and expenses, and other expenses not borne in the ordinary course of business) at or below 1.24% through April 30, 2022. Regarding the “Top Contributors” and “Top Detractors” tables shown above, the sum of all contributors to, and all detractors from, performance for all securities in the portfolio would approximate the Fund’s year-to-date performance for 2021. Upside Capture Ratio measures a manager’s performance in up markets relative to the Fund’s benchmark (Russell Microcap Index). It is calculated by measuring the Fund’s performance in quarters when the benchmark went up and dividing it by the benchmark’s return in those quarters. Downside Capture Ratio measures a manager’s performance in down markets relative to the Fund’s benchmark. It is calculated by measuring the Fund’s performance in quarters when the benchmark goes down and dividing it by the benchmark’s return in those quarters.
The Royce Funds 2021 Semiannual Report to Shareholders | 15
MANAGERS’ DISCUSSION (UNAUDITED)
Buzz Zaino, CFA®, Jim Stoefel,
Brendan Hartman, Jim Harvey, CFA®
FUND PERFORMANCE
For the year-to-date period ended 6/30/21, Royce Opportunity Fund was strong on an absolute and relative basis, advancing 30.9% and beating both the Russell 2000 Value (+26.7%) and Russell 2000 (+17.5%) Indexes for the same period. Opportunity also outperformed both indexes for the one-, three-, five-, 10-, 15-, 20-year, and since inception (11/19/96) periods ended 6/30/21.
WHAT WORKED… AND WHAT DIDN’T
All 11 equity sectors made a positive contribution to performance for the year-to-date period ended 6/30/21, led by Industrials and Information Technology—the portfolio’s two biggest weightings. Consumer Discretionary and Health Care came next while the smallest contributions came from lower-weighted sectors: Utilities, Consumer Staples, Communication Services, and Real Estate.
At the industry level, we got outsized positive impacts from semiconductors & semiconductor equipment in Information Technology and health care providers & services from Health Care, followed by metals & mining (Materials). Only two industries detracted from year-to-date performance: biotechnology in Health Care and road & rail in Industrials. The entertainment industry, from Communication Services, finished flat for the six-month period ended 6/30/21.
Our top contributor at the position level was Avid Technology, which develops software and systems for digital editing, newsroom computer systems, and digital audio systems. Avid raised guidance in May due to robust end market demand during the first quarter and management’s expectation that this demand can last through the end of 2021. In the same announcement, the company also reported impressive growth in its key recurring subscription revenues. Next came Community Health Systems, which operates acute care hospitals and owns interests in medical practices, imaging centers, home health agencies, and ambulatory surgery centers. The company focuses its business primarily in Sunbelt states in locales with attractive demographics, high population growth, and economic opportunity. Community Health announced a favorable debt refinancing plan in May after reporting positive results in February for the fourth quarter and full-year periods.
Lumber Liquidators Holdings, a specialty wood flooring maker, hurt performance most in the first half. After first rebounding nicely in the second half of 2020, the company then reported solid results in May, with increased revenues and same-store sales growth. However, supply disruptions due to the unavailability of containers and the Suez Canal shutdown had a negative effect on its shares, while the reimposition of tariffs hurt first-quarter profits. The supply constraint continues, and the company is finding new sources to offset tariffs. SmileDirectClub designs and manufactures invisible aligners and braces that straighten teeth. The company has had success expanding beyond the U.S. while profitably growing its domestic business. However, SmileDirectClub also suffered a cybersecurity-driven manufacturing interruption shortly after reporting results, which depressed its previously sunny near-term outlook. Uncertain of its long-term recovery, we reduced our stake.
Our year-to-date advantage came entirely from stock selection— sector allocation had a small negative effect. Stock picking drove results in the two sectors where the portfolio had the biggest edge over its small-cap value index: Information Technology and Health Care. Our higher weighting also helped us a bit in the latter sector. The combination of our lower weighting and effective stock selection was additive in Financials. The Fund’s cash position hurt us most versus the benchmark for the year-to-date period, followed by a combination of lower exposure and ineffective stock picking in both the Energy and Communication Services sectors.
Top Contributors to Performance | Top Detractors from Performance | |||||
Year-to-Date Through 6/30/21 (%)1 | Year-to-Date Through 6/30/21 (%)2 | |||||
Avid Technology | 0.79 | Lumber Liquidators Holdings | -0.15 | |||
Community Health Systems | 0.64 | SmileDirectClub Cl. A | -0.09 | |||
Lydall | 0.60 | Texas Capital Bancshares | -0.08 | |||
B. Riley Financial | 0.59 | Emergent BioSolutions | -0.07 | |||
Magnite | 0.59 | Meritor | -0.05 | |||
1 Includes dividends | 2 Net of dividends | |||||
CURRENT POSITIONING AND OUTLOOK
The combination of steep increases in private sector business reopenings with aggressive fiscal and monetary stimulus has, in our view, created stresses around supply chains. We believe these stresses, encompassing both production and labor, have accelerated long absent inflationary pressures. We’re confident, however, that supply chains will ultimately react, and labor will level set after generous unemployment benefits normalize, both of which should make the inflationary spike temporary. In the short term, we’ve made tactical sales in industries such as restaurants that seem more susceptible to inflationary pressures without the offsetting ability to pass through pricing. Even among homebuilders, where the long-term demographic trends still look favorable, we’ve seen increased consumer resistance related to sharp price increases— even as interest rates sit near historical lows. We have thus continued to populate the portfolio with companies that we believe successfully navigated the pandemic-driven recession and have since positioned themselves for success in a more typical economic environment. We’ve also been finding interesting companies in technology, building our exposure to retailers, and seeing opportunities in aerospace—in this last instance as companies benefit from reopenings and the reintroduction of Boeing’s 737-Max. In general, we’ve been seeking companies that show the potential to surpass expectations while still trading at valuations we find attractive. We are optimistic about both the earnings potential for such companies and the broader economic outlook.
16 | The Royce Funds 2021 Semiannual Report to Shareholders
PERFORMANCE AND PORTFOLIO REVIEW (UNAUDITED) | TICKER SYMBOLS RYPNX RYOFX ROFCX ROFIX ROFRX |
Performance and Expenses
Average Annual Total Return (%) Through 6/30/21
JAN-JUN 20211 | 1-YR | 3-YR | 5-YR | 10-YR | 15-YR | 20-YR | SINCE INCEPTION (11/19/96) | |
ROF | 30.87 | 102.05 | 17.76 | 21.11 | 13.19 | 10.42 | 11.24 | 13.23 |
Annual Operating Expenses: 1.23% |
1 Not annualized
Relative Returns: Monthly Rolling Average Annual Return Periods
20 Years Through 6/30/21
On a monthly rolling basis, The Fund outperformed the Russell 2000 Value in 99% of all 10-year periods; 74% of all 5-year periods; and 55% of all 1-year periods.
PERIODS BEATING THE INDEX | FUND AVG (%)1 | INDEX AVG (%)1 | ||||||
10-year | 120/121 | 99% | 9.6 | 8.1 | ||||
5-year | 134/181 | 74% | 9.7 | 8.2 | ||||
1-year | 125/229 | 55% | 14.2 | 10.3 |
1Average of monthly rolling average annual total returns over the specified periods.
Morningstar Style Map™ As of 6/30/21
The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund’s investment strategy. The Morningstar Ownership Zone provides detail about a portfolio’s investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. Over time, the shape and location of a fund’s ownership zone may vary. See page 86 for additional information.
Value of $10,000
Invested on 11/19/96 as of 6/30/21 ($)
Top 10 Positions | |
% of Net Assets | |
Community Health Systems | 0.8 |
Avid Technology | 0.8 |
Owens & Minor | 0.7 |
Alpha & Omega Semiconductor | 0.7 |
Hilltop Holdings | 0.7 |
Old Republic International | 0.7 |
Avaya Holdings | 0.7 |
Atlas Air Worldwide Holdings | 0.7 |
Ultra Clean Holdings | 0.7 |
WESCO International | 0.6 |
Portfolio Sector Breakdown | |
% of Net Assets | |
Industrials | 23.5 |
Information Technology | 16.2 |
Consumer Discretionary | 13.7 |
Health Care | 8.8 |
Financials | 8.7 |
Materials | 8.3 |
Real Estate | 3.6 |
Energy | 3.1 |
Communication Services | 1.6 |
Consumer Staples | 1.1 |
Utilities | 0.7 |
Cash and Cash Equivalents | 10.7 |
Calendar Year Total Returns (%) | |
YEAR | ROF |
2020 | 26.5 |
2019 | 28.2 |
2018 | -20.0 |
2017 | 21.9 |
2016 | 29.9 |
2015 | -13.6 |
2014 | -0.5 |
2013 | 43.5 |
2012 | 22.6 |
2011 | -13.0 |
2010 | 33.8 |
2009 | 62.1 |
2008 | -45.7 |
2007 | -2.0 |
2006 | 18.8 |
Upside/Downside Capture Ratios
Periods Ended 6/30/21 (%)
UPSIDE | DOWNSIDE | |
10-Year | 119 | 115 |
From 12/31/96 (Start of Fund’s First Full Quarter) | 125 | 117 |
Portfolio Diagnostics | |
Fund Net Assets | $2,233 million |
Number of Holdings | 277 |
Turnover Rate | 34% |
Average Market Capitalization1 | $1,404 million |
Weighted Average P/B Ratio2 | 2.1x |
Weighted Average P/S Ratio3 | 1.1x |
Active Share4 | 89% |
U.S. Investments (% of Net Assets) | 85.2% |
Non-U.S. Investments (% of Net Assets) | 4.1% |
1 | Geometric Average. This weighted calculation uses each portfolio holding’s market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio’s center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median. |
2 | Harmonic Average. This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio’s share in the earnings or book value, as the case may be, of its underlying stocks. |
3 | Price to Sales is calculated by dividing the company’s market cap by the revenue in the most recent year. |
4 | Active Share is the sum of the absolute values of the different weightings of each holding in the Fund versus each holding in the benchmark, divided by two. |
Important Performance and Expense Information
All performance information in this Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. All performance and risk information reflects results of the Investment Class (its oldest class). Operating expenses reflect the Fund’s total annual operating expenses for the Investment Class as of the Fund’s most current prospectus and include management fees and other expenses. Regarding the “Top Contributors” and “Top Detractors” tables shown above, the sum of all contributors to, and all detractors from, performance for all securities in the portfolio would approximate the Fund’s year-to-date performance for 2021. Upside Capture Ratio measures a manager’s performance in up markets relative to the Fund’s benchmark (Russell 2000 Value). It is calculated by measuring the Fund’s performance in quarters when the benchmark went up and dividing it by the benchmark’s return in those quarters. Downside Capture Ratio measures a manager’s performance in down markets relative to the Fund’s benchmark. It is calculated by measuring the Fund’s performance in quarters when the benchmark goes down and dividing it by the benchmark’s return in those quarters.
The Royce Funds 2021 Semiannual Report to Shareholders | 17
MANAGERS’ DISCUSSION (UNAUDITED)
Royce Pennsylvania Mutual Fund® (PMF)
Chuck Royce, Jay Kaplan, CFA®,
Steven McBoyle, Lauren Romeo, CFA®,
Miles Lewis, CFA®, Andrew Palen
FUND PERFORMANCE
Our flagship Royce Pennsylvania Mutual Fund was up 16.6% for the year-to-date period ended 6/30/21 versus a 17.5% gain for its small-cap benchmark, the Russell 2000 Index, for the same period. While not the relative result we were hoping for, we were pleased with first-half results on an absolute scale as well as by the Fund’s advantage over the Russell 2000 for the 20-, 25-, 30-, 35-, and 40-year periods ended 6/30/21, all under the management of Chuck Royce.
WHAT WORKED… AND WHAT DIDN’T
For the year-to-date period ended 6/30/21, each of the 10 equity sectors in which the Fund held investments made positive contributions to performance, with the largest coming from Industrials, Information Technology, and Consumer Discretionary, while the smallest were in Communication Services, Consumer Staples, and Energy—the portfolio’s lowest sector weightings for the six-month period. At the industry level, the top contributors were semiconductors & semiconductor equipment (Information Technology), banks (Financials)—which were very strong in 1Q21—and electronic equipment, instruments & components (Information Technology). Only three industries finished the year-to-date period in the red: health care technology (Health Care), metals & mining (Materials), and consumer finance (Financials).
Kulicke & Soffa Industries, which designs and manufactures capital equipment, related spare parts, and packaging materials used in semiconductor device assembly, was our top contributor for the first half of 2021. The company reported strong results for its fiscal second quarter in May, citing increased global reliance on semiconductors and the growing capital intensity within the assembly process as the primary drivers behind its recent success. First Citizens BancShares is a financial holding company that we have long seen as a highly valuable bank franchise. It holds a dominant deposit market share in both North and South Carolina as well as a negligible cost of funds due to its strong client relationships. The company also has a history of successfully acquiring other banks. The major story for First Citizens over the past year has been its acquisition of CIT. We see significant value creation potential in the acquisition that lies in the significant expansion in HOA (homeowner’s association) deposits for First Citizens as well as its own far lower cost of capital, which should allow it to compete much more effectively in some of CIT’s core verticals. The market has begun to recognize these benefits, leading its shares to rise in 2021’s first half. The top detractor at the position level was GCM Grosvenor, an investment management company focused on private equity, infrastructure investments, real estate, credit finance, and absolute return. Its shares fell after the company reported fiscal first-quarter results in mid-May that showed better-than-expected revenues but earnings that seemed to fall short of other investors’ expectations. We added shares through most of the first half. SmileDirect Club designs and manufactures dental equipment, supplying invisible aligners and braces that straighten teeth. The company has had success expanding beyond the U.S. while profitably growing its domestic business. However, SmileDirect also suffered a cybersecurity-driven manufacturing interruption shortly after reporting results, which depressed its previously sunny near-term outlook. Liking its long-term prospects, we chose to build our position while others were selling.
Relative to the Russell 2000 for the year-to-date period, underperformance came entirely from stock selection as sector allocation decisions had a modestly positive effect. Hurting relative results most at the sector level was the combination of lower exposure and ineffective stock selection in both Energy and Communication Services. In Materials, the positive effect of our higher weighting fell short of the impact from stock selection miscues in the period. Conversely, a lower weighting in the lagging Health Care sector, along with a small assist from stock selection, was additive vis-à-vis the benchmark. Successful stock picks in Information Technology (which outweighed the negative impact of our larger exposure) and having no exposure to lagging Utilities also helped relative results.
Top Contributors to Performance | Top Detractors from Performance | |||||
Year-to-Date Through 6/30/21 (%)1 | Year-to-Date Through 6/30/21 (%)2 | |||||
Kulicke & Soffa Industries | 0.65 | GCM Grosvenor Cl. A | -0.15 | |||
First Citizens BancShares Cl. A | 0.53 | SmileDirectClub Cl. A | -0.14 | |||
Upwork | 0.32 | Alamos Gold Cl. A | -0.10 | |||
Scientific Games | 0.32 | Haemonetics Corporation | -0.10 | |||
Shoe Carnival | 0.30 | Upland Software | -0.10 | |||
1 Includes dividends | 2 Net of dividends |
CURRENT POSITIONING AND OUTLOOK
We remain confident that cyclical small caps are poised for a strong run in the coming years, a confidence underscored by current expectations for strong nominal GDP growth in the U.S. this year and next coupled with an accommodative Fed and attractive relative valuations. Equally important, we remain excited about the opportunities in small caps, an asset class with a large number of diverse and interesting companies and evolving industries. We have recently been most focused on identifying those businesses that were able to use the difficulties wrought by the pandemic and ensuing recession to get stronger. We’ve been finding these kinds of businesses selling at what we think are attractive valuations largely in Industrials, Information Technology, and Financials. We believe that we are embarking on the leg of the market cycle when company results, rather than valuation expansion, typically begin to drive most of the stock price movement—an environment that we believe suits our skill sets well.
18 | The Royce Funds 2021 Semiannual Report to Shareholders
PERFORMANCE AND PORTFOLIO REVIEW (UNAUDITED) | TICKER SYMBOLS PENNX RYPFX RPMIX RYPCX RPMRX |
Performance and Expenses | |||||||||||
Average Annual Total Return (%) Through 6/30/21 | |||||||||||
JAN-JUN 20211 | 1-YR | 3-YR | 5-YR | 10-YR | 15-YR | 20-YR | 25-YR | 30-YR | 35-YR | 45-YR | |
PMF | 16.60 | 53.88 | 12.89 | 15.75 | 10.55 | 8.86 | 9.87 | 10.96 | 11.10 | 10.73 | 13.32 |
Annual Operating Expenses: 0.95% |
1 Not annualized
Morningstar Style Map™ As of 6/30/21
The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund’s investment strategy. The Morningstar Ownership Zone provides detail about a portfolio’s investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. Over time, the shape and location of a fund’s ownership zone may vary. See page 86 for additional information.
Value of $10,000
Invested on 12/29/78 (Russell 2000 Inception) as of 6/30/21 ($)
Top 10 Positions | |
% of Net Assets | |
First Citizens BancShares Cl. A | 1.4 |
Element Solutions | 1.1 |
Kulicke & Soffa Industries | 1.1 |
Upland Software | 1.0 |
Colfax | 0.9 |
Quaker Chemical | 0.9 |
MKS Instruments | 0.9 |
Mesa Laboratories | 0.9 |
KBR | 0.9 |
SEI Investments | 0.9 |
Portfolio Sector Breakdown | |
% of Net Assets | |
Industrials | 25.6 |
Information Technology | 21.3 |
Financials | 18.5 |
Consumer Discretionary | 9.7 |
Health Care | 7.8 |
Materials | 7.1 |
Real Estate | 2.2 |
Communication Services | 2.0 |
Energy | 1.4 |
Consumer Staples | 1.1 |
Cash and Cash Equivalents | 3.3 |
Calendar Year Total Returns (%) | |
YEAR | PMF |
2020 | 14.1 |
2019 | 26.6 |
2018 | -9.7 |
2017 | 16.2 |
2016 | 26.5 |
2015 | -11.4 |
2014 | -0.7 |
2013 | 35.3 |
2012 | 14.6 |
2011 | -4.2 |
2010 | 23.9 |
2009 | 36.3 |
2008 | -34.8 |
2007 | 2.8 |
2006 | 14.8 |
Upside/Downside Capture Ratios
Periods Ended 6/30/21 (%)
UPSIDE | DOWNSIDE | |
10-Year | 89 | 93 |
From 12/31/78 (Russell 2000 Inception) | 89 | 73 |
Portfolio Diagnostics | |
Fund Net Assets | $2,296 million |
Number of Holdings | 296 |
Turnover Rate | 41% |
Average Market Capitalization1 | $2,760 million |
Weighted Average P/E Ratio2,3 | 19.5x |
Weighted Average P/B Ratio2 | 2.6x |
Active Share4 | 87% |
U.S. Investments (% of Net Assets) | 87.0% |
Non-U.S. Investments (% of Net Assets) | 9.7% |
1 | Geometric Average. This weighted calculation uses each portfolio holding’s market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio’s center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median. |
2 | Harmonic Average. This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio’s share in the earnings or book value, as the case may be, of its underlying stocks. |
3 | The Fund’s P/E ratio calculation excludes companies with zero or negative earnings (19% of portfolio holdings as of 6/30/21). |
4 | Active Share is the sum of the absolute values of the different weightings of each holding in the Fund versus each holding in the benchmark, divided by two. |
Important Performance and Expense Information
All performance information in this Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. All performance and risk information reflects results of the Investment Class (its oldest class). Certain immaterial adjustments were made to the net assets of Royce Pennsylvania Mutual Fund at 6/30/19 for financial reporting purposes, and as a result the net asset values shareholder transactions on that date and the calendar year total returns (%) based on those net asset values differ from the adjusted net asset values and calendar year total returns reported in the Financial Highlights. Operating expenses reflect the Fund’s total annual operating expenses for the Investment Class as of the Fund’s most current prospectus and include management fees and other expenses. Regarding the “Top Contributors” and “Top Detractors” tables shown above, the sum of all contributors to, and all detractors from, performance for all securities in the portfolio would approximate the Fund’s year-to-date performance for 2021. Upside Capture Ratio measures a manager’s performance in up markets relative to the Fund’s benchmark (Russell 2000). It is calculated by measuring the Fund’s performance in quarters when the benchmark went up and dividing it by the benchmark’s return in those quarters. Downside Capture Ratio measures a manager’s performance in down markets relative to the Fund’s benchmark. It is calculated by measuring the Fund’s performance in quarters when the benchmark goes down and dividing it by the benchmark’s return in those quarters.
The Royce Funds 2021 Semiannual Report to Shareholders | 19
MANAGERS’ DISCUSSION (UNAUDITED)
Chuck Royce
Lauren Romeo, CFA®
Steven McBoyle
FUND PERFORMANCE
Royce Premier Fund posted an attractive absolute, though disappointing relative, performance in 2021’s first half, increasing 10.4% versus a gain of 17.5% for its small-cap benchmark, the Russell 2000 Index, for the same period. The Fund did, however, retain its leadership over its benchmark for longer-term periods, beating the Russell 2000 for the 15-, 20-, 25-year, and since inception (12/31/91) periods ended 6/30/21.
WHAT WORKED... AND WHAT DIDN’T
Seven of the Fund’s eight equity sectors finished the first half in the black, led by its two largest, Industrials and Information Technology. Health Care was the sole detractor, while Real Estate, our second-lowest weighting, made the smallest contribution. The Fund held sizable weights in its two top contributing industries: machinery (Industrials) and electronic equipment, instruments & components (Information Technology). Health care equipment & supplies (Health Care) was the largest industry detractor, followed by commercial services & supplies (Industrials).
Coherent, which makes laser-based photonic products, was the largest contributing position as the stock benefited from a takeover battle that resulted in its shares appreciating more than 70% for the year-to-date period. Manhattan Associates was the second top contributing position in 2021’s first half. The company develops and provides technology-based supply chain software solutions that help companies manage the effectiveness and efficiency of supply chains. Manhattan reported 1Q21 results in late April that included record first-quarter revenue, robust demand for its cloud-based solutions, and increased guidance for the remainder of 2021. The company also believes it can benefit from several secular tailwinds, such as the digitalization of businesses, the shift to more flexible multifunction facilities for brick-and-mortar stores, innovative inventory management solutions, and shorter fulfillment timelines. All of these trends are helping to spur demand for its products. It exemplifies a key theme in Premier’s portfolio: a business that proved its durability during the recession and has so far emerged with greater earnings and cash flow power as the economy recovers.
Haemonetics Corporation designs and manufactures automated systems for the collection, processing, and surgical salvage of donor and patient blood while also offering related information services and data management software. It was the largest detractor for the year-to-date period as its shares suffered a significant decline in April with the departure of a large customer in plasma distribution. Confident in the company’s expertise in its niche, we held shares at the end of June. The next top detractor at the position level was GCM Grosvenor, an investment management company focused on private equity, infrastructure investments, real estate, credit finance, and absolute return. Its shares fell after the company reported fiscal first-quarter results in mid-May that showed better-than-expected revenues but earnings that seemed to fall short of other investors’ expectations. We added a meaningful amount of shares in January before slightly trimming our position in May as part of a portfolio-wide effort to raise cash.
The Fund’s relative disadvantage for the year-to-date period was due largely to ineffective stock selection, though sector allocation also detracted slightly from relative performance. Consumer Discretionary was the largest relative detractor on a sector basis due to weak stock selection as well as our underweight in this outperforming sector for the benchmark. Having no exposure to two strong industry performers—specialty retail and (to a lesser extent) hotels, restaurants & leisure—accounted for most of the performance shortfall. Financials was the second largest sector detractor due exclusively to lagging stock selection, largely in capital markets. Perhaps surprisingly, Health Care was the biggest relative contributor in the first half of 2021, thanks to our underweight in this underperforming sector. The Fund’s lack of exposure to the lagging biotechnology industry was particularly additive to relative performance. Utilities was the second largest relative contributor for a similar reason—the Fund had no holdings in this underperforming sector.
Top Contributors to Performance | Top Detractors from Performance | |||||
Year-to-Date Through 6/30/21 (%)1 | Year-to-Date Through 6/30/21 (%)2 | |||||
Coherent | 1.06 | Haemonetics Corporation | -0.90 | |||
Manhattan Associates | 0.78 | GCM Grosvenor Cl . A | -0.32 | |||
Bio-Techne | 0.75 | Ritchie Bros. Auctioneers | -0.26 | |||
Valmont Industries | 0.75 | Ashmore Group | -0.14 | |||
Lindsay Corporation | 0.68 | ESCO Technologies | -0.12 | |||
1 includes dividends | 2 Net of dividends |
CURRENT POSITIONING AND OUTLOOK
The first half was a challenging relative performance period as low profitability and high leverage small caps did best, the opposite of the attributes that we seek. Corporate high yield spreads also contracted, which, while historically supportive for the Fund’s absolute returns, has also whipped up headwinds for its relative results. However, from the starting point of low high yield spreads, the Fund’s relative results have been very attractive throughout its nearly three decades of history. The Fund has also produced its greatest excess relative return in five-year periods with single digit returns, which is our expected range for the small cap index over the intermediate term. From a portfolio positioning standpoint, we raised cash throughout the second quarter. Sales have largely been focused on reducing weightings in some of our highest valuation holdings, which may be more vulnerable to price declines, and in companies where we still have long-term conviction—but where the near-term price appreciation seems a bit excessive. We are actively researching potential holdings and are prepared if market volatility gives us the opportunity to build existing holdings at more attractive prices.
20 | The Royce Funds 2021 Semiannual Report to Shareholders
|
PERFORMANCE AND PORTFOLIO REVIEW (UNAUDITED) | TICKER SYMBOLS RYPRX RPFFX RPFIX RPRCX RPRRX |
Performance and Expenses | |||||||||
Average Annual Total Return (%) Through 6/30/21 | |||||||||
JAN-JUN 20211 | 1-YR | 3-YR | 5-YR | 10-YR | 15-YR | 20-YR | 25-YR | SINCE INCEPTION (12/31/91) | |
RPR | 10.38 | 41.91 | 12.97 | 16.15 | 10.06 | 9.70 | 10.84 | 11.56 | 11.92 |
Annual Operating Expenses: 1.21% |
1 Not annualized
Relative Returns: Monthly Rolling Average Annual Return Periods
20 Years Through 6/30/21
On a monthly rolling basis, The Fund outperformed the Russell 2000 in 66% of all 10-year periods; 57% of all 5-year periods; and 60% of all 1-year periods.
PERIODS BEATING THE INDEX | FUND AVG (%)1 | INDEX AVG (%)1 | |||||
10-year | 80/121 | 66% | 10.0 | 9.1 | |||
5-year | 104/181 | 57% | 10.3 | 9.0 | |||
1-year | 137/229 | 60% | 12.2 | 11.0 |
1Average of monthly rolling average annual total returns over the specified periods.
Morningstar Style Map™ As of 6/30/21
The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund’s investment strategy. The Morningstar Ownership Zone provides detail about a portfolio’s investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. Over time, the shape and location of a fund’s ownership zone may vary. See page 86 for additional information.
Value of $10,000
Invested on 12/31/91 as of 6/30/21 ($)
Top 10 Positions
% of Net Assets
Morningstar | 2.9 |
Lincoln Electric Holdings | 2.7 |
MKS Instruments | 2.6 |
John Bean Technologies | 2.6 |
Lindsay Corporation | 2.5 |
Valmont Industries | 2.5 |
Quaker Chemical | 2.3 |
Reliance Steel & Aluminum | 2.2 |
Kennedy-Wilson Holdings | 2.2 |
Rogers Corporation | 2.2 |
Portfolio Sector Breakdown
% of Net Assets
Industrials | 31.9 |
Information Technology | 21.1 |
Financials | 13.4 |
Materials | 8.3 |
Consumer Discretionary | 6.8 |
Health Care | 6.0 |
Real Estate | 2.4 |
Consumer Staples | 1.6 |
Cash and Cash Equivalents | 8.5 |
Calendar Year Total Returns (%)
YEAR | RPR |
2020 | 11.5 |
2019 | 34.1 |
2018 | -10.4 |
2017 | 23.8 |
2016 | 23.0 |
2015 | -9.9 |
2014 | -0.9 |
2013 | 27.7 |
2012 | 11.4 |
2011 | -0.9 |
2010 | 26.5 |
2009 | 33.3 |
2008 | -28.3 |
2007 | 12.7 |
2006 | 8.8 |
Upside/Downside Capture Ratios
Periods Ended 6/30/21 (%)
UPSIDE | DOWNSIDE | |
10-Year | 84 | 87 |
From 12/31/91 (Start of Fund’s First Full Quarter) | 91 | 73 |
Portfolio Diagnostics | |
Fund Net Assets | $1,795 million |
Number of Holdings | 56 |
Turnover Rate | 10% |
Average Market Capitalization1 | $4,381 million |
Weighted Average P/E Ratio2,3 | 30.4x |
Weighted Average P/B Ratio2 | 3.5x |
Active Share4 | 98% |
U.S. Investments (% of Net Assets) | 85.4% |
Non-U.S. Investments (% of Net Assets) | 6.1% |
1 | Geometric Average. This weighted calculation uses each portfolio holding’s market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio’s center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median. |
2 | Harmonic Average. This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio’s share in the earnings or book value, as the case may be, of its underlying stocks. |
3 | The Fund’s P/E ratio calculation excludes companies with zero or negative earnings (7% of portfolio holdings as of 6/30/21). |
4 | Active Share is the sum of the absolute values of the different weightings of each holding in the Fund versus each holding in the benchmark, divided by two. |
Important Performance and Expense Information
All performance information in this Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. All performance and risk information reflects results of the Investment Class (its oldest class). Certain immaterial adjustments were made to the net assets of Royce Premier Fund at 6/30/19 for financial reporting purposes, and as a result the net asset values shareholder transactions on that date and the calendar year total returns (%) based on those net asset values differ from the adjusted net asset values and calendar year total returns reported in the Financial Highlights. Operating expenses reflect the Fund’s total annual operating expenses for the Investment Class as of the Fund’s most current prospectus and include management fees and other expenses. Regarding the “Top Contributors” and “Top Detractors” tables shown above, the sum of all contributors to, and all detractors from, performance for all securities in the portfolio would approximate the Fund’s year-to-date performance for 2021. Upside Capture Ratio measures a manager’s performance in up markets relative to the Fund’s benchmark (Russell 2000). It is calculated by measuring the Fund’s performance in quarters when the benchmark went up and dividing it by the benchmark’s return in those quarters. Downside Capture Ratio measures a manager’s performance in down markets relative to the Fund’s benchmark. It is calculated by measuring the Fund’s performance in quarters when the benchmark goes down and dividing it by the benchmark’s return in those quarters.
The Royce Funds 2021 Semiannual Report to Shareholders | 21
MANAGER’S DISCUSSION (UNAUDITED) |
Royce Small-Cap Value Fund (RVV) |
Jay Kaplan, CFA®
FUND PERFORMANCE
Royce Small-Cap Value Fund gained 23.1% for the year-to-date period ended 6/30/21, underperforming the Russell 2000 Value Index (+26.7%) while outpacing the Russell 2000 Index (+17.5%) for the same period.
WHAT WORKED... AND WHAT DIDN’T
All nine of the equity sectors in which the portfolio held investments made positive contributions to performance in 2021’s first half. The Fund’s largest weighting, Industrials, made the most sizable positive contribution followed closely by Consumer Discretionary and Information Technology. Real Estate, Consumer Staples, and Energy made the smallest positive contributions to performance.
Discount footwear retailer Shoe Carnival was the top contributing position, benefiting from substantial sales growth as high demand allowed it to sell shoes at full price rather than resort to discounting, boosting the company’s profits and expanding its margins. Kulicke & Soffa Industries—which designs and manufactures capital equipment, related spare parts, and packaging materials used to assemble semiconductor devices—reported strong results for its fiscal second quarter in May, citing increased global reliance on semiconductors and the growing capital intensity within the assembly process as the primary drivers behind its recent success. Kulicke & Soffa’s business also benefited from restoked demand for chips. In addition, the company was added to the Russell 2000 in May, helping to further lift its stock price. Our third best contributor was lease-to-own retailer The Aaron’s Company. Tightening credit for lower income Americans was relieved to a large degree by PPE money, which helped the company’s key rent-to-own furniture and appliance business. The company also reported first-quarter results in April that included higher revenues, much improved earnings, and raised guidance for the rest of 2021.
Conversely, specialty insurer and reinsurer James River Group Holdings caused the biggest drag on performance for the year-to-date period ended 6/30/21. Its shares were hit hard in May when the company announced a significant reserve charge related to its commercial auto business, specifically Uber, which led James River to stop writing new policies with the ride share company at the end of 2019. A larger-than-expected number of Uber-related legacy claims, however, led the company to meaningfully add to these reserves, which created a consequent negative impact on capital levels that in turn saw James River issue equity, the dilutive effect of which led its shares rapidly downward. Hopeful for an eventual turnaround, we held shares at the end of June. We also held a position in Florida-based Heritage Insurance Holdings at the end of the period. Stormy weather in the Southeast U.S. led to higher-than-anticipated losses that crimped profits. However, its competitors are facing considerable financial pressure, and Florida is implementing price increases for home insurance, both of which should help Heritage to rebound. In 2020, Aaron’s separated into two independent, publicly traded companies: the aforementioned mentioned Aaron’s Company and PROG Holdings. The latter, which offers a variety of non-traditional financial solutions for low income or credit-challenged consumers, was the Fund’s third-biggest detractor. Its shares were volatile through the first half, especially after the company announced solid first-quarter results in April that nonetheless seemed to disappoint investors. We like the company’s innovative financial and technological services and added to our stake through the first half.
Relative to the Russell 2000 Value for 2021’s first half, sector allocation decisions and ineffective stock selection equally hampered performance. Energy, the sector with the most sizable negative impact, detracted due to our lower weighting. Financials and Communication Services followed as a result of our ineffective stock picks, with sector allocation equally detracting in the latter. On the other hand, Information Technology benefited from savvy stock selection, while our lack of exposure to Utilities and our lower weighting in Real Estate were also additive.
Top Contributors to Performance | Top Detractors from Performance | |||||
Year-to-Date Through 6/30/21 (%)1 | Year-to-Date Through 6/30/21 (%)2 | |||||
Shoe Carnival | 1.58 | James River Group Holdings | -0.31 | |||
Kulicke & Soffa Industries | 1.52 | Heritage Insurance Holdings | -0.16 | |||
Aaron’s Company (The) | 1.16 | PROG Holdings | -0.12 | |||
Rent-A-Center | 1.14 | La-Z-Boy | -0.12 | |||
ArcBest | 1.13 | BioDelivery Sciences International | -0.10 | |||
1 Includes dividends | 2 Net of dividends | |||||
CURRENT POSITIONING AND OUTLOOK
Given the backdrop of ample liquidity and a rebounding economy, we believe that inflation is likely to grow, with Fed policy crucial to managing its effects. We think earnings for 2021 should remain strong as they’re being measured off 2020’s recession. However, the earnings picture for 2022 is unclear due to the current uncertainty in the market. We’re populating the portfolio with companies we believe will hold up well in the current murky climate, even if they’re currently out of favor for reasons we see as likely to prove short lived. Our heavy exposures to Industrials, Consumer Discretionary, and Financials best exemplify this. Industries such as construction & engineering in Industrials look attractive to us as they seem best positioned to deal with current supply chain issues and look more than capable of passing on costs in our inflationary environment. Constricted supply and high demand in Consumer Discretionary have attracted us to companies involved in household goods and furniture, because we anticipate that sales should remain robust. While rising rates and a steeper yield curve may bode well for banks, loan growth remains weak. However, a strengthening economy may fix that and, moreover, we believe the market still has an upward, though more modest, trajectory.
22 | The Royce Funds 2021 Semiannual Report to Shareholders
|
PERFORMANCE AND PORTFOLIO REVIEW (UNAUDITED) | TICKER SYMBOLS RYVFX RVVHX RVFCX RVVRX |
Performance and Expenses
Average Annual Total Return (%) Through 6/30/21
JAN-JUN 20211 | 1-YR | 3-YR | 5-YR | 10-YR | 15-YR | 20-YR | SINCE INCEPTION (6/14/01) | |
RVV | 23.08 | 60.08 | 5.65 | 9.27 | 5.69 | 6.31 | 8.92 | 9.12 |
Annual Gross Operating Expenses: 1.62% | Annual Net Operating Expenses: 1.49% |
1 Not annualized
Morningstar Style Map™ As of 6/30/21
The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund’s investment strategy. The Morningstar Ownership Zone provides detail about a portfolio’s investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. Over time, the shape and location of a fund’s ownership zone may vary. See page 86 for additional information.
Value of $10,000
Invested on 6/14/01 as of 6/30/21 ($)
Top 10 Positions
% of Net Assets
Evercore Cl. A | 2.4 |
Kulicke & Soffa Industries | 2.4 |
Shoe Carnival | 2.3 |
PulteGroup | 2.3 |
Sanmina Corporation | 2.3 |
Rent-A-Center | 2.3 |
Molina Healthcare | 2.1 |
Vishay Intertechnology | 2.1 |
La-Z-Boy | 2.0 |
Aaron’s Company (The) | 2.0 |
Portfolio Sector Breakdown
% of Net Assets
Industrials | 22.9 |
Financials | 22.9 |
Consumer Discretionary | 22.0 |
Information Technology | 19.5 |
Health Care | 7.7 |
Communication Services | 1.4 |
Energy | 0.5 |
Real Estate | 0.4 |
Consumer Staples | 0.4 |
Cash and Cash Equivalents | 2.3 |
Calendar Year Total Returns (%)
YEAR | RVV |
2020 | -6.5 |
2019 | 18.2 |
2018 | -7.2 |
2017 | 5.3 |
2016 | 21.1 |
2015 | -11.5 |
2014 | -0.0 |
2013 | 27.8 |
2012 | 9.6 |
2011 | -7.4 |
2010 | 25.0 |
2009 | 44.7 |
2008 | -34.2 |
2007 | 3.8 |
2006 | 16.8 |
Upside/Downside Capture Ratios
Periods Ended 6/30/21 (%)
UPSIDE | DOWNSIDE | |
10-Year | 80 | 104 |
From 6/30/01 (Start of Fund’s First Full Quarter) | 94 | 92 |
Portfolio Diagnostics | |
Fund Net Assets | $142 million |
Number of Holdings | 95 |
Turnover Rate | 28% |
Average Market Capitalization1 | $1,561 million |
Weighted Average P/E Ratio2,3 | 13.7x |
Weighted Average P/B Ratio2 | 2.0x |
Active Share4 | 96% |
U.S. Investments (% of Net Assets) | 94.2% |
Non-U.S. Investments (% of Net Assets) | 3.5% |
1 | Geometric Average. This weighted calculation uses each portfolio holding’s market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio’s center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median. |
2 | Harmonic Average. This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio’s share in the earnings or book value, as the case may be, of its underlying stocks. |
3 | The Fund’s P/E ratio calculation excludes companies with zero or negative earnings (6% of portfolio holdings as of 6/30/21). |
4 | Active Share is the sum of the absolute values of the different weightings of each holding in the Fund versus each holding in the benchmark, divided by two. |
Important Performance and Expense Information
All performance information in this Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. All performance and risk information reflects results of the Service Class (its oldest class). Certain immaterial adjustments were made to the net assets of Royce Small-Cap Value Fund at 6/30/16 for financial reporting purposes, and as a result the net asset values for shareholder transactions on that date and the calendar year Total Returns (%) based on those net asset values differ from the adjusted net asset values and calendar year total returns reported in the Financial Highlights. Gross operating expenses reflect the Fund’s gross total annual operating expenses for the Service Class and include management fees, 12b-1 distribution and service fees, and other expenses. Net operating expenses reflect contractual fee waivers and/or expense reimbursements. All expense information is reported as of the Fund’s most current prospectus. Royce & Associates has contractually agreed, without right of termination, to waive fees and/or reimburse expenses to the extent necessary to maintain the Service Class’s net annual operating expenses (excluding brokerage commissions, taxes, interest, litigation expenses, acquired fund fees and expenses, and other expenses not borne in the ordinary course of business) at or below 1.49% through April 30, 2022. Regarding the”Top Contributors” and”Top Detractors” tables shown above, the sum of all contributors to, and all detractors from, performance for all securities in the portfolio would approximate the Fund’s year-to-date performance for 2021. Upside Capture Ratio measures a manager’s performance in up markets relative to the Fund’s benchmark (Russell 2000 Value). It is calculated by measuring the Fund’s performance in quarters when the benchmark went up and dividing it by the benchmark’s return in those quarters. Downside Capture Ratio measures a manager’s performance in down markets relative to the Fund’s benchmark. It is calculated by measuring the Fund’s performance in quarters when the benchmark goes down and dividing it by the benchmark’s return in those quarters.
The Royce Funds 2021 Semiannual Report to Shareholders | 23
MANAGER’S DISCUSSION (UNAUDITED)
Royce Smaller-Companies Growth Fund (RVP)
Chip Skinner, CFA®
FUND PERFORMANCE
For the year-to-date period ended 6/30/21, Royce Smaller-Companies Growth Fund advanced 18.9%, outperforming both the Russell 2000 (+17.5%) and Russell 2000 Growth (+9.0%) Indexes for the same period. The Fund’s recent impressive results helped it to beat both indexes for the one-, three-, and five-year periods while also outpacing the Russell 2000—its primary benchmark—for the 10-, 15-, 20-year, and since inception (6/14/01) periods ended 6/30/21.
WHAT WORKED… AND WHAT DIDN’T
Eight of the Fund’s 10 equity sectors finished the year’s first half in the black. Health Care and Information Technology—the portfolio’s biggest weightings—made outsized positive contributions to performance, followed by Communication Services. Utilities and Materials, which were among the Fund’s three lowest portfolio weights, were the only sectors that detracted from performance while Real Estate, another low weighting, made the smallest contribution. The Fund’s top two contributing sectors furnished its three best contributors at the industry level: health care equipment, semiconductors & semiconductor equipment, and healthcare providers & services. The industries that made the largest (albeit modest) negative impact on performance came from three different sectors—electrical equipment (Industrials), diversified consumer services (Consumer Discretionary), and communications equipment (Information Technology).
The Fund’s best contributing position was The Joint Corporation, which operates and franchises chiropractic clinics. Its shares had already languished for a few years when we began building our position. We liked the recurring revenues of Joint’s franchise model as well as its more recent focus on ramping up its own stores that have thinner margins but higher revenues. The company navigated the pandemic successfully—being deemed an essential service helped—and chiropractic treatment has outgrown the stigma it had decades ago. In May, Joint reported increased revenue and a growing business while also raising guidance, leading its stock upward. Canadian sports media and online betting company Score Media and Gaming came next. The online sports betting industry is gaining traction on a global basis, and as the leading site in Canada for sports news and fantasy leagues, Score is also prepared to benefit from its home country’s efforts to legalize online sports gambling.
Aspen Group, the portfolio’s top detractor in 2021’s first half, is a for profit college specializing in nursing and related programs. Enrollment rates were strong prior to COVID, later dipping through the worst days of the pandemic. This decline drove some large investors away from this micro-cap stock, but enrollments have since re-accelerated, boosting our confidence in an eventual recovery for the stock. We added shares in March and May. With Blue Prism Group, which makes Robotic Process Automation (“RPA”) software, we chose to exit the position. RPA is an emerging technology area, and the company was one of the few pure plays in what we expect to be a key growth area, although it proved to not be as well-managed as we’d like.
Relative to the Russell 2000 in 2021’s first half, outperformance came from stock selection as sector allocation detracted from results. Our biggest advantage on a sector level came from stock selection in Health Care, where our holdings significantly outpaced both the sector within the benchmark and the index as a whole. Next came the additive effects of our overweight in Communication Services and stock picks in Information Technology. Conversely, we were hurt versus the benchmark by a combination of ineffective stock selection and our lower weighting in Consumer Discretionary, our cash position, and the Fund’s lack of exposure to the resurgent Energy sector.
Top Contributors to Performance | Top Detractors from Performance | |||||
Year-to-Date Through 6/30/21 (%)1 | Year-to-Date Through 6/30/21 (%)2 | |||||
Joint Corp. (The) | 1.53 | Aspen Group | -0.45 | |||
Score Media and Gaming Cl. A | 1.42 | Blue Prism Group | -0.42 | |||
MagnaChip Semiconductor | 1.40 | Beam Global | -0.42 | |||
InMode | 1.23 | Motorsport Games Cl. A | -0.40 | |||
STAAR Surgical | 1.19 | Rush Street Interactive Cl. A | -0.38 | |||
1 Includes dividends | 2 Net of dividends | |||||
CURRENT POSITIONING AND OUTLOOK
During the first half of 2021, we trimmed certain high multiple stocks earlier in the year while maintaining larger positions in those that we see as best positioned for long-term growth, including InMode, which makes state-of-the-art light, laser, and radio frequency devices for the aesthetic treatment of the face, body, and skin; Avid Bioservices, a contract development and manufacturing organization that provides process development and manufacturing practices for biotechnology companies engaged in gene editing; and Oxford Biomedica, a biopharmaceutical company involved in the research, development, and bioprocessing of lentiviral vector and cell therapy products for the treatment of various diseases. We made these changes based on the idea that earnings growth will continue to drive small cap performance. Eventually, the Fed will need to taper, whether due to continued inflationary and wage pressures or economic acceleration, but that scenario may take years to play out. The fact that COVID cases and attendant fears have lingered will also keep developed countries’ feet on the gas pedal. Leadership has rotated from small-cap growth to small-cap value, though the valuation gap remains wide, which suggests that value should continue to outperform in the near term. It’s also true that investors are perennially searching for “the next big thing,” and the U.S. continues to be a fertile source of innovation and leadership. Each of these factors underscores our confidence.
24 | The Royce Funds 2021 Semiannual Report to Shareholders
|
PERFORMANCE AND PORTFOLIO REVIEW (UNAUDITED) | TICKER SYMBOLS RYVPX RVPHX RVPCX RVPIX |
Performance and Expenses
Average Annual Total Return (%) Through 6/30/21
JAN-JUN 20211 | 1-YR | 3-YR | 5-YR | 10-YR | 15-YR | 20-YR | SINCE INCEPTION (6/14/01) | |
RVP | 18.90 | 73.78 | 21.31 | 21.34 | 13.08 | 9.73 | 12.85 | 13.12 |
Annual Gross Operating Expenses: 1.54% | Annual Net Operating Expenses: 1.49% |
1 Not annualized
Morningstar Style Map™ As of 6/30/21
The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund’s investment strategy. The Morningstar Ownership Zone provides detail about a portfolio’s investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. Over time, the shape and location of a fund’s ownership zone may vary. See page 86 for additional information.
Value of $10,000
Invested on 6/14/01 as of 6/30/21 ($)
Top 10 Positions | |
% of Net Assets | |
Enthusiast Gaming Holdings | 3.3 |
Unisys Corporation | 3.0 |
MagnaChip Semiconductor | 2.7 |
Iteris | 2.4 |
Lawson Products | 2.4 |
InMode | 2.3 |
STAAR Surgical | 2.3 |
CareDx | 1.8 |
Sea Cl. A ADR | 1.8 |
Avid Bioservices | 1.7 |
Portfolio Sector Breakdown
% of Net Assets
Health Care | 30.2 |
Information Technology | 25.3 |
Industrials | 12.9 |
Consumer Discretionary | 8.5 |
Communication Services | 6.5 |
Financials | 6.1 |
Materials | 1.6 |
Consumer Staples | 1.4 |
Real Estate | 0.9 |
Cash and Cash Equivalents | 6.6 |
Calendar Year Total Returns (%)
YEAR | RVP |
2020 | 49.3 |
2019 | 23.7 |
2018 | -10.2 |
2017 | 17.8 |
2016 | 9.4 |
2015 | -1.8 |
2014 | 3.9 |
2013 | 32.5 |
2012 | 15.3 |
2011 | -10.0 |
2010 | 19.7 |
2009 | 41.4 |
2008 | -41.1 |
2007 | 3.2 |
2006 | 19.3 |
Upside/Downside Capture Ratios
Periods Ended 6/30/21 (%)
UPSIDE | DOWNSIDE | |
10-Year | 105 | 103 |
From 6/30/01 (Start of Fund’s First Full Quarter) | 115 | 99 |
Portfolio Diagnostics | |
Fund Net Assets | $357 million |
Number of Holdings | 109 |
Turnover Rate | 29% |
Average Market Capitalization1 | $1,562 million |
Weighted Average P/B Ratio2 | 4.5x |
3-5 Year EPS Growth (est.)3 | 23.3% |
Active Share4 | 95% |
U.S. Investments (% of Net Assets) | 75.2% |
Non-U.S. Investments (% of Net Assets) | 18.2% |
1 | Geometric Average. This weighted calculation uses each portfolio holding’s market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio’s center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median. |
2 | Harmonic Average. This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio’s share in the earnings or book value, as the case may be, of its underlying stocks. |
3 | The 3-5 Year EPS Growth (est.) is calculated as a simple weighted average of the pre-calculated mean long-term EPS growth rate estimates by brokerage analysts. Long Term Growth (LTG) is the annual EPS growth that the company can sustain over the next 3 or 5 years. Source: Factset |
4 | Active Share is the sum of the absolute values of the different weightings of each holding in the Fund versus each holding in the benchmark, divided by two. |
Important Performance and Expense Information
All performance information in this Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. All performance and risk information reflects results of the Service Class (its oldest class). Gross operating expenses reflect the Fund’s gross total operating expenses for the Service Class and include management fees, 12b-1 distribution and service fees, and other expenses. Net operating expenses reflect contractual fee waivers and/or expense reimbursements. All expense information is reported as of the Fund’s most current prospectus. Royce & Associates has contractually agreed, without right of termination, to waive fees and/or reimburse expenses to the extent necessary to maintain the Service Class’s net annual operating expenses (excluding brokerage commissions, taxes, interest, litigation expenses, acquired fund fees and expenses, and other expenses not borne in the ordinary course of business) at or below 1.49% through April 30, 2022. Regarding the “Top Contributors” and “Top Detractors” tables shown above, the sum of all contributors to, and all detractors from, performance for all securities in the portfolio would approximate the Fund’s year-to-date performance for 2021. Upside Capture Ratio measures a manager’s performance in up markets relative to the Fund’s benchmark (Russell 2000). It is calculated by measuring the Fund’s performance in quarters when the benchmark went up and dividing it by the benchmark’s return in those quarters. Downside Capture Ratio measures a manager’s performance in down markets relative to the Fund’s benchmark. It is calculated by measuring the Fund’s performance in quarters when the benchmark goes down and dividing it by the benchmark’s return in those quarters.
The Royce Funds 2021 Semiannual Report to Shareholders | 25
MANAGERS’ DISCUSSION (UNAUDITED)
Royce Special Equity Fund (RSE)
Charlie Dreifus, CFA®
Steven McBoyle
FUND PERFORMANCE
For the year-to-date period ended 6/30/21, Royce Special Equity Fund advanced 14.2%, trailing its primary benchmark, the Russell 2000 Value Index, which gained 26.7%, and the Russell 2000 Index, which rose 17.5%, for the same period.
WHAT WORKED… AND WHAT DIDN’T
For the year-to-date period ended 6/30/21, all nine of the equity sectors in which the Fund held investments contributed to performance, led by Industrials, Information Technology, and Consumer Discretionary. Real Estate, Health Care, and Financials—three of the portfolio’s five lowest weightings at the end of the first half—made the smallest contributions to performance.
At the industry level, Information Technology’s semiconductors & semiconductor equipment industry contributed most by a wide margin for the year-to-date period ended 6/30/21. The industry was driven by the strength of Kulicke & Soffa Industries as well as a strong six months for Axcelis Technologies. Kulicke & Soffa designs, manufactures, and markets capital equipment and packaging materials (as well as service, maintenance, repair, and upgrade equipment that are used in semiconductor device assembly). Axcelis Technologies designs, manufactures, and services ion implantation, dry strip, thermal processing, and curing equipment, all of which are necessary in the fabrication of semiconductor chips. Auto components (Consumer Discretionary) came next among industry contributors, driven by positive results for Cooper Tire & Rubber, which was acquired by Goodyear at a hefty premium in June.
Other notable positive contributors at the position level included Meredith Corporation, a media and marketing company involved in magazine and book publishing, television broadcasting, integrated marketing, digital advertising, and interactive media. National Presto Industries also contributed meaningfully to first-half results. The company has two main businesses: Housewares & Small Appliances and Defense Products.
Only three industries detracted from year-to-date performance. The top two detracting industries were also home to the holdings that had the biggest negative effect at the position level. First came Information Technology’s IT services group, where Computer Services, whose expertise includes bank payment processing, cloud-based banking security, and regulatory compliance services to financial institutions and other corporate customers, had the biggest negative impact. Food & staples retailing (Consumer Staples) came next, due entirely to a poor showing from the second-largest detracting position in 2021’s first half—Ingles Markets, which operates a supermarket chain in the southeastern U.S. The smallest negative impact at the industry level came from Consumer Discretionary’s hotels, restaurants & leisure industry. Of the two other holdings that hurt performance in 2021’s first six months, International Money Express, which provides funds and data transfer services from the U.S. to Latin America and the Caribbean, came third. We exited the position in May. Rounding out the gang of four detractors was Bowl America, which offers bowling, food and beverages, and game rooms for a U.S. customer base.
Year-to-date through 6/30/21, relative underperformance mostly resulted from stock selection, though sector allocation also detracted. Stock picks in Consumer Discretionary—along with the Fund’s cash position—hindered results most. The Fund was also hurt by its lack of exposure to the resurgent Energy sector. Helping relative performance were the portfolio’s much lower weighting in Financials and its lack of exposure to Utilities, while its lower allocation to Health Care provided a more modest relative benefit. Each of these three sectors lagged the small-cap value index in 2021’s first half.
Top Contributors to Performance | Top Detractors from Performance | |||||
Year-to-Date Through 6/30/21(%)1 | Year-to-Date Through 6/30/21(%)2 | |||||
Kulicke & Soffa Industries | 2.53 | Computer Services | -0.15 | |||
Cooper Tire & Rubber | 1.57 | Ingles Markets Cl. A | -0.10 | |||
Meredith Corporation | 0.82 | International Money Express | -0.06 | |||
National Presto Industries | 0.80 | Bowl America Cl. A | -0.01 | |||
Axcelis Technologies | 0.73 | Sterling Construction | 0.03 | |||
1 Includes dividends | 2 Net of dividends |
CURRENT POSITIONING AND OUTLOOK
Historically, the market has been most challenged when profit margins are rolling over in a declining pattern. While not yet evident, it is something worth watching closely. Increased input costs need to be recaptured in prices for margins to hold. Related to this is the question of whether the productivity gains we have seen over the last several months can continue. Perhaps more than ever before, the durability of productivity improvements is critical. Time will tell, of course. As for our own preference for value and cyclical names, there is, in our view, a possible nascent positive development (though we are not there yet) in that the popularity of picking equities via macro themes, such as lockdowns and reopenings, appears to be coming to an end. If so, stock selection should matter more. Differentiation at the company level seems likely to become even more important, especially as earnings comparisons for the second, third, and fourth quarters this year will prove far easier than next. We believe the vast majority of those gains are already reflected in full-year earnings figures. We expect that an environment in which investors are more focused on individual companies could potentially benefit our intensive approach to stock selection.
26 | The Royce Funds 2021 Semiannual Report to Shareholders
|
PERFORMANCE AND PORTFOLIO REVIEW (UNAUDITED) | TICKER SYMBOLS RYSEX RSEFX RSEIX RSQCX |
Performance and Expenses
Average Annual Total Return (%) Through 6/30/21
JAN-JUN 20211 | 1-YR | 3-YR | 5-YR | 10-YR | 15-YR | 20-YR | SINCE INCEPTION (5/1/98) | |
RSE | 14.16 | 36.27 | 7.69 | 10.39 | 8.58 | 8.28 | 9.69 | 9.00 |
Annual Operating Expenses: 1.23% |
1 Not annualized
Relative Risk Adjusted Returns: Monthly Rolling Sharpe Ratios
20 Years Through 6/30/21
On a monthly rolling risk-adjusted basis, the Fund outperformed the Russell 2000 Value in 86% of all 10-year periods and 60% of all 5-year periods.
PERIODS BEATING THE INDEX | FUND AVG1 | INDEX AVG1 | |||||
10-year | 104/121 | 86% | 0.56 | 0.45 | |||
5-year | 109/181 | 60% | 0.55 | 0.50 |
1Average of monthly rolling Sharpe Ratios over the specified periods.
Morningstar Style Map™ As of 6/30/21
The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund’s investment strategy. The Morningstar Ownership Zone provides detail about a portfolio’s investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. Over time, the shape and location of a fund’s ownership zone may vary. See page 86 for additional information.
Value of $10,000
Invested on 5/1/98 as of 6/30/21 ($)
Top 10 Positions
% of Net Assets
Kulicke & Soffa Industries | 4.8 |
Johnson Outdoors Cl. A | 4.7 |
Standard Motor Products | 4.3 |
John B. Sanfilippo & Son | 4.3 |
Huntsman Corporation | 4.1 |
Computer Services | 4.0 |
Ingles Markets Cl. A | 3.8 |
National Presto Industries | 3.8 |
Hooker Furniture | 3.6 |
Flexsteel Industries | 2.8 |
Portfolio Sector Breakdown
% of Net Assets
Industrials | 24.1 |
Consumer Discretionary | 20.1 |
Information Technology | 15.4 |
Consumer Staples | 8.2 |
Financials | 5.4 |
Materials | 5.2 |
Communication Services | 2.5 |
Real Estate | 2.5 |
Health Care | 2.0 |
Cash and Cash Equivalents | 14.6 |
Calendar Year Total Returns (%)
YEAR | RSE |
2020 | 7.4 |
2019 | 12.6 |
2018 | -9.9 |
2017 | 7.9 |
2016 | 32.2 |
2015 | -12.4 |
2014 | 1.1 |
2013 | 29.4 |
2012 | 15.4 |
2011 | 0.1 |
2010 | 19.6 |
2009 | 28.4 |
2008 | -19.6 |
2007 | 4.7 |
2006 | 14.0 |
Upside/Downside Capture Ratios
Periods Ended 6/30/21 (%)
UPSIDE | DOWNSIDE | |
10-Year | 76 | 75 |
From 6/30/98 (Start of Fund’s First Full Quarter) | 79 | 66 |
Portfolio Diagnostics | |
Fund Net Assets | $1,104 million |
Number of Holdings | 38 |
Turnover Rate | 23% |
Average Market Capitalization1 | $1,352 million |
Weighted Average P/E Ratio2,3 | 15.6x |
Weighted Average P/B Ratio2 | 2.3x |
Active Share4 | 99% |
U.S. Investments (% of Net Assets) | 80.6% |
Non-U.S. Investments (% of Net Assets) | 4.8% |
1 | Geometric Average. This weighted calculation uses each portfolio holding’s market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio’s center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median. |
2 | Harmonic Average. This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio’s share in the earnings or book value, as the case may be, of its underlying stocks. |
3 | The Fund’s P/E ratio calculation excludes companies with zero or negative earnings (4% of portfolio holdings as of 6/30/21). |
4 | Active Share is the sum of the absolute values of the different weightings of each holding in the Fund versus each holding in the benchmark, divided by two. |
Important Performance and Expense Information
All performance information in this Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. All performance and risk information reflects results of the Investment Class (its oldest class). Operating expenses reflect the Fund’s total annual operating expenses for the Investment Class as of the Fund’s most current prospectus and include management fees and other expenses. The Sharpe Ratio is calculated for a specified period by dividing a fund’s annualized excess returns by its annualized standard deviation. The higher the Sharpe ratio, the better the fund’s historical risk-adjusted performance. Regarding the “Top Contributors” and “Top Detractors” tables shown above, the sum of all contributors to, and all detractors from, performance for all securities in the portfolio would approximate the Fund’s year-to-date performance for 2021. Upside Capture Ratio measures a manager’s performance in up markets relative to the Fund’s benchmark (Russell 2000 Value). It is calculated by measuring the Fund’s performance in quarters when the benchmark went up and dividing it by the benchmark’s return in those quarters. Downside Capture Ratio measures a manager’s performance in down markets relative to the Fund’s benchmark. It is calculated by measuring the Fund’s performance in quarters when the benchmark goes down and dividing it by the benchmark’s return in those quarters.
The Royce Funds 2021 Semiannual Report to Shareholders | 27
MANAGERS’ DISCUSSION (UNAUDITED)
Miles Lewis, CFA®
Chuck Royce
FUND PERFORMANCE
Royce Total Return Fund advanced 19.8% for the year-to-date period ended 6/30/21, underperforming its primary benchmark, the Russell 2000 Value Index, which gained 26.7%, but ahead of the Russell 2000 Index, which returned 17.5% for the same period.
WHAT WORKED… AND WHAT DIDN’T
Each of the Fund’s 11 equity sectors finished the year-to-date period ended 6/30/21 in the black. Financials, the Fund’s largest weighting, made by far the largest positive impact, followed by Industrials and Information Technology, the portfolio’s second and fourth largest weightings, respectively. Utilities, Real Estate, and Health Care made the smallest positive impacts.
The Fund’s top contributing position in the first half was Signature Bank, a New York City metro focused commercial lender. Its shares suffered—and its valuation grew more attractive—in 2020 as investors fretted about New York City’s commercial real estate market and the potential losses in Signature’s loan portfolio. Regional bank stocks then began to recover when vaccines were approved in the fall of 2020, and Signature was no exception. Since that time, Signature has delivered on its growth model with robust loan and deposit growth, as well as a rising stock price. Our next top contributor was Triumph Bancorp, where the market’s recognition of the bank’s fintech expertise validated our original investment thesis. The company saw a quarterly record for invoices—which increased more than 400% from 2020—while invoices processed per carrier increased more than 190%. Triumph also boasts a strong market share in U.S. transportation (via Triumph Business Capital) and has successfully expanded that segment into payment processing for the trucking industry through its Triumph Pay (T-Pay) platform. These positive developments all helped its stock to climb in the first half.
Shares of insurer James River Group Holdings were hit hard in May when the company announced a significant reserve charge related to its commercial auto business, specifically Uber, which led James River to stop writing new policies with the ride share company at the end of 2019. A larger-than-expected number of Uber-related legacy claims, however, led the company to meaningfully add to these reserves, which created a consequent negative impact on capital levels that in turn saw James River issue equity, the dilutive effect of which led its shares rapidly downward. Our subsequent due diligence, coupled with our long history with the company and the strong fundamentals of the E&S (“Excess & Surplus”) marketplace in which it has historically been successful, gave us the confidence to build our position. RenaissanceRe or “RenRe” has enjoyed many years of success in the reinsurance industry due to its use of internal models and databases to help price risk more accurately than its peers, which rely heavily on third-party models. Unfortunately, investors seemed uninterested or unaware of this distinction, as its shares fell along with most of the broader P&C (“property & casualty”) insurance industry in the first half. RenRe believes its current book of business will be profitable, and our research is in line with that estimate. In addition to its attractive valuation, we like the robust fundamentals we see throughout the P&C industry and believe RenRe is poised to ultimately benefit.
Relative to the Russell 2000 Value in 2021’s first half, ineffective stock selection and sector allocation decisions detracted from performance, with the former making the bigger negative impact. Stock selection and our lower exposure to Consumer Discretionary and Energy hurt relative performance, with stock selection having a larger effect in the former sector. Stock picking also hindered relative results in Materials. By contrast, our lower weighting in Utilities was additive, as were stock selection in Financials and, more modestly, our higher weighting in Information Technology.
Top Contributors to Performance | Top Detractors from Performance | |||||
Year-to-Date Through 6/30/21 (%)1 | Year-to-Date Through 6/30/21 (%)2 | |||||
Signature Bank | 1.20 | James River Group Holdings | -0.34 | |||
Triumph Bancorp | 1.07 | RenaissanceRe Holdings | -0.11 | |||
Kulicke & Soffa Industries | 0.96 | Trean Insurance Group | -0.10 | |||
Deluxe Corporation | 0.78 | Equity Commonwealth | -0.08 | |||
First Citizens BancShares Cl. A | 0.70 | TGS | -0.07 | |||
1 Includes dividends | 2 Net of dividends |
CURRENT POSITIONING AND OUTLOOK
While the market’s recent preoccupation with certain meme stocks may have dampened the attraction of more prosaic stocks—those that pay dividends, generate cash, and have low debt—we have been happy to build positions in these consistent business models at what we believe are very attractive valuations. In addition to regional banks and P&C insurers, we remain constructive on areas such as high-quality cyclical industrials and certain pockets of the Consumer Discretionary sector. U.S. consumers are in excellent financial shape, with increased savings and lower debt service versus pre-pandemic levels and are thus able to spend. Within the apparel industry, supply chain disruptions—first challenged by COVID and more recently by revived demand—have resulted in very lean inventories, which typically give sellers more pricing power as strong demand frees retailers from the obligation to be promotional, thus improving gross margins for holdings such as Levi’s and Ralph Lauren. The competitive landscape within restaurants has been similarly disrupted. Asset light restaurant companies such as Denny’s should see structurally higher growth rates over the next few years. Finally, we continue to closely monitor inflation, which virtually all of our holdings are experiencing, and believe that the portfolio is well positioned for a period of rising prices in the U.S. economy.
28 | The Royce Funds 2021 Semiannual Report to Shareholders
|
PERFORMANCE AND PORTFOLIO REVIEW (UNAUDITED) | TICKER SYMBOLS RYTRX RYTFX RTRIX RYTCX RTRRX |
Performance and Expenses
Average Annual Total Return (%) Through 6/30/21
JAN-JUN 20211 | 1-YR | 3-YR | 5-YR | 10-YR | 15-YR | 20-YR | 25-YR | SINCE INCEPTION (12/15/93) | |
RTR | 19.80 | 50.45 | 10.15 | 12.10 | 9.87 | 8.10 | 8.96 | 10.05 | 10.76 |
Annual Operating Expenses: 1.25% |
1 Not annualized
Relative Risk Adjusted Returns: Monthly Rolling Sharpe Ratios
20 Years Through 6/30/21
On a monthly rolling risk-adjusted basis, the Fund outperformed the Russell 2000 Value in 100% of all 10-year periods and 93% of all 5-year periods.
PERIODS BEATING THE INDEX | FUND AVG1 | INDEX AVG1 | |||||
10-year | 121/121 | 100% | 0.52 | 0.45 | |||
5-year | 168/181 | 93% | 0.58 | 0.50 |
1Average of monthly rolling Sharpe Ratios over the speciffed periods.
Morningstar Style Map™ As of 6/30/21
The Morningstar Style Map is the Morningstar Style Box™ with the center 75% of fund holdings plotted as the Morningstar Ownership Zone™. The Morningstar Style Box is designed to reveal a fund’s investment strategy. The Morningstar Ownership Zone provides detail about a portfolio’s investment style by showing the range of stock sizes and styles. The Ownership Zone is derived by plotting each stock in the portfolio within the proprietary Morningstar Style Box. Over time, the shape and location of a fund’s ownership zone may vary. See page 86 for additional information.
Value of $10,000
Invested on 12/15/93 as of 6/30/21 ($)
Top 10 Positions
% of Net Assets
Vontier Corporation | 2.4 |
Compass Diversified Holdings | 1.9 |
Independent Bank Group | 1.9 |
Element Solutions | 1.9 |
Carlisle Companies | 1.9 |
James River Group Holdings | 1.8 |
Graphic Packaging Holding Company | 1.8 |
Levi Strauss & Co. Cl. A | 1.7 |
Minerals Technologies | 1.7 |
MSC Industrial Direct Cl. A | 1.7 |
Portfolio Sector Breakdown
% of Net Assets
Financials | 40.6 |
Industrials | 22.6 |
Materials | 9.5 |
Information Technology | 8.4 |
Consumer Discretionary | 7.2 |
Energy | 2.9 |
Consumer Staples | 2.8 |
Real Estate | 2.4 |
Communication Services | 1.7 |
Health Care | 0.8 |
Preferred Stock | 0.1 |
Cash and Cash Equivalents | 1.0 |
Calendar Year Total Returns (%)
YEAR | RTR |
2020 | 3.8 |
2019 | 23.5 |
2018 | -12.5 |
2017 | 13.7 |
2016 | 25.9 |
2015 | -7.2 |
2014 | 1.3 |
2013 | 32.8 |
2012 | 14.4 |
2011 | -1.7 |
2010 | 23.5 |
2009 | 26.2 |
2008 | -31.2 |
2007 | 2.4 |
2006 | 14.5 |
Upside/Downside Capture Ratios
Periods Ended 6/30/21 (%)
UPSIDE | DOWNSIDE | |
10-Year | 85 | 81 |
From 12/31/93 (Start of Fund’s First Full Quarter) | 86 | 70 |
Portfolio Diagnostics | |
Fund Net Assets | $1,549 million |
Number of Holdings | 107 |
Turnover Rate | 36% |
Average Market Capitalization1 | $3,330 million |
Weighted Average P/E Ratio2,3 | 17.1x |
Weighted Average P/B Ratio2 | 2.2x |
Active Share4 | 96% |
U.S. Investments (% of Net Assets) | 86.1% |
Non-U.S. Investments (% of Net Assets) | 12.9% |
1 | Geometric Average. This weighted calculation uses each portfolio holding’s market cap in a way designed to not skew the effect of very large or small holdings; instead, it aims to better identify the portfolio’s center, which Royce believes offers a more accurate measure of average market cap than a simple mean or median. |
2 | Harmonic Average. This weighted calculation evaluates a portfolio as if it were a single stock and measures it overall. It compares the total market value of the portfolio to the portfolio’s share in the earnings or book value, as the case may be, of its underlying stocks. |
3 | The Fund’s P/E ratio calculation excludes companies with zero or negative earnings (12% of portfolio holdings as of 6/30/21). |
4 | Active Share is the sum of the absolute values of the different weightings of each holding in the Fund versus each holding in the benchmark, divided by two. |
Important Performance and Expense Information
All performance information in this Report reflects past performance, is presented on a total return basis, reflects the reinvestment of distributions, and does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Past performance is no guarantee of future results. Investment return and principal value of an investment will fluctuate, so that shares may be worth more or less than their original cost when redeemed. Shares redeemed within 30 days of purchase may be subject to a 1% redemption fee payable to the Fund, which is not reflected in the performance shown above; if it were, performance would be lower. Current month-end performance may be higher or lower than performance quoted and may be obtained at www.royceinvest.com. All performance and risk information reflects results of the Investment Class (its oldest class). Certain immaterial adjustments were made to the net assets of Royce Total Return Fund at 6/30/17 for financial reporting purposes, and as a result the net asset values for shareholder transactions on that date and the calendar year Total Returns (%) based on those net asset values differ from the adjusted net asset values and calendar year total returns reported in the Financial Highlights. Operating expenses reflect the Fund’s total annual operating expenses for the Investment Class as of the Fund’s most current prospectus and include management fees, other expenses, and acquired fund fees and expenses. Acquired fund fees and expenses reflect the estimated amount of the fees and expenses incurred indirectly by the Fund through its investments in mutual funds, hedge funds, private equity funds, and other investment companies. Regarding the “Top Contributors” and “Top Detractors” tables shown above, the sum of all contributors to, and all detractors from, performance for all securities in the portfolio would approximate the Fund’s year-to-date performance for 2021. The Sharpe Ratio is calculated for a specified period by dividing a fund’s annualized excess returns by its annualized standard deviation. The higher the Sharpe ratio, the better the fund’s historical risk-adjusted performance. Upside Capture Ratio measures a manager’s performance in up markets relative to the Fund’s benchmark (Russell 2000 Value). It is calculated by measuring the Fund’s performance in quarters when the benchmark went up and dividing it by the benchmark’s return in those quarters. Downside Capture Ratio measures a manager’s performance in down markets relative to the Fund’s benchmark. It is calculated by measuring the Fund’s performance in quarters when the benchmark goes down and dividing it by the benchmark’s return in those quarters.
The Royce Funds 2021 Semiannual Report to Shareholders | 29
Royce Dividend Value Fund | ||||||||
Common Stocks – 91.7% | ||||||||
SHARES | VALUE | |||||||
CONSUMER DISCRETIONARY – 6.6% | ||||||||
AUTO COMPONENTS - 0.9% | ||||||||
Nokian Renkaat | 18,000 | $ | 726,747 | |||||
HOUSEHOLD DURABLES - 0.8% | ||||||||
PulteGroup | 10,900 | 594,813 | ||||||
SPECIALTY RETAIL - 4.9% | ||||||||
American Eagle Outfitters | 24,345 | 913,668 | ||||||
Rent-A-Center | 36,466 | 1,935,250 | ||||||
USS | 56,000 | 976,894 | ||||||
3,825,812 | ||||||||
Total (Cost $2,370,193) | 5,147,372 | |||||||
ENERGY – 1.3% | ||||||||
ENERGY EQUIPMENT & SERVICES - 0.5% | ||||||||
TGS | 32,400 | 412,989 | ||||||
OIL, GAS & CONSUMABLE FUELS - 0.8% | ||||||||
Gaztransport Et Technigaz | 7,800 | 629,847 | ||||||
Total (Cost $1,196,477) | 1,042,836 | |||||||
FINANCIALS – 27.3% | ||||||||
BANKS - 4.1% | ||||||||
Bank of Georgia Group 1 | 39,500 | 734,366 | ||||||
BOK Financial | 15,414 | 1,334,853 | ||||||
Triumph Bancorp 1 | 15,000 | 1,113,750 | ||||||
3,182,969 | ||||||||
CAPITAL MARKETS - 23.2% | ||||||||
Ashmore Group | 244,300 | 1,301,070 | ||||||
B3-Brasil, Bolsa, Balcao | 336,600 | 1,138,287 | ||||||
Bolsa Mexicana de Valores | 444,000 | 980,034 | ||||||
Carlyle Group | 71,520 | 3,324,250 | ||||||
Coronation Fund Managers | 153,700 | 522,020 | ||||||
Evercore Cl. A | 13,500 | 1,900,395 | ||||||
Jupiter Fund Management | 225,700 | 880,434 | ||||||
KKR & Co. | 16,338 | 967,863 | ||||||
Moelis & Company Cl. A | 19,359 | 1,101,334 | ||||||
SEI Investments | 37,900 | 2,348,663 | ||||||
Sprott | 58,860 | 2,316,698 | ||||||
State Street | 16,800 | 1,382,304 | ||||||
18,163,352 | ||||||||
Total (Cost $11,238,290) | 21,346,321 | |||||||
HEALTH CARE – 3.2% | ||||||||
HEALTH CARE PROVIDERS & SERVICES - 0.7% | ||||||||
Ensign Group (The) | 5,951 | 515,773 | ||||||
PHARMACEUTICALS - 2.5% | ||||||||
Recordati Industria Chimica e Farmaceutica | 24,210 | 1,383,678 | ||||||
Santen Pharmaceutical | 41,600 | 572,915 | ||||||
1,956,593 | ||||||||
Total (Cost $626,525) | 2,472,366 | |||||||
INDUSTRIALS – 34.4% | ||||||||
AEROSPACE & DEFENSE - 3.7% | ||||||||
HEICO Corporation Cl. A | 23,259 | 2,888,303 | ||||||
BUILDING PRODUCTS - 0.8% | ||||||||
Geberit | 800 | 600,054 | ||||||
COMMERCIAL SERVICES & SUPPLIES - 0.6% | ||||||||
Healthcare Services Group | 15,700 | 495,649 | ||||||
CONSTRUCTION & ENGINEERING - 0.9% | ||||||||
Comfort Systems USA | 8,959 | 705,880 | ||||||
ELECTRICAL EQUIPMENT - 2.7% | ||||||||
Hubbell Incorporated | 11,462 | 2,141,560 | ||||||
MACHINERY - 11.1% | ||||||||
Graco | 25,224 | 1,909,457 | ||||||
Lincoln Electric Holdings | 10,022 | 1,319,998 | ||||||
Lindsay Corporation | 17,400 | 2,875,872 | ||||||
Spirax-Sarco Engineering | 13,478 | 2,538,396 | ||||||
8,643,723 | ||||||||
MARINE - 2.0% | ||||||||
Clarkson | 35,040 | 1,546,219 | ||||||
PROFESSIONAL SERVICES - 8.5% | ||||||||
KBR | 80,690 | 3,078,323 | ||||||
Korn Ferry | 10,023 | 727,169 | ||||||
ManpowerGroup | 19,300 | 2,294,963 | ||||||
Robert Half International | 5,994 | 533,286 | ||||||
6,633,741 | ||||||||
ROAD & RAIL - 0.5% | ||||||||
Werner Enterprises | 8,643 | 384,786 | ||||||
TRADING COMPANIES & DISTRIBUTORS - 3.6% | ||||||||
Applied Industrial Technologies | 31,294 | 2,849,632 | ||||||
Total (Cost $8,381,404) | 26,889,547 | |||||||
INFORMATION TECHNOLOGY – 1.9% | ||||||||
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS - 1.2% | ||||||||
Vishay Intertechnology | 42,497 | 958,307 | ||||||
SOFTWARE - 0.7% | ||||||||
SimCorp | 4,200 | 527,206 | ||||||
Total (Cost $680,418) | 1,485,513 | |||||||
MATERIALS – 17.0% | ||||||||
CHEMICALS - 2.8% | ||||||||
Quaker Chemical | 9,137 | 2,167,205 | ||||||
CONTAINERS & PACKAGING - 3.7% | ||||||||
AptarGroup | 20,396 | 2,872,573 | ||||||
METALS & MINING - 10.5% | ||||||||
Franco-Nevada | 18,335 | 2,659,858 | ||||||
Reliance Steel & Aluminum | 10,288 | 1,552,459 | ||||||
Royal Gold | 11,600 | 1,323,560 | ||||||
Worthington Industries | 44,460 | 2,720,063 | ||||||
8,255,940 | ||||||||
Total (Cost $3,760,557) | 13,295,718 | |||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $28,253,864) | 71,679,673 | |||||||
REPURCHASE AGREEMENT– 8.3% | ||||||||
Fixed Income Clearing Corporation, 0.00% dated 6/30/21, due 7/1/21, maturity value $6,490,181 (collateralized by obligations of various U.S. Government Agencies, 1.25% due 6/30/28, valued at $6,620,035) | ||||||||
(Cost $6,490,181) | 6,490,181 | |||||||
TOTAL INVESTMENTS – 100.0% | ||||||||
(Cost $34,744,045) | 78,169,854 | |||||||
LIABILITIES LESS CASH AND OTHER ASSETS – (0.0)% | (17,751 | ) | ||||||
NET ASSETS – 100.0% | $ | 78,152,103 |
30 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce Global Financial Services Fund | ||||||||
Common Stocks – 89.1% | ||||||||
SHARES | VALUE | |||||||
BANKS - 14.5% | ||||||||
BOK Financial | 10,450 | $ | 904,970 | |||||
Bryn Mawr Bank | 10,000 | 421,900 | ||||||
Cadence Bancorporation Cl. A | 15,887 | 331,721 | ||||||
Capital City Bank Group | 16,988 | 438,120 | ||||||
First Citizens BancShares Cl. A | 1,828 | 1,522,249 | ||||||
First Republic Bank | 2,599 | 486,455 | ||||||
Popular | 20,063 | 1,505,728 | ||||||
TriState Capital Holdings 1 | 11,600 | 236,524 | ||||||
Umpqua Holdings | 17,400 | 321,030 | ||||||
Total (Cost $3,172,676) | 6,168,697 | |||||||
CAPITAL MARKETS - 46.2% | ||||||||
Ares Management Cl. A | 14,986 | 952,960 | ||||||
Ashmore Group | 157,000 | 836,136 | ||||||
Associated Capital Group Cl. A | 7,000 | 272,020 | ||||||
B3-Brasil, Bolsa, Balcao | 183,000 | 618,855 | ||||||
Bolsa Mexicana de Valores | 174,000 | 384,067 | ||||||
Canaccord Genuity Group | 113,715 | 1,245,764 | ||||||
Carlyle Group | 22,300 | 1,036,504 | ||||||
Charles Schwab | 14,671 | 1,068,195 | ||||||
Coronation Fund Managers | 61,200 | 207,857 | ||||||
CRISIL | 14,000 | 480,856 | ||||||
Egyptian Financial Group-Hermes Holding Company 1 | 153,993 | 129,709 | ||||||
Hellenic Exchanges - Athens Stock Exchange | 50,000 | 243,079 | ||||||
Intermediate Capital Group | 39,111 | 1,149,132 | ||||||
IOOF Holdings | 55,000 | 176,126 | ||||||
JSE | 51,000 | 379,643 | ||||||
Jupiter Fund Management | 106,900 | 417,007 | ||||||
KKR & Co. | 19,120 | 1,132,669 | ||||||
MarketAxess Holdings | 1,581 | 732,936 | ||||||
NZX | 580,000 | 810,840 | ||||||
RF Capital Group 1 | 108,000 | 182,962 | ||||||
Rothschild & Co | 13,900 | 539,783 | ||||||
SEI Investments | 7,950 | 492,661 | ||||||
Silvercrest Asset Management Group Cl. A | 27,612 | 415,284 | ||||||
Sprott | 40,500 | 1,594,059 | ||||||
StoneX Group 1 | 9,846 | 597,357 | ||||||
Tel Aviv Stock Exchange | 273,000 | 1,686,493 | ||||||
U.S. Global Investors Cl. A | 165,500 | 1,024,445 | ||||||
Virtu Financial Cl. A | 21,330 | 589,348 | ||||||
Warsaw Stock Exchange | 9,500 | 118,694 | ||||||
Westaim Corporation (The) 1 | 105,000 | 226,162 | ||||||
Total (Cost $9,711,348) | 19,741,603 | |||||||
CLOSED-END FUNDS - 0.7% | ||||||||
Eagle Point Income | 19,341 | 312,937 | ||||||
Total (Cost $384,693) | 312,937 | |||||||
DIVERSIFIED FINANCIAL SERVICES - 2.2% | ||||||||
Banco Latinoamericano de Comercio | ||||||||
Exterior Cl. E | 25,700 | 395,009 | ||||||
ECN Capital | 75,000 | 562,681 | ||||||
Total (Cost $557,932) | 957,690 | |||||||
HEALTH CARE PROVIDERS & SERVICES - 0.6% | ||||||||
Great Elm Group 1 | 115,545 | 258,821 | ||||||
Total (Cost $419,653) | 258,821 | |||||||
INSURANCE - 7.0% | ||||||||
Axis Capital Holdings | 11,554 | 566,261 | ||||||
E-L Financial | 1,638 | 1,240,459 | ||||||
†James River Group Holdings | 18,700 | 701,624 | ||||||
†Trean Insurance Group 1 | 32,600 | 491,608 | ||||||
Total (Cost $2,466,753) | 2,999,952 | |||||||
IT SERVICES - 2.8% | ||||||||
Cass Information Systems | 4,013 | 163,530 | ||||||
PayPal Holdings 1 | 3,466 | 1,010,269 | ||||||
Total (Cost $292,954) | 1,173,799 | |||||||
METALS & MINING - 3.2% | ||||||||
Franco-Nevada | 9,523 | 1,381,502 | ||||||
Total (Cost $430,881) | 1,381,502 | |||||||
PROFESSIONAL SERVICES - 0.7% | ||||||||
Dun & Bradstreet Holdings 1 | 5,000 | 106,850 | ||||||
Quess Corp | 17,756 | 195,369 | ||||||
Total (Cost $263,190) | 302,219 | |||||||
REAL ESTATE MANAGEMENT & DEVELOPMENT - 7.9% | ||||||||
Altus Group | 23,760 | 1,101,171 | ||||||
FirstService | 8,379 | 1,434,988 | ||||||
FRP Holdings 1 | 7,957 | 443,046 | ||||||
RMR Group (The) Cl. A | 10,000 | 386,400 | ||||||
Total (Cost $1,471,633) | 3,365,605 | |||||||
SOFTWARE - 2.3% | ||||||||
Benefitfocus 1 | 10,600 | 149,460 | ||||||
Bottomline Technologies 1 | 9,800 | 363,384 | ||||||
Envestnet 1 | 6,000 | 455,160 | ||||||
Total (Cost $836,700) | 968,004 | |||||||
THRIFTS & MORTGAGE FINANCE - 1.0% | ||||||||
Provident Bancorp | 25,000 | 407,750 | ||||||
Total (Cost $313,394) | 407,750 | |||||||
TRANSPORTATION INFRASTRUCTURE - 0.0% | ||||||||
Morgan Group Holding Co. 1,2 | 156 | 881 | ||||||
Total (Cost $1,160) | 881 | |||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $20,322,967) | 38,039,460 | |||||||
REPURCHASE AGREEMENT– 10.9% | ||||||||
Fixed Income Clearing Corporation, 0.00% dated 6/30/21, due 7/1/21, maturity value $4,648,074 (collateralized by obligations of various U.S. Government Agencies, 1.25% due 6/30/28, valued at $4,741,061) | ||||||||
(Cost $4,648,074) | 4,648,074 | |||||||
TOTAL INVESTMENTS – 100.0% | ||||||||
(Cost $24,971,041) | 42,687,534 | |||||||
CASH AND OTHER ASSETS LESS LIABILITIES – 0.0% | 17,329 | |||||||
NET ASSETS – 100.0% | $ | 42,704,863 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 31 |
Schedules of Investments
Royce International Premier Fund | ||||||||
Common Stocks – 94.5% | ||||||||
SHARES | VALUE | |||||||
AUSTRALIA – 11.2% | ||||||||
Bravura Solutions | 12,051,629 | $ | 31,723,804 | |||||
Cochlear | 93,400 | 17,628,311 | ||||||
Hansen Technologies | 7,576,488 | 35,285,146 | ||||||
IPH | 7,122,918 | 41,666,300 | ||||||
Technology One | 2,363,800 | 16,504,136 | ||||||
Total (Cost $103,872,161) | 142,807,697 | |||||||
BRAZIL – 2.3% | ||||||||
OdontoPrev | 6,574,100 | 17,222,350 | ||||||
TOTVS | 1,522,300 | 11,523,301 | ||||||
Total (Cost $26,528,708) | 28,745,651 | |||||||
CANADA – 3.9% | ||||||||
Altus Group | 317,300 | 14,705,457 | ||||||
†Enghouse Systems | 336,800 | 14,995,153 | ||||||
LifeWorks | 748,100 | 20,169,008 | ||||||
Total (Cost $36,212,587) | 49,869,618 | |||||||
DENMARK – 2.7% | ||||||||
Chr. Hansen Holding | 226,600 | 20,451,361 | ||||||
SimCorp | 115,200 | 14,460,505 | ||||||
Total (Cost $28,428,833) | 34,911,866 | |||||||
GERMANY – 5.1% | ||||||||
Amadeus Fire | 100,598 | 18,393,607 | ||||||
Carl Zeiss Meditec | 42,100 | 8,134,477 | ||||||
New Work | 67,600 | 21,241,528 | ||||||
Norma Group | 333,500 | 17,075,430 | ||||||
Total (Cost $44,412,487) | 64,845,042 | |||||||
ICELAND – 2.8% | ||||||||
Marel | 2,828,670 | 19,847,107 | ||||||
Ossur 1 | 2,136,966 | 15,759,964 | ||||||
Total (Cost $26,153,042) | 35,607,071 | |||||||
INDIA – 1.3% | ||||||||
AIA Engineering 1 | 595,011 | 17,196,722 | ||||||
Total (Cost $14,168,432) | 17,196,722 | |||||||
ITALY – 4.2% | ||||||||
Carel Industries | 837,858 | 20,118,177 | ||||||
DiaSorin | 87,563 | 16,560,541 | ||||||
GVS | 998,435 | 16,349,582 | ||||||
Total (Cost $42,683,418) | 53,028,300 | |||||||
JAPAN – 17.2% | ||||||||
As One | 152,800 | 19,957,046 | ||||||
Benefit One | 540,700 | 17,010,185 | ||||||
Daifuku | 118,100 | 10,726,216 | ||||||
Fukui Computer Holdings | 643,800 | 24,339,169 | ||||||
Medikit | 344,000 | 9,753,814 | ||||||
Meitec Corporation | 580,600 | 31,409,209 | ||||||
NSD | 1,094,000 | 18,276,826 | ||||||
OBIC Business Consultants | 314,000 | 18,145,551 | ||||||
TechnoPro Holdings | 712,300 | 16,849,763 | ||||||
TKC Corporation | 1,163,000 | 35,226,563 | ||||||
USS | 1,020,900 | 17,809,120 | ||||||
Total (Cost $172,519,152) | 219,503,462 | |||||||
NETHERLANDS – 4.7% | ||||||||
IMCD | 192,700 | 30,641,052 | ||||||
Intertrust 1 | 1,634,791 | 29,425,726 | ||||||
Total (Cost $42,506,726) | 60,066,778 | |||||||
NEW ZEALAND – 1.0% | ||||||||
Fisher & Paykel Healthcare | 605,000 | 13,160,494 | ||||||
Total (Cost $4,868,369) | 13,160,494 | |||||||
SINGAPORE – 1.6% | ||||||||
XP Power | 266,516 | 20,571,874 | ||||||
Total (Cost $7,033,715) | 20,571,874 | |||||||
SOUTH KOREA – 1.4% | ||||||||
†NICE Information Service | 818,600 | 18,245,225 | ||||||
Total (Cost $16,955,596) | 18,245,225 | |||||||
SWEDEN – 8.8% | ||||||||
Alimak Group | 1,220,800 | 19,913,729 | ||||||
Bravida Holding | 1,165,928 | 16,866,114 | ||||||
Hexpol | 1,538,600 | 19,003,052 | ||||||
Karnov Group | 3,773,249 | 23,191,234 | ||||||
Lagercrantz Group | 680,700 | 7,405,051 | ||||||
Loomis | 811,000 | 25,368,329 | ||||||
Total (Cost $84,486,692) | 111,747,509 | |||||||
SWITZERLAND – 7.7% | ||||||||
dormakaba Holding | 37,600 | 25,622,048 | ||||||
Kardex Holding | 83,300 | 19,266,361 | ||||||
LEM Holding | 7,700 | 16,144,826 | ||||||
Partners Group Holding | 12,200 | 18,479,654 | ||||||
VZ Holding | 224,385 | 19,013,006 | ||||||
Total (Cost $62,081,801) | 98,525,895 | |||||||
UNITED KINGDOM – 18.6% | ||||||||
Ashmore Group | 2,969,650 | 15,815,479 | ||||||
AVEVA Group | 233,895 | 11,997,121 | ||||||
Croda International | 285,600 | 29,108,792 | ||||||
Diploma | 234,698 | 9,428,061 | ||||||
†DiscoverIE Group | 1,406,800 | 18,428,870 | ||||||
FDM Group Holdings | 1,181,638 | 16,672,510 | ||||||
†Learning Technologies Group | 6,511,300 | 16,942,320 | ||||||
Marlowe 1 | 2,467,958 | 30,042,551 | ||||||
Restore 1 | 5,326,839 | 28,737,603 | ||||||
Spirax-Sarco Engineering | 153,700 | 28,947,288 | ||||||
Victrex | 893,545 | 31,469,598 | ||||||
Total (Cost $166,319,698) | 237,590,193 | |||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $879,231,417) | 1,206,423,397 | |||||||
PREFERRED STOCK – 1.8% | ||||||||
GERMANY – 1.8% | ||||||||
FUCHS PETROLUB | 475,600 | 23,132,932 | ||||||
(Cost $21,078,127) | 23,132,932 |
32 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce International Premier Fund (continued) | ||||
VALUE | ||||
REPURCHASE AGREEMENT– 3.9% | ||||
Fixed Income Clearing Corporation, 0.00% dated 6/30/21, due 7/1/21, maturity value $50,003,917 (collateralized by obligations of various U.S. Government Agencies, 1.25% due 6/30/28, valued at $51,004,058) | ||||
(Cost $50,003,917) | $ | 50,003,917 | ||
TOTAL INVESTMENTS – 100.2% | ||||
(Cost $950,313,461) | 1,279,560,246 | |||
LIABILITIES LESS CASH AND OTHER ASSETS – (0.2)% | (2,907,527 | ) | ||
NET ASSETS – 100.0% | $ | 1,276,652,719 |
Royce Micro-Cap Fund | ||||||||
Common Stocks – 95.7% | ||||||||
SHARES | VALUE | |||||||
COMMUNICATION SERVICES – 4.4% | ||||||||
ENTERTAINMENT - 2.9% | ||||||||
Chicken Soup For The Soul Entertainment Cl. A 1 | 111,832 | $ | 4,629,845 | |||||
Gaia Cl. A 1 | 268,400 | 2,949,716 | ||||||
IMAX Corporation 1 | 58,600 | 1,259,900 | ||||||
†Motorsport Games Cl. A 1 | 87,700 | 1,227,800 | ||||||
Score Media and Gaming Cl. A 1 | 100,060 | 2,006,689 | ||||||
12,073,950 | ||||||||
INTERACTIVE MEDIA & SERVICES - 1.0% | ||||||||
†Enthusiast Gaming Holdings 1 | 128,700 | 764,143 | ||||||
QuinStreet 1 | 172,146 | 3,198,473 | ||||||
3,962,616 | ||||||||
MEDIA - 0.5% | ||||||||
Magnite 1,3 | 63,000 | 2,131,920 | ||||||
Total (Cost $9,716,015) | 18,168,486 | |||||||
CONSUMER DISCRETIONARY – 10.9% | ||||||||
AUTO COMPONENTS - 2.0% | ||||||||
Modine Manufacturing 1 | 198,100 | 3,286,479 | ||||||
Stoneridge 1 | 119,800 | 3,534,100 | ||||||
Unique Fabricating 1 | 373,951 | 1,383,619 | ||||||
8,204,198 | ||||||||
DIVERSIFIED CONSUMER SERVICES - 0.3% | ||||||||
†Select Interior Concepts Cl. A 1 | 119,900 | 1,127,060 | ||||||
HOTELS, RESTAURANTS & LEISURE - 1.8% | ||||||||
Century Casinos 1 | 356,700 | 4,790,481 | ||||||
Lindblad Expeditions Holdings 1,3 | 186,600 | 2,987,466 | ||||||
7,777,947 | ||||||||
HOUSEHOLD DURABLES - 0.7% | ||||||||
Legacy Housing 1 | 177,300 | 2,998,143 | ||||||
LEISURE PRODUCTS - 0.9% | ||||||||
MasterCraft Boat Holdings 1 | 141,300 | 3,714,777 | ||||||
SPECIALTY RETAIL - 4.2% | ||||||||
Chico's FAS 1 | 168,800 | 1,110,704 | ||||||
Citi Trends 1 | 51,724 | 4,499,988 | ||||||
OneWater Marine Cl. A | 91,900 | 3,862,557 | ||||||
Shoe Carnival | 65,511 | 4,689,932 | ||||||
Zumiez 1 | 66,400 | 3,252,936 | ||||||
17,416,117 | ||||||||
TEXTILES, APPAREL & LUXURY GOODS - 1.0% | ||||||||
Fossil Group 1 | 15,000 | 214,200 | ||||||
Vera Bradley 1 | 340,500 | 4,218,795 | ||||||
4,432,995 | ||||||||
Total (Cost $25,689,488) | 45,671,237 | |||||||
ENERGY – 3.0% | ||||||||
ENERGY EQUIPMENT & SERVICES - 3.0% | ||||||||
Aspen Aerogels 1 | 159,700 | 4,778,224 | ||||||
Natural Gas Services Group 1 | 324,287 | 3,333,671 | ||||||
Newpark Resources 1 | 755,700 | 2,614,722 | ||||||
Profire Energy 1 | 1,389,432 | 1,570,058 | ||||||
Total (Cost $9,867,245) | 12,296,675 | |||||||
FINANCIALS – 13.7% | ||||||||
BANKS - 6.5% | ||||||||
Allegiance Bancshares | 82,800 | 3,182,832 | ||||||
BayCom Corporation 1 | 160,500 | 2,880,975 | ||||||
Caribbean Investment Holdings 1 | 1,858,138 | 835,368 | ||||||
County Bancorp | 61,900 | 2,102,124 | ||||||
HarborOne Bancorp | 261,253 | 3,746,368 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 33 |
Schedules of Investments
Royce Micro-Cap Fund (continued) | ||||||||
SHARES | VALUE | |||||||
FINANCIALS (continued) | ||||||||
BANKS (continued) | ||||||||
HBT Financial | 197,300 | $ | 3,434,993 | |||||
HomeTrust Bancshares | 132,300 | 3,691,170 | ||||||
Investar Holding Corporation | 163,500 | 3,742,515 | ||||||
Midway Investments 1,4 | 1,858,170 | 0 | ||||||
TriState Capital Holdings 1 | 182,757 | 3,726,415 | ||||||
27,342,760 | ||||||||
CAPITAL MARKETS - 4.7% | ||||||||
B. Riley Financial | 62,000 | 4,681,000 | ||||||
Canaccord Genuity Group | 418,300 | 4,582,538 | ||||||
Silvercrest Asset Management Group Cl. A | 204,000 | 3,068,160 | ||||||
Sprott | 108,480 | 4,269,715 | ||||||
StoneX Group 1,3 | 50,200 | 3,045,634 | ||||||
19,647,047 | ||||||||
DIVERSIFIED FINANCIAL SERVICES - 0.2% | ||||||||
Waterloo Investment Holdings 1,4 | 2,760,000 | 690,000 | ||||||
THRIFTS & MORTGAGE FINANCE - 2.3% | ||||||||
PCSB Financial | 174,400 | 3,168,848 | ||||||
Territorial Bancorp | 112,300 | 2,916,431 | ||||||
Western New England Bancorp | 439,000 | 3,577,850 | ||||||
9,663,129 | ||||||||
Total (Cost $44,199,834) | 57,342,936 | |||||||
HEALTH CARE – 13.3% | ||||||||
BIOTECHNOLOGY - 2.1% | ||||||||
CareDx 1 | 32,200 | 2,946,944 | ||||||
Dynavax Technologies 1 | 261,300 | 2,573,805 | ||||||
MeiraGTx Holdings 1 | 212,500 | 3,293,750 | ||||||
8,814,499 | ||||||||
HEALTH CARE EQUIPMENT & SUPPLIES - 7.2% | ||||||||
Apyx Medical 1 | 348,300 | 3,590,973 | ||||||
AtriCure 1 | 44,700 | 3,546,051 | ||||||
Chembio Diagnostics 1 | 240,253 | 713,551 | ||||||
CryoLife 1 | 143,855 | 4,085,482 | ||||||
Cutera 1 | 97,000 | 4,755,910 | ||||||
Misonix 1 | 157,200 | 3,486,696 | ||||||
OrthoPediatrics Corp. 1 | 57,400 | 3,626,532 | ||||||
Profound Medical 1 | 162,900 | 2,653,236 | ||||||
Surmodics 1 | 65,822 | 3,570,844 | ||||||
30,029,275 | ||||||||
HEALTH CARE PROVIDERS & SERVICES - 0.6% | ||||||||
Sharps Compliance 1 | 232,600 | 2,395,780 | ||||||
LIFE SCIENCES TOOLS & SERVICES - 3.2% | ||||||||
Harvard Bioscience 1 | 734,679 | 6,119,876 | ||||||
†Inotiv 1 | 71,700 | 1,912,956 | ||||||
NeoGenomics 1 | 49,700 | 2,244,949 | ||||||
Quanterix Corporation 1 | 54,300 | 3,185,238 | ||||||
13,463,019 | ||||||||
PHARMACEUTICALS - 0.2% | ||||||||
Axsome Therapeutics 1,3 | 13,500 | 910,710 | ||||||
Total (Cost $26,722,167) | 55,613,283 | |||||||
INDUSTRIALS – 22.2% | ||||||||
AEROSPACE & DEFENSE - 0.9% | ||||||||
Astronics Corporation 1 | 113,400 | 1,985,634 | ||||||
CPI Aerostructures 1 | 466,084 | 1,654,598 | ||||||
3,640,232 | ||||||||
BUILDING PRODUCTS - 0.6% | ||||||||
Quanex Building Products | 94,700 | 2,352,348 | ||||||
COMMERCIAL SERVICES & SUPPLIES - 2.0% | ||||||||
Acme United | 72,400 | 3,226,144 | ||||||
Heritage-Crystal Clean 1 | 124,474 | 3,694,388 | ||||||
†VSE Corporation | 33,300 | 1,648,683 | ||||||
8,569,215 | ||||||||
CONSTRUCTION & ENGINEERING - 4.1% | ||||||||
Ameresco Cl. A 1 | 54,500 | 3,418,240 | ||||||
Construction Partners Cl. A 1 | 135,500 | 4,254,700 | ||||||
IES Holdings 1 | 54,800 | 2,814,528 | ||||||
Northwest Pipe 1 | 128,500 | 3,630,125 | ||||||
NV5 Global 1 | 33,500 | 3,166,085 | ||||||
17,283,678 | ||||||||
ELECTRICAL EQUIPMENT - 1.0% | ||||||||
American Superconductor 1 | 196,600 | 3,418,874 | ||||||
Power Solutions International 1,2 | 99,900 | 609,390 | ||||||
4,028,264 | ||||||||
MACHINERY - 5.6% | ||||||||
Alimak Group | 182,300 | 2,973,683 | ||||||
CIRCOR International 1 | 111,400 | 3,631,640 | ||||||
Graham Corporation | 204,888 | 2,819,259 | ||||||
Luxfer Holdings | 66,500 | 1,479,625 | ||||||
Porvair | 313,000 | 2,528,562 | ||||||
Shyft Group (The) | 119,500 | 4,470,495 | ||||||
Wabash National | 195,600 | 3,129,600 | ||||||
Westport Fuel Systems 1 | 407,700 | 2,164,887 | ||||||
23,197,751 | ||||||||
MARINE - 0.9% | ||||||||
Clarkson | 89,831 | 3,963,997 | ||||||
PROFESSIONAL SERVICES - 5.0% | ||||||||
CRA International | 52,483 | 4,492,545 | ||||||
Forrester Research 1 | 49,000 | 2,244,200 | ||||||
GP Strategies 1 | 239,418 | 3,763,651 | ||||||
Heidrick & Struggles International | 88,240 | 3,931,092 | ||||||
Kforce | 55,932 | 3,519,801 | ||||||
Resources Connection | 200,252 | 2,875,618 | ||||||
20,826,907 | ||||||||
TRADING COMPANIES & DISTRIBUTORS - 2.1% | ||||||||
Lawson Products 1 | 71,900 | 3,847,369 | ||||||
Transcat 1 | 87,500 | 4,944,625 | ||||||
8,791,994 | ||||||||
Total (Cost $53,709,761) | 92,654,386 | |||||||
INFORMATION TECHNOLOGY – 24.3% | ||||||||
COMMUNICATIONS EQUIPMENT - 2.8% | ||||||||
Digi International 1 | 202,500 | 4,072,275 | ||||||
EMCORE Corporation 1 | 413,400 | 3,811,548 | ||||||
†Genasys 1 | 261,200 | 1,431,376 | ||||||
Harmonic 1 | 306,600 | 2,612,232 | ||||||
11,927,431 | ||||||||
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS - 5.4% | ||||||||
FARO Technologies 1 | 41,300 | 3,211,901 | ||||||
LightPath Technologies Cl. A 1 | 789,784 | 2,006,052 | ||||||
Luna Innovations 1 | 379,100 | 4,105,653 | ||||||
nLIGHT 1 | 84,700 | 3,072,916 | ||||||
PAR Technology 1 | 57,800 | 4,042,532 | ||||||
PowerFleet 1 | 397,100 | 2,859,120 | ||||||
Vishay Precision Group 1 | 97,100 | 3,305,284 | ||||||
22,603,458 | ||||||||
IT SERVICES - 1.4% | ||||||||
Cass Information Systems | 69,516 | 2,832,777 |
34 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce Micro-Cap Fund (continued) | ||||||||
SHARES | VALUE | |||||||
INFORMATION TECHNOLOGY (continued) | ||||||||
IT SERVICES (continued) | ||||||||
Computer Task Group 1 | 314,400 | $ | 3,040,248 | |||||
5,873,025 | ||||||||
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 12.0% | ||||||||
Aehr Test Systems 1,3 | 699,800 | 1,931,448 | ||||||
Axcelis Technologies 1 | 95,400 | 3,856,068 | ||||||
AXT 1 | 331,100 | 3,635,478 | ||||||
Camtek 1 | 123,800 | 4,668,498 | ||||||
Cohu 1 | 96,100 | 3,535,519 | ||||||
CyberOptics Corporation 1 | 107,500 | 4,403,200 | ||||||
FormFactor 1 | 70,400 | 2,566,784 | ||||||
Ichor Holdings 1 | 76,700 | 4,126,460 | ||||||
NeoPhotonics Corporation 1 | 222,000 | 2,266,620 | ||||||
Nova Measuring Instruments 1,3 | 43,200 | 4,444,848 | ||||||
NVE Corporation | 40,400 | 2,991,620 | ||||||
PDF Solutions 1 | 158,900 | 2,888,802 | ||||||
Photronics 1 | 305,900 | 4,040,939 | ||||||
Ultra Clean Holdings 1 | 86,100 | 4,625,292 | ||||||
49,981,576 | ||||||||
SOFTWARE - 1.9% | ||||||||
Agilysys 1 | 84,900 | 4,828,263 | ||||||
†GTY Technology Holdings 1,3 | 142,800 | 1,015,308 | ||||||
QAD Cl. A | 24,013 | 2,089,611 | ||||||
7,933,182 | ||||||||
TECHNOLOGY HARDWARE, STORAGE & PERIPHERALS - 0.8% | ||||||||
AstroNova 1 | 228,700 | 3,183,504 | ||||||
Total (Cost $53,074,454) | 101,502,176 | |||||||
MATERIALS – 3.5% | ||||||||
METALS & MINING - 3.5% | ||||||||
Altius Minerals | 165,400 | 2,272,315 | ||||||
Ferroglobe (Warranty Insurance Trust) 1,4 | 205,763 | 0 | ||||||
Haynes International | 118,230 | 4,182,977 | ||||||
Major Drilling Group International 1 | 687,900 | 4,755,811 | ||||||
Universal Stainless & Alloy Products 1 | 343,900 | 3,463,073 | ||||||
Total (Cost $12,148,844) | 14,674,176 | |||||||
REAL ESTATE – 0.4% | ||||||||
REAL ESTATE MANAGEMENT & DEVELOPMENT - 0.4% | ||||||||
FRP Holdings 1 | 29,575 | 1,646,736 | ||||||
Total (Cost $534,936) | 1,646,736 | |||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $235,662,744) | 399,570,091 | |||||||
REPURCHASE AGREEMENT– 4.0% | ||||||||
Fixed Income Clearing Corporation, 0.00% dated 6/30/21, due 7/1/21, maturity value $16,721,174 (collateralized by obligations of various U.S. Government Agencies, 1.25% due 6/30/28, valued at $17,055,653) | ||||||||
(Cost $16,721,174) | 16,721,174 | |||||||
COLLATERAL RECEIVED FOR SECURITIES LOANED – 0.0% | ||||||||
Money Market Funds | ||||||||
Federated Government Obligations Fund - Institutional Shares (7 day yield-0.01%) | ||||||||
(Cost $189,300) | 189,300 | |||||||
TOTAL INVESTMENTS – 99.7% | ||||||||
(Cost $252,573,218) | 416,480,565 | |||||||
CASH AND OTHER ASSETS LESS LIABILITIES – 0.3% | 1,273,433 | |||||||
NET ASSETS – 100.0% | $ | 417,753,998 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 35 |
Schedules of Investments
Royce Opportunity Fund | ||||||||
Common Stocks – 89.3% | ||||||||
SHARES | VALUE | |||||||
COMMUNICATION SERVICES – 1.6% | ||||||||
DIVERSIFIED TELECOMMUNICATION SERVICES - 0.2% | ||||||||
Ooma 1 | 275,278 | $ | 5,191,743 | |||||
ENTERTAINMENT - 0.3% | ||||||||
†Marcus Corporation (The) 1 | 336,500 | 7,137,165 | ||||||
INTERACTIVE MEDIA & SERVICES - 0.7% | ||||||||
Cars.com 1 | 303,100 | 4,343,423 | ||||||
DHI Group 1 | 101,400 | 342,732 | ||||||
Eventbrite Cl. A 1,3 | 138,800 | 2,637,200 | ||||||
QuinStreet 1 | 418,900 | 7,783,162 | ||||||
15,106,517 | ||||||||
MEDIA - 0.4% | ||||||||
comScore 1,3 | 1,350,662 | 6,753,310 | ||||||
Entravision Communications Cl. A | 276,300 | 1,845,684 | ||||||
8,598,994 | ||||||||
Total (Cost $27,531,156) | 36,034,419 | |||||||
CONSUMER DISCRETIONARY – 13.7% | ||||||||
AUTO COMPONENTS - 2.0% | ||||||||
Dana | 506,753 | 12,040,451 | ||||||
Horizon Global 1,3 | 1,216,787 | 10,318,354 | ||||||
Modine Manufacturing 1 | 843,963 | 14,001,346 | ||||||
Stoneridge 1 | 266,877 | 7,872,872 | ||||||
Unique Fabricating 1 | 94,794 | 350,738 | ||||||
44,583,761 | ||||||||
DIVERSIFIED CONSUMER SERVICES - 1.6% | ||||||||
†American Public Education 1 | 369,700 | 10,477,298 | ||||||
frontdoor 1 | 150,599 | 7,502,842 | ||||||
Houghton Mifflin Harcourt 1,3 | 538,846 | 5,948,860 | ||||||
Regis 1 | 590,900 | 5,530,824 | ||||||
†Select Interior Concepts Cl. A 1 | 314,479 | 2,956,102 | ||||||
†Zovio 1,3 | 931,269 | 2,411,987 | ||||||
34,827,913 | ||||||||
HOTELS, RESTAURANTS & LEISURE - 2.3% | ||||||||
BJ's Restaurants 1 | 107,801 | 5,297,341 | ||||||
Carrols Restaurant Group 1 | 696,992 | 4,188,922 | ||||||
Cedar Fair LP 1 | 121,200 | 5,433,396 | ||||||
Century Casinos 1 | 234,994 | 3,155,970 | ||||||
Chuy's Holdings 1,3 | 179,593 | 6,691,635 | ||||||
†Drive Shack 1 | 231,000 | 764,610 | ||||||
J. Alexander's Holdings 1 | 265,189 | 3,086,800 | ||||||
Noodles & Company Cl. A 1 | 680,954 | 8,498,306 | ||||||
Ruth's Hospitality Group 1 | 343,610 | 7,913,338 | ||||||
Six Flags Entertainment 1 | 159,500 | 6,903,160 | ||||||
51,933,478 | ||||||||
HOUSEHOLD DURABLES - 2.3% | ||||||||
Beazer Homes USA 1 | 244,606 | 4,718,450 | ||||||
Cavco Industries 1 | 18,200 | 4,043,858 | ||||||
Century Communities | 83,100 | 5,529,474 | ||||||
Dixie Group (The) 1 | 430,315 | 1,260,823 | ||||||
Ethan Allen Interiors | 234,600 | 6,474,960 | ||||||
†GoPro Cl. A 1,3 | 196,900 | 2,293,885 | ||||||
LGI Homes 1,3 | 31,470 | 5,096,252 | ||||||
New Home Company (The) 1 | 494,849 | 2,904,763 | ||||||
Skyline Champion 1 | 106,700 | 5,687,110 | ||||||
Taylor Morrison Home 1,3 | 126,154 | 3,332,989 | ||||||
Toll Brothers | 90,486 | 5,230,996 | ||||||
Tri Pointe Homes 1,3 | 187,306 | 4,013,967 | ||||||
50,587,527 | ||||||||
INTERNET & DIRECT MARKETING RETAIL - 0.5% | ||||||||
†Overstock.com 1 | 108,800 | 10,031,360 | ||||||
MULTILINE RETAIL - 0.7% | ||||||||
Dillard's Cl. A | 40,500 | 7,325,640 | ||||||
†Nordstrom 1 | 251,000 | 9,179,070 | ||||||
16,504,710 | ||||||||
SPECIALTY RETAIL - 3.1% | ||||||||
America's Car-Mart 1 | 45,571 | 6,458,322 | ||||||
†Barnes & Noble Education 1 | 2,100 | 15,141 | ||||||
Caleres | 86,200 | 2,352,398 | ||||||
Chico's FAS 1 | 1,093,892 | 7,197,809 | ||||||
Conn's 1 | 406,300 | 10,360,650 | ||||||
Designer Brands Cl. A 1 | 433,079 | 7,167,457 | ||||||
†Express 1 | 550,300 | 3,571,447 | ||||||
Guess? | 154,894 | 4,089,202 | ||||||
†J.Jill 1 | 377,634 | 7,443,166 | ||||||
Kirkland's 1 | 405,900 | 9,286,992 | ||||||
Lumber Liquidators Holdings 1 | 361,956 | 7,637,272 | ||||||
Sonic Automotive Cl. A | 82,500 | 3,691,050 | ||||||
69,270,906 | ||||||||
TEXTILES, APPAREL & LUXURY GOODS - 1.2% | ||||||||
Fossil Group 1,3 | 245,400 | 3,504,312 | ||||||
Jerash Holdings (US) | 7,090 | 47,716 | ||||||
Skechers U.S.A. Cl. A 1 | 226,922 | 11,307,523 | ||||||
Under Armour Cl. A 1 | 154,900 | 3,276,135 | ||||||
Unifi 1 | 399,100 | 9,722,076 | ||||||
27,857,762 | ||||||||
Total (Cost $215,904,801) | 305,597,417 | |||||||
CONSUMER STAPLES – 1.1% | ||||||||
BEVERAGES - 0.3% | ||||||||
MGP Ingredients | 92,260 | 6,240,466 | ||||||
Reed's 1 | 1,419,794 | 1,448,190 | ||||||
7,688,656 | ||||||||
FOOD & STAPLES RETAILING - 0.5% | ||||||||
Chefs' Warehouse (The) 1,3 | 237,350 | 7,554,851 | ||||||
Natural Grocers by Vitamin Cottage | 308,542 | 3,313,741 | ||||||
10,868,592 | ||||||||
HOUSEHOLD PRODUCTS - 0.3% | ||||||||
Central Garden & Pet Cl. A 1 | 139,800 | 6,752,340 | ||||||
Total (Cost $17,840,314) | 25,309,588 | |||||||
ENERGY – 3.1% | ||||||||
ENERGY EQUIPMENT & SERVICES - 0.5% | ||||||||
Archrock | 490,800 | 4,373,028 | ||||||
Mammoth Energy Services 1 | 45,300 | 207,927 | ||||||
Ranger Energy Services Cl. A 1 | 125,001 | 1,000,008 | ||||||
U.S. Silica Holdings 1 | 365,702 | 4,227,515 | ||||||
9,808,478 | ||||||||
OIL, GAS & CONSUMABLE FUELS - 2.6% | ||||||||
Ardmore Shipping 1 | 858,393 | 3,622,419 | ||||||
Baytex Energy 1,2 | 1,272,800 | 2,469,232 | ||||||
†Chesapeake Energy | 187,300 | 9,724,616 | ||||||
Dorian LPG 1 | 544,192 | 7,683,991 | ||||||
Earthstone Energy Cl. A 1 | 875,472 | 9,691,475 | ||||||
Matador Resources | 247,683 | 8,919,065 | ||||||
Navigator Holdings 1 | 568,084 | 6,220,520 | ||||||
Scorpio Tankers | 172,100 | 3,794,805 | ||||||
Southwestern Energy 1 | 492,981 | 2,795,202 | ||||||
Teekay LNG Partners L.P. | 243,336 | 3,671,940 | ||||||
58,593,265 | ||||||||
Total (Cost $51,129,318) | 68,401,743 |
36 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce Opportunity Fund (continued) | ||||||||
SHARES | VALUE | |||||||
FINANCIALS – 8.7% | ||||||||
BANKS - 2.3% | ||||||||
First Foundation | 236,300 | $ | 5,319,113 | |||||
Hilltop Holdings | 436,908 | 15,903,451 | ||||||
Seacoast Banking Corporation of Florida | 353,650 | 12,077,148 | ||||||
Texas Capital Bancshares 1 | 147,700 | 9,377,473 | ||||||
TriState Capital Holdings 1 | 413,487 | 8,431,000 | ||||||
51,108,185 | ||||||||
CAPITAL MARKETS - 1.6% | ||||||||
B. Riley Financial | 181,567 | 13,708,309 | ||||||
Evercore Cl. A | 32,700 | 4,603,179 | ||||||
Houlihan Lokey Cl. A | 79,789 | 6,525,942 | ||||||
Moelis & Company Cl. A | 200,826 | 11,424,991 | ||||||
36,262,421 | ||||||||
INSURANCE - 2.7% | ||||||||
Brighthouse Financial 1 | 281,600 | 12,824,064 | ||||||
HCI Group | 128,476 | 12,774,369 | ||||||
Heritage Insurance Holdings | 318,069 | 2,729,032 | ||||||
Old Republic International | 622,900 | 15,516,439 | ||||||
Stewart Information Services | 180,340 | 10,223,475 | ||||||
United Fire Group | 260,303 | 7,218,202 | ||||||
61,285,581 | ||||||||
MORTGAGE REAL ESTATE INVESTMENT TRUSTS (REITS) - 0.3% | ||||||||
ACRES Commercial Realty 1 | 342,839 | 5,505,994 | ||||||
THRIFTS & MORTGAGE FINANCE - 1.8% | ||||||||
Axos Financial 1 | 116,300 | 5,395,157 | ||||||
MGIC Investment | 498,200 | 6,775,520 | ||||||
NMI Holdings Cl. A 1 | 376,363 | 8,460,640 | ||||||
Radian Group | 320,098 | 7,122,181 | ||||||
Walker & Dunlop | 112,588 | 11,751,935 | ||||||
39,505,433 | ||||||||
Total (Cost $145,305,933) | 193,667,614 | |||||||
HEALTH CARE – 8.8% | ||||||||
BIOTECHNOLOGY - 0.4% | ||||||||
Emergent BioSolutions 1 | 127,926 | 8,058,059 | ||||||
Flexion Therapeutics 1,3 | 232,251 | 1,911,425 | ||||||
9,969,484 | ||||||||
HEALTH CARE EQUIPMENT & SUPPLIES - 4.0% | ||||||||
Accuray 1 | 1,004,708 | 4,541,280 | ||||||
Alphatec Holdings 1 | 224,600 | 3,440,872 | ||||||
Cutera 1 | 210,610 | 10,326,208 | ||||||
IntriCon Corporation 1,5 | 482,047 | 10,836,417 | ||||||
Invacare Corporation 1 | 411,408 | 3,320,063 | ||||||
†Misonix 1,3 | 125,556 | 2,784,832 | ||||||
Neuronetics 1,3 | 399,690 | 6,403,034 | ||||||
†Ortho Clinical Diagnostics Holdings 1 | 460,800 | 9,865,728 | ||||||
Orthofix Medical 1 | 241,096 | 9,670,361 | ||||||
Sientra 1,3 | 990,416 | 7,883,711 | ||||||
SmileDirectClub Cl. A 1,3 | 507,194 | 4,402,444 | ||||||
Surgalign Holdings 1,3 | 1,353,045 | 1,880,732 | ||||||
Varex Imaging 1,3 | 228,646 | 6,132,286 | ||||||
ViewRay 1 | 1,112,970 | 7,345,602 | ||||||
88,833,570 | ||||||||
HEALTH CARE PROVIDERS & SERVICES - 3.7% | ||||||||
Acadia Healthcare 1,3 | 71,372 | 4,478,593 | ||||||
Community Health Systems 1 | 1,176,014 | 18,157,656 | ||||||
Cross Country Healthcare 1 | 746,620 | 12,326,696 | ||||||
Option Care Health 1,3 | 541,171 | 11,835,410 | ||||||
Owens & Minor | 391,007 | 16,551,326 | ||||||
RadNet 1 | 142,100 | 4,787,349 | ||||||
Select Medical Holdings | 273,900 | 11,575,014 | ||||||
Surgery Partners 1 | 51,564 | 3,435,194 | ||||||
83,147,238 | ||||||||
HEALTH CARE TECHNOLOGY - 0.3% | ||||||||
Castlight Health Cl. B 1 | 721,852 | 1,898,471 | ||||||
Evolent Health Cl. A 1 | 211,900 | 4,475,328 | ||||||
6,373,799 | ||||||||
PHARMACEUTICALS - 0.4% | ||||||||
†Organon & Co 1 | 291,403 | 8,817,855 | ||||||
Total (Cost $116,876,089) | 197,141,946 | |||||||
INDUSTRIALS – 23.5% | ||||||||
AEROSPACE & DEFENSE - 2.9% | ||||||||
AAR Corporation 1 | 295,900 | 11,466,125 | ||||||
Astronics Corporation 1 | 524,800 | 9,189,248 | ||||||
Ducommun 1 | 172,286 | 9,399,924 | ||||||
Hexcel Corporation 1 | 186,900 | 11,662,560 | ||||||
Spirit AeroSystems Holdings Cl. A | 209,800 | 9,900,462 | ||||||
Triumph Group 1 | 585,716 | 12,153,607 | ||||||
63,771,926 | ||||||||
AIR FREIGHT & LOGISTICS - 1.3% | ||||||||
Atlas Air Worldwide Holdings 1,3 | 217,436 | 14,809,566 | ||||||
Hub Group Cl. A 1 | 176,300 | 11,632,274 | ||||||
Radiant Logistics 1,3 | 517,069 | 3,583,288 | ||||||
30,025,128 | ||||||||
AIRLINES - 1.1% | ||||||||
Alaska Air Group 1 | 75,300 | 4,541,343 | ||||||
JetBlue Airways 1 | 600,400 | 10,074,712 | ||||||
Mesa Air Group 1 | 960,646 | 8,962,827 | ||||||
23,578,882 | ||||||||
BUILDING PRODUCTS - 2.0% | ||||||||
American Woodmark 1 | 13,350 | 1,090,562 | ||||||
Apogee Enterprises | 235,600 | 9,595,988 | ||||||
Gibraltar Industries 1 | 56,700 | 4,326,777 | ||||||
Griffon Corporation | 266,367 | 6,826,986 | ||||||
Insteel Industries | 106,533 | 3,425,036 | ||||||
JELD-WEN Holding 1,3 | 225,400 | 5,919,004 | ||||||
PGT Innovations 1 | 168,643 | 3,917,577 | ||||||
Resideo Technologies 1 | 302,916 | 9,087,480 | ||||||
44,189,410 | ||||||||
COMMERCIAL SERVICES & SUPPLIES - 3.0% | ||||||||
Covanta Holding Corporation | 434,800 | 7,656,828 | ||||||
Heritage-Crystal Clean 1 | 293,600 | 8,714,048 | ||||||
Herman Miller | 147,300 | 6,943,722 | ||||||
Interface | 446,267 | 6,827,885 | ||||||
KAR Auction Services 1 | 537,080 | 9,425,754 | ||||||
Pitney Bowes | 1,212,894 | 10,637,080 | ||||||
†Quest Resource Holding Corporation 1 | 152,576 | 968,858 | ||||||
Steelcase Cl. A | 506,900 | 7,659,259 | ||||||
†VSE Corporation | 154,021 | 7,625,580 | ||||||
66,459,014 | ||||||||
CONSTRUCTION & ENGINEERING - 2.7% | ||||||||
Ameresco Cl. A 1 | 109,026 | 6,838,111 | ||||||
Arcosa | 222,706 | 13,081,750 | ||||||
Comfort Systems USA | 144,110 | 11,354,427 | ||||||
Concrete Pumping Holdings 1,3 | 477,110 | 4,041,122 | ||||||
Construction Partners Cl. A 1 | 166,059 | 5,214,253 | ||||||
†Limbach Holdings 1,3 | 246,600 | 2,283,516 | ||||||
Northwest Pipe 1 | 196,322 | 5,546,096 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 37 |
Schedules of Investments
Royce Opportunity Fund (continued) | ||||||||
SHARES | VALUE | |||||||
INDUSTRIALS (continued) | ||||||||
CONSTRUCTION & ENGINEERING (continued) | ||||||||
Orion Group Holdings 1 | 546,553 | $ | 3,142,680 | |||||
Primoris Services | 287,580 | 8,463,479 | ||||||
59,965,434 | ||||||||
ELECTRICAL EQUIPMENT - 0.6% | ||||||||
Babcock & Wilcox Enterprises 1 | 659,395 | 5,196,033 | ||||||
Encore Wire | 41,733 | 3,162,944 | ||||||
LSI Industries | 480,553 | 3,849,229 | ||||||
Power Solutions International 1,2 | 274,009 | 1,671,455 | ||||||
13,879,661 | ||||||||
MACHINERY - 5.4% | ||||||||
CIRCOR International 1 | 338,803 | 11,044,978 | ||||||
Commercial Vehicle Group 1 | 684,692 | 7,278,276 | ||||||
EnPro Industries | 135,600 | 13,173,540 | ||||||
†Evercel 1,2 | 11,300 | 22,600 | ||||||
Gencor Industries 1 | 56,879 | 691,649 | ||||||
Hurco Companies | 67,351 | 2,357,285 | ||||||
Hyster-Yale Materials Handling Cl. A | 107,657 | 7,856,808 | ||||||
LiqTech International 1 | 486,655 | 3,562,315 | ||||||
†Luxfer Holdings | 290,300 | 6,459,175 | ||||||
Manitex International 1 | 468,026 | 3,411,909 | ||||||
Meritor 1 | 334,508 | 7,834,177 | ||||||
NN 1 | 511,400 | 3,758,790 | ||||||
Park-Ohio Holdings | 222,026 | 7,135,916 | ||||||
Shyft Group (The) | 256,538 | 9,597,087 | ||||||
TriMas Corporation 1 | 220,210 | 6,678,969 | ||||||
Trinity Industries | 358,124 | 9,629,954 | ||||||
Twin Disc 1 | 115,316 | 1,640,947 | ||||||
Wabash National | 683,100 | 10,929,600 | ||||||
Westport Fuel Systems 1 | 1,342,233 | 7,127,257 | ||||||
120,191,232 | ||||||||
MARINE - 0.2% | ||||||||
Diana Shipping 1 | 817,045 | 4,256,804 | ||||||
PROFESSIONAL SERVICES - 1.6% | ||||||||
GP Strategies 1 | 446,238 | 7,014,861 | ||||||
Heidrick & Struggles International | 156,452 | 6,969,937 | ||||||
Korn Ferry | 120,345 | 8,731,030 | ||||||
Mistras Group 1 | 382,851 | 3,763,425 | ||||||
TrueBlue 1 | 366,336 | 10,297,705 | ||||||
36,776,958 | ||||||||
ROAD & RAIL - 0.3% | ||||||||
†Daseke 1,3 | 481,700 | 3,121,416 | ||||||
†U.S. Xpress Enterprises Cl. A 1 | 512,400 | 4,406,640 | ||||||
7,528,056 | ||||||||
TRADING COMPANIES & DISTRIBUTORS - 2.4% | ||||||||
Air Lease Cl. A | 343,438 | 14,335,102 | ||||||
†BlueLinx Holdings 1 | 67,800 | 3,408,984 | ||||||
Herc Holdings 1 | 125,619 | 14,078,122 | ||||||
Univar Solutions 1,3 | 307,900 | 7,506,602 | ||||||
†WESCO International 1 | 140,704 | 14,467,185 | ||||||
53,795,995 | ||||||||
Total (Cost $404,278,846) | 524,418,500 | |||||||
INFORMATION TECHNOLOGY – 16.2% | ||||||||
COMMUNICATIONS EQUIPMENT - 4.1% | ||||||||
ADTRAN | 555,800 | 11,477,270 | ||||||
Applied Optoelectronics 1,3 | 240,100 | 2,033,647 | ||||||
Aviat Networks 1 | 208,378 | 6,828,547 | ||||||
CalAmp Corporation 1 | 945,500 | 12,026,760 | ||||||
Ceragon Networks 1,3 | 805,416 | 3,036,418 | ||||||
Comtech Telecommunications | 519,617 | 12,553,947 | ||||||
Digi International 1 | 629,502 | 12,659,285 | ||||||
DZS 1 | 649,604 | 13,479,283 | ||||||
Infinera Corporation 1,3 | 1,221,346 | 12,457,729 | ||||||
PCTEL | 637,830 | 4,177,787 | ||||||
90,730,673 | ||||||||
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS - 4.0% | ||||||||
Advanced Energy Industries | 87,753 | 9,890,641 | ||||||
Avnet | 334,100 | 13,390,728 | ||||||
CTS Corporation | 254,714 | 9,465,172 | ||||||
Fabrinet 1 | 111,829 | 10,721,046 | ||||||
Frequency Electronics 1 | 283,693 | 2,780,191 | ||||||
Identiv 1 | 321,520 | 5,465,840 | ||||||
II-VI 1 | 42,568 | 3,090,011 | ||||||
Iteris 1,3 | 825,800 | 5,491,570 | ||||||
Knowles 1 | 504,120 | 9,951,329 | ||||||
VIA optronics ADR 1 | 414,313 | 4,648,592 | ||||||
Vishay Intertechnology | 637,409 | 14,373,573 | ||||||
89,268,693 | ||||||||
IT SERVICES - 0.1% | ||||||||
†Conduent 1 | 216,200 | 1,621,500 | ||||||
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 4.8% | ||||||||
Alpha & Omega Semiconductor 1 | 544,613 | 16,550,789 | ||||||
Amkor Technology | 608,840 | 14,411,243 | ||||||
Amtech Systems 1 | 273,348 | 2,635,075 | ||||||
Cohu 1 | 288,976 | 10,631,427 | ||||||
FormFactor 1 | 205,113 | 7,478,420 | ||||||
Ichor Holdings 1 | 168,794 | 9,081,117 | ||||||
Kulicke & Soffa Industries | 164,365 | 10,059,138 | ||||||
Onto Innovation 1 | 149,519 | 10,920,868 | ||||||
Ultra Clean Holdings 1 | 270,927 | 14,554,198 | ||||||
Veeco Instruments 1 | 412,487 | 9,916,187 | ||||||
106,238,462 | ||||||||
SOFTWARE - 2.2% | ||||||||
A10 Networks 1 | 926,726 | 10,434,935 | ||||||
Avaya Holdings 1 | 567,054 | 15,253,752 | ||||||
InterDigital | 98,300 | 7,178,849 | ||||||
Kaleyra 1,3 | 652,457 | 7,986,074 | ||||||
SecureWorks Corp. Cl. A 1 | 512,062 | 9,488,509 | ||||||
50,342,119 | ||||||||
TECHNOLOGY HARDWARE, STORAGE & PERIPHERALS - 1.0% | ||||||||
Avid Technology 1 | 437,254 | 17,118,494 | ||||||
†Immersion Corporation 1 | 162,300 | 1,423,371 | ||||||
Intevac 1 | 615,875 | 4,150,998 | ||||||
22,692,863 | ||||||||
Total (Cost $222,061,911) | 360,894,310 | |||||||
MATERIALS – 8.3% | ||||||||
CHEMICALS - 3.6% | ||||||||
AdvanSix 1 | 320,512 | 9,570,488 | ||||||
American Vanguard | 504,741 | 8,838,015 | ||||||
Huntsman Corporation | 501,300 | 13,294,476 | ||||||
Intrepid Potash 1,3 | 195,582 | 6,231,242 | ||||||
Kraton Corporation 1 | 429,121 | 13,856,317 | ||||||
Livent Corporation 1,3 | 708,100 | 13,708,816 | ||||||
LSB Industries 1 | 485,856 | 2,939,429 | ||||||
Trecora Resources 1 | 515,231 | 4,286,722 | ||||||
Tronox Holdings | 351,600 | 7,875,840 | ||||||
80,601,345 |
38 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce Opportunity Fund (continued) | ||||||||
SHARES | VALUE | |||||||
MATERIALS (continued) | ||||||||
METALS & MINING - 4.4% | ||||||||
Allegheny Technologies 1 | 661,314 | $ | 13,788,397 | |||||
Carpenter Technology | 291,342 | 11,717,775 | ||||||
Century Aluminum 1 | 464,610 | 5,988,823 | ||||||
Cleveland-Cliffs 1 | 535,549 | 11,546,436 | ||||||
Coeur Mining 1 | 751,432 | 6,672,716 | ||||||
Commercial Metals | 395,300 | 12,143,616 | ||||||
Ferroglobe 1 | 1,366,671 | 8,364,027 | ||||||
Haynes International | 345,794 | 12,234,192 | ||||||
Major Drilling Group International 1 | 425,200 | 2,939,629 | ||||||
Noranda Aluminum Holding Corporation 1,2 | 488,157 | 24,408 | ||||||
†Olympic Steel | 153,695 | 4,517,096 | ||||||
TimkenSteel Corporation 1 | 633,800 | 8,968,270 | ||||||
98,905,385 | ||||||||
PAPER & FOREST PRODUCTS - 0.3% | ||||||||
Glatfelter | 415,245 | 5,800,973 | ||||||
Total (Cost $136,637,378) | 185,307,703 | |||||||
REAL ESTATE – 3.6% | ||||||||
EQUITY REAL ESTATE INVESTMENT TRUSTS (REITS) - 3.3% | ||||||||
Alexander & Baldwin | 493,000 | 9,031,760 | ||||||
Armada Hoffler Properties | 639,134 | 8,494,091 | ||||||
†Braemar Hotels & Resorts 1 | 459,453 | 2,853,203 | ||||||
CatchMark Timber Trust Cl. A | 258,600 | 3,025,620 | ||||||
†Chatham Lodging Trust 1 | 276,000 | 3,552,120 | ||||||
Diversified Healthcare Trust | 1,167,100 | 4,878,478 | ||||||
Kimco Realty | 522,900 | 10,902,465 | ||||||
†Macerich Company | 670,300 | 12,232,975 | ||||||
Ryman Hospitality Properties 1 | 106,771 | 8,430,638 | ||||||
Tanger Factory Outlet Centers | 554,600 | 10,454,210 | ||||||
73,855,560 | ||||||||
REAL ESTATE MANAGEMENT & DEVELOPMENT - 0.3% | ||||||||
Realogy Holdings 1 | 409,320 | 7,457,810 | ||||||
Total (Cost $59,704,557) | 81,313,370 | |||||||
UTILITIES – 0.7% | ||||||||
ELECTRIC UTILITIES - 0.2% | ||||||||
Hawaiian Electric Industries | 127,901 | 5,407,654 | ||||||
MULTI-UTILITIES - 0.5% | ||||||||
Black Hills | 155,300 | 10,192,339 | ||||||
Total (Cost $13,899,768) | 15,599,993 | |||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $1,411,170,071) | 1,993,686,603 | |||||||
REPURCHASE AGREEMENT– 11.1% | ||||||||
Fixed Income Clearing Corporation, 0.00% dated 6/30/21, due 7/1/21, maturity value $248,411,316 (collateralized by obligations of various U.S. Government Agencies, 1.25% due 6/30/28, valued at $253,379,563) | ||||||||
(Cost $248,411,316) | 248,411,316 | |||||||
COLLATERAL RECEIVED FOR SECURITIES LOANED – 0.2% | ||||||||
Money Market Funds | ||||||||
Federated Government Obligations Fund - Institutional Shares (7 day yield-0.01%) | ||||||||
(Cost $4,438,500) | 4,438,500 | |||||||
VALUE | ||||||||
TOTAL INVESTMENTS – 100.6% | ||||||||
(Cost $1,664,019,887) | 2,246,536,419 | |||||||
LIABILITIES LESS CASH AND OTHER ASSETS – (0.6)% | (13,671,038 | ) | ||||||
NET ASSETS – 100.0% | $ | 2,232,865,381 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 39 |
Schedules of Investments
Royce Pennsylvania Mutual Fund | ||||||||
Common Stocks – 96.7% | ||||||||
SHARES | VALUE | |||||||
COMMUNICATION SERVICES – 2.0% | ||||||||
DIVERSIFIED TELECOMMUNICATION SERVICES - 0.9% | ||||||||
Bandwidth Cl. A 1 | 109,335 | $ | 15,079,483 | |||||
Liberty Latin America Cl. C 1 | 383,565 | 5,408,266 | ||||||
20,487,749 | ||||||||
ENTERTAINMENT - 0.6% | ||||||||
†Chicken Soup For The Soul Entertainment Cl. A 1 | 29,000 | 1,200,600 | ||||||
IMAX Corporation 1 | 197,900 | 4,254,850 | ||||||
Manchester United Cl. A | 377,490 | 5,734,073 | ||||||
World Wrestling Entertainment Cl. A | 32,093 | 1,857,864 | ||||||
13,047,387 | ||||||||
INTERACTIVE MEDIA & SERVICES - 0.0% | ||||||||
QuinStreet 1 | 78,300 | 1,454,814 | ||||||
MEDIA - 0.5% | ||||||||
Media General (Rights) 1,4 | 102,272 | 0 | ||||||
Meredith Corporation 1 | 84,540 | 3,672,418 | ||||||
New York Times Cl. A | 169,395 | 7,377,152 | ||||||
11,049,570 | ||||||||
Total (Cost $42,211,052) | 46,039,520 | |||||||
CONSUMER DISCRETIONARY – 9.7% | ||||||||
AUTO COMPONENTS - 2.0% | ||||||||
Dorman Products 1 | 102,127 | 10,587,506 | ||||||
Gentex Corporation | 316,985 | 10,489,034 | ||||||
LCI Industries | 90,152 | 11,847,776 | ||||||
Patrick Industries | 111,291 | 8,124,243 | ||||||
Standard Motor Products | 21,790 | 944,596 | ||||||
Stoneridge 1 | 105,227 | 3,104,197 | ||||||
45,097,352 | ||||||||
AUTOMOBILES - 0.4% | ||||||||
Winnebago Industries | 120,849 | 8,212,898 | ||||||
DISTRIBUTORS - 0.2% | ||||||||
LKQ Corporation 1 | 101,823 | 5,011,728 | ||||||
DIVERSIFIED CONSUMER SERVICES - 0.1% | ||||||||
Regis 1 | 307,900 | 2,881,944 | ||||||
HOTELS, RESTAURANTS & LEISURE - 1.2% | ||||||||
Century Casinos 1 | 481,474 | 6,466,196 | ||||||
Hilton Grand Vacations 1 | 197,000 | 8,153,830 | ||||||
†Hyatt Hotels Cl. A 1 | 23,842 | 1,851,093 | ||||||
Scientific Games 1,3 | 148,200 | 11,476,608 | ||||||
27,947,727 | ||||||||
HOUSEHOLD DURABLES - 1.1% | ||||||||
La-Z-Boy | 136,227 | 5,045,848 | ||||||
Legacy Housing 1,3 | 100,000 | 1,691,000 | ||||||
PulteGroup | 114,900 | 6,270,093 | ||||||
Skyline Champion 1 | 108,300 | 5,772,390 | ||||||
TopBuild Corp. 1 | 28,600 | 5,656,508 | ||||||
24,435,839 | ||||||||
INTERNET & DIRECT MARKETING RETAIL - 0.0% | ||||||||
1-800-FLOWERS.COM Cl. A 1,3 | 34,650 | 1,104,295 | ||||||
LEISURE PRODUCTS - 0.9% | ||||||||
Brunswick Corporation | 46,875 | 4,669,687 | ||||||
Malibu Boats Cl. A 1 | 62,538 | 4,585,912 | ||||||
MasterCraft Boat Holdings 1,3 | 473,039 | 12,436,195 | ||||||
21,691,794 | ||||||||
SPECIALTY RETAIL - 2.9% | ||||||||
Aaron’s Company (The) | 154,491 | 4,942,167 | ||||||
America’s Car-Mart 1 | 70,479 | 9,988,284 | ||||||
Asbury Automotive Group 1 | 87,735 | 15,035,147 | ||||||
Haverty Furniture | 25,000 | 1,069,000 | ||||||
OneWater Marine Cl. A | 179,361 | 7,538,543 | ||||||
Rent-A-Center | 332,482 | 17,644,820 | ||||||
Shoe Carnival | 148,573 | 10,636,341 | ||||||
66,854,302 | ||||||||
TEXTILES, APPAREL & LUXURY GOODS - 0.9% | ||||||||
Canada Goose Holdings 1,3 | 133,000 | 5,817,420 | ||||||
†Levi Strauss & Co. Cl. A | 183,445 | 5,085,095 | ||||||
Ralph Lauren Cl. A | 34,444 | 4,057,848 | ||||||
Wolverine World Wide | 159,955 | 5,380,886 | ||||||
20,341,249 | ||||||||
Total (Cost $132,773,565) | 223,579,128 | |||||||
CONSUMER STAPLES – 1.1% | ||||||||
FOOD PRODUCTS - 0.4% | ||||||||
Nomad Foods 1 | 154,056 | 4,355,163 | ||||||
Seneca Foods Cl. A 1 | 94,033 | 4,803,206 | ||||||
9,158,369 | ||||||||
HOUSEHOLD PRODUCTS - 0.2% | ||||||||
Spectrum Brands Holdings | 59,117 | 5,027,309 | ||||||
PERSONAL PRODUCTS - 0.5% | ||||||||
Inter Parfums | 146,276 | 10,531,872 | ||||||
Total (Cost $11,191,356) | 24,717,550 | |||||||
ENERGY – 1.4% | ||||||||
ENERGY EQUIPMENT & SERVICES - 0.7% | ||||||||
†Aspen Aerogels 1 | 130,800 | 3,913,536 | ||||||
Pason Systems | 1,653,849 | 11,914,224 | ||||||
15,827,760 | ||||||||
OIL, GAS & CONSUMABLE FUELS - 0.7% | ||||||||
Cimarex Energy | 111,500 | 8,078,175 | ||||||
EQT Corporation 1 | 375,500 | 8,358,630 | ||||||
16,436,805 | ||||||||
Total (Cost $26,909,700) | 32,264,565 | |||||||
FINANCIALS – 18.5% | ||||||||
BANKS - 6.3% | ||||||||
BankUnited | 148,169 | 6,325,335 | ||||||
BOK Financial | 41,600 | 3,602,560 | ||||||
CIT Group | 113,630 | 5,862,172 | ||||||
City Holding Company | 48,743 | 3,667,423 | ||||||
First Bancshares (The) | 206,125 | 7,715,259 | ||||||
First Citizens BancShares Cl. A | 36,878 | 30,709,786 | ||||||
First Hawaiian | 434,425 | 12,311,604 | ||||||
German American Bancorp | 86,297 | 3,210,248 | ||||||
Glacier Bancorp | 16,487 | 908,104 | ||||||
Home BancShares | 275,648 | 6,802,993 | ||||||
Independent Bank Group | 130,345 | 9,642,923 | ||||||
National Bankshares | 117,867 | 4,126,524 | ||||||
Origin Bancorp | 126,328 | 5,363,887 | ||||||
Popular | 193,643 | 14,532,907 | ||||||
Signature Bank | 41,988 | 10,314,352 | ||||||
Texas Capital Bancshares 1 | 37,328 | 2,369,955 | ||||||
TriState Capital Holdings 1 | 75,000 | 1,529,250 | ||||||
Triumph Bancorp 1 | 215,745 | 16,019,066 | ||||||
145,014,348 | ||||||||
CAPITAL MARKETS - 5.5% | ||||||||
Ares Management Cl. A | 147,021 | 9,349,065 | ||||||
Artisan Partners Asset Management Cl. A | 122,702 | 6,235,716 | ||||||
B. Riley Financial | 35,200 | 2,657,600 | ||||||
Evercore Cl. A | 47,841 | 6,734,578 |
40 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce Pennsylvania Mutual Fund (continued) | ||||||||
SHARES | VALUE | |||||||
FINANCIALS (continued) | ||||||||
CAPITAL MARKETS (continued) | ||||||||
GCM Grosvenor Cl. A | 1,426,580 | $ | 14,864,964 | |||||
Houlihan Lokey Cl. A | 168,118 | 13,750,371 | ||||||
Lazard Cl. A | 134,669 | 6,093,772 | ||||||
Moelis & Company Cl. A | 54,524 | 3,101,870 | ||||||
Morningstar | 54,934 | 14,124,081 | ||||||
Open Lending 1,3 | 333,900 | 14,387,751 | ||||||
SEI Investments | 310,019 | 19,211,877 | ||||||
Silvercrest Asset Management Group Cl. A | 184,878 | 2,780,565 | ||||||
Sprott | 169,894 | 6,686,938 | ||||||
TMX Group | 56,620 | 5,980,819 | ||||||
125,959,967 | ||||||||
CONSUMER FINANCE - 0.3% | ||||||||
PROG Holdings 1 | 132,139 | 6,359,850 | ||||||
DIVERSIFIED FINANCIAL SERVICES - 0.3% | ||||||||
Compass Diversified Holdings | 245,113 | 6,250,381 | ||||||
INSURANCE - 5.3% | ||||||||
Alleghany Corporation 1 | 12,875 | 8,588,526 | ||||||
AMERISAFE | 108,980 | 6,505,016 | ||||||
Assured Guaranty | 152,041 | 7,218,907 | ||||||
Axis Capital Holdings | 88,227 | 4,324,005 | ||||||
CNO Financial Group | 182,993 | 4,322,295 | ||||||
E-L Financial | 24,818 | 18,794,690 | ||||||
†Employers Holdings | 126,000 | 5,392,800 | ||||||
†First American Financial | 77,625 | 4,839,919 | ||||||
James River Group Holdings | 433,944 | 16,281,579 | ||||||
Kemper Corporation | 76,628 | 5,662,809 | ||||||
Old Republic International | 194,300 | 4,840,013 | ||||||
ProAssurance Corporation | 315,326 | 7,173,667 | ||||||
RenaissanceRe Holdings | 20,515 | 3,053,042 | ||||||
RLI Corp. | 60,153 | 6,291,402 | ||||||
†Safety Insurance Group | 60,000 | 4,696,800 | ||||||
Selective Insurance Group | 48,300 | 3,919,545 | ||||||
†Trean Insurance Group 1,3 | 671,947 | 10,132,961 | ||||||
122,037,976 | ||||||||
INVESTMENT COMPANIES - 0.2% | ||||||||
†ACE Convergence Acquisition Cl. A 1,3 | 384,800 | 3,830,684 | ||||||
THRIFTS & MORTGAGE FINANCE - 0.6% | ||||||||
Axos Financial 1,3 | 122,961 | 5,704,161 | ||||||
Southern Missouri Bancorp | 52,093 | 2,342,101 | ||||||
Timberland Bancorp | 111,523 | 3,136,027 | ||||||
TrustCo Bank Corp NY | 87,066 | 2,993,329 | ||||||
14,175,618 | ||||||||
Total (Cost $306,955,260) | 423,628,824 | |||||||
HEALTH CARE – 7.8% | ||||||||
BIOTECHNOLOGY - 1.2% | ||||||||
CareDx 1,3 | 171,720 | 15,715,814 | ||||||
†Catalyst Pharmaceuticals 1,3 | 803,517 | 4,620,223 | ||||||
†MaxCyte 1 | 226,900 | 2,818,560 | ||||||
†MeiraGTx Holdings 1,3 | 97,600 | 1,512,800 | ||||||
†United Therapeutics 1 | 18,954 | 3,400,537 | ||||||
28,067,934 | ||||||||
HEALTH CARE EQUIPMENT & SUPPLIES - 4.0% | ||||||||
AtriCure 1 | 25,000 | 1,983,250 | ||||||
Atrion Corporation | 8,442 | 5,241,891 | ||||||
BioLife Solutions 1 | 145,416 | 6,472,466 | ||||||
Cutera 1,3 | 52,400 | 2,569,172 | ||||||
Haemonetics Corporation 1 | 100,969 | 6,728,574 | ||||||
Meridian Bioscience 1 | 500,700 | 11,105,526 | ||||||
Mesa Laboratories | 73,745 | 19,997,432 | ||||||
Misonix 1,3 | 201,200 | 4,462,616 | ||||||
Natus Medical 1,3 | 79,600 | 2,068,008 | ||||||
OrthoPediatrics Corp. 1,3 | 56,800 | 3,588,624 | ||||||
Profound Medical 1 | 53,200 | 866,496 | ||||||
SI-BONE 1,3 | 155,358 | 4,889,116 | ||||||
†SmileDirectClub Cl. A 1,3 | 1,237,695 | 10,743,193 | ||||||
Surmodics 1 | 43,200 | 2,343,600 | ||||||
Tandem Diabetes Care 1 | 78,286 | 7,625,056 | ||||||
90,685,020 | ||||||||
HEALTH CARE PROVIDERS & SERVICES - 0.9% | ||||||||
Encompass Health | 119,160 | 9,298,055 | ||||||
Ensign Group (The) | 39,308 | 3,406,824 | ||||||
Molina Healthcare 1 | 27,100 | 6,857,926 | ||||||
Sharps Compliance 1,3 | 124,900 | 1,286,470 | ||||||
20,849,275 | ||||||||
HEALTH CARE TECHNOLOGY - 0.3% | ||||||||
Simulations Plus | 127,941 | 7,025,240 | ||||||
LIFE SCIENCES TOOLS & SERVICES - 1.1% | ||||||||
Bio-Techne | 37,916 | 17,072,058 | ||||||
Harvard Bioscience 1 | 262,500 | 2,186,625 | ||||||
Quanterix Corporation 1,3 | 101,479 | 5,952,758 | ||||||
25,211,441 | ||||||||
PHARMACEUTICALS - 0.3% | ||||||||
†BioDelivery Sciences International 1 | 1,166,500 | 4,176,070 | ||||||
Supernus Pharmaceuticals 1,3 | 118,567 | 3,650,678 | ||||||
7,826,748 | ||||||||
Total (Cost $123,907,336) | 179,665,658 | |||||||
INDUSTRIALS – 25.6% | ||||||||
AEROSPACE & DEFENSE - 0.9% | ||||||||
HEICO Corporation | 83,764 | 11,678,377 | ||||||
Vectrus 1 | 204,839 | 9,748,288 | ||||||
21,426,665 | ||||||||
AIR FREIGHT & LOGISTICS - 0.6% | ||||||||
Forward Air | 74,011 | 6,642,487 | ||||||
Hub Group Cl. A 1 | 97,118 | 6,407,846 | ||||||
13,050,333 | ||||||||
AIRLINES - 0.5% | ||||||||
†Sun Country Airlines Holdings 1,3 | 298,802 | 11,058,662 | ||||||
BUILDING PRODUCTS - 1.9% | ||||||||
Advanced Drainage Systems | 37,631 | 4,386,646 | ||||||
†Builders FirstSource 1 | 273,490 | 11,667,083 | ||||||
Gibraltar Industries 1 | 92,367 | 7,048,526 | ||||||
Quanex Building Products | 55,700 | 1,383,588 | ||||||
Simpson Manufacturing | 51,562 | 5,694,507 | ||||||
UFP Industries | 168,054 | 12,493,134 | ||||||
42,673,484 | ||||||||
COMMERCIAL SERVICES & SUPPLIES - 1.8% | ||||||||
Brink’s Company (The) | 50,090 | 3,848,916 | ||||||
†Deluxe Corporation | 163,072 | 7,789,949 | ||||||
Healthcare Services Group | 265,352 | 8,377,163 | ||||||
Heritage-Crystal Clean 1 | 154,283 | 4,579,119 | ||||||
Herman Miller | 203,400 | 9,588,276 | ||||||
UniFirst Corporation | 28,385 | 6,660,256 | ||||||
40,843,679 | ||||||||
CONSTRUCTION & ENGINEERING - 3.3% | ||||||||
Arcosa | 296,117 | 17,393,913 | ||||||
Comfort Systems USA | 57,406 | 4,523,019 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 41 |
Schedules of Investments
Royce Pennsylvania Mutual Fund (continued) | ||||||||
SHARES | VALUE | |||||||
INDUSTRIALS (continued) | ||||||||
CONSTRUCTION & ENGINEERING (continued) | ||||||||
Construction Partners Cl. A 1,3 | 144,091 | $ | 4,524,457 | |||||
EMCOR Group | 29,550 | 3,640,264 | ||||||
Great Lakes Dredge & Dock 1 | 799,709 | 11,683,748 | ||||||
†Northwest Pipe 1 | 144,137 | 4,071,870 | ||||||
†NV5 Global 1 | 11,100 | 1,049,061 | ||||||
Primoris Services | 220,209 | 6,480,751 | ||||||
Valmont Industries | 75,575 | 17,839,479 | ||||||
WillScot Mobile Mini Holdings Corp. 1,3 | 199,150 | 5,550,311 | ||||||
76,756,873 | ||||||||
ELECTRICAL EQUIPMENT - 0.9% | ||||||||
†American Superconductor 1 | 95,300 | 1,657,267 | ||||||
Encore Wire | 58,580 | 4,439,778 | ||||||
GrafTech International | 342,861 | 3,984,045 | ||||||
Preformed Line Products | 144,775 | 10,742,305 | ||||||
20,823,395 | ||||||||
INDUSTRIAL CONGLOMERATES - 0.4% | ||||||||
Carlisle Companies | 42,398 | 8,114,129 | ||||||
MACHINERY - 7.3% | ||||||||
CIRCOR International 1 | 111,200 | 3,625,120 | ||||||
Colfax 1,3 | 449,634 | 20,597,734 | ||||||
Crane Company | 41,916 | 3,871,781 | ||||||
ESCO Technologies | 91,809 | 8,612,602 | ||||||
Graham Corporation | 93,792 | 1,290,578 | ||||||
Helios Technologies | 176,339 | 13,763,259 | ||||||
Hurco Companies | 98,030 | 3,431,050 | ||||||
John Bean Technologies | 108,150 | 15,424,353 | ||||||
Kadant | 107,402 | 18,912,418 | ||||||
Lincoln Electric Holdings | 126,226 | 16,625,227 | ||||||
Lindsay Corporation | 68,474 | 11,317,383 | ||||||
Meritor 1 | 366,110 | 8,574,296 | ||||||
Middleby Corporation (The) 1 | 89,220 | 15,458,257 | ||||||
Miller Industries | 324,951 | 12,816,067 | ||||||
RBC Bearings 1 | 45,622 | 9,097,939 | ||||||
†Rexnord Corporation | 57,600 | 2,882,304 | ||||||
†Westport Fuel Systems 1 | 169,500 | 900,045 | ||||||
167,200,413 | ||||||||
MARINE - 0.4% | ||||||||
Clarkson | 138,452 | 6,109,509 | ||||||
Kirby Corporation 1 | 54,000 | 3,274,560 | ||||||
9,384,069 | ||||||||
PROFESSIONAL SERVICES - 3.3% | ||||||||
Barrett Business Services | 37,119 | 2,695,211 | ||||||
Forrester Research 1 | 291,487 | 13,350,105 | ||||||
GP Strategies 1 | 127,213 | 1,999,788 | ||||||
Heidrick & Struggles International | 285,819 | 12,733,236 | ||||||
KBR | 523,961 | 19,989,112 | ||||||
Korn Ferry | 81,100 | 5,883,805 | ||||||
LifeWorks | 53,600 | 1,445,073 | ||||||
ManpowerGroup | 35,147 | 4,179,330 | ||||||
Upwork 1 | 251,660 | 14,669,261 | ||||||
76,944,921 | ||||||||
ROAD & RAIL - 2.1% | ||||||||
ArcBest | 104,347 | 6,071,952 | ||||||
Landstar System | 107,966 | 17,060,787 | ||||||
Saia 1 | 54,462 | 11,409,245 | ||||||
Schneider National Cl. B | 198,900 | 4,330,053 | ||||||
Universal Logistics Holdings | 306,291 | 7,136,580 | ||||||
Werner Enterprises | 75,000 | 3,339,000 | ||||||
49,347,617 | ||||||||
TRADING COMPANIES & DISTRIBUTORS - 2.2% | ||||||||
Air Lease Cl. A | 209,564 | 8,747,201 | ||||||
Applied Industrial Technologies | 93,965 | 8,556,453 | ||||||
EVI Industries 1,3 | 339,829 | 9,651,144 | ||||||
Lawson Products 1 | 19,600 | 1,048,796 | ||||||
MSC Industrial Direct Cl. A | 62,541 | 5,611,804 | ||||||
Richelieu Hardware | 355,741 | 11,513,657 | ||||||
Transcat 1 | 89,300 | 5,046,343 | ||||||
50,175,398 | ||||||||
Total (Cost $348,964,792) | 587,799,638 | |||||||
INFORMATION TECHNOLOGY – 21.3% | ||||||||
COMMUNICATIONS EQUIPMENT - 0.4% | ||||||||
Digi International 1,3 | 314,293 | 6,320,432 | ||||||
NETGEAR 1 | 49,400 | 1,893,008 | ||||||
8,213,440 | ||||||||
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS - 7.5% | ||||||||
Advanced Energy Industries | 19,148 | 2,158,171 | ||||||
Avnet | 71,074 | 2,848,646 | ||||||
Belden | 28,996 | 1,466,328 | ||||||
Cognex Corporation | 90,945 | 7,643,927 | ||||||
ePlus 1 | 46,321 | 4,015,567 | ||||||
Fabrinet 1 | 122,282 | 11,723,175 | ||||||
FARO Technologies 1 | 175,888 | 13,678,810 | ||||||
Insight Enterprises 1 | 117,493 | 11,750,475 | ||||||
IPG Photonics 1 | 27,231 | 5,739,478 | ||||||
Kimball Electronics 1 | 417,051 | 9,066,689 | ||||||
Littelfuse | 3,575 | 910,874 | ||||||
Luna Innovations 1,3 | 781,399 | 8,462,551 | ||||||
Methode Electronics | 91,378 | 4,496,711 | ||||||
National Instruments | 304,081 | 12,856,545 | ||||||
nLIGHT 1 | 128,000 | 4,643,840 | ||||||
PAR Technology 1 | 216,271 | 15,125,994 | ||||||
PC Connection | 40,044 | 1,852,836 | ||||||
†PowerFleet 1,3 | 158,600 | 1,141,920 | ||||||
Rogers Corporation 1 | 43,876 | 8,810,301 | ||||||
Sanmina Corporation 1 | 160,060 | 6,235,937 | ||||||
SYNNEX Corporation | 47,900 | 5,832,304 | ||||||
Vishay Intertechnology | 478,078 | 10,780,659 | ||||||
Vishay Precision Group 1 | 123,315 | 4,197,643 | ||||||
†Vontier Corporation | 502,647 | 16,376,239 | ||||||
171,815,620 | ||||||||
IT SERVICES - 1.9% | ||||||||
†Cass Information Systems | 67,200 | 2,738,400 | ||||||
Computer Services 2 | 143,710 | 8,083,688 | ||||||
Concentrix Corporation 1 | 12,583 | 2,023,346 | ||||||
MAXIMUS | 27,682 | 2,435,186 | ||||||
Repay Holdings Cl. A 1,3 | 472,704 | 11,363,804 | ||||||
Shift4 Payments Cl. A 1 | 138,838 | 13,011,897 | ||||||
Unisys Corporation 1 | 125,000 | 3,163,750 | ||||||
42,820,071 | ||||||||
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 8.2% | ||||||||
Axcelis Technologies 1 | 116,315 | 4,701,452 | ||||||
Brooks Automation | 90,200 | 8,594,256 | ||||||
†Camtek 1 | 331,671 | 12,507,314 | ||||||
Cirrus Logic 1 | 173,740 | 14,788,749 | ||||||
CMC Materials | 115,178 | 17,361,932 | ||||||
Cohu 1 | 276,018 | 10,154,702 | ||||||
†CyberOptics Corporation 1 | 148,400 | 6,078,464 | ||||||
Diodes 1 | 113,864 | 9,082,931 |
42 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce Pennsylvania Mutual Fund (continued) | ||||||||
SHARES | VALUE | |||||||
INFORMATION TECHNOLOGY (continued) | ||||||||
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT (continued) | ||||||||
FormFactor 1 | 448,223 | $ | 16,342,211 | |||||
†Ichor Holdings 1 | 30,400 | 1,635,520 | ||||||
Kulicke & Soffa Industries | 395,137 | 24,182,384 | ||||||
Lattice Semiconductor 1 | 89,571 | 5,032,099 | ||||||
MKS Instruments | 112,653 | 20,046,601 | ||||||
Nova Measuring Instruments 1,3 | 100,754 | 10,366,579 | ||||||
NVE Corporation | 52,363 | 3,877,480 | ||||||
Onto Innovation 1,3 | 147,920 | 10,804,077 | ||||||
Photronics 1 | 144,000 | 1,902,240 | ||||||
†SiTime 1,3 | 51,954 | 6,576,857 | ||||||
Ultra Clean Holdings 1 | 86,600 | 4,652,152 | ||||||
188,688,000 | ||||||||
SOFTWARE - 2.7% | ||||||||
ACI Worldwide 1 | 213,837 | 7,941,906 | ||||||
Agilysys 1 | 105,387 | 5,993,359 | ||||||
Aspen Technology 1 | 9,340 | 1,284,624 | ||||||
Blackbaud 1 | 27,110 | 2,075,813 | ||||||
ChannelAdvisor Corporation 1 | 132,030 | 3,236,055 | ||||||
Dolby Laboratories Cl. A | 92,120 | 9,054,475 | ||||||
j2 Global 1 | 42,902 | 5,901,170 | ||||||
Momentive Global 1 | 149,200 | 3,143,644 | ||||||
QAD Cl. A | 22,041 | 1,918,008 | ||||||
Upland Software 1,3 | 538,215 | 22,158,311 | ||||||
62,707,365 | ||||||||
TECHNOLOGY HARDWARE, STORAGE & PERIPHERALS - 0.6% | ||||||||
AstroNova 1 | 83,400 | 1,160,928 | ||||||
Avid Technology 1 | 316,740 | 12,400,371 | ||||||
13,561,299 | ||||||||
Total (Cost $292,196,070) | 487,805,795 | |||||||
MATERIALS – 7.1% | ||||||||
CHEMICALS - 5.0% | ||||||||
†Atotech 1,3 | 298,381 | 7,617,667 | ||||||
Balchem Corporation | 71,772 | 9,420,793 | ||||||
Element Solutions | 1,057,558 | 24,725,706 | ||||||
Huntsman Corporation | 208,700 | 5,534,724 | ||||||
Innospec | 177,924 | 16,121,694 | ||||||
Minerals Technologies | 232,591 | 18,297,934 | ||||||
Mosaic Company (The) | 371,300 | 11,848,183 | ||||||
Quaker Chemical | 84,902 | 20,137,905 | ||||||
113,704,606 | ||||||||
CONTAINERS & PACKAGING - 0.4% | ||||||||
Graphic Packaging Holding Company | 331,783 | 6,018,544 | ||||||
Silgan Holdings | 97,363 | 4,040,564 | ||||||
10,059,108 | ||||||||
METALS & MINING - 1.2% | ||||||||
Alamos Gold Cl. A | 2,037,600 | 15,566,370 | ||||||
Haynes International | 64,000 | 2,264,320 | ||||||
IAMGOLD Corporation 1 | 795,894 | 2,347,887 | ||||||
Reliance Steel & Aluminum | 49,834 | 7,519,951 | ||||||
27,698,528 | ||||||||
PAPER & FOREST PRODUCTS - 0.5% | ||||||||
Stella-Jones | 315,977 | 11,376,293 | ||||||
Total (Cost $88,384,749) | 162,838,535 | |||||||
REAL ESTATE – 2.2% | ||||||||
REAL ESTATE MANAGEMENT & DEVELOPMENT - 2.2% | ||||||||
Colliers International Group | 90,950 | 10,184,581 | ||||||
FirstService | 3,400 | 582,284 | ||||||
FRP Holdings 1 | 167,330 | 9,316,935 | ||||||
Jones Lang LaSalle 1 | 14,400 | 2,814,624 | ||||||
Kennedy-Wilson Holdings | 784,621 | 15,590,419 | ||||||
Marcus & Millichap 1 | 236,159 | 9,179,500 | ||||||
Tejon Ranch 1 | 235,407 | 3,580,541 | ||||||
Total (Cost $39,312,774) | 51,248,884 | |||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $1,412,806,654) | 2,219,588,097 | |||||||
REPURCHASE AGREEMENT– 3.2% | ||||||||
Fixed Income Clearing Corporation, 0.00% dated 6/30/21, due 7/1/21, maturity value $74,543,071 (collateralized by obligations of various U.S. Government Agencies, 1.25% due 6/30/28, valued at $76,033,992) | ||||||||
(Cost $74,543,071) | 74,543,071 | |||||||
COLLATERAL RECEIVED FOR SECURITIES LOANED – 0.5% | ||||||||
Money Market Funds | ||||||||
Federated Government Obligations Fund - Institutional Shares (7 day yield-0.01%) | ||||||||
(Cost $10,502,933) | 10,502,933 | |||||||
TOTAL INVESTMENTS – 100.4% | ||||||||
(Cost $1,497,852,658) | 2,304,634,101 | |||||||
LIABILITIES LESS CASH AND OTHER ASSETS – (0.4)% | (8,846,211 | ) | ||||||
NET ASSETS – 100.0% | $ | 2,295,787,890 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 43 |
Schedules of Investments
Royce Premier Fund | ||||||||
Common Stocks – 91.5% | ||||||||
SHARES | VALUE | |||||||
CONSUMER DISCRETIONARY – 6.8% | ||||||||
AUTO COMPONENTS - 2.3% | ||||||||
Dorman Products 1 | 242,225 | $ | 25,111,466 | |||||
LCI Industries | 123,447 | 16,223,405 | ||||||
41,334,871 | ||||||||
DISTRIBUTORS - 1.5% | ||||||||
Pool Corporation | 57,715 | 26,471,562 | ||||||
LEISURE PRODUCTS - 1.0% | ||||||||
Brunswick Corporation | 177,200 | 17,652,664 | ||||||
TEXTILES, APPAREL & LUXURY GOODS - 2.0% | ||||||||
Ralph Lauren Cl. A | 310,303 | 36,556,796 | ||||||
Total (Cost $64,692,954) | 122,015,893 | |||||||
CONSUMER STAPLES – 1.6% | ||||||||
PERSONAL PRODUCTS - 1.6% | ||||||||
Inter Parfums | 390,641 | 28,126,152 | ||||||
Total (Cost $17,960,499) | 28,126,152 | |||||||
FINANCIALS – 13.4% | ||||||||
CAPITAL MARKETS - 11.7% | ||||||||
Ares Management Cl. A | 379,270 | 24,117,779 | ||||||
Ashmore Group | 5,917,301 | 31,513,799 | ||||||
GCM Grosvenor Cl. A | 2,030,615 | 21,159,008 | ||||||
Lazard Cl. A | 518,583 | 23,465,881 | ||||||
Morningstar | 201,486 | 51,804,066 | ||||||
†SEI Investments | 595,300 | 36,890,741 | ||||||
TMX Group | 194,583 | 20,553,967 | ||||||
209,505,241 | ||||||||
INSURANCE - 1.7% | ||||||||
Alleghany Corporation 1 | 47,504 | 31,688,493 | ||||||
Total (Cost $121,149,700) | 241,193,734 | |||||||
HEALTH CARE – 6.0% | ||||||||
HEALTH CARE EQUIPMENT & SUPPLIES - 4.5% | ||||||||
Haemonetics Corporation 1 | 408,962 | 27,253,228 | ||||||
†Meridian Bioscience 1 | 800,000 | 17,744,000 | ||||||
Mesa Laboratories | 130,825 | 35,475,815 | ||||||
80,473,043 | ||||||||
LIFE SCIENCES TOOLS & SERVICES - 1.5% | ||||||||
Bio-Techne | 59,621 | 26,844,951 | ||||||
Total (Cost $89,237,213) | 107,317,994 | |||||||
INDUSTRIALS – 31.9% | ||||||||
AIR FREIGHT & LOGISTICS - 1.8% | ||||||||
Forward Air | 360,158 | 32,324,180 | ||||||
BUILDING PRODUCTS - 1.5% | ||||||||
Simpson Manufacturing | 245,995 | 27,167,688 | ||||||
COMMERCIAL SERVICES & SUPPLIES - 1.1% | ||||||||
Ritchie Bros. Auctioneers | 346,946 | 20,566,959 | ||||||
CONSTRUCTION & ENGINEERING - 4.1% | ||||||||
Arcosa | 489,123 | 28,731,085 | ||||||
Valmont Industries | 189,084 | 44,633,278 | ||||||
73,364,363 | ||||||||
MACHINERY - 16.9% | ||||||||
Colfax 1 | 625,570 | 28,657,362 | ||||||
ESCO Technologies | 237,273 | 22,258,580 | ||||||
Helios Technologies | 249,705 | 19,489,475 | ||||||
John Bean Technologies | 322,263 | 45,961,149 | ||||||
Kadant | 195,081 | 34,351,813 | ||||||
Lincoln Electric Holdings | 365,699 | 48,166,215 | ||||||
Lindsay Corporation | 270,643 | 44,731,875 | ||||||
RBC Bearings 1 | 113,770 | 22,688,014 | ||||||
Woodward | 299,257 | 36,772,700 | ||||||
303,077,183 | ||||||||
MARINE - 1.5% | ||||||||
Kirby Corporation 1 | 449,776 | 27,274,416 | ||||||
PROFESSIONAL SERVICES - 2.0% | ||||||||
Forrester Research 1 | 769,896 | 35,261,237 | ||||||
ROAD & RAIL - 1.4% | ||||||||
Landstar System | 162,485 | 25,675,880 | ||||||
TRADING COMPANIES & DISTRIBUTORS - 1.6% | ||||||||
Air Lease Cl. A | 688,405 | 28,734,025 | ||||||
Total (Cost $245,555,393) | 573,445,931 | |||||||
INFORMATION TECHNOLOGY – 21.1% | ||||||||
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS - 9.3% | ||||||||
Cognex Corporation | 307,691 | 25,861,428 | ||||||
FARO Technologies 1 | 401,548 | 31,228,388 | ||||||
IPG Photonics 1 | 98,709 | 20,804,896 | ||||||
National Instruments | 556,600 | 23,533,048 | ||||||
Rogers Corporation 1 | 195,566 | 39,269,653 | ||||||
†Vontier Corporation | 800,000 | 26,064,000 | ||||||
166,761,413 | ||||||||
IT SERVICES - 2.2% | ||||||||
Computer Services 2 | 561,400 | 31,578,750 | ||||||
Jack Henry & Associates | 49,987 | 8,173,374 | ||||||
39,752,124 | ||||||||
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 6.2% | ||||||||
Cirrus Logic 1 | 297,024 | 25,282,683 | ||||||
CMC Materials | 256,948 | 38,732,342 | ||||||
MKS Instruments | 264,834 | 47,127,210 | ||||||
111,142,235 | ||||||||
SOFTWARE - 3.4% | ||||||||
Fair Isaac 1 | 35,041 | 17,614,410 | ||||||
Manhattan Associates 1 | 157,171 | 22,764,648 | ||||||
†Upland Software 1 | 495,500 | 20,399,735 | ||||||
60,778,793 | ||||||||
Total (Cost $185,597,811) | 378,434,565 | |||||||
MATERIALS – 8.3% | ||||||||
CHEMICALS - 4.1% | ||||||||
Innospec | 348,753 | 31,600,509 | ||||||
Quaker Chemical | 176,802 | 41,935,667 | ||||||
73,536,176 | ||||||||
METALS & MINING - 2.2% | ||||||||
Reliance Steel & Aluminum | 264,355 | 39,891,169 | ||||||
PAPER & FOREST PRODUCTS - 2.0% | ||||||||
Stella-Jones | 1,012,691 | 36,460,471 | ||||||
Total (Cost $84,792,916) | 149,887,816 | |||||||
REAL ESTATE – 2.4% | ||||||||
REAL ESTATE MANAGEMENT & DEVELOPMENT - 2.4% | ||||||||
Kennedy-Wilson Holdings | 1,977,469 | 39,292,309 | ||||||
†Marcus & Millichap 1 | 77,626 | 3,017,323 | ||||||
Total (Cost $36,484,152) | 42,309,632 | |||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $845,470,638) | 1,642,731,717 |
44 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce Premier Fund (continued) | ||||
VALUE | ||||
REPURCHASE AGREEMENT– 8.0% | ||||
Fixed Income Clearing Corporation, 0.00% dated 6/30/21, due 7/1/21, maturity value $142,818,223 (collateralized by obligations of various U.S. Government Agencies, 1.25% due 6/30/28, valued at $145,674,590) | ||||
(Cost $142,818,223) | $ | 142,818,223 | ||
TOTAL INVESTMENTS – 99.5% | ||||
(Cost $988,288,861) | 1,785,549,940 | |||
CASH AND OTHER ASSETS LESS LIABILITIES – 0.5% | 9,302,629 | |||
NET ASSETS – 100.0% | $ | 1,794,852,569 |
Royce Small-Cap Value Fund | ||||||||
Common Stocks – 97.7% | ||||||||
SHARES | VALUE | |||||||
COMMUNICATION SERVICES – 1.4% | ||||||||
ENTERTAINMENT - 0.6% | ||||||||
SciPlay Corporation Cl. A 1,3 | 45,044 | $ | 763,496 | |||||
MEDIA - 0.8% | ||||||||
†Entravision Communications Cl. A | 61,385 | 410,052 | ||||||
Saga Communications Cl. A | 35,086 | 759,612 | ||||||
1,169,664 | ||||||||
Total (Cost $2,244,108) | 1,933,160 | |||||||
CONSUMER DISCRETIONARY – 22.0% | ||||||||
AUTO COMPONENTS - 0.5% | ||||||||
Gentex Corporation | 19,240 | 636,652 | ||||||
DIVERSIFIED CONSUMER SERVICES - 1.0% | ||||||||
†Lincoln Educational Services 1 | 180,741 | 1,406,165 | ||||||
HOUSEHOLD DURABLES - 5.4% | ||||||||
La-Z-Boy | 77,802 | 2,881,786 | ||||||
†Meritage Homes 1 | 16,110 | 1,515,629 | ||||||
PulteGroup | 59,800 | 3,263,286 | ||||||
7,660,701 | ||||||||
LEISURE PRODUCTS - 3.8% | ||||||||
Malibu Boats Cl. A 1 | 22,038 | 1,616,046 | ||||||
MasterCraft Boat Holdings 1 | 87,554 | 2,301,795 | ||||||
†Nautilus 1 | 89,509 | 1,508,227 | ||||||
5,426,068 | ||||||||
SPECIALTY RETAIL - 11.3% | ||||||||
Aaron’s Company (The) | 89,813 | 2,873,118 | ||||||
American Eagle Outfitters | 25,161 | 944,292 | ||||||
†Haverty Furniture | 41,771 | 1,786,128 | ||||||
†Lazydays Holdings 1,3 | 62,890 | 1,383,580 | ||||||
OneWater Marine Cl. A | 61,320 | 2,577,279 | ||||||
Rent-A-Center | 60,824 | 3,227,930 | ||||||
Shoe Carnival | 46,200 | 3,307,458 | ||||||
16,099,785 | ||||||||
Total (Cost $21,516,955) | 31,229,371 | |||||||
CONSUMER STAPLES – 0.4% | ||||||||
FOOD & STAPLES RETAILING - 0.4% | ||||||||
Village Super Market Cl. A | 22,390 | 526,389 | ||||||
Total (Cost $501,079) | 526,389 | |||||||
ENERGY – 0.5% | ||||||||
OIL, GAS & CONSUMABLE FUELS - 0.5% | ||||||||
Dorchester Minerals L.P. | 45,534 | 767,248 | ||||||
Total (Cost $620,050) | 767,248 | |||||||
FINANCIALS – 22.9% | ||||||||
BANKS - 7.0% | ||||||||
Ames National | 30,293 | 742,481 | ||||||
Camden National | 15,876 | 758,238 | ||||||
†Chemung Financial | 15,370 | 681,045 | ||||||
City Holding Company | 22,029 | 1,657,462 | ||||||
CNB Financial | 33,581 | 766,318 | ||||||
Financial Institutions | 23,378 | 701,340 | ||||||
Landmark Bancorp | 27,497 | 742,694 | ||||||
MidWestOne Financial Group | 39,267 | 1,129,711 | ||||||
National Bankshares | 56,004 | 1,960,700 | ||||||
Unity Bancorp | 32,992 | 727,474 | ||||||
9,867,463 | ||||||||
CAPITAL MARKETS - 4.0% | ||||||||
Evercore Cl. A | 24,244 | 3,412,828 | ||||||
Houlihan Lokey Cl. A | 8,595 | 702,985 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 45 |
Schedules of Investments
Royce Small-Cap Value Fund (continued) | ||||||||
SHARES | VALUE | |||||||
FINANCIALS (continued) | ||||||||
CAPITAL MARKETS (continued) | ||||||||
Moelis & Company Cl. A | 27,219 | $ | 1,548,489 | |||||
5,664,302 | ||||||||
CONSUMER FINANCE - 2.0% | ||||||||
PROG Holdings 1 | 59,200 | 2,849,296 | ||||||
INSURANCE - 6.8% | ||||||||
CNO Financial Group | 92,900 | 2,194,298 | ||||||
†Donegal Group Cl. A | 49,990 | 728,354 | ||||||
†Employers Holdings | 56,095 | 2,400,866 | ||||||
Heritage Insurance Holdings | 123,462 | 1,059,304 | ||||||
James River Group Holdings | 22,727 | 852,717 | ||||||
Kemper Corporation | 23,300 | 1,721,870 | ||||||
Selective Insurance Group | 8,637 | 700,893 | ||||||
9,658,302 | ||||||||
THRIFTS & MORTGAGE FINANCE - 3.1% | ||||||||
Southern Missouri Bancorp | 33,486 | 1,505,531 | ||||||
Timberland Bancorp | 54,119 | 1,521,826 | ||||||
TrustCo Bank Corp NY | 40,911 | 1,406,520 | ||||||
4,433,877 | ||||||||
Total (Cost $26,299,015) | 32,473,240 | |||||||
HEALTH CARE – 7.7% | ||||||||
BIOTECHNOLOGY - 2.1% | ||||||||
Catalyst Pharmaceuticals 1 | 357,994 | 2,058,466 | ||||||
Coherus BioSciences 1 | 28,887 | 399,507 | ||||||
Vanda Pharmaceuticals 1 | 23,938 | 514,906 | ||||||
2,972,879 | ||||||||
HEALTH CARE PROVIDERS & SERVICES - 3.1% | ||||||||
Ensign Group (The) | 12,121 | 1,050,527 | ||||||
Molina Healthcare 1 | 11,714 | 2,964,345 | ||||||
Pennant Group 1 | 8,013 | 327,732 | ||||||
4,342,604 | ||||||||
PHARMACEUTICALS - 2.5% | ||||||||
†BioDelivery Sciences International 1 | 277,103 | 992,029 | ||||||
†SIGA Technologies 1 | 136,123 | 854,852 | ||||||
Supernus Pharmaceuticals 1 | 56,661 | 1,744,592 | ||||||
3,591,473 | ||||||||
Total (Cost $8,109,208) | 10,906,956 | |||||||
INDUSTRIALS – 22.9% | ||||||||
AEROSPACE & DEFENSE - 1.5% | ||||||||
Vectrus 1 | 43,961 | 2,092,104 | ||||||
BUILDING PRODUCTS - 1.4% | ||||||||
†Builders FirstSource 1 | 19,541 | 833,619 | ||||||
UFP Industries | 15,900 | 1,182,006 | ||||||
2,015,625 | ||||||||
COMMERCIAL SERVICES & SUPPLIES - 1.3% | ||||||||
Herman Miller | 39,920 | 1,881,829 | ||||||
CONSTRUCTION & ENGINEERING - 5.8% | ||||||||
Comfort Systems USA | 7,138 | 562,403 | ||||||
Great Lakes Dredge & Dock 1 | 196,557 | 2,871,698 | ||||||
MasTec 1 | 6,012 | 637,873 | ||||||
MYR Group 1 | 7,840 | 712,813 | ||||||
Northwest Pipe 1 | 40,333 | 1,139,407 | ||||||
Primoris Services | 75,599 | 2,224,879 | ||||||
8,149,073 | ||||||||
MACHINERY - 2.3% | ||||||||
Alamo Group | 4,063 | 620,339 | ||||||
Federal Signal | 16,010 | 644,082 | ||||||
Miller Industries | 51,828 | 2,044,096 | ||||||
3,308,517 | ||||||||
PROFESSIONAL SERVICES - 5.1% | ||||||||
Barrett Business Services | 13,131 | 953,442 | ||||||
Heidrick & Struggles International | 54,426 | 2,424,678 | ||||||
Kforce | 15,195 | 956,221 | ||||||
Korn Ferry | 18,164 | 1,317,798 | ||||||
Resources Connection | 66,253 | 951,393 | ||||||
Robert Half International | 7,216 | 642,008 | ||||||
7,245,540 | ||||||||
ROAD & RAIL - 5.5% | ||||||||
ArcBest | 47,584 | 2,768,913 | ||||||
Old Dominion Freight Line | 2,246 | 570,035 | ||||||
Saia 1 | 2,653 | 555,777 | ||||||
Schneider National Cl. B | 81,551 | 1,775,365 | ||||||
Werner Enterprises | 48,784 | 2,171,864 | ||||||
7,841,954 | ||||||||
Total (Cost $20,724,791) | 32,534,642 | |||||||
INFORMATION TECHNOLOGY – 19.5% | ||||||||
COMMUNICATIONS EQUIPMENT - 1.0% | ||||||||
NETGEAR 1 | 38,400 | 1,471,488 | ||||||
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS - 13.9% | ||||||||
Advanced Energy Industries | 6,165 | 694,857 | ||||||
ePlus 1 | 24,296 | 2,106,220 | ||||||
Fabrinet 1 | 7,254 | 695,441 | ||||||
Insight Enterprises 1 | 21,623 | 2,162,516 | ||||||
Kimball Electronics 1 | 102,285 | 2,223,676 | ||||||
Methode Electronics | 29,189 | 1,436,391 | ||||||
PC Connection | 17,789 | 823,097 | ||||||
Plexus Corporation 1 | 7,353 | 672,138 | ||||||
Sanmina Corporation 1 | 83,541 | 3,254,757 | ||||||
SYNNEX Corporation | 22,466 | 2,735,460 | ||||||
Vishay Intertechnology | 131,404 | 2,963,160 | ||||||
19,767,713 | ||||||||
IT SERVICES - 1.7% | ||||||||
Concentrix Corporation 1 | 5,600 | 900,480 | ||||||
IBEX 1,3 | 36,914 | 720,561 | ||||||
Sykes Enterprises 1 | 14,918 | 801,097 | ||||||
2,422,138 | ||||||||
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 2.9% | ||||||||
Kulicke & Soffa Industries | 55,139 | 3,374,507 | ||||||
MKS Instruments | 3,880 | 690,446 | ||||||
4,064,953 | ||||||||
Total (Cost $16,033,109) | 27,726,292 | |||||||
REAL ESTATE – 0.4% | ||||||||
REAL ESTATE MANAGEMENT & DEVELOPMENT - 0.4% | ||||||||
Marcus & Millichap 1 | 16,289 | 633,153 | ||||||
Total (Cost $424,709) | 633,153 | |||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $96,473,024) | 138,730,451 |
46 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce Small-Cap Value Fund (continued) | ||||
VALUE | ||||
REPURCHASE AGREEMENT– 2.6% | ||||
Fixed Income Clearing Corporation, 0.00% dated 6/30/21, due 7/1/21, maturity value $3,716,925 (collateralized by obligations of various U.S. Government Agencies, 1.25% due 6/30/28, valued at $3,791,268) | ||||
(Cost $3,716,925) | $ | 3,716,925 | ||
COLLATERAL RECEIVED FOR SECURITIES LOANED – 0.5% | ||||
Money Market Funds | ||||
Federated Government Obligations Fund - Institutional Shares (7 day yield-0.01%) | ||||
(Cost $669,300) | 669,300 | |||
TOTAL INVESTMENTS – 100.8% | ||||
(Cost $100,859,249) | 143,116,676 | |||
LIABILITIES LESS CASH AND OTHER ASSETS – (0.8)% | (1,074,332 | ) | ||
NET ASSETS – 100.0% | $ | 142,042,344 |
Royce Smaller-Companies Growth Fund | ||||||||
Common Stocks – 93.4% | ||||||||
SHARES | VALUE | |||||||
COMMUNICATION SERVICES – 6.5% | ||||||||
ENTERTAINMENT - 3.3% | ||||||||
CuriosityStream Cl. A 1,3 | 117,700 | $ | 1,605,428 | |||||
†LiveXLive Media 1 | 482,000 | 2,275,040 | ||||||
†Motorsport Games Cl. A 1 | 62,200 | 870,800 | ||||||
Score Media and Gaming Cl. A 1 | 30,200 | 605,657 | ||||||
Sea Cl. A ADR 1 | 23,000 | 6,315,800 | ||||||
11,672,725 | ||||||||
INTERACTIVE MEDIA & SERVICES - 3.2% | ||||||||
Enthusiast Gaming Holdings 1 | 1,964,800 | 11,665,802 | ||||||
Total (Cost $9,906,475) | 23,338,527 | |||||||
CONSUMER DISCRETIONARY – 8.5% | ||||||||
DIVERSIFIED CONSUMER SERVICES - 0.8% | ||||||||
Aspen Group 1 | 450,000 | 2,934,000 | ||||||
HOTELS, RESTAURANTS & LEISURE - 2.3% | ||||||||
†Bragg Gaming Group 1 | 11,400 | 121,210 | ||||||
DraftKings Cl. A 1,3 | 12,000 | 626,040 | ||||||
NEOGAMES 1 | 19,000 | 1,167,930 | ||||||
Papa John’s International | 22,000 | 2,297,680 | ||||||
Rush Street Interactive Cl. A 1,3 | 145,000 | 1,777,700 | ||||||
Texas Roadhouse | 23,000 | 2,212,600 | ||||||
8,203,160 | ||||||||
HOUSEHOLD DURABLES - 1.8% | ||||||||
Lovesac Company (The) 1,3 | 50,666 | 4,042,640 | ||||||
Purple Innovation 1 | 94,000 | 2,482,540 | ||||||
6,525,180 | ||||||||
INTERNET & DIRECT MARKETING RETAIL - 0.8% | ||||||||
CarParts.com 1,3 | 128,000 | 2,606,080 | ||||||
LEISURE PRODUCTS - 0.6% | ||||||||
Callaway Golf 1 | 58,000 | 1,956,340 | ||||||
SPECIALTY RETAIL - 2.2% | ||||||||
†Leslie’s 1 | 126,500 | 3,477,485 | ||||||
Lithia Motors Cl. A | 13,000 | 4,467,320 | ||||||
7,944,805 | ||||||||
Total (Cost $22,070,532) | 30,169,565 | |||||||
CONSUMER STAPLES – 1.4% | ||||||||
FOOD & STAPLES RETAILING - 0.4% | ||||||||
MedAvail Holdings 1,3 | 116,740 | 1,430,065 | ||||||
FOOD PRODUCTS - 0.4% | ||||||||
Freshpet 1 | 8,000 | 1,303,680 | ||||||
HOUSEHOLD PRODUCTS - 0.6% | ||||||||
†Central Garden & Pet Cl. A 1 | 45,000 | 2,173,500 | ||||||
Total (Cost $3,761,894) | 4,907,245 | |||||||
FINANCIALS – 6.1% | ||||||||
BANKS - 2.5% | ||||||||
Primis Financial | 4,000 | 61,040 | ||||||
Seacoast Banking Corporation of Florida | 82,000 | 2,800,300 | ||||||
TriState Capital Holdings 1 | 124,057 | 2,529,522 | ||||||
†Triumph Bancorp 1 | 48,000 | 3,564,000 | ||||||
8,954,862 | ||||||||
CAPITAL MARKETS - 0.4% | ||||||||
MarketAxess Holdings | 3,000 | 1,390,770 | ||||||
INSURANCE - 1.7% | ||||||||
†BRP Group Cl. A 1,3 | 36,000 | 959,400 | ||||||
†Metromile 1,3 | 150,000 | 1,372,500 | ||||||
†Trean Insurance Group 1 | 170,800 | 2,575,664 | ||||||
†Trupanion 1 | 10,000 | 1,151,000 | ||||||
6,058,564 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 47 |
Schedules of Investments
Royce Smaller-Companies Growth Fund (continued) | ||||||||
SHARES | VALUE | |||||||
FINANCIALS (continued) | ||||||||
INVESTMENT COMPANIES - 1.5% | ||||||||
†Rodgers Silicon Valley Acquisition 1,3 | 125,000 | $ | 2,871,250 | |||||
†Trident Acquisitions 1,3 | 192,000 | 2,424,960 | ||||||
5,296,210 | ||||||||
Total (Cost $18,185,209) | 21,700,406 | |||||||
HEALTH CARE – 30.2% | ||||||||
BIOTECHNOLOGY - 8.0% | ||||||||
Avid Bioservices 1 | 231,000 | 5,925,150 | ||||||
†BiomX 1,3 | 359,000 | 1,960,140 | ||||||
CareDx 1 | 70,000 | 6,406,400 | ||||||
†Krystal Biotech 1,3 | 22,000 | 1,496,000 | ||||||
MeiraGTx Holdings 1 | 190,000 | 2,945,000 | ||||||
Oxford Biomedica 1 | 224,000 | 4,028,170 | ||||||
PureTech Health 1 | 846,000 | 3,990,627 | ||||||
†Synlogic 1 | 484,041 | 1,882,919 | ||||||
28,634,406 | ||||||||
HEALTH CARE EQUIPMENT & SUPPLIES - 12.0% | ||||||||
Alphatec Holdings 1 | 304,000 | 4,657,280 | ||||||
Axonics 1,3 | 47,000 | 2,980,270 | ||||||
CryoPort 1 | 23,198 | 1,463,794 | ||||||
CytoSorbents Corporation 1 | 137,000 | 1,034,350 | ||||||
InMode 1 | 87,000 | 8,237,160 | ||||||
Itamar Medical ADR 1,3 | 63,000 | 1,483,650 | ||||||
Neuronetics 1 | 243,500 | 3,900,870 | ||||||
Profound Medical 1 | 92,000 | 1,498,451 | ||||||
†SeaSpine Holdings 1 | 128,000 | 2,625,280 | ||||||
†Semler Scientific 1,2 | 16,000 | 1,788,640 | ||||||
SI-BONE 1 | 82,000 | 2,580,540 | ||||||
STAAR Surgical 1 | 54,000 | 8,235,000 | ||||||
West Pharmaceutical Services | 6,000 | 2,154,600 | ||||||
42,639,885 | ||||||||
HEALTH CARE PROVIDERS & SERVICES - 6.9% | ||||||||
Addus HomeCare 1 | 25,000 | 2,181,000 | ||||||
Joint Corp. (The) 1,3 | 45,000 | 3,776,400 | ||||||
ModivCare 1 | 32,000 | 5,442,240 | ||||||
Pennant Group 1 | 68,000 | 2,781,200 | ||||||
PetIQ Cl. A 1,3 | 72,000 | 2,779,200 | ||||||
Progyny 1 | 52,000 | 3,068,000 | ||||||
Sharps Compliance 1,3 | 284,000 | 2,925,200 | ||||||
Vivos Therapeutics 1 | 348,000 | 1,722,600 | ||||||
24,675,840 | ||||||||
HEALTH CARE TECHNOLOGY - 1.3% | ||||||||
CareCloud 1,3 | 284,000 | 2,391,280 | ||||||
Schrodinger 1,3 | 30,100 | 2,275,861 | ||||||
4,667,141 | ||||||||
LIFE SCIENCES TOOLS & SERVICES - 2.0% | ||||||||
Harvard Bioscience 1 | 213,600 | 1,779,288 | ||||||
†Inotiv 1 | 105,796 | 2,822,637 | ||||||
Medpace Holdings 1 | 15,000 | 2,649,450 | ||||||
7,251,375 | ||||||||
Total (Cost $60,332,417) | 107,868,647 | |||||||
INDUSTRIALS – 12.9% | ||||||||
AEROSPACE & DEFENSE - 1.7% | ||||||||
AeroVironment 1 | 31,000 | 3,104,650 | ||||||
Kratos Defense & Security Solutions 1 | 101,000 | 2,877,490 | ||||||
5,982,140 | ||||||||
COMMERCIAL SERVICES & SUPPLIES - 1.0% | ||||||||
†ACV Auctions Cl. A 1 | 40,000 | 1,025,200 | ||||||
†VSE Corporation | 53,000 | 2,624,030 | ||||||
3,649,230 | ||||||||
CONSTRUCTION & ENGINEERING - 0.6% | ||||||||
†Ameresco Cl. A 1 | 36,000 | 2,257,920 | ||||||
ELECTRICAL EQUIPMENT - 2.6% | ||||||||
American Superconductor 1 | 226,349 | 3,936,209 | ||||||
EnerSys | 29,000 | 2,834,170 | ||||||
Eos Energy Enterprises 1,3 | 111,000 | 1,993,560 | ||||||
†GrafTech International | 50,000 | 581,000 | ||||||
9,344,939 | ||||||||
MACHINERY - 2.6% | ||||||||
ATS Automation Tooling Systems 1 | 193,000 | 5,539,642 | ||||||
Chart Industries 1 | 26,000 | 3,804,320 | ||||||
9,343,962 | ||||||||
PROFESSIONAL SERVICES - 2.0% | ||||||||
ASGN 1,3 | 26,000 | 2,520,180 | ||||||
Atlas Technical Consultants Cl. A 1 | 256,000 | 2,478,080 | ||||||
GP Strategies 1 | 143,282 | 2,252,393 | ||||||
7,250,653 | ||||||||
TRADING COMPANIES & DISTRIBUTORS - 2.4% | ||||||||
Lawson Products 1 | 157,000 | 8,401,070 | ||||||
Total (Cost $31,684,607) | 46,229,914 | |||||||
INFORMATION TECHNOLOGY – 25.3% | ||||||||
COMMUNICATIONS EQUIPMENT - 0.2% | ||||||||
†Genasys 1 | 104,000 | 569,920 | ||||||
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS - 5.2% | ||||||||
Advanced Energy Industries | 34,000 | 3,832,140 | ||||||
Iteris 1 | 1,287,474 | 8,561,702 | ||||||
nLIGHT 1 | 91,000 | 3,301,480 | ||||||
Rogers Corporation 1 | 14,000 | 2,811,200 | ||||||
18,506,522 | ||||||||
IT SERVICES - 4.4% | ||||||||
Cantaloupe 1 | 428,996 | 5,087,893 | ||||||
Unisys Corporation 1 | 426,900 | 10,804,839 | ||||||
15,892,732 | ||||||||
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 9.9% | ||||||||
Ambarella 1 | 50,000 | 5,331,500 | ||||||
AXT 1 | 216,400 | 2,376,072 | ||||||
Canadian Solar 1,3 | 68,000 | 3,049,120 | ||||||
CyberOptics Corporation 1 | 79,000 | 3,235,840 | ||||||
Impinj 1,3 | 61,000 | 3,146,990 | ||||||
Lattice Semiconductor 1 | 39,000 | 2,191,020 | ||||||
MagnaChip Semiconductor 1 | 403,461 | 9,626,579 | ||||||
Onto Innovation 1 | 43,000 | 3,140,720 | ||||||
Silicon Laboratories 1 | 22,000 | 3,371,500 | ||||||
35,469,341 | ||||||||
SOFTWARE - 5.6% | ||||||||
Agilysys 1 | 99,000 | 5,630,130 | ||||||
Coupa Software 1 | 5,000 | 1,310,550 | ||||||
Descartes Systems Group (The) 1 | 65,033 | 4,497,682 | ||||||
LivePerson 1,3 | 59,000 | 3,731,160 | ||||||
Paylocity Holding Corporation 1,3 | 9,786 | 1,867,169 | ||||||
RingCentral Cl. A 1 | 4,000 | 1,162,320 | ||||||
Veritone 1 | 90,000 | 1,773,900 | ||||||
19,972,911 | ||||||||
Total (Cost $46,766,477) | 90,411,426 |
48 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce Smaller-Companies Growth Fund (continued) | ||||||||
SHARES | VALUE | |||||||
MATERIALS – 1.6% | ||||||||
CHEMICALS - 1.2% | ||||||||
†Danimer Scientific Cl. A 1 | 84,000 | $ | 2,104,200 | |||||
NanoXplore 1 | 611,000 | 2,203,267 | ||||||
4,307,467 | ||||||||
METALS & MINING - 0.4% | ||||||||
†ioneer 1 | 6,000,000 | 1,574,896 | ||||||
Total (Cost $5,575,686) | 5,882,363 | |||||||
REAL ESTATE – 0.9% | ||||||||
EQUITY REAL ESTATE INVESTMENT TRUSTS (REITS) - 0.9% | ||||||||
Postal Realty Trust Cl. A | 170,000 | 3,100,800 | ||||||
Total (Cost $2,830,846) | 3,100,800 | |||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $201,114,143) | 333,608,893 | |||||||
REPURCHASE AGREEMENT– 6.8% | ||||||||
Fixed Income Clearing Corporation, 0.00% dated 6/30/21, due 7/1/21, maturity value $24,389,873 (collateralized by obligations of various U.S. Government Agencies, 1.25% due 6/30/28, valued at $24,877,739) | ||||||||
(Cost $24,389,873) | 24,389,873 | |||||||
COLLATERAL RECEIVED FOR SECURITIES LOANED – 3.7% | ||||||||
Money Market Funds | ||||||||
Federated Government Obligations Fund - Institutional Shares (7 day yield-0.01%) | ||||||||
(Cost $13,108,421) | 13,108,421 | |||||||
TOTAL INVESTMENTS – 103.9% | ||||||||
(Cost $238,612,437) | 371,107,187 | |||||||
LIABILITIES LESS CASH AND OTHER ASSETS – (3.9)% | (14,088,229 | ) | ||||||
NET ASSETS – 100.0% | $ | 357,018,958 |
Royce Special Equity Fund | ||||||||
Common Stocks – 85.4% | ||||||||
SHARES | VALUE | |||||||
COMMUNICATION SERVICES – 2.5% | ||||||||
MEDIA - 2.5% | ||||||||
Meredith Corporation 1 | 643,000 | $ | 27,931,920 | |||||
Total (Cost $18,775,544) | 27,931,920 | |||||||
CONSUMER DISCRETIONARY – 20.1% | ||||||||
AUTO COMPONENTS - 5.7% | ||||||||
Gentex Corporation | 468,200 | 15,492,738 | ||||||
Standard Motor Products | 1,105,000 | 47,901,750 | ||||||
63,394,488 | ||||||||
AUTOMOBILES - 1.9% | ||||||||
Winnebago Industries | 316,500 | 21,509,340 | ||||||
HOTELS, RESTAURANTS & LEISURE - 0.3% | ||||||||
Bowl America Cl. A 1,5 | 325,000 | 2,863,250 | ||||||
HOUSEHOLD DURABLES - 6.4% | ||||||||
Flexsteel Industries 5 | 767,500 | 30,999,325 | ||||||
Hooker Furniture 5 | 1,137,000 | 39,385,680 | ||||||
70,385,005 | ||||||||
LEISURE PRODUCTS - 4.7% | ||||||||
Johnson Outdoors Cl. A | 432,000 | 52,272,000 | ||||||
TEXTILES, APPAREL & LUXURY GOODS - 1.1% | ||||||||
Movado Group | 372,900 | 11,735,163 | ||||||
Total (Cost $151,063,460) | 222,159,246 | |||||||
CONSUMER STAPLES – 8.2% | ||||||||
FOOD & STAPLES RETAILING - 3.8% | ||||||||
†Ingles Markets Cl. A | 722,500 | 42,100,075 | ||||||
FOOD PRODUCTS - 4.4% | ||||||||
John B. Sanfilippo & Son | 539,500 | 47,783,515 | ||||||
Total (Cost $82,651,431) | 89,883,590 | |||||||
FINANCIALS – 5.4% | ||||||||
CAPITAL MARKETS - 5.4% | ||||||||
†BrightSphere Investment Group | 923,000 | 21,625,890 | ||||||
Diamond Hill Investment Group | 139,500 | 23,339,745 | ||||||
†Federated Hermes Cl. B | 422,500 | 14,326,975 | ||||||
Total (Cost $50,940,554) | 59,292,610 | |||||||
HEALTH CARE – 2.0% | ||||||||
BIOTECHNOLOGY - 2.0% | ||||||||
United Therapeutics 1 | 124,500 | 22,336,545 | ||||||
Total (Cost $15,628,188) | 22,336,545 | |||||||
INDUSTRIALS – 24.1% | ||||||||
AEROSPACE & DEFENSE - 3.8% | ||||||||
National Presto Industries 5 | 408,000 | 41,473,200 | ||||||
BUILDING PRODUCTS - 2.3% | ||||||||
Insteel Industries | 182,500 | 5,867,375 | ||||||
†UFP Industries | 261,500 | 19,439,910 | ||||||
25,307,285 | ||||||||
COMMERCIAL SERVICES & SUPPLIES - 1.9% | ||||||||
Ennis | 950,000 | 20,444,000 | ||||||
CONSTRUCTION & ENGINEERING - 3.3% | ||||||||
Argan | 250,000 | 11,947,500 | ||||||
†MYR Group 1 | 215,000 | 19,547,800 | ||||||
†Sterling Construction 1 | 210,000 | 5,067,300 | ||||||
36,562,600 | ||||||||
ELECTRICAL EQUIPMENT - 2.7% | ||||||||
Encore Wire | 227,500 | 17,242,225 | ||||||
Hubbell Incorporated | 65,000 | 12,144,600 | ||||||
29,386,825 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 49 |
Schedules of Investments
Royce Special Equity Fund (continued)
SHARES | VALUE | |||||||
INDUSTRIALS (continued) | ||||||||
MACHINERY - 7.5% | ||||||||
Gencor Industries 1,5 | 1,065,000 | $ | 12,950,400 | |||||
Hurco Companies 5 | 580,000 | 20,300,000 | ||||||
Miller Industries 5 | 696,500 | 27,469,960 | ||||||
Mueller Industries | 515,500 | 22,326,305 | ||||||
83,046,665 | ||||||||
TRADING COMPANIES & DISTRIBUTORS - 2.6% | ||||||||
MSC Industrial Direct Cl. A | 325,000 | 29,162,250 | ||||||
Total (Cost $195,159,329) | 265,382,825 | |||||||
INFORMATION TECHNOLOGY – 15.4% | ||||||||
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS - 2.7% | ||||||||
Vishay Intertechnology | 1,079,200 | 24,335,960 | ||||||
Vishay Precision Group 1 | 152,500 | 5,191,100 | ||||||
29,527,060 | ||||||||
IT SERVICES - 4.0% | ||||||||
Computer Services 2 | 790,800 | 44,482,500 | ||||||
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 8.7% | ||||||||
Axcelis Technologies 1 | 593,500 | 23,989,270 | ||||||
Kulicke & Soffa Industries | 860,000 | 52,632,000 | ||||||
NVE Corporation 5 | 259,000 | 19,178,950 | ||||||
95,800,220 | ||||||||
Total (Cost $79,200,037) | 169,809,780 | |||||||
MATERIALS – 5.2% | ||||||||
CHEMICALS - 4.1% | ||||||||
Huntsman Corporation | 1,700,000 | 45,084,000 | ||||||
CONSTRUCTION MATERIALS - 1.1% | ||||||||
United States Lime & Minerals | 88,500 | 12,309,465 | ||||||
Total (Cost $41,846,104) | 57,393,465 | |||||||
REAL ESTATE – 2.5% | ||||||||
REAL ESTATE MANAGEMENT & DEVELOPMENT - 2.5% | ||||||||
Marcus & Millichap 1 | 717,400 | 27,885,338 | ||||||
Total (Cost $18,963,009) | 27,885,338 | |||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $654,227,656) | 942,075,319 | |||||||
REPURCHASE AGREEMENT– 14.5% | ||||||||
Fixed Income Clearing Corporation, 0.00% dated 6/30/21, due 7/1/21, maturity value $160,575,568 (collateralized by obligations of various U.S. Government Agencies, 1.25% due 6/30/28, valued at $163,787,103) | ||||||||
(Cost $160,575,568) | 160,575,568 | |||||||
TOTAL INVESTMENTS – 99.9% | ||||||||
(Cost $814,803,224) | 1,102,650,887 | |||||||
CASH AND OTHER ASSETS LESS LIABILITIES – 0.1% | 888,358 | |||||||
NET ASSETS – 100.0% | $ | 1,103,539,245 |
Royce Total Return Fund
Common Stocks – 98.9%
SHARES | VALUE | |||||||
COMMUNICATION SERVICES – 1.7% | ||||||||
DIVERSIFIED TELECOMMUNICATION SERVICES - 0.8% | ||||||||
ATN International | 261,693 | $ | 11,904,415 | |||||
ENTERTAINMENT - 0.9% | ||||||||
World Wrestling Entertainment Cl. A | 256,851 | 14,869,104 | ||||||
Total (Cost $19,907,550) | 26,773,519 | |||||||
CONSUMER DISCRETIONARY – 7.2% | ||||||||
AUTO COMPONENTS - 1.4% | ||||||||
Gentex Corporation | 367,584 | 12,163,354 | ||||||
LCI Industries | 76,885 | 10,104,227 | ||||||
22,267,581 | ||||||||
HOTELS, RESTAURANTS & LEISURE - 1.5% | ||||||||
†Denny's Corporation 1 | 1,131,800 | 18,663,382 | ||||||
Hyatt Hotels Cl. A 1 | 58,253 | 4,522,763 | ||||||
23,186,145 | ||||||||
HOUSEHOLD DURABLES - 0.9% | ||||||||
Leggett & Platt | 258,940 | 13,415,681 | ||||||
TEXTILES, APPAREL & LUXURY GOODS - 3.4% | ||||||||
Levi Strauss & Co. Cl. A | 966,431 | 26,789,468 | ||||||
Ralph Lauren Cl. A | 211,936 | 24,968,180 | ||||||
51,757,648 | ||||||||
Total (Cost $73,954,660) | 110,627,055 | |||||||
CONSUMER STAPLES – 2.8% | ||||||||
FOOD PRODUCTS - 0.0% | ||||||||
Hershey Creamery 2 | 158 | 632,000 | ||||||
HOUSEHOLD PRODUCTS - 2.8% | ||||||||
Reynolds Consumer Products | 660,565 | 20,048,148 | ||||||
Spectrum Brands Holdings | 271,926 | 23,124,587 | ||||||
43,172,735 | ||||||||
Total (Cost $35,285,771) | 43,804,735 | |||||||
ENERGY – 2.9% | ||||||||
ENERGY EQUIPMENT & SERVICES - 2.9% | ||||||||
†Cactus Cl. A | 547,600 | 20,107,872 | ||||||
†ChampionX 1 | 175,500 | 4,501,575 | ||||||
Computer Modelling Group | 1,435,056 | 5,915,728 | ||||||
Pason Systems | 1,115,676 | 8,037,259 | ||||||
TGS | 502,068 | 6,399,652 | ||||||
Total (Cost $45,242,954) | 44,962,086 | |||||||
FINANCIALS – 40.6% | ||||||||
BANKS - 20.2% | ||||||||
†Atlantic Capital Bancshares 1 | 225,300 | 5,736,138 | ||||||
Bank of N.T. Butterfield & Son | 630,512 | 22,351,650 | ||||||
BankUnited | 523,372 | 22,342,751 | ||||||
BOK Financial | 203,495 | 17,622,667 | ||||||
†CapStar Financial Holdings | 176,500 | 3,618,250 | ||||||
†CBTX | 152,000 | 4,151,120 | ||||||
†First Bancshares (The) | 297,000 | 11,116,710 | ||||||
First Citizens BancShares Cl. A | 21,403 | 17,823,134 | ||||||
First Hawaiian | 686,675 | 19,460,369 | ||||||
HBT Financial | 405,244 | 7,055,298 | ||||||
†Heritage Commerce | 319,200 | 3,552,696 | ||||||
Home BancShares | 942,522 | 23,261,443 | ||||||
†HomeTrust Bancshares | 127,400 | 3,554,460 | ||||||
Independent Bank Group | 397,691 | 29,421,180 | ||||||
OceanFirst Financial | 351,270 | 7,320,467 | ||||||
†Origin Bancorp | 392,500 | 16,665,550 | ||||||
†Preferred Bank | 83,100 | 5,257,737 | ||||||
†Primis Financial | 206,800 | 3,155,768 |
50 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce Total Return Fund (continued)
SHARES | VALUE | |||||||
FINANCIALS (continued) | ||||||||
BANKS (continued) | ||||||||
†QCR Holdings | 147,800 | $ | 7,107,702 | |||||
Signature Bank | 57,413 | 14,103,503 | ||||||
†Southern First Bancshares 1 | 65,400 | 3,345,864 | ||||||
†TowneBank | 323,600 | 9,843,912 | ||||||
Triumph Bancorp 1 | 327,562 | 24,321,479 | ||||||
UMB Financial | 137,611 | 12,806,080 | ||||||
Valley National Bancorp | 1,301,723 | 17,482,140 | ||||||
312,478,068 | ||||||||
CAPITAL MARKETS - 5.1% | ||||||||
Ares Management Cl. A | 204,033 | 12,974,459 | ||||||
Artisan Partners Asset Management Cl. A | 369,269 | 18,766,251 | ||||||
Ashmore Group | 321,022 | 1,709,668 | ||||||
Lazard Cl. A | 200,587 | 9,076,562 | ||||||
Moelis & Company Cl. A | 250,305 | 14,239,851 | ||||||
Sprott | 217,831 | 8,573,713 | ||||||
TMX Group | 126,404 | 13,352,162 | ||||||
78,692,666 | ||||||||
DIVERSIFIED FINANCIAL SERVICES - 2.4% | ||||||||
Compass Diversified Holdings | 1,162,793 | 29,651,222 | ||||||
Equitable Holdings | 271,054 | 8,253,594 | ||||||
37,904,816 | ||||||||
INSURANCE - 12.9% | ||||||||
AMERISAFE | 218,356 | 13,033,670 | ||||||
Assured Guaranty | 266,400 | 12,648,672 | ||||||
Axis Capital Holdings | 499,684 | 24,489,513 | ||||||
First American Financial | 315,660 | 19,681,401 | ||||||
Hanover Insurance Group | 62,031 | 8,413,885 | ||||||
†International General Insurance Holdings | 477,801 | 4,443,549 | ||||||
James River Group Holdings | 751,492 | 28,195,980 | ||||||
Old Republic International | 543,500 | 13,538,585 | ||||||
ProAssurance Corporation | 670,034 | 15,243,273 | ||||||
RenaissanceRe Holdings | 104,200 | 15,507,044 | ||||||
Stewart Information Services | 346,000 | 19,614,740 | ||||||
†Trean Insurance Group 1 | 1,631,715 | 24,606,262 | ||||||
199,416,574 | ||||||||
Total (Cost $453,966,043) | 628,492,124 | |||||||
HEALTH CARE – 0.8% | ||||||||
HEALTH CARE PROVIDERS & SERVICES - 0.8% | ||||||||
Patterson Companies | 383,842 | 11,664,958 | ||||||
Total (Cost $7,285,802) | 11,664,958 | |||||||
INDUSTRIALS – 22.6% | ||||||||
BUILDING PRODUCTS - 2.6% | ||||||||
Fortune Brands Home & Security | 164,792 | 16,414,931 | ||||||
UFP Industries | 326,016 | 24,236,030 | ||||||
40,650,961 | ||||||||
COMMERCIAL SERVICES & SUPPLIES - 3.1% | ||||||||
Deluxe Corporation | 495,231 | 23,657,185 | ||||||
Healthcare Services Group | 782,509 | 24,703,809 | ||||||
48,360,994 | ||||||||
ELECTRICAL EQUIPMENT - 3.6% | ||||||||
GrafTech International | 1,701,600 | 19,772,592 | ||||||
Hubbell Incorporated | 66,834 | 12,487,264 | ||||||
†nVent Electric | 723,100 | 22,589,644 | ||||||
54,849,500 | ||||||||
INDUSTRIAL CONGLOMERATES - 1.9% | ||||||||
Carlisle Companies | 149,967 | 28,700,684 |
MACHINERY - 5.7% | ||||||||
Crane Company | 272,986 | 25,215,717 | ||||||
Douglas Dynamics | 207,400 | 8,439,106 | ||||||
Lincoln Electric Holdings | 109,444 | 14,414,869 | ||||||
Lindsay Corporation | 47,857 | 7,909,805 | ||||||
Mueller Industries | 226,865 | 9,825,523 | ||||||
Timken Company (The) | 284,711 | 22,944,860 | ||||||
88,749,880 | ||||||||
PROFESSIONAL SERVICES - 1.1% | ||||||||
KBR | 456,759 | 17,425,356 | ||||||
ROAD & RAIL - 0.5% | ||||||||
Werner Enterprises | 164,137 | 7,307,379 | ||||||
TRADING COMPANIES & DISTRIBUTORS - 4.1% | ||||||||
Applied Industrial Technologies | 22,700 | 2,067,062 | ||||||
Global Industrial | 355,933 | 13,066,300 | ||||||
Lawson Products 1 | 60,600 | 3,242,706 | ||||||
McGrath RentCorp | 77,008 | 6,281,543 | ||||||
MSC Industrial Direct Cl. A | 292,880 | 26,280,122 | ||||||
Watsco | 44,468 | 12,746,308 | ||||||
63,684,041 | ||||||||
Total (Cost $219,754,150) | 349,728,795 | |||||||
INFORMATION TECHNOLOGY – 8.4% | ||||||||
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS - 4.2% | ||||||||
Avnet | 467,330 | 18,730,586 | ||||||
PC Connection | 220,844 | 10,218,452 | ||||||
†Vontier Corporation | 1,118,700 | 36,447,246 | ||||||
65,396,284 | ||||||||
IT SERVICES - 1.5% | ||||||||
EVERTEC | 458,800 | 20,026,620 | ||||||
Hackett Group (The) | 155,832 | 2,808,093 | ||||||
22,834,713 | ||||||||
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT - 1.9% | ||||||||
Kulicke & Soffa Industries | 340,253 | 20,823,484 | ||||||
MKS Instruments | 49,201 | 8,755,318 | ||||||
29,578,802 | ||||||||
SOFTWARE - 0.8% | ||||||||
†CDK Global | 258,800 | 12,859,772 | ||||||
Total (Cost $95,222,101) | 130,669,571 | |||||||
MATERIALS – 9.5% | ||||||||
CHEMICALS - 5.6% | ||||||||
Chase Corporation | 78,156 | 8,019,587 | ||||||
Element Solutions | 1,246,302 | 29,138,541 | ||||||
Innospec | 215,927 | 19,565,145 | ||||||
Minerals Technologies | 337,697 | 26,566,623 | ||||||
Quaker Chemical | 13,273 | 3,148,223 | ||||||
86,438,119 | ||||||||
CONTAINERS & PACKAGING - 3.7% | ||||||||
AptarGroup | 53,387 | 7,519,025 | ||||||
Graphic Packaging Holding Company | 1,511,334 | 27,415,599 | ||||||
Silgan Holdings | 529,254 | 21,964,041 | ||||||
56,898,665 | ||||||||
METALS & MINING - 0.2% | ||||||||
Ferroglobe (Warranty Insurance Trust) 1,4 | 569,803 | 0 | ||||||
Gold Fields ADR | 453,801 | 4,038,829 | ||||||
4,038,829 | ||||||||
Total (Cost $103,732,894) | 147,375,613 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 51 |
June 30, 2021 (unaudited)
Schedules of Investments
Royce Total Return Fund (continued)
SHARES | VALUE | |||||||
REAL ESTATE – 2.4% | ||||||||
EQUITY REAL ESTATE INVESTMENT TRUSTS (REITS) - 1.0% | ||||||||
†Equity Commonwealth | 574,300 | $ | 15,046,660 | |||||
REAL ESTATE MANAGEMENT & DEVELOPMENT - 1.4% | ||||||||
Kennedy-Wilson Holdings | 1,123,505 | 22,324,044 | ||||||
Total (Cost $37,293,962) | 37,370,704 | |||||||
TOTAL COMMON STOCKS | ||||||||
(Cost $1,091,645,887) | 1,531,469,160 | |||||||
PREFERRED STOCK - 0.1% | ||||||||
Chicken Soup For The Soul Entertainment | ||||||||
9.75% Ser. A | 74,883 | 2,137,910 | ||||||
(Cost $1,884,656) | 2,137,910 | |||||||
REPURCHASE AGREEMENT– 1.1% | ||||||||
Fixed Income Clearing Corporation, 0.00% dated 6/30/21, due 7/1/21, maturity value $16,613,576 (collateralized by obligations of various U.S. Government Agencies, 1.25% due 6/30/28, valued at $16,945,885) | ||||||||
(Cost $16,613,576) | 16,613,576 | |||||||
TOTAL INVESTMENTS – 100.1% | ||||||||
(Cost $1,110,144,119) | 1,550,220,646 | |||||||
LIABILITIES LESS CASH AND OTHER ASSETS – (0.1)% | (963,947 | ) | ||||||
NET ASSETS – 100.0% | $ | 1,549,256,699 |
ADR- American Depository Receipt
† | New additions in 2021. |
1 | Non-income producing. |
2 | These securities are defined as Level 2 securities due to fair value being based on quoted prices for similar securities. See Notes to Financial Statements. |
3 | All or a portion of these securities were on loan at June 30, 2021. |
Securities of Royce International Premier Fund are categorized by the country of their headquarters.
Bold indicates a Fund’s 20 largest equity holdings in terms of June 30, 2021, market value.
52 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
Statements of Assets and Liabilities | June 30, 2021 (unaudited) |
Royce Dividend Value Fund | Royce Global Financial Services Fund | Royce International Premier Fund | Royce Micro-Cap Fund | |||||||||||||
ASSETS: | ||||||||||||||||
Investments at value (including collateral on loaned securities)1 | ||||||||||||||||
Non-Affiliated Companies | $ | 71,679,673 | $ | 38,039,460 | $ | 1,229,556,329 | $ | 399,759,391 | ||||||||
Repurchase agreements (at cost and value) | 6,490,181 | 4,648,074 | 50,003,917 | 16,721,174 | ||||||||||||
Cash | — | — | — | 20,732 | ||||||||||||
Foreign currency2 | — | 7,382 | 307,526 | 21,955 | ||||||||||||
Receivable for investments sold | — | — | 885,940 | 2,678,037 | ||||||||||||
Receivable for capital shares sold | 18,591 | 26,385 | 1,839,715 | 47,676 | ||||||||||||
Receivable for dividends | 102,373 | 69,770 | 2,500,798 | 178,500 | ||||||||||||
Receivable for securities lending income | — | — | — | 1,300 | ||||||||||||
Prepaid expenses and other assets | 2,056 | 843 | 24,687 | 8,036 | ||||||||||||
Total Assets | 78,292,874 | 42,791,914 | 1,285,118,912 | 419,436,801 | ||||||||||||
LIABILITIES: | ||||||||||||||||
Payable for collateral on loaned securities | — | — | — | 189,300 | ||||||||||||
Payable for investments purchased | — | — | 2,296,285 | 873,642 | ||||||||||||
Payable for capital shares redeemed | 28,610 | 624 | 4,763,878 | 81,680 | ||||||||||||
Payable for investment advisory fees | 55,298 | 35,592 | 1,002,518 | 343,146 | ||||||||||||
Payable for trustees’ fees | 2,859 | 1,175 | 33,108 | 11,455 | ||||||||||||
Accrued expenses | 54,004 | 49,470 | 329,565 | 183,580 | ||||||||||||
Deferred capital gains tax | — | 190 | 40,839 | — | ||||||||||||
Total Liabilities | 140,771 | 87,051 | 8,466,193 | 1,682,803 | ||||||||||||
Net Assets | $ | 78,152,103 | $ | 42,704,863 | $ | 1,276,652,719 | $ | 417,753,998 | ||||||||
ANALYSIS OF NET ASSETS: | ||||||||||||||||
Paid-in capital | $ | 25,677,207 | $ | 24,204,776 | $ | 961,679,375 | $ | 194,255,960 | ||||||||
Total distributable earnings (loss) | 52,474,896 | 18,500,087 | 314,973,344 | 223,498,038 | ||||||||||||
Net Assets | $ | 78,152,103 | $ | 42,704,863 | $ | 1,276,652,719 | $ | 417,753,998 | ||||||||
Investment Class | $ | 55,614,607 | $ | 502,808,608 | $ | 201,820,706 | ||||||||||
Service Class | 20,191,643 | $ | 33,582,741 | 65,281,664 | 199,404,346 | |||||||||||
Consultant Class | 1,408,369 | 9,464,931 | 16,528,946 | |||||||||||||
Institutional Class | 937,484 | 9,122,122 | 699,097,516 | |||||||||||||
SHARES OUTSTANDING (unlimited number of $.001 par value): | ||||||||||||||||
Investment Class | 7,810,195 | 26,758,071 | 12,645,368 | |||||||||||||
Service Class | 2,733,096 | 2,675,818 | 2,908,085 | 12,803,979 | ||||||||||||
Consultant Class | 166,368 | 396,894 | 1,378,968 | |||||||||||||
Institutional Class | 133,817 | 560,930 | 37,169,972 | |||||||||||||
NET ASSET VALUES (Net Assets ÷ Shares Outstanding): | ||||||||||||||||
Investment Class3 | $ | 7.12 | $ | 18.79 | $ | 15.96 | ||||||||||
Service Class3 | 7.39 | $ | 12.55 | 22.45 | 15.57 | |||||||||||
Consultant Class4 | 8.47 | 23.85 | 11.99 | |||||||||||||
Institutional Class5 | 7.01 | 16.26 | 18.81 | |||||||||||||
Investments at identified cost | $ | 28,253,864 | $ | 20,322,967 | $ | 900,309,544 | $ | 235,852,044 | ||||||||
Market value of loaned securities6 | — | — | — | 8,196,314 |
1 | See Notes to Financial Statements for information on non-cash collateral on loaned securities. |
2 | The cost of foreign currency is $7,397 for Royce Global Financial Services Fund, $308,466 for Royce International Premier Fund and $21,961 for Royce Micro-Cap Fund. |
3 | Offering and redemption price per share; shares held less than 30 days may be subject to a 1% redemption fee, or a 2% redemption fee (Royce International Premier Fund), payable to the Fund. |
4 | Offering and redemption price per share; shares held less than 365 days may be subject to a 1% contingent deferred sales charge, payable to Royce Fund Services, LLC. |
5 | Offering and redemption price per share. |
6 | Market value of loaned securities backed by non-cash collateral is as of prior business day. |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 53 |
Statements of Assets and Liabilities
Royce Opportunity Fund | Royce Pennsylvania Mutual Fund | Royce Premier Fund | Royce Small-Cap Value Fund | |||||||||||||
ASSETS: | ||||||||||||||||
Investments at value (including collateral on loaned securities)1 | ||||||||||||||||
Non-Affiliated Companies | $ | 1,987,288,686 | $ | 2,230,091,030 | $ | 1,642,731,717 | $ | 139,399,751 | ||||||||
Affiliated Companies | 10,836,417 | — | — | — | ||||||||||||
Repurchase agreements (at cost and value) | 248,411,316 | 74,543,071 | 142,818,223 | 3,716,925 | ||||||||||||
Cash | 174,292 | — | — | — | ||||||||||||
Receivable for investments sold | 11,462,077 | 6,362,268 | 11,727,959 | 141,125 | ||||||||||||
Receivable for capital shares sold | 10,097,032 | 292,489 | 1,221,666 | 96,106 | ||||||||||||
Receivable for dividends | 481,271 | 1,400,861 | 1,248,039 | 207,354 | ||||||||||||
Receivable for securities lending income | 88,388 | 7,447 | — | 162 | ||||||||||||
Prepaid expenses and other assets | 22,396 | 3,592,503 | 42,133 | 3,108 | ||||||||||||
Total Assets | 2,268,861,875 | 2,316,289,669 | 1,799,789,737 | 143,564,531 | ||||||||||||
LIABILITIES: | ||||||||||||||||
Payable for collateral on loaned securities | 4,438,500 | 10,502,933 | — | 669,300 | ||||||||||||
Payable for investments purchased | 18,105,060 | 6,919,003 | 1,697,558 | 531,992 | ||||||||||||
Payable for capital shares redeemed | 11,394,358 | 929,683 | 1,229,044 | 112,942 | ||||||||||||
Payable for investment advisory fees | 1,825,979 | 1,436,572 | 1,476,413 | 118,338 | ||||||||||||
Payable for trustees’ fees | 39,241 | 64,031 | 58,779 | 4,563 | ||||||||||||
Accrued expenses | 193,356 | 649,557 | 475,374 | 85,052 | ||||||||||||
Total Liabilities | 35,996,494 | 20,501,779 | 4,937,168 | 1,522,187 | ||||||||||||
Net Assets | $ | 2,232,865,381 | $ | 2,295,787,890 | $ | 1,794,852,569 | $ | 142,042,344 | ||||||||
ANALYSIS OF NET ASSETS: | ||||||||||||||||
Paid-in capital | $ | 1,393,650,347 | $ | 1,104,252,386 | $ | 719,375,084 | $ | 100,612,561 | ||||||||
Total distributable earnings (loss) | 839,215,034 | 1,191,535,504 | 1,075,477,485 | 41,429,783 | ||||||||||||
Net Assets | $ | 2,232,865,381 | $ | 2,295,787,890 | $ | 1,794,852,569 | $ | 142,042,344 | ||||||||
Investment Class | $ | 1,543,556,920 | $ | 1,661,901,180 | $ | 1,464,918,782 | $ | 44,247,396 | ||||||||
Service Class | 166,767,930 | 146,836,728 | 32,241,504 | 84,593,318 | ||||||||||||
Consultant Class | 16,438,249 | 260,580,584 | 16,357,055 | 4,459,333 | ||||||||||||
Institutional Class | 452,882,118 | 216,926,336 | 272,670,863 | |||||||||||||
R Class | 53,220,164 | 9,543,062 | 8,664,365 | 8,742,297 | ||||||||||||
SHARES OUTSTANDING (unlimited number of $.001 par value): | ||||||||||||||||
Investment Class | 74,446,584 | 139,163,225 | 97,629,637 | 4,172,253 | ||||||||||||
Service Class | 8,707,300 | 12,325,425 | 2,212,533 | 8,014,029 | ||||||||||||
Consultant Class | 1,001,376 | 27,827,017 | 1,404,945 | 481,604 | ||||||||||||
Institutional Class | 21,335,384 | 18,097,940 | 17,889,422 | |||||||||||||
R Class | 2,908,386 | 859,410 | 630,414 | 866,723 | ||||||||||||
NET ASSET VALUES (Net Assets ÷ Shares Outstanding): | ||||||||||||||||
Investment Class2 | $ | 20.73 | $ | 11.94 | $ | 15.00 | $ | 10.61 | ||||||||
Service Class2 | 19.15 | 11.91 | 14.57 | 10.56 | ||||||||||||
Consultant Class3 | 16.42 | 9.36 | 11.64 | 9.26 | ||||||||||||
Institutional Class4 | 21.23 | 11.99 | 15.24 | |||||||||||||
R Class4 | 18.30 | 11.10 | 13.74 | 10.09 | ||||||||||||
Investments at identified cost | $ | 1,415,608,571 | $ | 1,423,309,587 | $ | 845,470,638 | $ | 97,142,324 | ||||||||
Market value of loaned securities5 | 58,026,220 | 45,734,602 | — | 1,141,014 |
1 | See Notes to Financial Statements for information on non-cash collateral on loaned securities. |
2 | Offering and redemption price per share; shares held less than 30 days may be subject to a 1% redemption fee, payable to the Fund. |
3 | Offering and redemption price per share; shares held less than 365 days may be subject to a 1% contingent deferred sales charge, payable to Royce Fund Services, LLC. |
4 | Offering and redemption price per share. |
5 | Market value of loaned securities backed by non-cash collateral is as of prior business day. |
54 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
June 30, 2021 (unaudited)
Royce Smaller- Companies Growth Fund | Royce Special Equity Fund | Royce Total Return Fund | ||||||||||
ASSETS: | ||||||||||||
Investments at value (including collateral on loaned securities)1 | ||||||||||||
Non-Affiliated Companies | $ | 346,717,314 | $ | 747,454,554 | $ | 1,533,607,070 | ||||||
Affiliated Companies | — | 194,620,765 | — | |||||||||
Repurchase agreements (at cost and value) | 24,389,873 | 160,575,568 | 16,613,576 | |||||||||
Receivable for investments sold | — | 2,233,736 | 8,361,169 | |||||||||
Receivable for capital shares sold | 70,254 | 1,250,772 | 1,266,014 | |||||||||
Receivable for dividends | — | 316,725 | 1,535,362 | |||||||||
Receivable for securities lending income | 166,723 | — | — | |||||||||
Prepaid expenses and other assets | 6,543 | 23,334 | 33,008 | |||||||||
Total Assets | 371,350,707 | 1,106,475,454 | 1,561,416,199 | |||||||||
LIABILITIES: | ||||||||||||
Payable for collateral on loaned securities | 13,108,421 | — | — | |||||||||
Payable for investments purchased | 571,669 | 956,764 | 5,262,264 | |||||||||
Payable for capital shares redeemed | 214,115 | 763,933 | 5,020,768 | |||||||||
Payable for investment advisory fees | 291,220 | 915,704 | 1,298,778 | |||||||||
Payable for trustees’ fees | 9,952 | 33,195 | 46,695 | |||||||||
Accrued expenses | 136,372 | 266,613 | 530,995 | |||||||||
Total Liabilities | 14,331,749 | 2,936,209 | 12,159,500 | |||||||||
Net Assets | $ | 357,018,958 | $ | 1,103,539,245 | $ | 1,549,256,699 | ||||||
ANALYSIS OF NET ASSETS: | ||||||||||||
Paid-in capital | $ | 151,700,805 | $ | 728,024,219 | $ | 831,206,579 | ||||||
Total distributable earnings (loss) | 205,318,153 | 375,515,026 | 718,050,120 | |||||||||
Net Assets | $ | 357,018,958 | $ | 1,103,539,245 | $ | 1,549,256,699 | ||||||
Investment Class | $ | 130,809,461 | $ | 796,976,130 | $ | 1,033,864,278 | ||||||
Service Class | 211,152,086 | 56,300,687 | 87,403,964 | |||||||||
Consultant Class | 8,900,133 | 26,075,968 | 121,436,591 | |||||||||
Institutional Class | 6,157,278 | 224,186,460 | 273,142,424 | |||||||||
R Class | 33,409,442 | |||||||||||
SHARES OUTSTANDING (unlimited number of $.001 par value): | ||||||||||||
Investment Class | 9,932,684 | 38,307,578 | 92,876,284 | |||||||||
Service Class | 16,538,776 | 2,713,202 | 7,615,630 | |||||||||
Consultant Class | 827,773 | 1,382,695 | 10,447,735 | |||||||||
Institutional Class | 460,513 | 10,866,643 | 24,977,595 | |||||||||
R Class | 2,870,241 | |||||||||||
NET ASSET VALUES (Net Assets ÷ Shares Outstanding): | ||||||||||||
Investment Class2 | $ | 13.17 | $ | 20.80 | $ | 11.13 | ||||||
Service Class2 | 12.77 | 20.75 | 11.48 | |||||||||
Consultant Class3 | 10.75 | 18.86 | 11.62 | |||||||||
Institutional Class4 | 13.37 | 20.63 | 10.94 | |||||||||
R Class4 | 11.64 | |||||||||||
Investments at identified cost | $ | 214,222,564 | $ | 654,227,656 | $ | 1,093,530,543 | ||||||
Market value of loaned securities5 | 41,563,519 | — | — |
1 | See Notes to Financial Statements for information on non-cash collateral on loaned securities. |
2 | Offering and redemption price per share; shares held less than 30 days may be subject to a 1% redemption fee, payable to the Fund. |
3 | Offering and redemption price per share; shares held less than 365 days may be subject to a 1% contingent deferred sales charge, payable to Royce Fund Services, LLC. |
4 | Offering and redemption price per share. |
5 | Market value of loaned securities backed by non-cash collateral is as of prior business day. |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 55 |
Statements of Operations
Royce Dividend Value Fund | Royce Global Financial Services Fund | Royce International Premier Fund | Royce Micro-Cap Fund | |||||||||||||
INVESTMENT INCOME: | ||||||||||||||||
INCOME: | ||||||||||||||||
Dividends | ||||||||||||||||
Non-Affiliated Companies | $ | 796,965 | $ | 446,954 | $ | 12,898,681 | $ | 1,798,246 | ||||||||
Affiliated Companies | — | — | 242,990 | — | ||||||||||||
Foreign withholding tax | (30,947 | ) | (27,768 | ) | (1,181,069 | ) | (27,417 | ) | ||||||||
Securities lending | — | — | — | 8,680 | ||||||||||||
Total income | 766,018 | 419,186 | 11,960,602 | 1,779,509 | ||||||||||||
EXPENSES: | ||||||||||||||||
Investment advisory fees | 328,226 | 189,550 | 5,881,882 | 1,996,650 | ||||||||||||
Distribution fees | 31,713 | 36,554 | 125,965 | 318,522 | ||||||||||||
Shareholder servicing | 63,230 | 25,290 | 408,031 | 227,186 | ||||||||||||
Registration | 27,879 | 16,529 | 47,846 | 23,229 | ||||||||||||
Administrative and office facilities | 26,334 | 16,607 | 221,521 | 81,035 | ||||||||||||
Audit | 16,530 | 16,118 | 20,745 | 17,524 | ||||||||||||
Custody | 16,174 | 17,229 | 151,931 | 18,186 | ||||||||||||
Shareholder reports | 7,541 | 2,781 | 105,363 | 39,231 | ||||||||||||
Trustees’ fees | 4,725 | 2,113 | 65,088 | 22,344 | ||||||||||||
Legal | 1,651 | 742 | 23,988 | 7,491 | ||||||||||||
Other expenses | 4,891 | 1,983 | 33,209 | 11,710 | ||||||||||||
Total expenses | 528,894 | 325,496 | 7,085,569 | 2,763,108 | ||||||||||||
Compensating balance credits | (6 | ) | (3 | ) | (243 | ) | (61 | ) | ||||||||
Fees waived by investment adviser and distributor | — | (4,386 | ) | (285,412 | ) | — | ||||||||||
Expenses reimbursed by investment adviser | (76,273 | ) | (38,677 | ) | (207,469 | ) | (411 | ) | ||||||||
Net expenses | 452,615 | 282,430 | 6,592,445 | 2,762,636 | ||||||||||||
Net investment income (loss) | 313,403 | 136,756 | 5,368,157 | (983,127 | ) | |||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY: | ||||||||||||||||
NET REALIZED GAIN (LOSS): | ||||||||||||||||
Investments in Non-Affiliated Companies | 7,610,014 | 956,576 | 19,307,014 | 55,749,109 | ||||||||||||
Investments in Affiliated Companies | — | — | 10,218 | — | ||||||||||||
Foreign currency transactions | 4,097 | 8,020 | (122,535 | ) | 5,812 | |||||||||||
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION): | ||||||||||||||||
Investments in Non-Affiliated Companies | 4,050,525 | 4,781,627 | 51,749,406 | 32,022,692 | ||||||||||||
Investments in Affiliated Companies | — | — | 2,198,260 | — | ||||||||||||
Other assets and liabilities denominated in foreign currency | (11,212 | ) | (1,718 | ) | (51,162 | ) | (39 | ) | ||||||||
Net realized and unrealized gain (loss) on investments and foreign currency | 11,653,424 | 5,744,505 | 73,091,201 | 87,777,574 | ||||||||||||
NET INCREASE (DECREASE) IN NET ASSETS FROM INVESTMENT OPERATIONS | $ | 11,966,827 | $ | 5,881,261 | $ | 78,459,358 | $ | 86,794,447 |
56 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
Six Months Ended June 30, 2021 (unaudited)
Royce Opportunity Fund | Royce Pennsylvania Mutual Fund | Royce Premier Fund | Royce Small-Cap Value Fund | |||||||||||||
INVESTMENT INCOME: | ||||||||||||||||
INCOME: | ||||||||||||||||
Dividends | $ | 8,075,127 | $ | 10,077,813 | $ | 8,908,783 | $ | 947,389 | ||||||||
Foreign withholding tax | — | (130,262 | ) | (106,656 | ) | — | ||||||||||
Interest | 175 | 347,781 | — | — | ||||||||||||
Securities lending | 492,961 | 83,448 | 105,678 | 548 | ||||||||||||
Total income | 8,568,263 | 10,378,780 | 8,907,805 | 947,937 | ||||||||||||
EXPENSES: | ||||||||||||||||
Investment advisory fees | 9,623,275 | 8,333,063 | 9,075,575 | 695,809 | ||||||||||||
Distribution fees | 412,731 | 1,475,143 | 144,728 | 147,420 | ||||||||||||
Shareholder servicing | 682,564 | 698,655 | 666,260 | 105,029 | ||||||||||||
Registration | 60,035 | 41,760 | 36,418 | 25,385 | ||||||||||||
Administrative and office facilities | 258,151 | 404,543 | 371,746 | 36,398 | ||||||||||||
Audit | 21,831 | 24,286 | 20,787 | 15,095 | ||||||||||||
Custody | 67,895 | 86,252 | 76,414 | 12,841 | ||||||||||||
Shareholder reports | 56,641 | 137,671 | 107,652 | 12,693 | ||||||||||||
Trustees’ fees | 88,752 | 121,485 | 107,505 | 7,994 | ||||||||||||
Legal | 29,622 | 43,955 | 40,333 | 2,551 | ||||||||||||
Other expenses | 35,797 | 89,822 | 60,752 | 6,122 | ||||||||||||
Total expenses | 11,337,294 | 11,456,635 | 10,708,170 | 1,067,337 | ||||||||||||
Compensating balance credits | (100 | ) | (200 | ) | (99 | ) | (16 | ) | ||||||||
Fees waived by distributor | — | (6,267 | ) | — | — | |||||||||||
Expenses reimbursed by investment adviser | — | — | (6,767 | ) | (37,344 | ) | ||||||||||
Net expenses | 11,337,194 | 11,450,168 | 10,701,304 | 1,029,977 | ||||||||||||
Net investment income (loss) | (2,768,931 | ) | (1,071,388 | ) | (1,793,499 | ) | (82,040 | ) | ||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY: | ||||||||||||||||
NET REALIZED GAIN (LOSS): | ||||||||||||||||
Investments in Non-Affiliated Companies | 258,220,093 | 360,073,014 | 227,521,296 | 15,924,082 | ||||||||||||
Investments in Affiliated Companies | (15,787 | ) | — | — | — | |||||||||||
Foreign currency transactions | 1,488 | (25,401 | ) | (63,026 | ) | — | ||||||||||
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION): | ||||||||||||||||
Investments in Non-Affiliated Companies | 190,659,426 | (39,949,208 | ) | (45,764,347 | ) | 11,917,669 | ||||||||||
Investments in Affiliated Companies | 1,579,483 | — | — | — | ||||||||||||
Other assets and liabilities denominated in foreign currency | 16 | 360 | — | — | ||||||||||||
Net realized and unrealized gain (loss) on investments and foreign currency | 450,444,719 | 320,098,765 | 181,693,923 | 27,841,751 | ||||||||||||
NET INCREASE (DECREASE) IN NET ASSETS FROM INVESTMENT OPERATIONS | $ | 447,675,788 | $ | 319,027,377 | $ | 179,900,424 | $ | 27,759,711 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 57 |
Statements of Operations | Six Months Ended June 30, 2021 (unaudited) |
Royce Smaller- Companies Growth Fund | Royce Special Equity Fund | Royce Total Return Fund | ||||||||||
INVESTMENT INCOME: | ||||||||||||
INCOME: | ||||||||||||
Dividends | ||||||||||||
Non-Affiliated Companies | $ | 167,865 | $ | 5,914,891 | $ | 16,015,337 | ||||||
Affiliated Companies | — | 3,924,150 | — | |||||||||
Foreign withholding tax | — | — | (145,189 | ) | ||||||||
Securities lending | 359,309 | — | 25 | |||||||||
Total income | 527,174 | 9,839,041 | 15,870,173 | |||||||||
EXPENSES: | ||||||||||||
Investment advisory fees | 1,750,575 | 5,357,758 | 7,537,428 | |||||||||
Distribution fees | 299,517 | 171,816 | 791,954 | |||||||||
Shareholder servicing | 197,178 | 436,184 | 604,530 | |||||||||
Registration | 29,343 | 39,803 | 41,805 | |||||||||
Administrative and office facilities | 71,585 | 211,646 | 294,325 | |||||||||
Audit | 15,810 | 18,881 | 24,107 | |||||||||
Custody | 14,923 | 41,251 | 58,245 | |||||||||
Shareholder reports | 22,328 | 65,509 | 117,696 | |||||||||
Trustees’ fees | 19,752 | 60,679 | 84,722 | |||||||||
Legal | 8,340 | 22,172 | 80,147 | |||||||||
Other expenses | 10,583 | 51,581 | 53,333 | |||||||||
Total expenses | 2,439,934 | 6,477,280 | 9,688,292 | |||||||||
Compensating balance credits | (43 | ) | (86 | ) | (185 | ) | ||||||
Expenses reimbursed by investment adviser | (13,446 | ) | (28,430 | ) | (3,551 | ) | ||||||
Net expenses | 2,426,445 | 6,448,764 | 9,684,556 | |||||||||
Net investment income (loss) | (1,899,271 | ) | 3,390,277 | 6,185,617 | ||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY: | ||||||||||||
NET REALIZED GAIN (LOSS): | ||||||||||||
Investments in Non-Affiliated Companies | 52,302,849 | 69,123,905 | 233,654,402 | |||||||||
Investments in Affiliated Companies | — | (121,067 | ) | — | ||||||||
Foreign currency transactions | (6,933 | ) | — | 49,256 | ||||||||
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION): | ||||||||||||
Investments in Non-Affiliated Companies | 8,165,418 | 46,529,244 | 21,296,320 | |||||||||
Investments in Affiliated Companies | — | 18,311,054 | — | |||||||||
Other assets and liabilities denominated in foreign currency | (72 | ) | — | (7,267 | ) | |||||||
Net realized and unrealized gain (loss) on investments and foreign currency | 60,461,262 | 133,843,136 | 254,992,711 | |||||||||
NET INCREASE (DECREASE) IN NET ASSETS FROM INVESTMENT OPERATIONS | $ | 58,561,991 | $ | 137,233,413 | $ | 261,178,328 |
58 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
Statements of Changes in Net Assets
Royce Dividend Value Fund | Royce Global Financial Services Fund | Royce International Premier Fund | ||||||||||||||||||||||
Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | |||||||||||||||||||
INVESTMENT OPERATIONS: | ||||||||||||||||||||||||
Net investment income (loss) | $ | 313,403 | $ | 922,919 | $ | 136,756 | $ | 250,118 | $ | 5,368,157 | $ | 2,943,349 | ||||||||||||
Net realized gain (loss) on investments and foreign currency | 7,614,111 | 2,367,798 | 964,596 | 1,465,214 | 19,194,697 | 22,478,465 | ||||||||||||||||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency | 4,039,313 | (4,365,237 | ) | 4,779,909 | 2,115,926 | 53,896,504 | 134,690,339 | |||||||||||||||||
Net increase (decrease) in net assets from investment operations | 11,966,827 | (1,074,520 | ) | 5,881,261 | 3,831,258 | 78,459,358 | 160,112,153 | |||||||||||||||||
DISTRIBUTIONS: | ||||||||||||||||||||||||
Total distributable earnings | �� | |||||||||||||||||||||||
Investment Class | (238,180 | ) | (3,240,413 | ) | — | (1,247,887 | ) | |||||||||||||||||
Service Class | (55,615 | ) | (1,079,729 | ) | — | (1,687,634 | ) | — | — | |||||||||||||||
Consultant Class | — | (50,593 | ) | — | — | |||||||||||||||||||
Institutional Class | (3,993 | ) | (45,009 | ) | — | (490,704 | ) | — | (1,995,035 | ) | ||||||||||||||
Total distributions | (297,788 | ) | (4,415,744 | ) | — | (2,178,338 | ) | — | (3,242,922 | ) | ||||||||||||||
CAPITAL SHARE TRANSACTIONS: | ||||||||||||||||||||||||
Net capital share transactions | ||||||||||||||||||||||||
Investment Class | (6,107,355 | ) | (18,600,025 | ) | (14,709,524 | ) | 55,751,664 | |||||||||||||||||
Service Class | (2,534,327 | ) | (4,485,993 | ) | 3,156,561 | (5,406,864 | ) | (7,772,922 | ) | (10,968,052 | ) | |||||||||||||
Consultant Class | (18,723 | ) | (320,764 | ) | (255,797 | ) | (1,726,782 | ) | ||||||||||||||||
Institutional Class | 31,573 | (30,118 | ) | — | 478,106 | 88,334,793 | 123,907,508 | |||||||||||||||||
Shareholder redemption fees | ||||||||||||||||||||||||
Investment Class | 75 | 6,074 | 5,058 | 15,694 | ||||||||||||||||||||
Service Class | 3 | 1 | 1,922 | 833 | 739 | 4,735 | ||||||||||||||||||
Net increase (decrease) in net assets from capital share transactions | (8,628,754 | ) | (23,430,825 | ) | 3,158,483 | (4,927,925 | ) | 65,602,347 | 166,984,767 | |||||||||||||||
Net Increase (Decrease) In Net Assets | 3,040,285 | (28,921,089 | ) | 9,039,744 | (3,275,005 | ) | 144,061,705 | 323,853,998 | ||||||||||||||||
NET ASSETS: | ||||||||||||||||||||||||
Beginning of period | 75,111,818 | 104,032,907 | 33,665,119 | 36,940,124 | 1,132,591,014 | 808,737,016 | ||||||||||||||||||
End of period | $ | 78,152,103 | $ | 75,111,818 | $ | 42,704,863 | $ | 33,665,119 | $ | 1,276,652,719 | $ | 1,132,591,014 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 59 |
Statements of Changes in Net Assets
Royce Micro-Cap Fund | Royce Opportunity Fund | Royce Pennsylvania Mutual Fund | ||||||||||||||||||||||
Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | |||||||||||||||||||
INVESTMENT OPERATIONS: | ||||||||||||||||||||||||
Net investment income (loss) | $ | (983,127 | ) | $ | (1,813,798 | ) | $ | (2,768,931 | ) | $ | (2,562,219 | ) | $ | (1,071,388 | ) | $ | 3,704,489 | |||||||
Net realized gain (loss) on investments and foreign currency | 55,754,921 | 23,319,990 | 258,205,794 | 9,918,591 | 360,047,613 | 35,621,900 | ||||||||||||||||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency | 32,022,653 | 44,803,849 | 192,238,925 | 256,040,438 | (39,948,848 | ) | 163,878,166 | |||||||||||||||||
Net increase (decrease) in net assets from investment operations | 86,794,447 | 66,310,041 | 447,675,788 | 263,396,810 | 319,027,377 | 203,204,555 | ||||||||||||||||||
DISTRIBUTIONS: | ||||||||||||||||||||||||
Total distributable earnings | ||||||||||||||||||||||||
Investment Class | — | (12,180,419 | ) | — | — | — | (69,231,208 | ) | ||||||||||||||||
Service Class | — | (11,758,124 | ) | — | — | — | (3,611,159 | ) | ||||||||||||||||
Consultant Class | — | (980,127 | ) | — | — | — | (10,246,820 | ) | ||||||||||||||||
Institutional Class | — | — | — | (8,012,607 | ) | |||||||||||||||||||
R Class | — | — | — | (345,468 | ) | |||||||||||||||||||
Total distributions | — | (24,918,670 | ) | — | — | — | (91,447,262 | ) | ||||||||||||||||
CAPITAL SHARE TRANSACTIONS: | ||||||||||||||||||||||||
Net capital share transactions | ||||||||||||||||||||||||
Investment Class | (14,514,702 | ) | (5,433,235 | ) | 474,483,708 | 24,573,263 | (1,957,778 | ) | (88,625,855 | ) | ||||||||||||||
Service Class | (10,276,162 | ) | (14,965,795 | ) | (7,332,349 | ) | 55,823,736 | 53,059,167 | (63,518,198 | ) | ||||||||||||||
Consultant Class | (898,592 | ) | (1,616,260 | ) | (1,073,022 | ) | 2,345,556 | (15,846,556 | ) | (35,210,467 | ) | |||||||||||||
Institutional Class | 4,266,475 | 40,046,884 | 25,476,166 | 43,371,094 | ||||||||||||||||||||
R Class | 5,806,089 | (2,834,479 | ) | 96,966 | (1,187,456 | ) | ||||||||||||||||||
Shareholder redemption fees | ||||||||||||||||||||||||
Investment Class | 302 | 731 | 22,887 | 4,415 | 694 | 5,223 | ||||||||||||||||||
Service Class | 39 | 2 | 21,977 | 94 | 10,431 | 19 | ||||||||||||||||||
Net increase (decrease) in net assets from capital share transactions | (25,689,115 | ) | (22,014,557 | ) | 476,195,765 | 119,959,469 | 60,839,090 | (145,165,640 | ) | |||||||||||||||
Net Increase (Decrease) In Net Assets | 61,105,332 | 19,376,814 | 923,871,553 | 383,356,279 | 379,866,467 | (33,408,347 | ) | |||||||||||||||||
NET ASSETS: | ||||||||||||||||||||||||
Beginning of period | 356,648,666 | 337,271,852 | 1,308,993,828 | 925,637,549 | 1,915,921,423 | 1,949,329,770 | ||||||||||||||||||
End of period | $ | 417,753,998 | $ | 356,648,666 | $ | 2,232,865,381 | $ | 1,308,993,828 | $ | 2,295,787,890 | $ | 1,915,921,423 |
60 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
Royce Premier Fund | Royce Small-Cap Value Fund | Royce Smaller-Companies Growth Fund | ||||||||||||||||||||||
Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | |||||||||||||||||||
INVESTMENT OPERATIONS: | ||||||||||||||||||||||||
Net investment income (loss) | $ | (1,793,499 | ) | $ | 6,088,084 | $ | (82,040 | ) | $ | 587,163 | $ | (1,899,271 | ) | $ | (2,496,079 | ) | ||||||||
Net realized gain (loss) on investments and foreign currency | 227,458,270 | 116,147,396 | 15,924,082 | (14,605,696 | ) | 52,295,916 | 48,688,482 | |||||||||||||||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency | (45,764,347 | ) | 47,760,937 | 11,917,669 | (4,160,421 | ) | 8,165,346 | 57,485,397 | ||||||||||||||||
Net increase (decrease) in net assets from investment operations | 179,900,424 | 169,996,417 | 27,759,711 | (18,178,954 | ) | 58,561,991 | 103,677,800 | |||||||||||||||||
DISTRIBUTIONS: | ||||||||||||||||||||||||
Total distributable earnings | ||||||||||||||||||||||||
Investment Class | — | (75,818,358 | ) | — | (1,397,547 | ) | — | (10,744,144 | ) | |||||||||||||||
Service Class | — | (1,489,604 | ) | — | (2,901,432 | ) | — | (17,138,595 | ) | |||||||||||||||
Consultant Class | — | (723,891 | ) | — | (118,304 | ) | — | (754,437 | ) | |||||||||||||||
Institutional Class | — | (14,256,624 | ) | — | (526,528 | ) | ||||||||||||||||||
R Class | — | (449,228 | ) | — | (253,771 | ) | ||||||||||||||||||
Total distributions | — | (92,737,705 | ) | — | (4,671,054 | ) | — | (29,163,704 | ) | |||||||||||||||
CAPITAL SHARE TRANSACTIONS: | ||||||||||||||||||||||||
Net capital share transactions | ||||||||||||||||||||||||
Investment Class | (96,897,377 | ) | (144,735,583 | ) | 1,309,427 | (11,132,948 | ) | (3,746,752 | ) | (6,812,104 | ) | |||||||||||||
Service Class | (297,743 | ) | (1,348,855 | ) | (7,835,591 | ) | (13,760,257 | ) | (4,580,357 | ) | (16,079,760 | ) | ||||||||||||
Consultant Class | (855,977 | ) | (2,305,819 | ) | (293,776 | ) | (2,225,129 | ) | (653,740 | ) | (75,431 | ) | ||||||||||||
Institutional Class | (21,330,608 | ) | 488,982 | (549,578 | ) | (3,787,896 | ) | |||||||||||||||||
R Class | (1,663,016 | ) | (1,755,980 | ) | 36,804 | (234,297 | ) | |||||||||||||||||
Shareholder redemption fees | ||||||||||||||||||||||||
Investment Class | 247 | 1,373 | 103 | — | 1,335 | 4 | ||||||||||||||||||
Service Class | — | 83 | 149 | 94 | 1,442 | 257 | ||||||||||||||||||
Net increase (decrease) in net assets from capital share transactions | (121,044,474 | ) | (149,655,799 | ) | (6,782,884 | ) | (27,352,537 | ) | (9,527,650 | ) | (26,754,930 | ) | ||||||||||||
Net Increase (Decrease) In Net Assets | 58,855,950 | (72,397,087 | ) | 20,976,827 | (50,202,545 | ) | 49,034,341 | 47,759,166 | ||||||||||||||||
NET ASSETS: | ||||||||||||||||||||||||
Beginning of period | 1,735,996,619 | 1,808,393,706 | 121,065,517 | 171,268,062 | 307,984,617 | 260,225,451 | ||||||||||||||||||
End of period | $ | 1,794,852,569 | $ | 1,735,996,619 | $ | 142,042,344 | $ | 121,065,517 | $ | 357,018,958 | $ | 307,984,617 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 61 |
Statements of Changes in Net Assets
Royce Special Equity Fund | Royce Total Return Fund | |||||||||||||||
Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | |||||||||||||
INVESTMENT OPERATIONS: | ||||||||||||||||
Net investment income (loss) | $ | 3,390,277 | $ | 14,493,483 | $ | 6,185,617 | $ | 21,768,475 | ||||||||
Net realized gain (loss) on investments and foreign currency | 69,002,838 | 53,147,713 | 233,703,658 | 255,117,502 | ||||||||||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency | 64,840,298 | (16,019,772 | ) | 21,289,053 | (248,636,152 | ) | ||||||||||
Net increase (decrease) in net assets from investment operations | 137,233,413 | 51,621,424 | 261,178,328 | 28,249,825 | ||||||||||||
DISTRIBUTIONS: | ||||||||||||||||
Total distributable earnings | ||||||||||||||||
Investment Class | — | (24,875,767 | ) | (5,670,940 | ) | (163,088,384 | ) | |||||||||
Service Class | — | (1,595,055 | ) | (290,772 | ) | (12,587,274 | ) | |||||||||
Consultant Class | — | (513,029 | ) | (54,278 | ) | (18,324,601 | ) | |||||||||
Institutional Class | — | (7,057,430 | ) | (1,462,953 | ) | (37,383,740 | ) | |||||||||
R Class | (61,017 | ) | (5,028,388 | ) | ||||||||||||
Total distributions | — | (34,041,281 | ) | (7,539,960 | ) | (236,412,387 | ) | |||||||||
CAPITAL SHARE TRANSACTIONS: | ||||||||||||||||
Net capital share transactions | ||||||||||||||||
Investment Class | (5,729,095 | ) | (128,578,387 | ) | (32,927,970 | ) | 9,353,382 | |||||||||
Service Class | 3,136,719 | (15,238,819 | ) | 4,760,297 | 3,463,014 | |||||||||||
Consultant Class | 4,807,564 | (6,046,446 | ) | (9,556,121 | ) | (19,183,979 | ) | |||||||||
Institutional Class | 1,095,489 | 3,602,098 | 23,384,956 | 5,823,751 | ||||||||||||
R Class | (2,355,669 | ) | (1,232,394 | ) | ||||||||||||
Shareholder redemption fees | ||||||||||||||||
Investment Class | 2,158 | 6,740 | 966 | 607 | ||||||||||||
Service Class | 3,074 | 1,954 | 446 | 17 | ||||||||||||
Net increase (decrease) in net assets from capital share transactions | 3,315,909 | (146,252,860 | ) | (16,693,095 | ) | (1,775,602 | ) | |||||||||
Net Increase (Decrease) In Net Assets | 140,549,322 | (128,672,717 | ) | 236,945,273 | (209,938,164 | ) | ||||||||||
NET ASSETS: | ||||||||||||||||
Beginning of period | 962,989,923 | 1,091,662,640 | 1,312,311,426 | 1,522,249,590 | ||||||||||||
End of period | $ | 1,103,539,245 | $ | 962,989,923 | $ | 1,549,256,699 | $ | 1,312,311,426 |
62 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
Financial Highlights
This table is presented to show selected data for a share outstanding throughout each year or other indicated period and to assist shareholders in evaluating a Fund’s performance for the periods presented. Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
Ratio of Expenses to Average Net Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss) | Net Realized and Unrealized Gain (Loss) on Investments and Foreign Currency | Total from Investment Operations | Distributions from Net Investment Income | Distributions from Net Realized Gain on Investments and Foreign Currency | Total Distributions | Net Asset Value, End of Period | Total Return | Net Assets, End of Period (in thousands) | Prior to Fee Waivers, Expense Reimbursements and Balance Credits | Prior to Fee Waivers and Expense Reimbursements | Net of Fee Waivers and Expense Reimbursements | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||||||||||||||
Royce Dividend Value Fund–Investment Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 6.11 | $ | 0.03 | $ | 1.01 | $ | 1.04 | $ | (0.03 | ) | $ | – | $ | (0.03 | ) | $ | 7.12 | 17.03 | %1 | $ | 55,615 | 1.22 | %2 | 1.22 | %2 | 1.09 | %2 | 0.89 | %2 | 0 | % | ||||||||||||||||||||
2020 | 6.21 | 0.07 | 0.20 | 0.27 | (0.11 | ) | (0.26 | ) | (0.37 | ) | 6.11 | 4.57 | 53,421 | 1.26 | 1.26 | 1.09 | 1.27 | 4 | ||||||||||||||||||||||||||||||||||
2019 | 5.56 | 0.09 | 1.58 | 1.67 | (0.10 | ) | (0.92 | ) | (1.02 | ) | 6.21 | 30.34 | 76,273 | 1.21 | 1.20 | 1.09 | 1.37 | 8 | ||||||||||||||||||||||||||||||||||
2018 | 7.56 | 0.10 | (1.27 | ) | (1.17 | ) | (0.10 | ) | (0.73 | ) | (0.83 | ) | 5.56 | (16.06 | ) | 88,036 | 1.13 | 1.13 | 1.04 | 1.29 | 13 | |||||||||||||||||||||||||||||||
2017 | 7.18 | 0.10 | 1.43 | 1.53 | (0.13 | ) | (1.02 | ) | (1.15 | ) | 7.56 | 21.91 | 121,209 | 1.13 | 1.13 | 1.06 | 1.24 | 16 | ||||||||||||||||||||||||||||||||||
2016 | 6.84 | 0.12 | 1.02 | 1.14 | (0.11 | ) | (0.69 | ) | (0.80 | ) | 7.18 | 16.75 | 99,462 | 1.16 | 1.16 | 1.11 | 1.64 | 21 | ||||||||||||||||||||||||||||||||||
Royce Dividend Value Fund–Service Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 6.34 | $ | 0.02 | $ | 1.05 | $ | 1.07 | $ | (0.02 | ) | $ | – | $ | (0.02 | ) | $ | 7.39 | 16.88 | %1 | $ | 20,192 | 1.55 | %2 | 1.55 | %2 | 1.34 | %2 | 0.64 | %2 | 0 | % | ||||||||||||||||||||
2020 | 6.42 | 0.06 | 0.21 | 0.27 | (0.08 | ) | (0.27 | ) | (0.35 | ) | 6.34 | 4.47 | 19,687 | 1.60 | 1.60 | 1.34 | 1.02 | 4 | ||||||||||||||||||||||||||||||||||
2019 | 5.73 | 0.08 | 1.61 | 1.69 | (0.06 | ) | (0.94 | ) | (1.00 | ) | 6.42 | 29.78 | 25,256 | 1.53 | 1.52 | 1.34 | 1.14 | 8 | ||||||||||||||||||||||||||||||||||
2018 | 7.76 | 0.07 | (1.29 | ) | (1.22 | ) | (0.06 | ) | (0.75 | ) | (0.81 | ) | 5.73 | (16.24 | ) | 28,120 | 1.43 | 1.43 | 1.34 | 1.01 | 13 | |||||||||||||||||||||||||||||||
2017 | 7.33 | 0.08 | 1.46 | 1.54 | (0.07 | ) | (1.04 | ) | (1.11 | ) | 7.76 | 21.66 | 59,641 | 1.40 | 1.39 | 1.31 | 1.04 | 16 | ||||||||||||||||||||||||||||||||||
2016 | 6.96 | 0.10 | 1.04 | 1.14 | (0.08 | ) | (0.69 | ) | (0.77 | ) | 7.33 | 16.36 | 115,547 | 1.43 | 1.43 | 1.37 | 1.39 | 21 | ||||||||||||||||||||||||||||||||||
Royce Dividend Value Fund–Consultant Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 7.27 | $ | (0.00 | ) | $ | 1.20 | $ | 1.20 | $ | – | $ | – | $ | – | $ | 8.47 | 16.51 | %1 | $ | 1,408 | 3.45 | %2 | 3.45 | %2 | 2.09 | %2 | (0.09 | )%2 | 0 | % | |||||||||||||||||||||
2020 | 7.33 | 0.02 | 0.23 | 0.25 | (0.01 | ) | (0.30 | ) | (0.31 | ) | 7.27 | 3.55 | 1,228 | 3.32 | 3.32 | 2.09 | 0.30 | 4 | ||||||||||||||||||||||||||||||||||
2019 | 6.53 | 0.03 | 1.85 | 1.88 | (0.01 | ) | (1.07 | ) | (1.08 | ) | 7.33 | 29.03 | 1,621 | 3.30 | 3.29 | 2.09 | 0.40 | 8 | ||||||||||||||||||||||||||||||||||
2018 | 8.87 | 0.02 | (1.48 | ) | (1.46 | ) | (0.03 | ) | (0.85 | ) | (0.88 | ) | 6.53 | (16.93 | ) | 1,349 | 3.44 | 3.44 | 2.09 | 0.24 | 13 | |||||||||||||||||||||||||||||||
2017 | 8.39 | 0.02 | 1.68 | 1.70 | (0.03 | ) | (1.19 | ) | (1.22 | ) | 8.87 | 20.71 | 1,534 | 3.26 | 3.26 | 2.09 | 0.23 | 16 | ||||||||||||||||||||||||||||||||||
2016 | 7.90 | 0.05 | 1.17 | 1.22 | (0.04 | ) | (0.69 | ) | (0.73 | ) | 8.39 | 15.44 | 1,572 | 3.26 | 3.26 | 2.14 | 0.58 | 21 | ||||||||||||||||||||||||||||||||||
Royce Dividend Value Fund–Institutional Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 6.02 | $ | 0.03 | $ | 0.99 | $ | 1.02 | $ | (0.03 | ) | $ | – | $ | (0.03 | ) | $ | 7.01 | 16.95 | %1 | $ | 937 | 3.10 | %2 | 3.10 | %2 | 1.09 | %2 | 0.92 | %2 | 0 | % | ||||||||||||||||||||
2020 | 6.10 | 0.07 | 0.21 | 0.28 | (0.11 | ) | (0.25 | ) | (0.36 | ) | 6.02 | 4.82 | 776 | 3.75 | 3.75 | 1.09 | 1.27 | 4 | ||||||||||||||||||||||||||||||||||
2019 | 5.48 | 0.15 | 1.48 | 1.63 | (0.11 | ) | (0.90 | ) | (1.01 | ) | 6.10 | 30.08 | 883 | 1.98 | 1.98 | 0.97 | 1.62 | 8 | ||||||||||||||||||||||||||||||||||
2018 | 7.46 | 0.09 | (1.23 | ) | (1.14 | ) | (0.12 | ) | (0.72 | ) | (0.84 | ) | 5.48 | (15.94 | ) | 3,016 | 1.89 | 1.89 | 0.89 | 1.28 | 13 | |||||||||||||||||||||||||||||||
2017 | 7.09 | 0.11 | 1.42 | 1.53 | (0.15 | ) | (1.01 | ) | (1.16 | ) | 7.46 | 22.21 | 1,112 | 2.79 | 2.79 | 0.89 | 1.43 | 16 | ||||||||||||||||||||||||||||||||||
2016 | 6.78 | 0.13 | 1.00 | 1.13 | (0.13 | ) | (0.69 | ) | (0.82 | ) | 7.09 | 16.70 | 823 | 3.30 | 3.30 | 0.93 | 1.81 | 21 | ||||||||||||||||||||||||||||||||||
Royce Global Financial Services Fund–Service Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 10.66 | $ | 0.04 | $ | 1.85 | $ | 1.89 | $ | – | $ | – | $ | – | $ | 12.55 | 17.73 | %1 | $ | 33,583 | 1.78 | %2 | 1.78 | %2 | 1.49 | %2 | 0.72 | %2 | 3 | % | ||||||||||||||||||||||
2020 | 9.91 | 0.07 | 1.42 | 1.49 | (0.04 | ) | (0.70 | ) | (0.74 | ) | 10.66 | 15.25 | 25,919 | 1.88 | 1.88 | 1.49 | 0.80 | 4 | ||||||||||||||||||||||||||||||||||
2019 | 8.18 | 0.10 | 1.87 | 1.97 | (0.15 | ) | (0.09 | ) | (0.24 | ) | 9.91 | 24.17 | 30,202 | 1.82 | 1.81 | 1.49 | 0.86 | 5 | ||||||||||||||||||||||||||||||||||
2018 | 10.57 | 0.07 | (1.45 | ) | (1.38 | ) | (0.09 | ) | (0.92 | ) | (1.01 | ) | 8.18 | (13.41 | ) | 32,113 | 1.68 | 1.68 | 1.49 | 0.61 | 8 | |||||||||||||||||||||||||||||||
2017 | 8.95 | 0.10 | 1.90 | 2.00 | (0.23 | ) | (0.15 | ) | (0.38 | ) | 10.57 | 22.46 | 47,197 | 1.68 | 1.68 | 1.49 | 0.83 | 19 | ||||||||||||||||||||||||||||||||||
2016 | 7.99 | 0.11 | 0.92 | 1.03 | (0.05 | ) | (0.02 | ) | (0.07 | ) | 8.95 | 12.93 | 43,629 | 1.67 | 1.67 | 1.49 | 1.25 | 37 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 63 |
Financial Highlights
This table is presented to show selected data for a share outstanding throughout each year or other indicated period and to assist shareholders in evaluating a Fund’s performance for the periods presented. Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
Ratio of Expenses to Average Net Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss) | Net Realized and Unrealized Gain (Loss) on Investments and Foreign Currency | Total from Investment Operations | Distributions from Net Investment Income | Distributions from Net Realized Gain on Investments and Foreign Currency | Total Distributions | Net Asset Value, End of Period | Total Return | Net Assets, End of Period (in thousands) | Prior to Fee Waivers, Expense Reimbursements and Balance Credits | Prior to Fee Waivers and Expense Reimbursements | Net of Fee Waivers and Expense Reimbursements | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||||||||||||||
Royce Global Financial Services Fund–Institutional Class a | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 13.81 | $ | 0.06 | $ | 2.39 | $ | 2.45 | $ | – | $ | – | $ | – | $ | 16.26 | 17.74 | %1 | $ | 9,122 | 1.52 | %2 | 1.52 | %2 | 1.49 | %2 | 0.72 | %2 | 3 | % | ||||||||||||||||||||||
2020 | 12.83 | 0.10 | 1.82 | 1.92 | (0.04 | ) | (0.90 | ) | (0.94 | ) | 13.81 | 15.18 | 7,746 | 1.67 | 1.67 | 1.49 | 0.81 | 4 | ||||||||||||||||||||||||||||||||||
2019 | 10.55 | 0.14 | 2.42 | 2.56 | (0.16 | ) | (0.12 | ) | (0.28 | ) | 12.83 | 24.35 | 6,738 | 1.60 | 1.60 | 1.33 | 1.04 | 5 | ||||||||||||||||||||||||||||||||||
2018 | 13.58 | 0.15 | (1.85 | ) | (1.70 | ) | (0.14 | ) | (1.19 | ) | (1.33 | ) | 10.55 | (12.87 | ) | 6,951 | 1.43 | 1.43 | 1.04 | 1.06 | 8 | |||||||||||||||||||||||||||||||
2017 | 11.43 | 0.15 | 2.47 | 2.62 | (0.27 | ) | (0.20 | ) | (0.47 | ) | 13.58 | 23.01 | 8,608 | 1.44 | 1.44 | 1.04 | 1.29 | 19 | ||||||||||||||||||||||||||||||||||
2016 | 10.00 | 0.18 | 1.36 | 1.54 | (0.09 | ) | (0.02 | ) | (0.11 | ) | 11.43 | 15.41 | 1 | 6,474 | 1.85 | 2 | 1.85 | 2 | 1.04 | 2 | 1.82 | 2 | 37 | |||||||||||||||||||||||||||||
Royce International Premier Fund–Investment Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 17.64 | $ | 0.08 | $ | 1.07 | $ | 1.15 | $ | – | $ | – | $ | – | $ | 18.79 | 6.52 | %1 | $ | 502,809 | 1.21 | %2 | 1.21 | %2 | 1.16 | %2 | 0.85 | %2 | 11 | % | ||||||||||||||||||||||
2020 | 15.25 | 0.04 | 2.40 | 2.44 | (0.05 | ) | – | (0.05 | ) | 17.64 | 15.99 | 486,378 | 1.26 | 1.26 | 1.19 | 0.30 | 21 | |||||||||||||||||||||||||||||||||||
2019 | 11.39 | 0.11 | 3.82 | 3.93 | (0.07 | ) | – | (0.07 | ) | 15.25 | 34.49 | 360,623 | 1.26 | 1.26 | 1.18 | 0.74 | 40 | |||||||||||||||||||||||||||||||||||
2018 | 13.07 | 0.09 | (1.72 | ) | (1.63 | ) | (0.05 | ) | – | (0.05 | ) | 11.39 | (12.45 | ) | 285,065 | 1.27 | 1.26 | 1.16 | 1.00 | 65 | ||||||||||||||||||||||||||||||||
2017 | 9.44 | (0.10 | ) | 3.88 | 3.78 | (0.15 | ) | – | (0.15 | ) | 13.07 | 40.08 | 103,032 | 1.37 | 1.37 | 1.19 | 0.32 | 41 | ||||||||||||||||||||||||||||||||||
2016 | 9.82 | 0.10 | (0.19 | ) | (0.09 | ) | (0.28 | ) | (0.01 | ) | (0.29 | ) | 9.44 | (0.79 | ) | 19,556 | 1.59 | 1.59 | 1.19 | 0.96 | 67 | |||||||||||||||||||||||||||||||
Royce International Premier Fund–Service Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 21.10 | $ | 0.06 | $ | 1.29 | $ | 1.35 | $ | – | $ | – | $ | – | $ | 22.45 | 6.40 | %1 | $ | 65,282 | 1.53 | %2 | 1.53 | %2 | 1.44 | %2 | 0.56 | %2 | 11 | % | ||||||||||||||||||||||
2020 | 18.24 | 0.01 | 2.85 | 2.86 | – | – | – | 21.10 | 15.68 | 69,153 | 1.57 | 1.57 | 1.44 | 0.04 | 21 | |||||||||||||||||||||||||||||||||||||
2019 | 13.61 | 0.10 | 4.57 | 4.67 | (0.04 | ) | – | (0.04 | ) | 18.24 | 34.29 | 71,350 | 1.58 | 1.58 | 1.41 | 0.63 | 40 | |||||||||||||||||||||||||||||||||||
2018 | 15.60 | 0.11 | (2.10 | ) | (1.99 | ) | – | – | – | 13.61 | (12.76 | ) | 36,303 | 1.59 | 1.59 | 1.44 | 0.71 | 65 | ||||||||||||||||||||||||||||||||||
2017 | 11.24 | 0.05 | 4.42 | 4.47 | (0.11 | ) | – | (0.11 | ) | 15.60 | 39.81 | 48,642 | 1.65 | 1.65 | 1.44 | 0.28 | 41 | |||||||||||||||||||||||||||||||||||
2016 | 11.64 | 0.06 | (0.19 | ) | (0.13 | ) | (0.26 | ) | (0.01 | ) | (0.27 | ) | 11.24 | (1.06 | ) | 38,884 | 1.84 | 1.84 | 1.44 | 0.66 | 67 | |||||||||||||||||||||||||||||||
Royce International Premier Fund–Consultant Class b | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 22.50 | $ | (0.02 | ) | $ | 1.37 | $ | 1.35 | $ | – | $ | – | $ | – | $ | 23.85 | 6.00 | %1 | $ | 9,465 | 2.37 | %2 | 2.37 | %2 | 2.19 | %2 | (0.18 | )%2 | 11 | % | |||||||||||||||||||||
2020 | 19.60 | (0.13 | ) | 3.03 | 2.90 | – | – | – | 22.50 | 14.80 | 9,182 | 2.42 | 2.41 | 2.19 | (0.70 | ) | 21 | |||||||||||||||||||||||||||||||||||
2019 | 14.71 | (0.03 | ) | 4.92 | 4.89 | – | – | – | 19.60 | 33.24 | 9,894 | 2.41 | 2.41 | 2.18 | (0.17 | ) | 40 | |||||||||||||||||||||||||||||||||||
2018 | 16.99 | (0.00 | ) | (2.28 | ) | (2.28 | ) | – | – | – | 14.71 | (13.42 | ) | 8,546 | 2.33 | 2.32 | 2.19 | (0.00 | ) | 65 | ||||||||||||||||||||||||||||||||
2017 | 12.27 | (0.08 | ) | 4.83 | 4.75 | (0.03 | ) | – | (0.03 | ) | 16.99 | 38.73 | 9,281 | 2.73 | 2.73 | 2.19 | (0.52 | ) | 41 | |||||||||||||||||||||||||||||||||
2016 | 11.59 | 0.01 | 0.85 | 0.86 | (0.17 | ) | (0.01 | ) | (0.18 | ) | 12.27 | 7.49 | 1 | 5,086 | 2.70 | 2 | 2.70 | 2 | 2.19 | 2 | (0.04 | )2 | 67 | |||||||||||||||||||||||||||||
Royce International Premier Fund–Institutional Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 17.64 | $ | 0.09 | $ | 1.08 | $ | 1.17 | $ | – | $ | – | $ | – | $ | 18.81 | 6.63 | %1 | $ | 699,098 | 1.15 | %2 | 1.15 | %2 | 1.04 | %2 | 1.01 | %2 | 11 | % | ||||||||||||||||||||||
2020 | 15.25 | 0.06 | 2.39 | 2.45 | (0.06 | ) | – | (0.06 | ) | 17.64 | 16.12 | 567,878 | 1.20 | 1.20 | 1.04 | 0.44 | 21 | |||||||||||||||||||||||||||||||||||
2019 | 11.39 | (0.03 | ) | 3.98 | 3.95 | (0.09 | ) | – | (0.09 | ) | 15.25 | 34.68 | 366,870 | 1.19 | 1.19 | 1.04 | 0.57 | 40 | ||||||||||||||||||||||||||||||||||
2018 | 12.98 | (0.00 | ) | (1.53 | ) | (1.53 | ) | (0.06 | ) | – | (0.06 | ) | 11.39 | (11.78 | )1 | 32,340 | 1.34 | 2 | 1.34 | 2 | 1.04 | 2 | 0.84 | 2 | 65 |
a The Class commenced operations on January 5, 2016.
b The Class commenced operations on February 26, 2016.
c The Class commenced operations on May 2, 2018.
64 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
Financial Highlights
This table is presented to show selected data for a share outstanding throughout each year or other indicated period and to assist shareholders in evaluating a Fund’s performance for the periods presented. Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
Ratio of Expenses to Average Net Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss) | Net Realized and Unrealized Gain (Loss) on Investments and Foreign Currency | Total from Investment Operations | Distributions from Net Investment Income | Distributions from Net Realized Gain on Investments and Foreign Currency | Total Distributions | Net Asset Value, End of Period | Total Return | Net Assets, End of Period (in thousands) | Prior to Fee Waivers, Expense Reimbursements and Balance Credits | Prior to Fee Waivers and Expense Reimbursements | Net of Fee Waivers and Expense Reimbursements | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||||||||||||||
Royce Micro-Cap Fund–Investment Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 12.74 | $ | (0.02 | ) | $ | 3.24 | $ | 3.22 | $ | – | $ | – | $ | – | $ | 15.96 | 25.27 | %1 | $ | 201,821 | 1.20 | %2 | 1.20 | %2 | 1.20 | %2 | (0.31 | )%2 | 13 | % | |||||||||||||||||||||
2020 | 11.02 | (0.05 | ) | 2.71 | 2.66 | – | (0.94 | ) | (0.94 | ) | 12.74 | 24.50 | 174,339 | 1.29 | 1.29 | 1.24 | (0.46 | ) | 25 | |||||||||||||||||||||||||||||||||
2019 | 9.35 | (0.05 | ) | 2.02 | 1.97 | – | (0.30 | ) | (0.30 | ) | 11.02 | 21.16 | 158,112 | 1.51 | 1.50 | 1.36 | (0.46 | ) | 21 | |||||||||||||||||||||||||||||||||
2018 | 11.64 | (0.05 | ) | (0.94 | ) | (0.99 | ) | – | (1.30 | ) | (1.30 | ) | 9.35 | (8.94 | ) | 117,040 | 1.50 | 1.50 | 1.49 | (0.43 | ) | 24 | ||||||||||||||||||||||||||||||
2017 | 11.92 | (0.03 | ) | 0.66 | 0.63 | (0.01 | ) | (0.90 | ) | (0.91 | ) | 11.64 | 5.43 | 166,935 | 1.51 | 1.51 | 1.49 | (0.28 | ) | 26 | ||||||||||||||||||||||||||||||||
2016 | 11.09 | 0.01 | 2.18 | 2.19 | (0.06 | ) | (1.30 | ) | (1.36 | ) | 11.92 | 19.74 | 192,731 | 1.48 | 1.48 | 1.48 | 0.03 | 38 | ||||||||||||||||||||||||||||||||||
Royce Micro-Cap Fund–Service Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 12.45 | $ | (0.04 | ) | $ | 3.16 | $ | 3.12 | $ | – | $ | – | $ | – | $ | 15.57 | 25.06 | %1 | $ | 199,404 | 1.49 | %2 | 1.49 | %2 | 1.49 | %2 | (0.60 | )%2 | 13 | % | |||||||||||||||||||||
2020 | 10.79 | (0.07 | ) | 2.65 | 2.58 | – | (0.92 | ) | (0.92 | ) | 12.45 | 24.26 | 168,285 | 1.60 | 1.60 | 1.49 | (0.71 | ) | 25 | |||||||||||||||||||||||||||||||||
2019 | 9.15 | (0.01 | ) | 1.94 | 1.93 | – | (0.29 | ) | (0.29 | ) | 10.79 | 21.22 | 164,956 | 1.51 | 1.51 | 1.50 | (0.09 | ) | 21 | |||||||||||||||||||||||||||||||||
2018 | 11.41 | (0.07 | ) | (0.91 | ) | (0.98 | ) | – | (1.28 | ) | (1.28 | ) | 9.15 | (9.09 | ) | 8,053 | 1.90 | 1.89 | 1.61 | (0.56 | ) | 24 | ||||||||||||||||||||||||||||||
2017 | 11.69 | (0.05 | ) | 0.65 | 0.60 | – | (0.88 | ) | (0.88 | ) | 11.41 | 5.32 | 13,880 | 1.86 | 1.86 | 1.61 | (0.40 | ) | 26 | |||||||||||||||||||||||||||||||||
2016 | 10.90 | (0.01 | ) | 2.15 | 2.14 | (0.05 | ) | (1.30 | ) | (1.35 | ) | 11.69 | 19.59 | 17,343 | 1.83 | 1.83 | 1.61 | (0.11 | ) | 38 | ||||||||||||||||||||||||||||||||
Royce Micro-Cap Fund–Consultant Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 9.62 | $ | (0.08 | ) | $ | 2.45 | $ | 2.37 | $ | – | $ | – | $ | – | $ | 11.99 | 24.64 | %1 | $ | 16,529 | 2.30 | %2 | 2.30 | %2 | 2.30 | %2 | (1.41 | )%2 | 13 | % | |||||||||||||||||||||
2020 | 8.42 | (0.13 | ) | 2.04 | 1.91 | – | (0.71 | ) | (0.71 | ) | 9.62 | 23.04 | 14,025 | 2.41 | 2.41 | 2.41 | (1.63 | ) | 25 | |||||||||||||||||||||||||||||||||
2019 | 7.23 | (0.13 | ) | 1.55 | 1.42 | – | (0.23 | ) | (0.23 | ) | 8.42 | 19.72 | 14,204 | 2.59 | 2.59 | 2.58 | (1.69 | ) | 21 | |||||||||||||||||||||||||||||||||
2018 | 9.10 | (0.14 | ) | (0.72 | ) | (0.86 | ) | – | (1.01 | ) | (1.01 | ) | 7.23 | (9.93 | ) | 16,680 | 2.56 | 2.56 | 2.56 | (1.50 | ) | 24 | ||||||||||||||||||||||||||||||
2017 | 9.41 | (0.13 | ) | 0.53 | 0.40 | – | (0.71 | ) | (0.71 | ) | 9.10 | 4.35 | 24,396 | 2.54 | 2.54 | 2.54 | (1.34 | ) | 26 | |||||||||||||||||||||||||||||||||
2016 | 9.04 | (0.09 | ) | 1.76 | 1.67 | – | (1.30 | ) | (1.30 | ) | 9.41 | 18.48 | 33,622 | 2.53 | 2.53 | 2.53 | (1.02 | ) | 38 | |||||||||||||||||||||||||||||||||
Royce Opportunity Fund–Investment Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 15.84 | $ | (0.02 | ) | $ | 4.91 | $ | 4.89 | $ | – | $ | – | $ | – | $ | 20.73 | 30.87 | %1 | $ | 1,543,557 | 1.15 | %2 | 1.15 | %2 | 1.15 | %2 | (0.25 | )%2 | 34 | % | |||||||||||||||||||||
2020 | 12.52 | (0.03 | ) | 3.35 | 3.32 | – | – | – | 15.84 | 26.52 | 786,849 | 1.24 | 1.23 | 1.23 | (0.28 | ) | 53 | |||||||||||||||||||||||||||||||||||
2019 | 9.92 | (0.06 | ) | 2.86 | 2.80 | – | (0.20 | ) | (0.20 | ) | 12.52 | 28.21 | 609,316 | 1.23 | 1.22 | 1.22 | (0.50 | ) | 47 | |||||||||||||||||||||||||||||||||
2018 | 13.58 | (0.04 | ) | (2.61 | ) | (2.65 | ) | – | (1.01 | ) | (1.01 | ) | 9.92 | (19.97 | ) | 557,003 | 1.20 | 1.20 | 1.20 | (0.30 | ) | 47 | ||||||||||||||||||||||||||||||
2017 | 12.85 | (0.04 | ) | 2.79 | 2.75 | – | (2.02 | ) | (2.02 | ) | 13.58 | 21.88 | 805,660 | 1.18 | 1.18 | 1.18 | (0.28 | ) | 43 | |||||||||||||||||||||||||||||||||
2016 | 10.57 | (0.02 | ) | 3.19 | 3.17 | – | (0.89 | ) | (0.89 | ) | 12.85 | 29.86 | 751,184 | 1.19 | 1.19 | 1.19 | (0.18 | ) | 26 | |||||||||||||||||||||||||||||||||
Royce Opportunity Fund–Service Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 14.66 | $ | (0.05 | ) | $ | 4.54 | $ | 4.49 | $ | – | $ | – | $ | – | $ | 19.15 | 30.63 | %1 | $ | 166,768 | 1.44 | %2 | 1.44 | %2 | 1.44 | %2 | (0.56 | )%2 | 34 | % | |||||||||||||||||||||
2020 | 11.61 | (0.06 | ) | 3.11 | 3.05 | – | – | – | 14.66 | 26.27 | 131,725 | 1.54 | 1.54 | 1.49 | (0.54 | ) | 53 | |||||||||||||||||||||||||||||||||||
2019 | 9.23 | (0.09 | ) | 2.65 | 2.56 | – | (0.18 | ) | (0.18 | ) | 11.61 | 27.79 | 46,032 | 1.55 | 1.55 | 1.49 | (0.77 | ) | 47 | |||||||||||||||||||||||||||||||||
2018 | 12.66 | (0.07 | ) | (2.42 | ) | (2.49 | ) | – | (0.94 | ) | (0.94 | ) | 9.23 | (20.14 | ) | 48,797 | 1.52 | 1.52 | 1.49 | (0.59 | ) | 47 | ||||||||||||||||||||||||||||||
2017 | 12.02 | (0.08 | ) | 2.61 | 2.53 | – | (1.89 | ) | (1.89 | ) | 12.66 | 21.46 | 96,663 | 1.53 | 1.53 | 1.49 | (0.61 | ) | 43 | |||||||||||||||||||||||||||||||||
2016 | 9.95 | (0.05 | ) | 3.01 | 2.96 | – | (0.89 | ) | (0.89 | ) | 12.02 | 29.61 | 73,517 | 1.53 | 1.53 | 1.49 | (0.48 | ) | 26 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 65 |
Financial Highlights
This table is presented to show selected data for a share outstanding throughout each year or other indicated period and to assist shareholders in evaluating a Fund’s performance for the periods presented. Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
Ratio of Expenses to Average Net Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss) | Net Realized and Unrealized Gain (Loss) on Investments and Foreign Currency | Total from Investment Operations | Distributions from Net Investment Income | Distributions from Net Realized Gain on Investments and Foreign Currency | Total Distributions | Net Asset Value, End of Period | Total Return | Net Assets, End of Period (in thousands) | Prior to Fee Waivers, Expense Reimbursements and Balance Credits | Prior to Fee Waivers and Expense Reimbursements | Net of Fee Waivers and Expense Reimbursements | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||||||||||||||
Royce Opportunity Fund–Consultant Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 12.61 | $ | (0.10 | ) | $ | 3.91 | $ | 3.81 | $ | – | $ | – | $ | – | $ | 16.42 | 30.21 | %1 | $ | 16,438 | 2.24 | %2 | 2.24 | %2 | 2.24 | %2 | (1.35 | )%2 | 34 | % | |||||||||||||||||||||
2020 | 10.09 | (0.14 | ) | 2.66 | 2.52 | – | – | – | 12.61 | 24.98 | 13,477 | 2.45 | 2.45 | 2.45 | (1.50 | ) | 53 | |||||||||||||||||||||||||||||||||||
2019 | 8.09 | (0.16 | ) | 2.32 | 2.16 | – | (0.16 | ) | (0.16 | ) | 10.09 | 26.70 | 8,621 | 2.41 | 2.41 | 2.41 | (1.67 | ) | 47 | |||||||||||||||||||||||||||||||||
2018 | 11.19 | (0.16 | ) | (2.12 | ) | (2.28 | ) | – | (0.82 | ) | (0.82 | ) | 8.09 | (20.81 | ) | 9,831 | 2.30 | 2.29 | 2.29 | (1.39 | ) | 47 | ||||||||||||||||||||||||||||||
2017 | 10.71 | (0.16 | ) | 2.31 | 2.15 | – | (1.67 | ) | (1.67 | ) | 11.19 | 20.50 | 20,574 | 2.27 | 2.27 | 2.27 | (1.37 | ) | 43 | |||||||||||||||||||||||||||||||||
2016 | 9.01 | (0.12 | ) | 2.71 | 2.59 | – | (0.89 | ) | (0.89 | ) | 10.71 | 28.59 | 21,116 | 2.28 | 2.28 | 2.28 | (1.27 | ) | 26 | |||||||||||||||||||||||||||||||||
Royce Opportunity Fund–Institutional Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 16.22 | $ | (0.02 | ) | $ | 5.03 | $ | 5.01 | $ | – | $ | – | $ | – | $ | 21.23 | 30.89 | %1 | $ | 452,882 | 1.06 | %2 | 1.06 | %2 | 1.06 | %2 | (0.17 | )%2 | 34 | % | |||||||||||||||||||||
2020 | 12.80 | (0.02 | ) | 3.44 | 3.42 | – | – | – | 16.22 | 26.72 | 340,877 | 1.12 | 1.12 | 1.12 | (0.17 | ) | 53 | |||||||||||||||||||||||||||||||||||
2019 | 10.13 | (0.05 | ) | 2.92 | 2.87 | – | (0.20 | ) | (0.20 | ) | 12.80 | 28.36 | 230,439 | 1.12 | 1.12 | 1.12 | (0.39 | ) | 47 | |||||||||||||||||||||||||||||||||
2018 | 13.84 | (0.02 | ) | (2.66 | ) | (2.68 | ) | – | (1.03 | ) | (1.03 | ) | 10.13 | (19.83 | ) | 227,261 | 1.08 | 1.08 | 1.08 | (0.17 | ) | 47 | ||||||||||||||||||||||||||||||
2017 | 13.08 | (0.02 | ) | 2.84 | 2.82 | – | (2.06 | ) | (2.06 | ) | 13.84 | 22.02 | 639,057 | 1.07 | 1.07 | 1.07 | (0.17 | ) | 43 | |||||||||||||||||||||||||||||||||
2016 | 10.74 | (0.01 | ) | 3.24 | 3.23 | – | (0.89 | ) | (0.89 | ) | 13.08 | 29.94 | 583,975 | 1.07 | 1.07 | 1.07 | (0.06 | ) | 26 | |||||||||||||||||||||||||||||||||
Royce Opportunity Fund–R Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 14.03 | $ | (0.08 | ) | $ | 4.35 | $ | 4.27 | $ | – | $ | – | $ | – | $ | 18.30 | 30.43 | %1 | $ | 53,220 | 1.76 | %2 | 1.76 | %2 | 1.76 | %2 | (0.88 | )%2 | 34 | % | |||||||||||||||||||||
2020 | 11.16 | (0.09 | ) | 2.96 | 2.87 | – | – | – | 14.03 | 25.72 | 36,065 | 1.88 | 1.87 | 1.87 | (0.93 | ) | 53 | |||||||||||||||||||||||||||||||||||
2019 | 8.90 | (0.12 | ) | 2.55 | 2.43 | – | (0.17 | ) | (0.17 | ) | 11.16 | 27.38 | 31,230 | 1.86 | 1.85 | 1.85 | (1.13 | ) | 47 | |||||||||||||||||||||||||||||||||
2018 | 12.25 | (0.11 | ) | (2.33 | ) | (2.44 | ) | – | (0.91 | ) | (0.91 | ) | 8.90 | (20.42 | ) | 26,337 | 1.84 | 1.84 | 1.84 | (0.93 | ) | 47 | ||||||||||||||||||||||||||||||
2017 | 11.67 | (0.12 | ) | 2.53 | 2.41 | – | (1.83 | ) | (1.83 | ) | 12.25 | 21.06 | 39,311 | 1.82 | 1.82 | 1.82 | (0.92 | ) | 43 | |||||||||||||||||||||||||||||||||
2016 | 9.72 | (0.08 | ) | 2.92 | 2.84 | – | (0.89 | ) | (0.89 | ) | 11.67 | 29.08 | 38,902 | 1.82 | 1.82 | 1.82 | (0.81 | ) | 26 | |||||||||||||||||||||||||||||||||
Royce Pennsylvania Mutual Fund–Investment Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 10.24 | $ | 0.00 | $ | 1.70 | $ | 1.70 | $ | – | $ | – | $ | – | $ | 11.94 | 16.60 | %1 | $ | 1,661,901 | 0.91 | %2 | 0.91 | %2 | 0.91 | %2 | 0.04 | %2 | 41 | % | ||||||||||||||||||||||
2020 | 9.44 | 0.03 | 1.29 | 1.32 | (0.06 | ) | (0.46 | ) | (0.52 | ) | 10.24 | 14.08 | 1,426,472 | 0.95 | 0.95 | 0.95 | 0.37 | 32 | ||||||||||||||||||||||||||||||||||
2019 | 7.75 | 0.04 | 2.01 | 2.05 | (0.02 | ) | (0.34 | ) | (0.36 | ) | 9.44 | 26.56 | 1,429,042 | 0.95 | 0.94 | 0.94 | 0.39 | 30 | ||||||||||||||||||||||||||||||||||
2018 | 10.52 | 0.04 | (0.97 | ) | (0.93 | ) | (0.02 | ) | (1.82 | ) | (1.84 | ) | 7.75 | (9.66 | ) | 1,203,967 | 0.92 | 0.92 | 0.92 | 0.33 | 35 | |||||||||||||||||||||||||||||||
2017 | 11.02 | 0.06 | 1.68 | 1.74 | (0.06 | ) | (2.18 | ) | (2.24 | ) | 10.52 | 16.24 | 1,622,523 | 0.92 | 0.92 | 0.92 | 0.47 | 27 | ||||||||||||||||||||||||||||||||||
2016 | 9.33 | 0.07 | 2.41 | 2.48 | (0.04 | ) | (0.75 | ) | (0.79 | ) | 11.02 | 26.47 | 1,671,848 | 0.92 | 0.92 | 0.92 | 0.60 | 18 | ||||||||||||||||||||||||||||||||||
Royce Pennsylvania Mutual Fund–Service Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 10.23 | $ | (0.01 | ) | $ | 1.69 | $ | 1.68 | $ | – | $ | – | $ | – | $ | 11.91 | 16.42 | %1 | $ | 146,837 | 1.23 | %2 | 1.23 | %2 | 1.22 | %2 | (0.24 | )%2 | 41 | % | |||||||||||||||||||||
2020 | 9.42 | 0.02 | 1.28 | 1.30 | (0.03 | ) | (0.46 | ) | (0.49 | ) | 10.23 | 13.88 | 78,789 | 1.25 | 1.24 | 1.13 | 0.23 | 32 | ||||||||||||||||||||||||||||||||||
2019 | 7.77 | (0.00 | ) | 2.00 | 2.00 | (0.01 | ) | (0.34 | ) | (0.35 | ) | 9.42 | 25.75 | 142,864 | 1.31 | 1.30 | 1.30 | (0.01 | ) | 30 | ||||||||||||||||||||||||||||||||
2018 | 10.56 | (0.01 | ) | (0.96 | ) | (0.97 | ) | – | (1.82 | ) | (1.82 | ) | 7.77 | (9.96 | ) | 32,191 | 1.30 | 1.30 | 1.30 | (0.07 | ) | 35 | ||||||||||||||||||||||||||||||
2017 | 11.03 | 0.01 | 1.69 | 1.70 | – | (2.17 | ) | (2.17 | ) | 10.56 | 15.88 | 54,938 | 1.27 | 1.27 | 1.27 | 0.07 | 27 | |||||||||||||||||||||||||||||||||||
2016 | 9.35 | 0.03 | 2.41 | 2.44 | (0.01 | ) | (0.75 | ) | (0.76 | ) | 11.03 | 25.99 | 100,598 | 1.26 | 1.26 | 1.26 | 0.27 | 18 |
66 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
Financial Highlights
This table is presented to show selected data for a share outstanding throughout each year or other indicated period and to assist shareholders in evaluating a Fund’s performance for the periods presented. Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
Ratio of Expenses to Average Net Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss) | Net Realized and Unrealized Gain (Loss) on Investments and Foreign Currency | Total from Investment Operations | Distributions from Net Investment Income | Distributions from Net Realized Gain on Investments and Foreign Currency | Total Distributions | Net Asset Value, End of Period | Total Return | Net Assets, End of Period (in thousands) | Prior to Fee Waivers, Expense Reimbursements and Balance Credits | Prior to Fee Waivers and Expense Reimbursements | Net of Fee Waivers and Expense Reimbursements | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||||||||||||||
Royce Pennsylvania Mutual Fund–Consultant Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 8.07 | $ | (0.04 | ) | $ | 1.33 | $ | 1.29 | $ | – | $ | – | $ | – | $ | 9.36 | 15.99 | %1 | $ | 260,581 | 1.92 | %2 | 1.92 | %2 | 1.92 | %2 | (0.98 | )%2 | 41 | % | |||||||||||||||||||||
2020 | 7.47 | (0.04 | ) | 1.00 | 0.96 | – | (0.36 | ) | (0.36 | ) | 8.07 | 12.94 | 238,595 | 1.96 | 1.96 | 1.96 | (0.64 | ) | 32 | |||||||||||||||||||||||||||||||||
2019 | 6.18 | (0.04 | ) | 1.60 | 1.56 | – | (0.27 | ) | (0.27 | ) | 7.47 | 25.25 | 262,007 | 1.96 | 1.95 | 1.95 | (0.62 | ) | 30 | |||||||||||||||||||||||||||||||||
2018 | 8.46 | (0.06 | ) | (0.77 | ) | (0.83 | ) | – | (1.45 | ) | (1.45 | ) | 6.18 | (10.56 | ) | 249,004 | 1.93 | 1.93 | 1.93 | (0.69 | ) | 35 | ||||||||||||||||||||||||||||||
2017 | 8.90 | (0.05 | ) | 1.35 | 1.30 | – | (1.74 | ) | (1.74 | ) | 8.46 | 15.06 | 361,569 | 1.93 | 1.92 | 1.92 | (0.54 | ) | 27 | |||||||||||||||||||||||||||||||||
2016 | 7.70 | (0.03 | ) | 1.98 | 1.95 | – | (0.75 | ) | (0.75 | ) | 8.90 | 25.20 | 402,114 | 1.94 | 1.94 | 1.94 | (0.42 | ) | 18 | |||||||||||||||||||||||||||||||||
Royce Pennsylvania Mutual Fund–Institutional Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 10.27 | $ | 0.01 | $ | 1.71 | $ | 1.72 | $ | – | $ | – | $ | – | $ | 11.99 | 16.75 | %1 | $ | 216,926 | 0.85 | %2 | 0.85 | %2 | 0.85 | %2 | 0.10 | %2 | 41 | % | ||||||||||||||||||||||
2020 | 9.47 | 0.04 | 1.28 | 1.32 | (0.06 | ) | (0.46 | ) | (0.52 | ) | 10.27 | 14.10 | 163,944 | 0.89 | 0.89 | 0.89 | 0.42 | 32 | ||||||||||||||||||||||||||||||||||
2019 | 7.78 | 0.04 | 2.02 | 2.06 | (0.03 | ) | (0.34 | ) | (0.37 | ) | 9.47 | 26.53 | 106,564 | 0.89 | 0.89 | 0.89 | 0.45 | 30 | ||||||||||||||||||||||||||||||||||
2018 | 10.55 | 0.04 | (0.97 | ) | (0.93 | ) | (0.02 | ) | (1.82 | ) | (1.84 | ) | 7.78 | (9.56 | ) | 83,908 | 0.88 | 0.88 | 0.88 | 0.40 | 35 | |||||||||||||||||||||||||||||||
2017 | 11.04 | 0.09 | 1.67 | 1.76 | (0.07 | ) | (2.18 | ) | (2.25 | ) | 10.55 | 16.44 | 53,367 | 0.83 | 0.83 | 0.83 | 0.42 | 27 | ||||||||||||||||||||||||||||||||||
2016 | 9.34 | 0.09 | 2.41 | 2.50 | (0.05 | ) | (0.75 | ) | (0.80 | ) | 11.04 | 26.65 | 245,009 | 0.83 | 0.83 | 0.83 | 0.63 | 18 | ||||||||||||||||||||||||||||||||||
Royce Pennsylvania Mutual Fund–R Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 9.56 | $ | (0.04 | ) | $ | 1.58 | $ | 1.54 | $ | – | $ | – | $ | – | $ | 11.10 | 16.11 | %1 | $ | 9,543 | 1.71 | %2 | 1.71 | %2 | 1.71 | %2 | (0.76 | )%2 | 41 | % | |||||||||||||||||||||
2020 | 8.84 | (0.04 | ) | 1.19 | 1.15 | – | (0.43 | ) | (0.43 | ) | 9.56 | 13.07 | 8,121 | 1.83 | 1.83 | 1.83 | (0.51 | ) | 32 | |||||||||||||||||||||||||||||||||
2019 | 7.30 | (0.03 | ) | 1.89 | 1.86 | – | (0.32 | ) | (0.32 | ) | 8.84 | 25.48 | 8,853 | 1.75 | 1.74 | 1.74 | (0.41 | ) | 30 | |||||||||||||||||||||||||||||||||
2018 | 9.94 | (0.03 | ) | (0.91 | ) | (0.94 | ) | – | (1.70 | ) | (1.70 | ) | 7.30 | (10.15 | ) | 10,014 | 1.58 | 1.57 | 1.57 | (0.34 | ) | 35 | ||||||||||||||||||||||||||||||
2017 | 10.44 | (0.04 | ) | 1.58 | 1.54 | – | (2.04 | ) | (2.04 | ) | 9.94 | 15.25 | 15,136 | 1.73 | 1.73 | 1.73 | (0.36 | ) | 27 | |||||||||||||||||||||||||||||||||
2016 | 8.90 | (0.01 | ) | 2.30 | 2.29 | – | (0.75 | ) | (0.75 | ) | 10.44 | 25.62 | 17,059 | 1.63 | 1.63 | 1.63 | (0.11 | ) | 18 | |||||||||||||||||||||||||||||||||
Royce Premier Fund–Investment Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 13.59 | $ | (0.01 | ) | $ | 1.42 | $ | 1.41 | $ | – | $ | – | $ | – | $ | 15.00 | 10.38 | %1 | $ | 1,464,919 | 1.17 | %2 | 1.17 | %2 | 1.17 | %2 | (0.19 | )%2 | 10 | % | |||||||||||||||||||||
2020 | 12.88 | 0.05 | 1.41 | 1.46 | (0.12 | ) | (0.63 | ) | (0.75 | ) | 13.59 | 11.50 | 1,414,718 | 1.21 | 1.21 | 1.21 | 0.41 | 23 | ||||||||||||||||||||||||||||||||||
2019 | 11.62 | 0.05 | 3.87 | 3.92 | (0.05 | ) | (2.61 | ) | (2.66 | ) | 12.88 | 34.13 | 1,505,821 | 1.20 | 1.19 | 1.19 | 0.32 | 19 | ||||||||||||||||||||||||||||||||||
2018 | 16.60 | 0.02 | (1.60 | ) | (1.58 | ) | (0.01 | ) | (3.39 | ) | (3.40 | ) | 11.62 | (10.40 | ) | 1,398,965 | 1.17 | 1.17 | 1.17 | 0.11 | 23 | |||||||||||||||||||||||||||||||
2017 | 15.51 | 0.00 | 3.63 | 3.63 | (0.02 | ) | (2.52 | ) | (2.54 | ) | 16.60 | 23.77 | 1,978,847 | 1.16 | 1.16 | 1.16 | 0.00 | 8 | ||||||||||||||||||||||||||||||||||
2016 | 14.28 | 0.06 | 3.25 | 3.31 | (0.04 | ) | (2.04 | ) | (2.08 | ) | 15.51 | 23.00 | 1,768,580 | 1.16 | 1.16 | 1.16 | 0.35 | 15 | ||||||||||||||||||||||||||||||||||
Royce Premier Fund–Service Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 13.22 | $ | (0.04 | ) | $ | 1.39 | $ | 1.35 | $ | – | $ | – | $ | – | $ | 14.57 | 10.21 | %1 | $ | 32,242 | 1.53 | %2 | 1.53 | %2 | 1.49 | %2 | (0.51 | )%2 | 10 | % | |||||||||||||||||||||
2020 | 12.54 | 0.01 | 1.37 | 1.38 | (0.09 | ) | (0.61 | ) | (0.70 | ) | 13.22 | 11.16 | 29,588 | 1.57 | 1.57 | 1.49 | 0.12 | 23 | ||||||||||||||||||||||||||||||||||
2019 | 11.31 | (0.01 | ) | 3.78 | 3.77 | – | (2.54 | ) | (2.54 | ) | 12.54 | 33.65 | 29,696 | 1.57 | 1.57 | 1.46 | (0.06 | ) | 19 | |||||||||||||||||||||||||||||||||
2018 | 16.15 | (0.03 | ) | (1.55 | ) | (1.58 | ) | – | (3.26 | ) | (3.26 | ) | 11.31 | (10.66 | ) | 41,738 | 1.52 | 1.52 | 1.48 | (0.19 | ) | 23 | ||||||||||||||||||||||||||||||
2017 | 15.13 | (0.06 | ) | 3.53 | 3.47 | – | (2.45 | ) | (2.45 | ) | 16.15 | 23.32 | 54,557 | 1.53 | 1.53 | 1.49 | (0.34 | ) | 8 | |||||||||||||||||||||||||||||||||
2016 | 13.98 | 0.00 | 3.19 | 3.19 | – | (2.04 | ) | (2.04 | ) | 15.13 | 22.63 | 46,550 | 1.50 | 1.50 | 1.49 | 0.02 | 15 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 67 |
Financial Highlights
This table is presented to show selected data for a share outstanding throughout each year or other indicated period and to assist shareholders in evaluating a Fund’s performance for the periods presented. Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
Ratio of Expenses to Average Net Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss) | Net Realized and Unrealized Gain (Loss) on Investments and Foreign Currency | Total from Investment Operations | Distributions from Net Investment Income | Distributions from Net Realized Gain on Investments and Foreign Currency | Total Distributions | Net Asset Value, End of Period | Total Return | Net Assets, End of Period (in thousands) | Prior to Fee Waivers, Expense Reimbursements and Balance Credits | Prior to Fee Waivers and Expense Reimbursements | Net of Fee Waivers and Expense Reimbursements | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||||||||||||||
Royce Premier Fund–Consultant Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 10.60 | $ | (0.08 | ) | $ | 1.12 | $ | 1.04 | $ | – | $ | – | $ | – | $ | 11.64 | 9.81 | %1 | $ | 16,357 | 2.29 | %2 | 2.29 | %2 | 2.29 | %2 | (1.31 | )%2 | 10 | % | |||||||||||||||||||||
2020 | 10.09 | (0.07 | ) | 1.09 | 1.02 | (0.02 | ) | (0.49 | ) | (0.51 | ) | 10.60 | 10.19 | 15,686 | 2.34 | 2.34 | 2.34 | (0.72 | ) | 23 | ||||||||||||||||||||||||||||||||
2019 | 9.17 | (0.10 | ) | 3.05 | 2.95 | – | (2.03 | ) | (2.03 | ) | 10.09 | 32.55 | 17,585 | 2.26 | 2.26 | 2.26 | (0.91 | ) | 19 | |||||||||||||||||||||||||||||||||
2018 | 13.21 | (0.12 | ) | (1.27 | ) | (1.39 | ) | – | (2.65 | ) | (2.65 | ) | 9.17 | (11.41 | ) | 21,370 | 2.21 | 2.21 | 2.21 | (0.93 | ) | 23 | ||||||||||||||||||||||||||||||
2017 | 12.46 | (0.14 | ) | 2.89 | 2.75 | – | (2.00 | ) | (2.00 | ) | 13.21 | 22.49 | 31,489 | 2.21 | 2.21 | 2.21 | (1.06 | ) | 8 | |||||||||||||||||||||||||||||||||
2016 | 11.89 | (0.09 | ) | 2.70 | 2.61 | – | (2.04 | ) | (2.04 | ) | 12.46 | 21.72 | 31,353 | 2.22 | 2.22 | 2.22 | (0.72 | ) | 15 | |||||||||||||||||||||||||||||||||
Royce Premier Fund–Institutional Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 13.80 | $ | (0.01 | ) | $ | 1.45 | $ | 1.44 | $ | – | $ | – | $ | – | $ | 15.24 | 10.43 | %1 | $ | 272,671 | 1.10 | %2 | 1.10 | %2 | 1.10 | %2 | (0.12 | )%2 | 10 | % | |||||||||||||||||||||
2020 | 13.08 | 0.05 | 1.44 | 1.49 | (0.13 | ) | (0.64 | ) | (0.77 | ) | 13.80 | 11.53 | 266,587 | 1.15 | 1.15 | 1.15 | 0.44 | 23 | ||||||||||||||||||||||||||||||||||
2019 | 11.79 | 0.05 | 3.94 | 3.99 | (0.05 | ) | (2.65 | ) | (2.70 | ) | 13.08 | 34.23 | 244,343 | 1.15 | 1.15 | 1.15 | 0.33 | 19 | ||||||||||||||||||||||||||||||||||
2018 | 16.82 | 0.03 | (1.63 | ) | (1.60 | ) | (0.02 | ) | (3.41 | ) | (3.43 | ) | 11.79 | (10.41 | ) | 197,697 | 1.12 | 1.12 | 1.12 | 0.16 | 23 | |||||||||||||||||||||||||||||||
2017 | 15.72 | 0.01 | 3.68 | 3.69 | (0.03 | ) | (2.56 | ) | (2.59 | ) | 16.82 | 23.85 | 250,119 | 1.09 | 1.09 | 1.09 | 0.07 | 8 | ||||||||||||||||||||||||||||||||||
2016 | 14.44 | 0.08 | 3.30 | 3.38 | (0.06 | ) | (2.04 | ) | (2.10 | ) | 15.72 | 23.20 | 250,826 | 1.07 | 1.07 | 1.07 | 0.44 | 15 | ||||||||||||||||||||||||||||||||||
Royce Premier Fund–R Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 12.49 | $ | (0.06 | ) | $ | 1.31 | $ | 1.25 | $ | – | $ | – | $ | – | $ | 13.74 | 10.01 | %1 | $ | 8,664 | 1.90 | %2 | 1.90 | %2 | 1.90 | %2 | (0.93 | )%2 | 10 | % | |||||||||||||||||||||
2020 | 11.86 | (0.04 | ) | 1.29 | 1.25 | (0.04 | ) | (0.58 | ) | (0.62 | ) | 12.49 | 10.64 | 9,418 | 1.95 | 1.95 | 1.95 | (0.33 | ) | 23 | ||||||||||||||||||||||||||||||||
2019 | 10.73 | (0.05 | ) | 3.57 | 3.52 | – | (2.39 | ) | (2.39 | ) | 11.86 | 33.17 | 10,949 | 1.90 | 1.90 | 1.90 | (0.43 | ) | 19 | |||||||||||||||||||||||||||||||||
2018 | 15.39 | (0.08 | ) | (1.48 | ) | (1.56 | ) | – | (3.10 | ) | (3.10 | ) | 10.73 | (11.01 | ) | 9,715 | 1.80 | 1.80 | 1.80 | (0.52 | ) | 23 | ||||||||||||||||||||||||||||||
2017 | 14.47 | (0.12 | ) | 3.37 | 3.25 | – | (2.33 | ) | (2.33 | ) | 15.39 | 22.88 | 12,841 | 1.90 | 1.90 | 1.90 | (0.75 | ) | 8 | |||||||||||||||||||||||||||||||||
2016 | 13.49 | (0.05 | ) | 3.07 | 3.02 | – | (2.04 | ) | (2.04 | ) | 14.47 | 22.18 | 13,889 | 1.84 | 1.84 | 1.84 | (0.33 | ) | 15 | |||||||||||||||||||||||||||||||||
Royce Small-Cap Value Fund–Investment Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 8.61 | $ | 0.01 | $ | 1.99 | $ | 2.00 | $ | – | $ | – | $ | – | $ | 10.61 | 23.23 | %1 | $ | 44,247 | 1.31 | %2 | 1.30 | %2 | 1.24 | %2 | 0.13 | %2 | 28 | % | ||||||||||||||||||||||
2020 | 9.57 | 0.06 | (0.66 | ) | (0.60 | ) | (0.17 | ) | (0.19 | ) | (0.36 | ) | 8.61 | (6.25 | ) | 34,523 | 1.39 | 1.39 | 1.24 | 0.76 | 61 | |||||||||||||||||||||||||||||||
2019 | 8.35 | 0.09 | 1.46 | 1.55 | (0.08 | ) | (0.25 | ) | (0.33 | ) | 9.57 | 18.60 | 53,234 | 1.30 | 1.30 | 1.24 | 0.84 | 64 | ||||||||||||||||||||||||||||||||||
2018 | 10.16 | 0.05 | (0.73 | ) | (0.68 | ) | (0.04 | ) | (1.09 | ) | (1.13 | ) | 8.35 | (7.05 | ) | 56,433 | 1.26 | 1.26 | 1.24 | 0.45 | 64 | |||||||||||||||||||||||||||||||
2017 | 10.03 | 0.04 | 0.50 | 0.54 | (0.06 | ) | (0.35 | ) | (0.41 | ) | 10.16 | 5.49 | 66,094 | 1.26 | 1.25 | 1.24 | 0.44 | 61 | ||||||||||||||||||||||||||||||||||
2016 | 8.74 | 0.08 | 1.79 | 1.87 | (0.08 | ) | (0.50 | ) | (0.58 | ) | 10.03 | 21.37 | 72,863 | 1.24 | 1.24 | 1.24 | 0.72 | 56 | ||||||||||||||||||||||||||||||||||
Royce Small-Cap Value Fund–Service Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 8.58 | $ | (0.01 | ) | $ | 1.99 | $ | 1.98 | $ | – | $ | – | $ | – | $ | 10.56 | 23.08 | %1 | $ | 84,593 | 1.55 | %2 | 1.55 | %2 | 1.49 | %2 | (0.13 | )%2 | 28 | % | |||||||||||||||||||||
2020 | 9.54 | 0.04 | (0.66 | ) | (0.62 | ) | (0.15 | ) | (0.19 | ) | (0.34 | ) | 8.58 | (6.47 | ) | 75,502 | 1.62 | 1.62 | 1.49 | 0.50 | 61 | |||||||||||||||||||||||||||||||
2019 | 8.33 | 0.07 | 1.44 | 1.51 | (0.05 | ) | (0.25 | ) | (0.30 | ) | 9.54 | 18.21 | 102,465 | 1.56 | 1.55 | 1.49 | 0.65 | 64 | ||||||||||||||||||||||||||||||||||
2018 | 10.12 | 0.02 | (0.72 | ) | (0.70 | ) | (0.01 | ) | (1.08 | ) | (1.09 | ) | 8.33 | (7.17 | ) | 111,855 | 1.53 | 1.53 | 1.49 | 0.19 | 64 | |||||||||||||||||||||||||||||||
2017 | 9.98 | 0.02 | 0.50 | 0.52 | (0.03 | ) | (0.35 | ) | (0.38 | ) | 10.12 | 5.27 | 152,232 | 1.51 | 1.51 | 1.49 | 0.17 | 61 | ||||||||||||||||||||||||||||||||||
2016 | 8.70 | 0.05 | 1.79 | 1.84 | (0.06 | ) | (0.50 | ) | (0.56 | ) | 9.98 | 21.06 | 213,067 | 1.49 | 1.49 | 1.48 | 0.48 | 56 |
68 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
Financial Highlights
This table is presented to show selected data for a share outstanding throughout each year or other indicated period and to assist shareholders in evaluating a Fund’s performance for the periods presented. Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
Ratio of Expenses to Average Net Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss) | Net Realized and Unrealized Gain (Loss) on Investments and Foreign Currency | Total from Investment Operations | Distributions from Net Investment Income | Distributions from Net Realized Gain on Investments and Foreign Currency | Total Distributions | Net Asset Value, End of Period | Total Return | Net Assets, End of Period (in thousands) | Prior to Fee Waivers, Expense Reimbursements and Balance Credits | Prior to Fee Waivers and Expense Reimbursements | Net of Fee Waivers and Expense Reimbursements | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||||||||||||||
Royce Small-Cap Value Fund–Consultant Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 7.57 | $ | (0.06 | ) | $ | 1.75 | $ | 1.69 | $ | – | $ | – | $ | – | $ | 9.26 | 22.32 | %1 | $ | 4,459 | 2.68 | %2 | 2.68 | %2 | 2.68 | %2 | (1.33 | )%2 | 28 | % | |||||||||||||||||||||
2020 | 8.44 | (0.05 | ) | (0.60 | ) | (0.65 | ) | (0.06 | ) | (0.16 | ) | (0.22 | ) | 7.57 | (7.71 | ) | 3,899 | 2.74 | 2.73 | 2.73 | (0.71 | ) | 61 | |||||||||||||||||||||||||||||
2019 | 7.40 | (0.04 | ) | 1.30 | 1.26 | – | (0.22 | ) | (0.22 | ) | 8.44 | 17.03 | 7,486 | 2.44 | 2.44 | 2.44 | (0.50 | ) | 64 | |||||||||||||||||||||||||||||||||
2018 | 9.06 | (0.06 | ) | (0.64 | ) | (0.70 | ) | – | (0.96 | ) | (0.96 | ) | 7.40 | (8.07 | ) | 9,641 | 2.35 | 2.34 | 2.34 | (0.66 | ) | 64 | ||||||||||||||||||||||||||||||
2017 | 8.98 | (0.06 | ) | 0.45 | 0.39 | – | (0.31 | ) | (0.31 | ) | 9.06 | 4.44 | 13,111 | 2.32 | 2.32 | 2.32 | (0.66 | ) | 61 | |||||||||||||||||||||||||||||||||
2016 | 7.89 | (0.03 | ) | 1.62 | 1.59 | – | (0.50 | ) | (0.50 | ) | 8.98 | 20.10 | 16,484 | 2.28 | 2.28 | 2.28 | (0.33 | ) | 56 | |||||||||||||||||||||||||||||||||
Royce Small-Cap Value Fund–R Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 8.22 | $ | (0.03 | ) | $ | 1.90 | $ | 1.87 | $ | – | $ | – | $ | – | $ | 10.09 | 22.75 | %1 | $ | 8,742 | 1.99 | %2 | 1.99 | %2 | 1.99 | %2 | (0.61 | )%2 | 28 | % | |||||||||||||||||||||
2020 | 9.16 | (0.00 | ) | (0.64 | ) | (0.64 | ) | (0.12 | ) | (0.18 | ) | (0.30 | ) | 8.22 | (6.95 | ) | 7,142 | 2.10 | 2.10 | 1.99 | (0.02 | ) | 61 | |||||||||||||||||||||||||||||
2019 | 8.00 | 0.01 | 1.40 | 1.41 | (0.01 | ) | (0.24 | ) | (0.25 | ) | 9.16 | 17.68 | 8,083 | 1.98 | 1.98 | 1.97 | 0.11 | 64 | ||||||||||||||||||||||||||||||||||
2018 | 9.75 | (0.03 | ) | (0.68 | ) | (0.71 | ) | – | (1.04 | ) | (1.04 | ) | 8.00 | (7.62 | ) | 8,254 | 1.92 | 1.92 | 1.92 | (0.26 | ) | 64 | ||||||||||||||||||||||||||||||
2017 | 9.63 | (0.02 | ) | 0.48 | 0.46 | – | (0.34 | ) | (0.34 | ) | 9.75 | 4.81 | 14,620 | 1.88 | 1.88 | 1.88 | (0.21 | ) | 61 | |||||||||||||||||||||||||||||||||
2016 | 8.42 | 0.01 | 1.73 | 1.74 | (0.03 | ) | (0.50 | ) | (0.53 | ) | 9.63 | 20.60 | 18,059 | 1.85 | 1.85 | 1.85 | 0.11 | 56 | ||||||||||||||||||||||||||||||||||
Royce Smaller-Companies Growth Fund–Investment Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 11.06 | $ | (0.06 | ) | $ | 2.17 | $ | 2.11 | $ | – | $ | – | $ | – | $ | 13.17 | 19.08 | %1 | $ | 130,809 | 1.18 | %2 | 1.18 | %2 | 1.18 | %2 | (0.88 | )%2 | 29 | % | |||||||||||||||||||||
2020 | 8.21 | (0.07 | ) | 4.06 | 3.99 | – | (1.14 | ) | (1.14 | ) | 11.06 | 49.61 | 112,668 | 1.25 | 1.25 | 1.24 | (0.86 | ) | 61 | |||||||||||||||||||||||||||||||||
2019 | 6.86 | (0.05 | ) | 1.68 | 1.63 | – | (0.28 | ) | (0.28 | ) | 8.21 | 23.92 | 91,670 | 1.25 | 1.24 | 1.24 | (0.69 | ) | 53 | |||||||||||||||||||||||||||||||||
2018 | 10.93 | (0.07 | ) | (0.86 | ) | (0.93 | ) | – | (3.14 | ) | (3.14 | ) | 6.86 | (9.94 | ) | 87,213 | 1.21 | 1.21 | 1.21 | (0.62 | ) | 61 | ||||||||||||||||||||||||||||||
2017 | 11.22 | (0.09 | ) | 2.08 | 1.99 | – | (2.28 | ) | (2.28 | ) | 10.93 | 18.20 | 119,745 | 1.19 | 1.19 | 1.19 | (0.67 | ) | 64 | |||||||||||||||||||||||||||||||||
2016 | 11.36 | (0.05 | ) | 1.17 | 1.12 | – | (1.26 | ) | (1.26 | ) | 11.22 | 9.67 | 98,962 | 1.15 | 1.15 | 1.15 | (0.41 | ) | 59 | |||||||||||||||||||||||||||||||||
Royce Smaller-Companies Growth Fund–Service Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 10.74 | $ | (0.07 | ) | $ | 2.10 | $ | 2.03 | $ | – | $ | – | $ | – | $ | 12.77 | 18.90 | %1 | $ | 211,152 | 1.49 | %2 | 1.49 | %2 | 1.49 | %2 | (1.19 | )%2 | 29 | % | |||||||||||||||||||||
2020 | 7.99 | (0.09 | ) | 3.95 | 3.86 | – | (1.11 | ) | (1.11 | ) | 10.74 | 49.26 | 181,591 | 1.54 | 1.54 | 1.49 | (1.11 | ) | 61 | |||||||||||||||||||||||||||||||||
2019 | 6.69 | (0.07 | ) | 1.65 | 1.58 | – | (0.28 | ) | (0.28 | ) | 7.99 | 23.67 | 154,236 | 1.55 | 1.54 | 1.49 | (0.93 | ) | 53 | |||||||||||||||||||||||||||||||||
2018 | 10.69 | (0.10 | ) | (0.85 | ) | (0.95 | ) | – | (3.05 | ) | (3.05 | ) | 6.69 | (10.22 | ) | 156,057 | 1.52 | 1.52 | 1.49 | (0.90 | ) | 61 | ||||||||||||||||||||||||||||||
2017 | 11.01 | (0.12 | ) | 2.03 | 1.91 | – | (2.23 | ) | (2.23 | ) | 10.69 | 17.80 | 228,008 | 1.49 | 1.49 | 1.47 | (0.96 | ) | 64 | |||||||||||||||||||||||||||||||||
2016 | 11.20 | (0.08 | ) | 1.15 | 1.07 | – | (1.26 | ) | (1.26 | ) | 11.01 | 9.37 | 284,640 | 1.51 | 1.51 | 1.49 | (0.74 | ) | 59 | |||||||||||||||||||||||||||||||||
Royce Smaller-Companies Growth Fund–Consultant Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 9.08 | $ | (0.10 | ) | $ | 1.77 | $ | 1.67 | $ | – | $ | – | $ | – | $ | 10.75 | 18.39 | %1 | $ | 8,900 | 2.39 | %2 | 2.39 | %2 | 2.24 | %2 | (1.94 | )%2 | 29 | % | |||||||||||||||||||||
2020 | 6.81 | (0.13 | ) | 3.34 | 3.21 | – | (0.94 | ) | (0.94 | ) | 9.08 | 48.05 | 8,080 | 2.54 | 2.54 | 2.24 | (1.86 | ) | 61 | |||||||||||||||||||||||||||||||||
2019 | 5.74 | (0.11 | ) | 1.42 | 1.31 | – | (0.24 | ) | (0.24 | ) | 6.81 | 22.85 | 6,298 | 2.52 | 2.51 | 2.11 | (1.71 | ) | 53 | |||||||||||||||||||||||||||||||||
2018 | 9.28 | (0.16 | ) | (0.72 | ) | (0.88 | ) | – | (2.66 | ) | (2.66 | ) | 5.74 | (10.95 | ) | 6,328 | 2.40 | 2.40 | 2.24 | (1.66 | ) | 61 | ||||||||||||||||||||||||||||||
2017 | 9.63 | (0.18 | ) | 1.77 | 1.59 | – | (1.94 | ) | (1.94 | ) | 9.28 | 16.92 | 10,119 | 2.36 | 2.36 | 2.24 | (1.73 | ) | 64 | |||||||||||||||||||||||||||||||||
2016 | 10.01 | (0.14 | ) | 1.02 | 0.88 | – | (1.26 | ) | (1.26 | ) | 9.63 | 8.58 | 10,593 | 2.35 | 2.35 | 2.24 | (1.50 | ) | 59 |
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 69 |
Financial Highlights
This table is presented to show selected data for a share outstanding throughout each year or other indicated period and to assist shareholders in evaluating a Fund’s performance for the periods presented. Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
Ratio of Expenses to Average Net Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss) | Net Realized and Unrealized Gain (Loss) on Investments and Foreign Currency | Total from Investment Operations | Distributions from Net Investment Income | Distributions from Net Realized Gain on Investments and Foreign Currency | Total Distributions | Net Asset Value, End of Period | Total Return | Net Assets, End of Period (in thousands) | Prior to Fee Waivers, Expense Reimbursements and Balance Credits | Prior to Fee Waivers and Expense Reimbursements | Net of Fee Waivers and Expense Reimbursements | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||||||||||||||
Royce Smaller-Companies Growth Fund–Institutional Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 11.23 | $ | (0.05 | ) | $ | 2.19 | $ | 2.14 | $ | – | $ | – | $ | – | $ | 13.37 | 19.06 | %1 | $ | 6,157 | 1.38 | %2 | 1.38 | %2 | 1.16 | %2 | (0.86 | )%2 | 29 | % | |||||||||||||||||||||
2020 | 8.33 | (0.07 | ) | 4.13 | 4.06 | – | (1.16 | ) | (1.16 | ) | 11.23 | 49.70 | 5,646 | 1.44 | 1.44 | 1.23 | (0.85 | ) | 61 | |||||||||||||||||||||||||||||||||
2019 | 6.95 | (0.05 | ) | 1.72 | 1.67 | – | (0.29 | ) | (0.29 | ) | 8.33 | 24.10 | 8,021 | 1.35 | 1.35 | 1.17 | (0.62 | ) | 53 | |||||||||||||||||||||||||||||||||
2018 | 11.06 | (0.06 | ) | (0.88 | ) | (0.94 | ) | – | (3.17 | ) | (3.17 | ) | 6.95 | (9.94 | ) | 7,165 | 1.28 | 1.28 | 1.08 | (0.49 | ) | 61 | ||||||||||||||||||||||||||||||
2017 | 11.35 | (0.09 | ) | 2.11 | 2.02 | – | (2.31 | ) | (2.31 | ) | 11.06 | 18.23 | 9,315 | 1.21 | 1.21 | 1.21 | (0.70 | ) | 64 | |||||||||||||||||||||||||||||||||
2016 | 11.48 | (0.05 | ) | 1.18 | 1.13 | – | (1.26 | ) | (1.26 | ) | 11.35 | 9.66 | 20,523 | 1.15 | 1.15 | 1.15 | (0.41 | ) | 59 | |||||||||||||||||||||||||||||||||
Royce Special Equity Fund–Investment Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 18.22 | $ | 0.07 | $ | 2.51 | $ | 2.58 | $ | – | $ | – | $ | – | $ | 20.80 | 14.16 | %1 | $ | 796,976 | 1.19 | %2 | 1.19 | %2 | 1.19 | %2 | 0.65 | %2 | 23 | % | ||||||||||||||||||||||
2020 | 17.59 | 0.27 | 1.03 | 1.30 | (0.26 | ) | (0.41 | ) | (0.67 | ) | 18.22 | 7.43 | 702,556 | 1.23 | 1.23 | 1.23 | 1.68 | 39 | ||||||||||||||||||||||||||||||||||
2019 | 17.43 | 0.21 | 1.98 | 2.19 | (0.21 | ) | (1.82 | ) | (2.03 | ) | 17.59 | 12.63 | 819,015 | 1.21 | 1.21 | 1.21 | 0.99 | 20 | ||||||||||||||||||||||||||||||||||
2018 | 21.79 | 0.23 | (2.31 | ) | (2.08 | ) | (0.22 | ) | (2.06 | ) | (2.28 | ) | 17.43 | (9.86 | ) | 909,113 | 1.18 | 1.18 | 1.18 | 1.04 | 21 | |||||||||||||||||||||||||||||||
2017 | 22.02 | 0.13 | 1.56 | 1.69 | (0.12 | ) | (1.80 | ) | (1.92 | ) | 21.79 | 7.87 | 1,142,224 | 1.17 | 1.17 | 1.17 | 0.54 | 15 | ||||||||||||||||||||||||||||||||||
2016 | 17.94 | 0.21 | 5.57 | 5.78 | (0.21 | ) | (1.49 | ) | (1.70 | ) | 22.02 | 32.21 | 1,225,095 | 1.17 | 1.17 | 1.17 | 0.99 | 29 | ||||||||||||||||||||||||||||||||||
Royce Special Equity Fund–Service Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 18.19 | $ | 0.04 | $ | 2.52 | $ | 2.56 | $ | – | $ | – | $ | – | $ | 20.75 | 14.07 | %1 | $ | 56,301 | 1.53 | %2 | 1.53 | %2 | 1.43 | %2 | 0.41 | %2 | 23 | % | ||||||||||||||||||||||
2020 | 17.56 | 0.24 | 1.04 | 1.28 | (0.24 | ) | (0.41 | ) | (0.65 | ) | 18.19 | 7.29 | 46,671 | 1.60 | 1.60 | 1.39 | 1.49 | 39 | ||||||||||||||||||||||||||||||||||
2019 | 17.41 | 0.16 | 1.99 | 2.15 | (0.17 | ) | (1.83 | ) | (2.00 | ) | 17.56 | 12.40 | 60,070 | 1.58 | 1.58 | 1.39 | 0.80 | 20 | ||||||||||||||||||||||||||||||||||
2018 | 21.76 | 0.20 | (2.33 | ) | (2.13 | ) | (0.18 | ) | (2.04 | ) | (2.22 | ) | 17.41 | (10.13 | ) | 62,706 | 1.51 | 1.50 | 1.39 | 0.88 | 21 | |||||||||||||||||||||||||||||||
2017 | 21.98 | 0.08 | 1.56 | 1.64 | (0.07 | ) | (1.79 | ) | (1.86 | ) | 21.76 | 7.66 | 108,001 | 1.50 | 1.50 | 1.39 | 0.32 | 15 | ||||||||||||||||||||||||||||||||||
2016 | 17.92 | 0.16 | 5.56 | 5.72 | (0.17 | ) | (1.49 | ) | (1.66 | ) | 21.98 | 31.92 | 128,102 | 1.50 | 1.50 | 1.39 | 0.77 | 29 | ||||||||||||||||||||||||||||||||||
Royce Special Equity Fund–Consultant Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 16.60 | $ | (0.04 | ) | $ | 2.30 | $ | 2.26 | $ | – | $ | – | $ | – | $ | 18.86 | 13.61 | %1 | $ | 26,076 | 2.27 | %2 | 2.27 | %2 | 2.27 | %2 | (0.45 | )%2 | 23 | % | |||||||||||||||||||||
2020 | 16.05 | 0.09 | 0.92 | 1.01 | (0.09 | ) | (0.37 | ) | (0.46 | ) | 16.60 | 6.27 | 18,852 | 2.31 | 2.31 | 2.31 | 0.59 | 39 | ||||||||||||||||||||||||||||||||||
2019 | 15.90 | (0.02 | ) | 1.82 | 1.80 | (0.00 | ) | (1.65 | ) | (1.65 | ) | 16.05 | 11.38 | 24,793 | 2.25 | 2.25 | 2.25 | (0.12 | ) | 20 | ||||||||||||||||||||||||||||||||
2018 | 19.86 | 0.01 | (2.10 | ) | (2.09 | ) | (0.01 | ) | (1.86 | ) | (1.87 | ) | 15.90 | (10.83 | ) | 30,234 | 2.19 | 2.19 | 2.19 | 0.04 | 21 | |||||||||||||||||||||||||||||||
2017 | 20.16 | (0.10 | ) | 1.43 | 1.33 | – | (1.63 | ) | (1.63 | ) | 19.86 | 6.77 | 46,654 | 2.21 | 2.20 | 2.20 | (0.49 | ) | 15 | |||||||||||||||||||||||||||||||||
2016 | 16.57 | (0.01 | ) | 5.13 | 5.12 | (0.04 | ) | (1.49 | ) | (1.53 | ) | 20.16 | 30.91 | 50,514 | 2.20 | 2.20 | 2.20 | (0.04 | ) | 29 | ||||||||||||||||||||||||||||||||
Royce Special Equity Fund–Institutional Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 18.06 | $ | 0.07 | $ | 2.50 | $ | 2.57 | $ | – | $ | – | $ | – | $ | 20.63 | 14.23 | %1 | $ | 224,186 | 1.11 | %2 | 1.11 | %2 | 1.11 | %2 | 0.73 | %2 | 23 | % | ||||||||||||||||||||||
2020 | 17.43 | 0.30 | 1.01 | 1.31 | (0.28 | ) | (0.40 | ) | (0.68 | ) | 18.06 | 7.52 | 194,911 | 1.15 | 1.15 | 1.15 | 1.84 | 39 | ||||||||||||||||||||||||||||||||||
2019 | 17.28 | 0.22 | 1.96 | 2.18 | (0.22 | ) | (1.81 | ) | (2.03 | ) | 17.43 | 12.65 | 187,785 | 1.14 | 1.14 | 1.14 | 1.04 | 20 | ||||||||||||||||||||||||||||||||||
2018 | 21.61 | 0.25 | (2.30 | ) | (2.05 | ) | (0.24 | ) | (2.04 | ) | (2.28 | ) | 17.28 | (9.81 | ) | 202,317 | 1.11 | 1.11 | 1.11 | 1.14 | 21 | |||||||||||||||||||||||||||||||
2017 | 21.84 | 0.14 | 1.55 | 1.69 | (0.14 | ) | (1.78 | ) | (1.92 | ) | 21.61 | 7.96 | 247,004 | 1.09 | 1.09 | 1.09 | 0.60 | 15 | ||||||||||||||||||||||||||||||||||
2016 | 17.80 | 0.23 | 5.53 | 5.76 | (0.23 | ) | (1.49 | ) | (1.72 | ) | 21.84 | 32.35 | 206,270 | 1.07 | 1.07 | 1.07 | 1.10 | 29 |
70 | The Royce Funds 2021 Semiannual Report to Shareholders | THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS |
Financial Highlights
This table is presented to show selected data for a share outstanding throughout each year or other indicated period and to assist shareholders in evaluating a Fund’s performance for the periods presented. Per share amounts have been determined on the basis of the weighted average number of shares outstanding during the period.
Ratio of Expenses to Average Net Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss) | Net Realized and Unrealized Gain (Loss) on Investments and Foreign Currency | Total from Investment Operations | Distributions from Net Investment Income | Distributions from Net Realized Gain on Investments and Foreign Currency | Total Distributions | Net Asset Value, End of Period | Total Return | Net Assets, End of Period (in thousands) | Prior to Fee Waivers, Expense Reimbursements and Balance Credits | Prior to Fee Waivers and Expense Reimbursements | Net of Fee Waivers and Expense Reimbursements | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||||||||||||||
Royce Total Return Fund–Investment Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 9.34 | $ | 0.05 | $ | 1.80 | $ | 1.85 | $ | (0.06 | ) | $ | – | $ | (0.06 | ) | $ | 11.13 | 19.80 | %1 | $ | 1,033,864 | 1.19 | %2 | 1.19 | %2 | 1.19 | %2 | 0.92 | %2 | 36 | % | ||||||||||||||||||||
2020 | 10.93 | 0.17 | 0.19 | 0.36 | (0.21 | ) | (1.74 | ) | (1.95 | ) | 9.34 | 3.82 | 893,868 | 1.24 | 1.24 | 1.24 | 1.88 | 61 | ||||||||||||||||||||||||||||||||||
2019 | 9.71 | 0.16 | 2.10 | 2.26 | (0.15 | ) | (0.89 | ) | (1.04 | ) | 10.93 | 23.45 | 1,026,074 | 1.21 | 1.21 | 1.21 | 1.42 | 21 | ||||||||||||||||||||||||||||||||||
2018 | 13.58 | 0.20 | (1.78 | ) | (1.58 | ) | (0.19 | ) | (2.10 | ) | (2.29 | ) | 9.71 | (12.46 | ) | 1,036,211 | 1.18 | 1.18 | 1.18 | 1.45 | 22 | |||||||||||||||||||||||||||||||
2017 | 13.68 | 0.14 | 1.67 | 1.81 | (0.12 | ) | (1.79 | ) | (1.91 | ) | 13.58 | 13.65 | 1,550,893 | 1.19 | 1.19 | 1.19 | 1.00 | 12 | ||||||||||||||||||||||||||||||||||
2016 | 11.91 | 0.15 | 2.93 | 3.08 | (0.22 | ) | (1.09 | ) | (1.31 | ) | 13.68 | 25.86 | 1,835,927 | 1.19 | 1.19 | 1.19 | 1.08 | 16 | ||||||||||||||||||||||||||||||||||
Royce Total Return Fund–Service Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 9.62 | $ | 0.03 | $ | 1.87 | $ | 1.90 | $ | (0.04 | ) | $ | – | $ | (0.04 | ) | $ | 11.48 | 19.75 | %1 | $ | 87,404 | 1.50 | %2 | 1.50 | %2 | 1.49 | %2 | 0.61 | %2 | 36 | % | ||||||||||||||||||||
2020 | 11.27 | 0.16 | 0.18 | 0.34 | (0.19 | ) | (1.80 | ) | (1.99 | ) | 9.62 | 3.51 | 69,634 | 1.55 | 1.55 | 1.49 | 1.64 | 61 | ||||||||||||||||||||||||||||||||||
2019 | 9.97 | 0.13 | 2.16 | 2.29 | (0.08 | ) | (0.91 | ) | (0.99 | ) | 11.27 | 23.08 | 77,177 | 1.52 | 1.52 | 1.49 | 1.13 | 21 | ||||||||||||||||||||||||||||||||||
2018 | 13.88 | 0.16 | (1.82 | ) | (1.66 | ) | (0.11 | ) | (2.14 | ) | (2.25 | ) | 9.97 | (12.71 | ) | 83,368 | 1.52 | 1.52 | 1.48 | 1.15 | 22 | |||||||||||||||||||||||||||||||
2017 | 13.98 | 0.10 | 1.69 | 1.79 | (0.07 | ) | (1.82 | ) | (1.89 | ) | 13.88 | 13.24 | 97,854 | 1.49 | 1.48 | 1.48 | 0.72 | 12 | ||||||||||||||||||||||||||||||||||
2016 | 12.12 | 0.11 | 3.00 | 3.11 | (0.16 | ) | (1.09 | ) | (1.25 | ) | 13.98 | 25.60 | 142,606 | 1.46 | 1.46 | 1.46 | 0.80 | 16 | ||||||||||||||||||||||||||||||||||
Royce Total Return Fund–Consultant Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 9.75 | $ | (0.00 | ) | $ | 1.88 | $ | 1.88 | $ | (0.01 | ) | $ | – | $ | (0.01 | ) | $ | 11.62 | 19.23 | %1 | $ | 121,437 | 2.19 | %2 | 2.19 | %2 | 2.19 | %2 | (0.09 | )%2 | 36 | % | |||||||||||||||||||
2020 | 11.31 | 0.09 | 0.18 | 0.27 | (0.03 | ) | (1.80 | ) | (1.83 | ) | 9.75 | 2.76 | 110,179 | 2.22 | 2.22 | 2.22 | 0.88 | 61 | ||||||||||||||||||||||||||||||||||
2019 | 10.02 | 0.05 | 2.17 | 2.22 | (0.02 | ) | (0.91 | ) | (0.93 | ) | 11.31 | 22.18 | 150,175 | 2.20 | 2.20 | 2.20 | 0.43 | 21 | ||||||||||||||||||||||||||||||||||
2018 | 13.95 | 0.06 | (1.82 | ) | (1.76 | ) | (0.02 | ) | (2.15 | ) | (2.17 | ) | 10.02 | (13.26 | ) | 160,540 | 2.17 | 2.17 | 2.17 | 0.45 | 22 | |||||||||||||||||||||||||||||||
2017 | 14.07 | 0.01 | 1.70 | 1.71 | – | (1.83 | ) | (1.83 | ) | 13.95 | 12.53 | 247,914 | 2.16 | 2.16 | 2.16 | 0.04 | 12 | |||||||||||||||||||||||||||||||||||
2016 | 12.15 | 0.01 | 3.01 | 3.02 | (0.01 | ) | (1.09 | ) | (1.10 | ) | 14.07 | 24.73 | 267,083 | 2.16 | 2.16 | 2.16 | 0.11 | 16 | ||||||||||||||||||||||||||||||||||
Royce Total Return Fund–Institutional Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 9.17 | $ | 0.05 | $ | 1.78 | $ | 1.83 | $ | (0.06 | ) | $ | – | $ | (0.06 | ) | $ | 10.94 | 19.95 | %1 | $ | 273,142 | 1.10 | %2 | 1.10 | %2 | 1.10 | %2 | 1.01 | %2 | 36 | % | ||||||||||||||||||||
2020 | 10.77 | 0.18 | 0.18 | 0.36 | (0.24 | ) | (1.72 | ) | (1.96 | ) | 9.17 | 3.87 | 208,605 | 1.13 | 1.13 | 1.13 | 1.98 | 61 | ||||||||||||||||||||||||||||||||||
2019 | 9.58 | 0.17 | 2.07 | 2.24 | (0.18 | ) | (0.87 | ) | (1.05 | ) | 10.77 | 23.59 | 232,479 | 1.13 | 1.13 | 1.13 | 1.49 | 21 | ||||||||||||||||||||||||||||||||||
2018 | 13.40 | 0.21 | (1.76 | ) | (1.55 | ) | (0.21 | ) | (2.06 | ) | (2.27 | ) | 9.58 | (12.39 | ) | 218,268 | 1.09 | 1.09 | 1.09 | 1.53 | 22 | |||||||||||||||||||||||||||||||
2017 | 13.52 | 0.16 | 1.64 | 1.80 | (0.15 | ) | (1.77 | ) | (1.92 | ) | 13.40 | 13.80 | 310,603 | 1.06 | 1.06 | 1.06 | 1.13 | 12 | ||||||||||||||||||||||||||||||||||
2016 | 11.78 | 0.18 | 2.90 | 3.08 | (0.25 | ) | (1.09 | ) | (1.34 | ) | 13.52 | 26.13 | 420,375 | 1.05 | 1.05 | 1.05 | 1.22 | 16 | ||||||||||||||||||||||||||||||||||
Royce Total Return Fund–R Class | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2021† | $ | 9.76 | $ | 0.02 | $ | 1.88 | $ | 1.90 | $ | (0.02 | ) | $ | – | $ | (0.02 | ) | $ | 11.64 | 19.47 | %1 | $ | 33,409 | 1.82 | %2 | 1.82 | %2 | 1.82 | %2 | 0.28 | %2 | 36 | % | ||||||||||||||||||||
2020 | 11.38 | 0.12 | 0.18 | 0.30 | (0.12 | ) | (1.80 | ) | (1.92 | ) | 9.76 | 3.08 | 30,027 | 1.89 | 1.88 | 1.88 | 1.23 | 61 | ||||||||||||||||||||||||||||||||||
2019 | 10.06 | 0.09 | 2.18 | 2.27 | (0.03 | ) | (0.92 | ) | (0.95 | ) | 11.38 | 22.66 | 36,345 | 1.85 | 1.84 | 1.84 | 0.76 | 21 | ||||||||||||||||||||||||||||||||||
2018 | 13.99 | 0.11 | (1.83 | ) | (1.72 | ) | (0.06 | ) | (2.15 | ) | (2.21 | ) | 10.06 | (12.96 | ) | 45,145 | 1.81 | 1.81 | 1.81 | 0.82 | 22 | |||||||||||||||||||||||||||||||
2017 | 14.09 | 0.06 | 1.71 | 1.77 | (0.03 | ) | (1.84 | ) | (1.87 | ) | 13.99 | 12.97 | 54,979 | 1.80 | 1.80 | 1.80 | 0.40 | 12 | ||||||||||||||||||||||||||||||||||
2016 | 12.19 | 0.07 | 3.00 | 3.07 | (0.08 | ) | (1.09 | ) | (1.17 | ) | 14.09 | 25.14 | 53,896 | 1.78 | 1.78 | 1.78 | 0.49 | 16 |
† Six months ended June 30, 2021 (unaudited).
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS | The Royce Funds 2021 Semiannual Report to Shareholders | 71 |
Notes to Financial Statements (unaudited)
Summary of Significant Accounting Policies:
Royce Dividend Value Fund, Royce Global Financial Services Fund, Royce International Premier Fund, Royce Micro-Cap Fund, Royce Opportunity Fund, Royce Pennsylvania Mutual Fund, Royce Premier Fund, Royce Small-Cap Value Fund, Royce Smaller-Companies Growth Fund, Royce Special Equity Fund and Royce Total Return Fund (the “Fund” or “Funds”), are the eleven series of The Royce Fund (the “Trust”), an open-end management investment company organized as a Delaware statutory trust.
Classes of shares have equal rights as to earnings and assets, except that each class may bear different fees and expenses for distribution, shareholder servicing, registration and shareholder reports, and receive different compensating balance credits and expense reimbursements. Investment income, realized and unrealized capital gains or losses on investments and foreign currency, and expenses other than those attributable to a specific class are allocated to each class of shares based on its relative net assets.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
Each Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification Topic 946 “Financial Services-Investment Companies.”
Royce & Associates, LP, the Funds’ investment adviser, is a majority-owned subsidiary of Franklin Resources, Inc. and primarily conducts business using the name Royce Investment Partners (“Royce”). At June 30, 2021, officers, employees of Royce, Fund trustees, the Royce retirement plans and other affiliates owned more than 10% of the following Fund:
Royce Global Financial Services Fund 11%
VALUATION OF INVESTMENTS:
Securities are valued as of the close of trading on the New York Stock Exchange (NYSE) (generally 4:00 p.m. Eastern time) on the valuation date. Securities that trade on an exchange, and securities traded on Nasdaq’s Electronic Bulletin Board, are valued at their last reported sales price or Nasdaq official closing price taken from the primary market in which each security trades or, if no sale is reported for such day, at their highest bid price. Other over-the-counter securities for which market quotations are readily available are valued at their highest bid price, except in the case of some bonds and other fixed income securities which may be valued by reference to other securities with comparable ratings, interest rates and maturities, using established independent pricing services. The Funds value their non-U.S. dollar denominated securities in U.S. dollars daily at the prevailing foreign currency exchange rates as quoted by a major bank. Securities for which market quotations are not readily available are valued at their fair value in accordance with the provisions of the 1940 Act, under procedures approved by the Trust’s Board of Trustees, and are reported as Level 3 securities. As a general principle, the fair value of a security is the amount which the Fund might reasonably expect to receive for the security upon its current sale. However, in light of the judgment involved in fair valuations, there can be no assurance that a fair value assigned to a particular security will be the amount which the Fund might be able to receive upon its current sale. In addition, if, between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that are significant and may make the closing price unreliable, a Fund may fair value the security. The Funds use an independent pricing service to provide fair value estimates for relevant non-U.S. equity securities on days when the U.S. market volatility exceeds a certain threshold. This pricing service uses proprietary correlations it has developed between the movement of prices of non-U.S. equity securities and indices of U.S.-traded securities, futures contracts and other indications to estimate the fair value of relevant non-U.S. securities. When fair value pricing is employed, the prices of securities used by a Fund may differ from quoted or published prices for the same security. Investments in money market funds are valued at net asset value per share.
Various inputs are used in determining the value of each Fund’s investments, as noted above. These inputs are summarized in the three broad levels below:
Level 1 – | quoted prices in active markets for identical securities. | |
Level 2 – | other significant observable inputs (including quoted prices for similar securities, foreign securities that may be fair valued and repurchase agreements). The table below includes all Level 2 securities. Level 2 securities with values based on quoted prices for similar securities are noted in the Schedules of Investments. | |
Level 3 – | significant unobservable inputs (including last trade price before trading was suspended, or at a discount thereto for lack of marketability or otherwise, market price information regarding other securities, information received from the company and/or published documents, including SEC filings and financial statements, or other publicly available information). |
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
72 | The Royce Funds 2021 Semiannual Report to Shareholders
VALUATION OF INVESTMENTS (continued):
The following is a summary of the inputs used to value each Fund’s investments as of June 30, 2021. For a detailed breakout of common stocks by sector classification or country, please refer to the Schedules of Investments.
LEVEL 1 | LEVEL 2 | LEVEL 3 | TOTAL | |||||||||||||
Royce Dividend Value Fund | ||||||||||||||||
Common Stocks | $ | 71,679,673 | $ | – | $ | – | $ | 71,679,673 | ||||||||
Repurchase Agreement | – | 6,490,181 | – | 6,490,181 | ||||||||||||
Royce Global Financial Services Fund | ||||||||||||||||
Common Stocks | 38,038,578 | 882 | – | 38,039,460 | ||||||||||||
Repurchase Agreement | – | 4,648,074 | – | 4,648,074 | ||||||||||||
Royce International Premier Fund | ||||||||||||||||
Common Stocks | 1,206,423,397 | – | – | 1,206,423,397 | ||||||||||||
Preferred Stocks | 23,132,932 | – | – | 23,132,932 | ||||||||||||
Repurchase Agreement | – | 50,003,917 | – | 50,003,917 | ||||||||||||
Royce Micro-Cap Fund | ||||||||||||||||
Common Stocks | 398,270,701 | 609,390 | 690,000 | 399,570,091 | ||||||||||||
Repurchase Agreement | – | 16,721,174 | – | 16,721,174 | ||||||||||||
Money Market Fund/Collateral Received for Securities Loaned | 189,300 | – | – | 189,300 | ||||||||||||
Royce Opportunity Fund | ||||||||||||||||
Common Stocks | 1,989,498,908 | 4,187,695 | – | 1,993,686,603 | ||||||||||||
Repurchase Agreement | – | 248,411,316 | – | 248,411,316 | ||||||||||||
Money Market Fund/Collateral Received for Securities Loaned | 4,438,500 | – | – | 4,438,500 | ||||||||||||
Royce Pennsylvania Mutual Fund | ||||||||||||||||
Common Stocks | 2,211,504,410 | 8,083,687 | 0 | 2,219,588,097 | ||||||||||||
Repurchase Agreement | – | 74,543,071 | – | 74,543,071 | ||||||||||||
Money Market Fund/Collateral Received for Securities Loaned | 10,502,933 | – | – | 10,502,933 | ||||||||||||
Royce Premier Fund | ||||||||||||||||
Common Stocks | 1,611,152,967 | 31,578,750 | – | 1,642,731,717 | ||||||||||||
Repurchase Agreement | – | 142,818,223 | – | 142,818,223 | ||||||||||||
Royce Small-Cap Value Fund | ||||||||||||||||
Common Stocks | 138,730,451 | – | – | 138,730,451 | ||||||||||||
Repurchase Agreement | – | 3,716,925 | – | 3,716,925 | ||||||||||||
Money Market Fund/Collateral Received for Securities Loaned | 669,300 | – | – | 669,300 | ||||||||||||
Royce Smaller-Companies Growth Fund | ||||||||||||||||
Common Stocks | 331,820,253 | 1,788,640 | – | 333,608,893 | ||||||||||||
Repurchase Agreement | – | 24,389,873 | – | 24,389,873 | ||||||||||||
Money Market Fund/Collateral Received for Securities Loaned | 13,108,421 | – | – | 13,108,421 | ||||||||||||
Royce Special Equity Fund | ||||||||||||||||
Common Stocks | 897,592,819 | 44,482,500 | – | 942,075,319 | ||||||||||||
Repurchase Agreement | – | 160,575,568 | – | 160,575,568 | ||||||||||||
Royce Total Return Fund | ||||||||||||||||
Common Stocks | 1,530,837,160 | 632,000 | 0 | 1,531,469,160 | ||||||||||||
Preferred Stocks | 2,137,910 | – | – | 2,137,910 | ||||||||||||
Repurchase Agreement | – | 16,613,576 | – | 16,613,576 |
Level 3 Reconciliation:
BALANCE AS OF 12/31/20 | SALES | REALIZED GAIN (LOSS) | UNREALIZED GAIN (LOSS) 1 | BALANCE AS OF 6/30/21 | ||||||||||||||||
Royce Micro-Cap Fund | ||||||||||||||||||||
Common Stocks | $ | 690,000 | $ | – | $ | – | $ | – | $ | 690,000 | ||||||||||
Royce Pennsylvania Mutual Fund | ||||||||||||||||||||
Common Stocks | 0 | – | – | – | 0 | |||||||||||||||
Royce Total Return Fund | ||||||||||||||||||||
Common Stocks | 506,127 | 516,640 | (3,567,783 | ) | 3,578,296 | 0 |
1 | The net change in unrealized appreciation (depreciation) is included in the accompanying Statement of Operations. Change in unrealized appreciation (depreciation) includes net unrealized appreciation (depreciation) resulting from changes in investment values during the reporting period and the reversal of previously recorded unrealized appreciation (depreciation) when gains or losses are realized. Net realized gain (loss) from investments and foreign currency transactions is included in the accompanying Statement of Operations. |
The Royce Funds 2021 Semiannual Report to Shareholders | 73
Notes to Financial Statements (unaudited) (continued)
REPURCHASE AGREEMENTS:
The Funds may enter into repurchase agreements with institutions that the Funds’ investment adviser has determined are creditworthy. Each Fund restricts repurchase agreements to maturities of no more than seven days. Securities pledged as collateral for repurchase agreements, which are held until maturity of the repurchase agreements, are marked-to-market daily and maintained at a value at least equal to the principal amount of the repurchase agreement (including accrued interest). Repurchase agreements could involve certain risks in the event of default or insolvency of the counter-party, including possible delays or restrictions upon the ability of each Fund to dispose of its underlying securities. The remaining contractual maturities of repurchase agreements held by the Funds at June 30, 2021 are overnight and continuous.
FOREIGN CURRENCY:
Net realized foreign exchange gains or losses arise from sales and maturities of short-term securities, sales of foreign currencies, expiration of currency forward contracts, currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on each Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the value of assets and liabilities, other than investments in securities at the end of the reporting period, as a result of changes in foreign currency exchange rates.
The Funds do not isolate that portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments.
SECURITIES LENDING:
The Funds loan securities through a lending agent, State Street Bank and Trust Company, to qualified institutional investors for the purpose of earning additional income. The lending agent receives and holds collateral from such borrowers to secure their obligations to the Funds. Such loans must be secured at all times by collateral in an amount at least equal to the market value of the loaned securities. The market values of the loaned securities and the collateral fluctuate and are determined at the close of each business day by the lending agent. Borrowers are required to post additional collateral to the lending agent on the next succeeding business day in the event of a collateral shortfall. Counterparty risk is further reduced by loaning securities only to parties that participate in a Global Securities Lending Program organized and monitored by the lending agent and that are deemed by it to satisfy its requirements and by having the lending agent enter into securities lending agreements with such borrowers. The lending agent is not affiliated with Royce.
Collateral may be in the form of cash or U.S. Treasuries. Cash collateral is invested in certain money market pooled investment vehicles. The Funds record a liability in their respective Statements of Assets and Liabilities for the return of such cash collateral during periods in which securities are on loan. The Funds bear the risk of loss for any decrease in the market value of the loaned securities or the investments purchased with cash collateral received from the borrowers.
Pursuant to the agreement in place between the Funds and the lending agent, if a borrower fails to return loaned securities, and the cash collateral being maintained by the lending agent on behalf of such borrower is insufficient to cover the value of loaned securities and provided such collateral insufficiency is not the result of investment losses, the lending agent shall, at its option, either replace the loaned securities or pay the amount of the shortfall to the Funds. In the event of the bankruptcy of a borrower, the Funds could experience delay in recovering the loaned securities or only recover cash or a security of equivalent value.
Loans of securities generally do not have stated maturity dates, and the Funds may recall a security at any time. The Funds’ securities lending income consists of the income earned on investing cash collateral, plus any premium payments received for lending certain securities, less any rebates paid to borrowers and lending agent fees associated with the loan. Pursuant to the agreement in place between the Funds and the lending agent, the Funds are responsible for any shortfall in the event the value of the investments purchased with cash collateral is insufficient to pay the rebate fee to the borrower.
The following table presents cash collateral and the market value of securities on loan collateralized by cash collateral held by the Funds at June 30, 2021:
CASH COLLATERAL1 | SECURITIES ON LOAN COLLATERALIZED BY CASH COLLATERAL | NET AMOUNT | ||||||||||
Royce Micro-Cap Fund | $ | 189,300 | $ | (174,156 | ) | $ | 15,144 | |||||
Royce Opportunity Fund | 4,438,500 | (4,312,150 | ) | 126,350 | ||||||||
Royce Pennsylvania Mutual Fund | 10,502,933 | (10,065,020 | ) | 437,913 | ||||||||
Royce Small-Cap Value Fund | 669,300 | (640,200 | ) | 29,100 | ||||||||
Royce Smaller-Companies Growth Fund | 13,108,421 | (12,839,966 | ) | 268,455 |
1 | Absent an event of default, assets and liabilities are presented gross and not offset in the Statements of Assets and Liabilities. The remaining contractual maturity of cash collateral is overnight and continuous. |
74 | The Royce Funds 2021 Semiannual Report to Shareholders
SECURITIES LENDING (continued):
The following table presents non-cash collateral and the market value of securities on loan collateralized by non-cash collateral held by the Funds’ custodian at June 30, 2021:
NON-CASH COLLATERAL | SECURITIES ON LOAN COLLATERALIZED BY NON-CASH COLLATERAL | NET AMOUNT | ||||||||||
Royce Micro-Cap Fund | $ | 8,258,322 | $ | (8,022,158 | ) | $ | 236,164 | |||||
Royce Opportunity Fund | 55,096,131 | (53,714,070 | ) | 1,382,061 | ||||||||
Royce Pennsylvania Mutual Fund | 36,609,566 | (35,669,582 | ) | 939,984 | ||||||||
Royce Small-Cap Value Fund | 512,790 | (500,814 | ) | 11,976 | ||||||||
Royce Smaller-Companies Growth Fund | 29,494,928 | (28,723,553 | ) | 771,375 |
DISTRIBUTIONS AND TAXES:
As qualified regulated investment companies under Subchapter M of the Internal Revenue Code, the Funds are not subject to income taxes to the extent that each Fund distributes substantially all of its taxable income for its fiscal year.
Royce Dividend Value Fund and Royce Total Return Fund pay any dividends from net investment income quarterly and make any distributions from net realized gains annually in December. The other Funds pay any dividends and capital gain distributions annually in December. Dividends from net investment income and distributions from capital gains are determined at a class level. Because federal income tax regulations differ from generally accepted accounting principles, income and capital gain distributions determined in accordance with tax regulations may differ from net investment income and realized gains recognized for financial reporting purposes. Accordingly, the character of distributions and composition of net assets for tax purposes differ from those reflected in the accompanying financial statements.
CAPITAL GAINS TAXES:
The Funds may be subject to a tax imposed on capital gains on securities of issuers domiciled in certain countries. The Funds record an estimated deferred tax liability for gains in these securities that have been held for less than one year. This amount, if any, is reported as deferred capital gains tax in the accompanying Statements of Assets and Liabilities, assuming those positions were disposed of at the end of the period, and accounted for as a reduction in the market value of the security.
INVESTMENT TRANSACTIONS AND RELATED INVESTMENT INCOME:
Investment transactions are accounted for on the trade date. Dividend income is recorded on the ex-dividend date. Non-cash dividend income is recorded at the fair market value of the securities received. Interest income is recorded on an accrual basis. Premiums and discounts on debt securities are amortized using the effective yield-to-maturity method. Realized gains and losses from investment transactions are determined on the basis of identified cost for book and tax purposes.
EXPENSES:
The Funds incur direct and indirect expenses. Expenses directly attributable to a Fund are charged to the Fund’s operations, while expenses applicable to more than one of the Royce Funds are allocated equitably. Certain personnel, occupancy costs and other administrative expenses related to the Funds are allocated by Royce under an administration agreement and are included in administrative and office facilities and legal expenses.
COMPENSATING BALANCE CREDITS:
The Funds have arrangements with their custodian bank and transfer agent, whereby a portion of the custodian’s fee and transfer agent’s fee is paid indirectly by credits earned on a Fund’s cash on deposit with the bank and transfer agent. These deposit arrangements are an alternative to purchasing overnight investments. Conversely, a Fund pays interest to the custodian on any cash overdrafts, to the extent they are not offset by credits earned on positive cash balances.
LINE OF CREDIT:
The Funds, along with certain other Royce Funds, participate in a $65 million line of credit (“Credit Agreement”) with State Street Bank and Trust Company to be used for temporary or emergency purposes. This revolving Credit Agreement expires on October 8, 2021. Pursuant to the Credit Agreement, each participating Fund is liable for a portion of the commitment fee for the credit facility and for principal and interest payments related to borrowings made by that Fund. Borrowings under the Credit Agreement bear interest at a variable rate equal to the Applicable Rate plus the Applicable Margin. The term Applicable Rate means, for any day, a rate equal to the sum of (a) 0.10%, plus (b) the higher of (i) the Federal Funds Effective Rate for such day, or (ii) the Overnight Bank Funding Rate for such day. The term Applicable Margin means 1.25%. The Funds did not utilize the line of credit during the six months ended June 30, 2021.
The Royce Funds 2021 Semiannual Report to Shareholders | 75
Notes to Financial Statements (unaudited) (continued)
Capital Share Transactions (in dollars):
SHARES SOLD | SHARES ISSUED FOR REINVESTMENT OF DISTRIBUTIONS | SHARES REDEEMED | NET INCREASE (DECREASE) FROM CAPITAL SHARE TRANSACTIONS | |||||||||||||||||||||||||||||
Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | |||||||||||||||||||||||||
Royce Dividend Value Fund | ||||||||||||||||||||||||||||||||
Investment Class | $ | 2,293,040 | $ | 7,191,951 | $ | 210,841 | $ | 2,949,058 | $ | (8,611,236 | ) | $ | (28,741,034 | ) | $ | (6,107,355 | ) | $ | (18,600,025 | ) | ||||||||||||
Service Class | 359,778 | 644,642 | 46,769 | 948,324 | (2,940,874 | ) | (6,078,959 | ) | (2,534,327 | ) | (4,485,993 | ) | ||||||||||||||||||||
Consultant Class | 17,465 | 11,980 | – | 46,021 | (36,188 | ) | (378,765 | ) | (18,723 | ) | (320,764 | ) | ||||||||||||||||||||
Institutional Class | 45,695 | 185,589 | 3,927 | 44,783 | (18,049 | ) | (260,490 | ) | 31,573 | (30,118 | ) | |||||||||||||||||||||
Royce Global Financial Services Fund | ||||||||||||||||||||||||||||||||
Service Class | 6,020,633 | 3,804,511 | – | 1,530,984 | (2,864,072 | ) | (10,742,359 | ) | 3,156,561 | (5,406,864 | ) | |||||||||||||||||||||
Institutional Class | – | – | – | 490,704 | – | (12,598 | ) | – | 478,106 | |||||||||||||||||||||||
Royce International Premier Fund | ||||||||||||||||||||||||||||||||
Investment Class | 74,780,078 | 204,010,079 | – | 916,927 | (89,489,602 | ) | (149,175,342 | ) | (14,709,524 | ) | 55,751,664 | |||||||||||||||||||||
Service Class | 6,394,644 | 26,685,353 | – | – | (14,167,566 | ) | (37,653,405 | ) | (7,772,922 | ) | (10,968,052 | ) | ||||||||||||||||||||
Consultant Class | 166,780 | 576,990 | – | – | (422,577 | ) | (2,303,772 | ) | (255,797 | ) | (1,726,782 | ) | ||||||||||||||||||||
Institutional Class | 125,599,226 | 187,478,073 | – | 1,123,513 | (37,264,433 | ) | (64,694,078 | ) | 88,334,793 | 123,907,508 | ||||||||||||||||||||||
Royce Micro-Cap Fund | ||||||||||||||||||||||||||||||||
Investment Class | 9,330,545 | 7,333,691 | – | 11,024,344 | (23,845,247 | ) | (23,791,270 | ) | (14,514,702 | ) | (5,433,235 | ) | ||||||||||||||||||||
Service Class | 3,347,861 | 2,833,711 | – | 11,018,041 | (13,624,023 | ) | (28,817,547 | ) | (10,276,162 | ) | (14,965,795 | ) | ||||||||||||||||||||
Consultant Class | 55,275 | 215,088 | – | 907,664 | (953,867 | ) | (2,739,012 | ) | (898,592 | ) | (1,616,260 | ) | ||||||||||||||||||||
Royce Opportunity Fund | ||||||||||||||||||||||||||||||||
Investment Class | 685,860,618 | 171,205,300 | – | – | (211,376,910 | ) | (146,632,037 | ) | 474,483,708 | 24,573,263 | ||||||||||||||||||||||
Service Class | 96,299,929 | 74,701,884 | – | – | (103,632,278 | ) | (18,878,148 | ) | (7,332,349 | ) | 55,823,736 | |||||||||||||||||||||
Consultant Class | 1,746,405 | 4,354,940 | – | – | (2,819,427 | ) | (2,009,384 | ) | (1,073,022 | ) | 2,345,556 | |||||||||||||||||||||
Institutional Class | 149,147,237 | 159,214,915 | – | – | (144,880,762 | ) | (119,168,031 | ) | 4,266,475 | 40,046,884 | ||||||||||||||||||||||
R Class | 12,750,984 | 5,428,658 | – | – | (6,944,895 | ) | (8,263,137 | ) | 5,806,089 | (2,834,479 | ) | |||||||||||||||||||||
Royce Pennsylvania Mutual Fund | ||||||||||||||||||||||||||||||||
Investment Class | 100,653,917 | 129,712,233 | – | 62,415,440 | (102,611,695 | ) | (280,753,528 | ) | (1,957,778 | ) | (88,625,855 | ) | ||||||||||||||||||||
Service Class | 73,048,473 | 11,914,461 | – | 3,351,244 | (19,989,306 | ) | (78,783,903 | ) | �� | 53,059,167 | (63,518,198 | ) | ||||||||||||||||||||
Consultant Class | 1,169,391 | 4,275,481 | – | 9,558,258 | (17,015,947 | ) | (49,044,206 | ) | (15,846,556 | ) | (35,210,467 | ) | ||||||||||||||||||||
Institutional Class | 50,470,727 | 66,450,769 | – | 7,982,989 | (24,994,561 | ) | (31,062,664 | ) | 25,476,166 | 43,371,094 | ||||||||||||||||||||||
R Class | 1,423,204 | 762,130 | – | 345,260 | (1,326,238 | ) | (2,294,846 | ) | 96,966 | (1,187,456 | ) | |||||||||||||||||||||
Royce Premier Fund | ||||||||||||||||||||||||||||||||
Investment Class | 63,851,422 | 180,850,254 | – | 61,454,622 | (160,748,799 | ) | (387,040,459 | ) | (96,897,377 | ) | (144,735,583 | ) | ||||||||||||||||||||
Service Class | 5,844,181 | 8,349,210 | – | 1,387,591 | (6,141,924 | ) | (11,085,656 | ) | (297,743 | ) | (1,348,855 | ) | ||||||||||||||||||||
Consultant Class | 56,141 | 779,765 | – | 689,259 | (912,118 | ) | (3,774,843 | ) | (855,977 | ) | (2,305,819 | ) | ||||||||||||||||||||
Institutional Class | 19,221,028 | 87,405,548 | – | 13,980,733 | (40,551,636 | ) | (100,897,299 | ) | (21,330,608 | ) | 488,982 | |||||||||||||||||||||
R Class | 96,742 | 597,038 | – | 449,228 | (1,759,758 | ) | (2,802,246 | ) | (1,663,016 | ) | (1,755,980 | ) | ||||||||||||||||||||
Royce Small-Cap Value Fund | ||||||||||||||||||||||||||||||||
Investment Class | 4,842,536 | 3,457,167 | – | 1,216,083 | (3,533,109 | ) | (15,806,198 | ) | 1,309,427 | (11,132,948 | ) | |||||||||||||||||||||
Service Class | 2,154,019 | 2,271,024 | – | 2,650,395 | (9,989,610 | ) | (18,681,676 | ) | (7,835,591 | ) | (13,760,257 | ) | ||||||||||||||||||||
Consultant Class | 19,263 | 248,256 | – | 112,639 | (313,039 | ) | (2,586,024 | ) | (293,776 | ) | (2,225,129 | ) | ||||||||||||||||||||
R Class | 1,572,739 | 1,341,968 | – | 253,771 | (1,535,935 | ) | (1,830,036 | ) | 36,804 | (234,297 | ) | |||||||||||||||||||||
Royce Smaller-Companies Growth Fund | ||||||||||||||||||||||||||||||||
Investment Class | 16,660,573 | 4,059,712 | – | 8,872,763 | (20,407,325 | ) | (19,744,579 | ) | (3,746,752 | ) | (6,812,104 | ) | ||||||||||||||||||||
Service Class | 11,807,212 | 4,157,959 | – | 16,456,391 | (16,387,569 | ) | (36,694,110 | ) | (4,580,357 | ) | (16,079,760 | ) | ||||||||||||||||||||
Consultant Class | 15,174 | 72,295 | – | 730,139 | (668,914 | ) | (877,865 | ) | (653,740 | ) | (75,431 | ) | ||||||||||||||||||||
Institutional Class | 340,573 | 648,706 | – | 520,741 | (890,151 | ) | (4,957,343 | ) | (549,578 | ) | (3,787,896 | ) | ||||||||||||||||||||
Royce Special Equity Fund | ||||||||||||||||||||||||||||||||
Investment Class | 86,977,818 | 175,354,994 | – | 21,056,949 | (92,706,913 | ) | (324,990,330 | ) | (5,729,095 | ) | (128,578,387 | ) | ||||||||||||||||||||
Service Class | 10,861,678 | 20,262,269 | – | 1,314,464 | (7,724,959 | ) | (36,815,552 | ) | 3,136,719 | (15,238,819 | ) | |||||||||||||||||||||
Consultant Class | 6,894,819 | 748,171 | – | 454,137 | (2,087,255 | ) | (7,248,754 | ) | 4,807,564 | (6,046,446 | ) | |||||||||||||||||||||
Institutional Class | 29,192,130 | 173,759,435 | – | 4,804,761 | (28,096,641 | ) | (174,962,098 | ) | 1,095,489 | 3,602,098 | ||||||||||||||||||||||
Royce Total Return Fund | ||||||||||||||||||||||||||||||||
Investment Class | 106,940,859 | 152,290,416 | 4,927,278 | 141,179,953 | (144,796,107 | ) | (284,116,987 | ) | (32,927,970 | ) | 9,353,382 | |||||||||||||||||||||
Service Class | 17,238,814 | 18,551,062 | 269,012 | 11,684,426 | (12,747,529 | ) | (26,772,474 | ) | 4,760,297 | 3,463,014 | ||||||||||||||||||||||
Consultant Class | 970,766 | 2,633,113 | 49,070 | 16,711,733 | (10,575,957 | ) | (38,528,825 | ) | (9,556,121 | ) | (19,183,979 | ) | ||||||||||||||||||||
Institutional Class | 45,158,799 | 75,965,309 | 1,402,820 | 35,429,144 | (23,176,663 | ) | (105,570,702 | ) | 23,384,956 | 5,823,751 | ||||||||||||||||||||||
R Class | 3,658,083 | 3,797,612 | 61,017 | 5,028,346 | (6,074,769 | ) | (10,058,352 | ) | (2,355,669 | ) | (1,232,394 | ) |
76 | The Royce Funds 2021 Semiannual Report to Shareholders
Capital Share Transactions (in shares):
SHARES SOLD | SHARES ISSUED FOR REINVESTMENT OF DISTRIBUTIONS | SHARES REDEEMED | NET INCREASE (DECREASE) IN SHARES OUTSTANDING | |||||||||||||||||||||||||||||
Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | Six Months Ended 6/30/21 (unaudited) | Year Ended 12/31/20 | |||||||||||||||||||||||||
Royce Dividend Value Fund | ||||||||||||||||||||||||||||||||
Investment Class | 346,567 | 1,491,917 | 29,894 | 505,159 | (1,304,391 | ) | (5,548,817 | ) | (927,930 | ) | (3,551,741 | ) | ||||||||||||||||||||
Service Class | 50,461 | 110,691 | 6,417 | 155,513 | (428,325 | ) | (1,092,901 | ) | (371,447 | ) | (826,697 | ) | ||||||||||||||||||||
Consultant Class | 2,301 | 1,626 | – | 6,502 | (4,795 | ) | (60,476 | ) | (2,494 | ) | (52,348 | ) | ||||||||||||||||||||
Institutional Class | 7,003 | 35,276 | 566 | 7,729 | (2,830 | ) | (58,716 | ) | 4,739 | (15,711 | ) | |||||||||||||||||||||
Royce Global Financial Services Fund | ||||||||||||||||||||||||||||||||
Service Class | 485,582 | 404,322 | – | 148,495 | (241,798 | ) | (1,167,633 | ) | 243,784 | (614,816 | ) | |||||||||||||||||||||
Institutional Class | – | – | – | 36,729 | – | (962 | ) | – | 35,767 | |||||||||||||||||||||||
Royce International Premier Fund | ||||||||||||||||||||||||||||||||
Investment Class | 4,227,921 | 14,592,460 | – | 54,906 | (5,045,866 | ) | (10,718,019 | ) | (817,945 | ) | 3,929,347 | |||||||||||||||||||||
Service Class | 301,066 | 1,574,067 | – | – | (670,361 | ) | (2,208,142 | ) | (369,295 | ) | (634,075 | ) | ||||||||||||||||||||
Consultant Class | 7,425 | 30,314 | – | – | (18,667 | ) | (127,076 | ) | (11,242 | ) | (96,762 | ) | ||||||||||||||||||||
Institutional Class | 7,063,439 | 12,732,043 | – | 67,236 | (2,080,130 | ) | (4,668,427 | ) | 4,983,309 | 8,130,852 | ||||||||||||||||||||||
Royce Micro-Cap Fund | ||||||||||||||||||||||||||||||||
Investment Class | 614,349 | 796,798 | – | 899,213 | (1,649,385 | ) | (2,365,898 | ) | (1,035,036 | ) | (669,887 | ) | ||||||||||||||||||||
Service Class | 226,954 | 296,175 | – | 919,703 | (936,623 | ) | (2,986,275 | ) | (709,669 | ) | (1,770,397 | ) | ||||||||||||||||||||
Consultant Class | 5,000 | 25,771 | – | 98,020 | (83,394 | ) | (353,855 | ) | (78,394 | ) | (230,064 | ) | ||||||||||||||||||||
Royce Opportunity Fund | ||||||||||||||||||||||||||||||||
Investment Class | 35,511,500 | 14,661,281 | – | – | (10,724,428 | ) | (13,657,249 | ) | 24,787,072 | 1,004,032 | ||||||||||||||||||||||
Service Class | 5,385,417 | 6,849,928 | – | – | (5,665,284 | ) | (1,826,392 | ) | (279,867 | ) | 5,023,536 | |||||||||||||||||||||
Consultant Class | 116,114 | 454,655 | – | – | (183,197 | ) | (240,344 | ) | (67,083 | ) | 214,311 | |||||||||||||||||||||
Institutional Class | 7,508,164 | 13,611,720 | – | – | (7,194,415 | ) | (10,590,136 | ) | 313,749 | 3,021,584 | ||||||||||||||||||||||
R Class | 735,040 | 565,983 | – | – | (397,738 | ) | (793,591 | ) | 337,302 | (227,608 | ) | |||||||||||||||||||||
Royce Pennsylvania Mutual Fund | ||||||||||||||||||||||||||||||||
Investment Class | 8,709,058 | 15,208,886 | – | 6,235,307 | (8,872,038 | ) | (33,501,741 | ) | (162,980 | ) | (12,057,548 | ) | ||||||||||||||||||||
Service Class | 6,347,403 | 1,396,869 | – | 335,124 | (1,724,430 | ) | (9,188,921 | ) | 4,622,973 | (7,456,928 | ) | |||||||||||||||||||||
Consultant Class | 128,699 | 641,767 | – | 1,211,439 | (1,872,515 | ) | (7,355,627 | ) | (1,743,816 | ) | (5,502,421 | ) | ||||||||||||||||||||
Institutional Class | 4,327,396 | 7,639,708 | – | 795,118 | (2,187,253 | ) | (3,728,269 | ) | 2,140,143 | 4,706,557 | ||||||||||||||||||||||
R Class | 132,506 | 101,253 | – | 36,926 | (122,805 | ) | (290,280 | ) | 9,701 | (152,101 | ) | |||||||||||||||||||||
Royce Premier Fund | ||||||||||||||||||||||||||||||||
Investment Class | 4,313,755 | 16,310,049 | – | 4,620,630 | (10,819,350 | ) | (33,679,066 | ) | (6,505,595 | ) | (12,748,387 | ) | ||||||||||||||||||||
Service Class | 399,616 | 750,092 | – | 107,233 | (426,050 | ) | (986,464 | ) | (26,434 | ) | (129,139 | ) | ||||||||||||||||||||
Consultant Class | 4,920 | 85,497 | – | 66,403 | (79,813 | ) | (414,639 | ) | (74,893 | ) | (262,739 | ) | ||||||||||||||||||||
Institutional Class | 1,273,402 | 7,594,039 | – | 1,035,610 | (2,708,367 | ) | (7,985,684 | ) | (1,434,965 | ) | 643,965 | |||||||||||||||||||||
R Class | 7,137 | 57,807 | – | 36,732 | (130,782 | ) | (263,346 | ) | (123,645 | ) | (168,807 | ) | ||||||||||||||||||||
Royce Small-Cap Value Fund | ||||||||||||||||||||||||||||||||
Investment Class | 509,441 | 506,019 | – | 143,745 | (345,480 | ) | (2,203,807 | ) | 163,961 | (1,554,043 | ) | |||||||||||||||||||||
Service Class | 209,966 | 330,143 | – | 314,400 | (992,280 | ) | (2,585,606 | ) | (782,314 | ) | (1,941,063 | ) | ||||||||||||||||||||
Consultant Class | 2,187 | 38,081 | – | 15,140 | (35,316 | ) | (425,583 | ) | (33,129 | ) | (372,362 | ) | ||||||||||||||||||||
R Class | 159,933 | 207,737 | – | 31,408 | (161,837 | ) | (252,973 | ) | (1,904 | ) | (13,828 | ) | ||||||||||||||||||||
Royce Smaller-Companies Growth Fund | ||||||||||||||||||||||||||||||||
Investment Class | 1,349,062 | 490,453 | – | 858,101 | (1,604,116 | ) | (2,323,038 | ) | (255,054 | ) | (974,484 | ) | ||||||||||||||||||||
Service Class | 960,782 | 481,738 | – | 1,639,083 | (1,333,677 | ) | (4,507,093 | ) | (372,895 | ) | (2,386,272 | ) | ||||||||||||||||||||
Consultant Class | 1,533 | 10,070 | – | 86,000 | (63,991 | ) | (131,084 | ) | (62,458 | ) | (35,014 | ) | ||||||||||||||||||||
Institutional Class | 26,328 | 75,338 | – | 49,642 | (68,660 | ) | (584,614 | ) | (42,332 | ) | (459,634 | ) | ||||||||||||||||||||
Royce Special Equity Fund | ||||||||||||||||||||||||||||||||
Investment Class | 4,315,143 | 10,858,599 | – | 1,158,248 | (4,575,147 | ) | (20,023,301 | ) | (260,004 | ) | (8,006,454 | ) | ||||||||||||||||||||
Service Class | 526,286 | 1,282,416 | – | 72,382 | (378,972 | ) | (2,209,225 | ) | 147,314 | (854,427 | ) | |||||||||||||||||||||
Consultant Class | 360,276 | 50,624 | – | 27,391 | (113,275 | ) | (487,054 | ) | 247,001 | (409,039 | ) | |||||||||||||||||||||
Institutional Class | 1,450,239 | 11,083,103 | – | 266,635 | (1,377,750 | ) | (11,328,678 | ) | 72,489 | 21,060 | ||||||||||||||||||||||
Royce Total Return Fund | ||||||||||||||||||||||||||||||||
Investment Class | 10,279,594 | 17,443,229 | 442,267 | 15,382,416 | (13,585,092 | ) | (30,941,230 | ) | (2,863,231 | ) | 1,884,415 | |||||||||||||||||||||
Service Class | 1,511,179 | 1,967,665 | 23,268 | 1,235,560 | (1,155,434 | ) | (2,812,704 | ) | 379,013 | 390,521 | ||||||||||||||||||||||
Consultant Class | 86,079 | 294,027 | 4,190 | 1,743,701 | (943,857 | ) | (4,014,620 | ) | (853,588 | ) | (1,976,892 | ) | ||||||||||||||||||||
Institutional Class | 4,296,553 | 7,809,989 | 126,740 | 3,929,141 | (2,197,210 | ) | (10,576,324 | ) | 2,226,083 | 1,162,806 | ||||||||||||||||||||||
R Class | 319,690 | 418,932 | 5,211 | 524,317 | (531,815 | ) | (1,061,005 | ) | (206,914 | ) | (117,756 | ) |
The Royce Funds 2021 Semiannual Report to Shareholders | 77
Notes to Financial Statements (unaudited) (continued)
Investment Adviser and Distributor:
INVESTMENT ADVISER:
Under the Trust’s investment advisory agreements with Royce, Royce is entitled to receive investment advisory fees in respect of each Fund that are computed daily and payable monthly. Royce has contractually agreed, without right of termination, to waive fees and/or reimburse expenses (excluding brokerage commissions, taxes, interest, litigation expenses, acquired fund fees and expenses, and other expenses not borne in the ordinary course of business) to the extent necessary to maintain certain Funds’ net annual operating expense ratios at specified levels through April 30, 2022, and is shown below to the extent that it impacted net expenses for the six months ended June 30, 2021. See the Prospectuses for contractual waivers and expiration dates for all classes of all Funds.
ANNUAL CONTRACTUAL ADVISORY FEE AS A | COMMITTED NET ANNUAL OPERATING EXPENSE RATIO CAP | SIX MONTHS ENDED JUNE 30, 2021 (UNAUDITED) | ||||||||||||||||||||||
PERCENTAGE OF AVERAGE NET ASSETS1 | Investment Class | Service Class | Consultant Class | Institutional Class | R Class | Net advisory fees | Advisory fees waived | |||||||||||||||||
Royce Dividend Value Fund | 0.85 | % | 1.09 | % | 1.34 | % | 2.09 | % | 1.09 | % | N/A | $ | 328,226 | $ | – | |||||||||
Royce Global Financial Services Fund | 1.00 | % | N/A | 1.49 | %3 | N/A | 1.49 | %3 | N/A | 189,550 | – | |||||||||||||
Royce International Premier Fund | 1.00 | % | 1.19 | % | 1.44 | % | 2.19 | % | 1.04 | % | N/A | 5,596,470 | 285,412 | |||||||||||
Royce Micro-Cap Fund | 1.00 | % | N/A | 1.49 | % | N/A | N/A | N/A | 1,996,650 | – | ||||||||||||||
Royce Opportunity Fund | 1.00 | % | N/A | N/A | N/A | N/A | N/A | 9,623,275 | – | |||||||||||||||
Royce Pennsylvania Mutual Fund | 0.76 | %2 | N/A | N/A | N/A | N/A | N/A | 8,333,063 | – | |||||||||||||||
Royce Premier Fund | 1.00 | % | N/A | 1.49 | % | N/A | N/A | N/A | 9,075,575 | – | ||||||||||||||
Royce Small-Cap Value Fund | 1.00 | % | 1.24 | % | 1.49 | % | N/A | N/A | N/A | 695,809 | – | |||||||||||||
Royce Smaller-Companies Growth Fund | 1.00 | % | N/A | N/A | 2.24 | % | 1.16 | % | N/A | 1,750,575 | – | |||||||||||||
Royce Special Equity Fund | 1.00 | % | N/A | 1.49 | %4 | N/A | N/A | N/A | 5,357,758 | – | ||||||||||||||
Royce Total Return Fund | 1.00 | % | N/A | 1.49 | %3 | N/A | N/A | N/A | 7,537,428 | – |
1 | From a base annual rate of 1.00% (0.85% for Royce Dividend Value Fund), the annual rates of investment advisory fees payable by each of the Funds, other than Royce Pennsylvania Mutual Fund, are reduced by the indicated amount at the following breakpoints applicable to a Fund’s net assets in excess of $2 billion: more than $2 billion to $3 billion – .05% per annum; more than $3 billion to $4 billion – .10% per annum; over $4 billion – .15% per annum. |
2 | Royce Pennsylvania Mutual Fund’s fees are calculated at the annual rate of 1.00% of the first $50 million of the Fund’s average net assets, 0.875% of the next $50 million of average net assets and 0.75% of average net assets in excess of $100 million. |
3 | Committed net annual operating expense ratio cap excludes acquired fund fees and expenses. |
4 | Royce Special Equity Fund’s committed net annual operating expense ratio cap was increased from 1.39% to 1.49% for Service Class, effective May 1, 2021. |
DISTRIBUTOR:
Royce Fund Services, LLC (“RFS”), the distributor of the Trust’s shares, is a wholly owned subsidiary of Royce. RFS is entitled to receive distribution fees that are computed daily and payable monthly.
ANNUAL CONTRACTUAL DISTRIBUTION FEE AS A | SIX MONTHS ENDED JUNE 30, 2021 (UNAUDITED) | |||||||||||
PERCENTAGE OF AVERAGE NET ASSETS | Net distribution fees | Distribution fees waived | ||||||||||
Royce Dividend Value Fund – Service Class | 0.25 | % | $ | 24,992 | $ | – | ||||||
Royce Dividend Value Fund – Consultant Class | 1.00 | % | 6,721 | – | ||||||||
Royce Global Financial Services Fund – Service Class | 0.25 | % | 32,168 | 4,386 | ||||||||
Royce International Premier Fund – Service Class | 0.25 | % | 80,398 | – | ||||||||
Royce International Premier Fund – Consultant Class | 1.00 | % | 45,567 | – | ||||||||
Royce Micro-Cap Fund – Service Class | 0.25 | % | 238,431 | – | ||||||||
Royce Micro-Cap Fund – Consultant Class | 1.00 | % | 80,091 | – | ||||||||
Royce Opportunity Fund – Service Class | 0.25 | % | 214,791 | – | ||||||||
Royce Opportunity Fund – Consultant Class | 1.00 | % | 80,712 | – | ||||||||
Royce Opportunity Fund – R Class | 0.50 | % | 117,228 | – | ||||||||
Royce Pennsylvania Mutual Fund – Service Class | 0.25 | % | 150,418 | 6,267 | ||||||||
Royce Pennsylvania Mutual Fund – Consultant Class | 1.00 | % | 1,295,086 | – | ||||||||
Royce Pennsylvania Mutual Fund – R Class | 0.50 | % | 23,372 | – | ||||||||
Royce Premier Fund – Service Class | 0.25 | % | 39,347 | – | ||||||||
Royce Premier Fund – Consultant Class | 1.00 | % | 82,312 | – | ||||||||
Royce Premier Fund – R Class | 0.50 | % | 23,069 | – | ||||||||
Royce Small-Cap Value Fund – Service Class | 0.25 | % | 105,186 | – | ||||||||
Royce Small-Cap Value Fund – Consultant Class | 1.00 | % | 22,037 | – | ||||||||
Royce Small-Cap Value Fund – R Class | 0.50 | % | 20,197 | – | ||||||||
Royce Smaller-Companies Growth Fund – Service Class | 0.25 | % | 256,090 | – | ||||||||
Royce Smaller-Companies Growth Fund – Consultant Class | 1.00 | % | 43,427 | – | ||||||||
Royce Special Equity Fund – Service Class | 0.25 | % | 65,304 | – | ||||||||
Royce Special Equity Fund – Consultant Class | 1.00 | % | 106,512 | – | ||||||||
Royce Total Return Fund – Service Class | 0.25 | % | 101,417 | – | ||||||||
Royce Total Return Fund – Consultant Class | 1.00 | % | 606,273 | – | ||||||||
Royce Total Return Fund – R Class | 0.50 | % | 84,264 | – |
78 | The Royce Funds 2021 Semiannual Report to Shareholders
Purchases and Sales of Investment Securities:
For the six months ended June 30, 2021, the costs of purchases and the proceeds from sales of investment securities, other than short-term securities and collateral received for securities loaned, were as follows:
PURCHASES | SALES | |||||||
Royce Dividend Value Fund | $ | – | $ | 12,732,805 | ||||
Royce Global Financial Services Fund | 1,197,844 | 1,497,256 | ||||||
Royce International Premier Fund | 199,438,720 | 118,286,991 | ||||||
Royce Micro-Cap Fund | 48,013,551 | 88,964,189 | ||||||
Royce Opportunity Fund | 890,526,031 | 590,453,438 | ||||||
Royce Pennsylvania Mutual Fund | 877,370,825 | 866,213,761 | ||||||
Royce Premier Fund | 177,064,099 | 409,199,936 | ||||||
Royce Small-Cap Value Fund | 37,241,271 | 45,024,340 | ||||||
Royce Smaller-Companies Growth Fund | 95,623,443 | 116,988,367 | ||||||
Royce Special Equity Fund | 227,453,007 | 201,227,413 | ||||||
Royce Total Return Fund | 527,086,825 | 538,032,831 |
Cross trades were executed by the Funds pursuant to Rule 17a-7 under the 1940 Act. Cross trading is the buying or selling of portfolio securities between funds to which Royce serves as investment adviser. The Trust’s Chief Compliance Officer reviews such transactions each quarter for compliance with the requirements and restrictions set forth by Rule 17a-7, and reports the results of her review to the Board of Trustees. Cross trades for the six months ended June 30, 2021, were as follows:
COSTS OF PURCHASES | PROCEEDS FROM SALES | REALIZED GAIN (LOSS) | ||||||||||
Royce Micro-Cap Fund | $ | 478,333 | $ | 2,747,350 | $ | 851,747 | ||||||
Royce Opportunity Fund | 5,443,470 | 1,398,559 | (298,722 | ) | ||||||||
Royce Pennsylvania Mutual Fund | 3,604,344 | 2,010,238 | (415,786 | ) | ||||||||
Royce Premier Fund | – | 1,390,400 | (85,318 | ) | ||||||||
Royce Special Equity Fund | – | 113,834 | 78,523 | |||||||||
Royce Total Return Fund | 1,717,571 | – | – |
Class Specific Expenses:
Class specific expenses were as follows for the six months ended June 30, 2021:
NET DISTRIBUTION FEES | SHAREHOLDER SERVICING | SHAREHOLDER REPORTS | REGISTRATION | TRANSFER AGENT BALANCE CREDITS | TOTAL | CLASS LEVEL EXPENSES REIMBURSED BY INVESTMENT ADVISER | ||||||||||||||||||||||
Royce Dividend Value Fund – Investment Class | $ | – | $ | 38,100 | $ | 5,031 | $ | 9,720 | $ | (4 | ) | $ | 52,847 | $ | 36,924 | |||||||||||||
Royce Dividend Value Fund – Service Class | 24,992 | 18,151 | 1,945 | 7,038 | (2 | ) | 52,124 | 21,328 | ||||||||||||||||||||
Royce Dividend Value Fund – Consultant Class | 6,721 | 3,622 | 446 | 5,464 | – | 16,253 | 9,144 | |||||||||||||||||||||
Royce Dividend Value Fund – Institutional Class | – | 3,357 | 119 | 5,657 | – | 9,133 | 8,877 | |||||||||||||||||||||
31,713 | 63,230 | 7,541 | 27,879 | (6 | ) | 76,273 | ||||||||||||||||||||||
Royce Global Financial Services Fund – Service Class | 32,168 | 22,003 | 2,774 | 9,880 | (3 | ) | 66,822 | 37,441 | ||||||||||||||||||||
Royce Global Financial Services Fund – Institutional Class | – | 3,287 | 7 | 6,649 | – | 9,943 | 1,236 | |||||||||||||||||||||
32,168 | 25,290 | 2,781 | 16,529 | (3 | ) | 38,677 | ||||||||||||||||||||||
Royce International Premier Fund – Investment Class | – | 255,468 | 21,666 | 20,560 | (9 | ) | 297,685 | – | ||||||||||||||||||||
Royce International Premier Fund – Service Class | 80,398 | 51,332 | 3,566 | 7,348 | (2 | ) | 142,642 | 13,299 | ||||||||||||||||||||
Royce International Premier Fund – Consultant Class | 45,567 | 6,356 | 610 | 5,962 | – | 58,495 | 6,030 | |||||||||||||||||||||
Royce International Premier Fund – Institutional Class | – | 94,875 | 79,521 | 13,976 | (232 | ) | 188,140 | 188,140 | ||||||||||||||||||||
125,965 | 408,031 | 105,363 | 47,846 | (243 | ) | 207,469 | ||||||||||||||||||||||
Royce Micro-Cap Fund – Investment Class | – | 81,646 | 28,242 | 8,444 | (44 | ) | 118,288 | – | ||||||||||||||||||||
Royce Micro-Cap Fund – Service Class | 238,431 | 135,389 | 9,506 | 8,663 | (6 | ) | 391,983 | 411 | ||||||||||||||||||||
Royce Micro-Cap Fund – Consultant Class | 80,091 | 10,151 | 1,483 | 6,122 | (2 | ) | 97,845 | – | ||||||||||||||||||||
318,522 | 227,186 | 39,231 | 23,229 | (52 | ) | 411 |
The Royce Funds 2021 Semiannual Report to Shareholders | 79
Notes to Financial Statements (unaudited) (continued)
Class Specific Expenses (continued):
NET DISTRIBUTION FEES | SHAREHOLDER SERVICING | SHAREHOLDER REPORTS | REGISTRATION | TRANSFER AGENT BALANCE CREDITS | TOTAL | CLASS LEVEL EXPENSES REIMBURSED BY INVESTMENT ADVISER | ||||||||||||||||||||||
Royce Opportunity Fund – Investment Class | $ | – | $ | 514,226 | $ | 44,419 | $ | 27,059 | $ | (58 | ) | $ | 585,646 | $ | – | |||||||||||||
Royce Opportunity Fund – Service Class | 214,791 | 108,328 | 3,692 | 9,088 | (2 | ) | 335,897 | – | ||||||||||||||||||||
Royce Opportunity Fund – Consultant Class | 80,712 | 8,574 | 884 | 5,827 | (1 | ) | 95,996 | – | ||||||||||||||||||||
Royce Opportunity Fund – Institutional Class | – | 7,904 | 6,762 | 11,906 | (11 | ) | 26,561 | – | ||||||||||||||||||||
Royce Opportunity Fund – R Class | 117,228 | 43,532 | 884 | 6,155 | (1 | ) | 167,798 | – | ||||||||||||||||||||
412,731 | 682,564 | 56,641 | 60,035 | (73 | ) | – | ||||||||||||||||||||||
Royce Pennsylvania Mutual Fund – Investment Class | – | 519,169 | 102,019 | 13,651 | (150 | ) | 634,689 | – | ||||||||||||||||||||
Royce Pennsylvania Mutual Fund – Service Class | 150,418 | 70,424 | 13,802 | 8,016 | (6 | ) | 242,654 | – | ||||||||||||||||||||
Royce Pennsylvania Mutual Fund – Consultant Class | 1,295,086 | 92,019 | 16,448 | 7,127 | (21 | ) | 1,410,659 | – | ||||||||||||||||||||
Royce Pennsylvania Mutual Fund – Institutional Class | – | 4,640 | 4,408 | 8,761 | (2 | ) | 17,807 | – | ||||||||||||||||||||
Royce Pennsylvania Mutual Fund – R Class | 23,372 | 12,403 | 994 | 4,205 | (2 | ) | 40,972 | – | ||||||||||||||||||||
1,468,876 | 698,655 | 137,671 | 41,760 | (181 | ) | – | ||||||||||||||||||||||
Royce Premier Fund – Investment Class | – | 614,085 | 79,456 | 14,864 | (71 | ) | 708,334 | – | ||||||||||||||||||||
Royce Premier Fund – Service Class | 39,347 | 23,478 | 2,919 | 6,351 | (1 | ) | 72,094 | 6,767 | ||||||||||||||||||||
Royce Premier Fund – Consultant Class | 82,312 | 10,617 | 1,182 | 5,973 | (1 | ) | 100,083 | – | ||||||||||||||||||||
Royce Premier Fund – Institutional Class | – | 5,640 | 23,809 | 6,802 | (5 | ) | 36,246 | – | ||||||||||||||||||||
Royce Premier Fund – R Class | 23,069 | 12,440 | 286 | 2,428 | – | 38,223 | – | |||||||||||||||||||||
144,728 | 666,260 | 107,652 | 36,418 | (78 | ) | 6,767 | ||||||||||||||||||||||
Royce Small-Cap Value Fund – Investment Class | – | 27,717 | 5,095 | 7,178 | (9 | ) | 39,981 | 13,818 | ||||||||||||||||||||
Royce Small-Cap Value Fund – Service Class | 105,186 | 59,837 | 6,337 | 9,477 | (5 | ) | 180,832 | 23,526 | ||||||||||||||||||||
Royce Small-Cap Value Fund – Consultant Class | 22,037 | 5,920 | 686 | 5,914 | (1 | ) | 34,556 | – | ||||||||||||||||||||
Royce Small-Cap Value Fund – R Class | 20,197 | 11,555 | 575 | 2,816 | – | 35,143 | – | |||||||||||||||||||||
147,420 | 105,029 | 12,693 | 25,385 | (15 | ) | 37,344 | ||||||||||||||||||||||
Royce Smaller-Companies Growth Fund – Investment Class | – | 44,202 | 12,213 | 7,567 | (21 | ) | 63,961 | – | ||||||||||||||||||||
Royce Smaller-Companies Growth Fund – Service Class | 256,090 | 142,811 | 9,121 | 10,046 | (5 | ) | 418,063 | – | ||||||||||||||||||||
Royce Smaller-Companies Growth Fund – Consultant Class | 43,427 | 6,698 | 736 | 6,005 | (1 | ) | 56,865 | 6,507 | ||||||||||||||||||||
Royce Smaller-Companies Growth Fund – Institutional Class | – | 3,467 | 258 | 5,725 | – | 9,450 | 6,939 | |||||||||||||||||||||
299,517 | 197,178 | 22,328 | 29,343 | (27 | ) | 13,446 | ||||||||||||||||||||||
Royce Special Equity Fund – Investment Class | – | 370,836 | 44,165 | 16,193 | (60 | ) | 431,134 | – | ||||||||||||||||||||
Royce Special Equity Fund – Service Class | 65,304 | 43,825 | 3,367 | 6,917 | (2 | ) | 119,411 | 28,430 | ||||||||||||||||||||
Royce Special Equity Fund – Consultant Class | 106,512 | 12,012 | 1,919 | 6,013 | (3 | ) | 126,453 | – | ||||||||||||||||||||
Royce Special Equity Fund – Institutional Class | – | 9,511 | 16,058 | 10,680 | (15 | ) | 36,234 | – | ||||||||||||||||||||
171,816 | 436,184 | 65,509 | 39,803 | (80 | ) | 28,430 | ||||||||||||||||||||||
Royce Total Return Fund – Investment Class | – | 455,904 | 91,165 | 16,071 | (64 | ) | 563,076 | – | ||||||||||||||||||||
Royce Total Return Fund – Service Class | 101,417 | 58,704 | 3,887 | 6,425 | (3 | ) | 170,430 | 3,551 | ||||||||||||||||||||
Royce Total Return Fund – Consultant Class | 606,273 | 49,039 | 7,920 | 8,945 | (8 | ) | 672,169 | – | ||||||||||||||||||||
Royce Total Return Fund – Institutional Class | – | 4,970 | 13,096 | 6,634 | (2 | ) | 24,698 | – | ||||||||||||||||||||
Royce Total Return Fund – R Class | 84,264 | 35,913 | 1,628 | 3,730 | (3 | ) | 125,532 | – | ||||||||||||||||||||
791,954 | 604,530 | 117,696 | 41,805 | (80 | ) | 3,551 |
80 | The Royce Funds 2021 Semiannual Report to Shareholders
Tax Information:
At June 30, 2021, net unrealized appreciation (depreciation) based on identified cost for tax purposes was as follows:
NET UNREALIZED | GROSS UNREALIZED | |||||||||||||||
TAX BASIS COST | APPRECIATION (DEPRECIATION) | Appreciation | (Depreciation) | |||||||||||||
Royce Dividend Value Fund | $ | 34,805,553 | $ | 43,364,301 | $ | 43,693,356 | $ | 329,055 | ||||||||
Royce Global Financial Services Fund | 24,971,049 | 17,716,485 | 18,980,618 | 1,264,133 | ||||||||||||
Royce International Premier Fund | 950,412,728 | 329,147,518 | 335,068,227 | 5,920,709 | ||||||||||||
Royce Micro-Cap Fund | 252,675,564 | 163,805,001 | 173,530,451 | 9,725,450 | ||||||||||||
Royce Opportunity Fund | 1,666,887,227 | 579,649,192 | 596,700,861 | 17,051,669 | ||||||||||||
Royce Pennsylvania Mutual Fund | 1,500,111,859 | 804,522,242 | 823,175,563 | 18,653,321 | ||||||||||||
Royce Premier Fund | 988,485,617 | 797,064,323 | 810,904,460 | 13,840,137 | ||||||||||||
Royce Small-Cap Value Fund | 100,892,444 | 42,224,232 | 44,081,666 | 1,857,434 | ||||||||||||
Royce Smaller-Companies Growth Fund | 238,830,104 | 132,277,083 | 137,054,405 | 4,777,322 | ||||||||||||
Royce Special Equity Fund | 814,826,280 | 287,824,607 | 293,039,775 | 5,215,168 | ||||||||||||
Royce Total Return Fund | 1,110,226,985 | 439,993,661 | 452,982,743 | 12,989,082 |
The primary cause of the difference between book and tax basis cost is the timing of the recognition of losses on securities sold.
Transactions in Affiliated Companies:
An “Affiliated Company,” as defined in the Investment Company Act of 1940, is a company in which a fund owns 5% or more of the company’s outstanding voting securities at any time during the period. The following transactions were effected in shares of such companies for the six months ended June 30, 2021:
AFFILIATED COMPANY 1 | SHARES 12/31/20 | MARKET VALUE 12/31/20 | COSTS OF PURCHASES | PROCEEDS FROM SALES | REALIZED GAIN (LOSS) | CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) | DIVIDEND INCOME | SHARES 6/30/21 | MARKET VALUE 6/30/21 | |||||||||||||||||
Royce International Premier Fund | ||||||||||||||||||||||||||
AUSTRALIA – 2.5% | ||||||||||||||||||||||||||
Bravura Solutions 2 | 11,180,629 | $ | 27,783,984 | $ | 2,994,621 | $ | 1,263,279 | $ | 10,218 | $ | 2,198,260 | $ | 242,990 | |||||||||||||
27,783,984 | 10,218 | 2,198,260 | 242,990 | |||||||||||||||||||||||
Royce Opportunity Fund | ||||||||||||||||||||||||||
HEALTH CARE – 0.5% | ||||||||||||||||||||||||||
HEALTH CARE EQUIPMENT & SUPPLIES – 0.5% | ||||||||||||||||||||||||||
IntriCon Corporation 3,4 | 395,910 | 7,165,971 | 2,175,160 | 68,410 | (15,787 | ) | 1,579,483 | – | 482,047 | $ | 10,836,417 | |||||||||||||||
7,165,971 | (15,787 | ) | 1,579,483 | – | 10,836,417 | |||||||||||||||||||||
Royce Special Equity Fund | ||||||||||||||||||||||||||
CONSUMER DISCRETIONARY– 6.7% | ||||||||||||||||||||||||||
HOTELS, RESTAURANTS & LEISURE – 0.3% | ||||||||||||||||||||||||||
Bowl America Cl. A 3,4 | 347,000 | 3,270,475 | – | 204,367 | (121,067 | ) | (81,791 | ) | – | 325,000 | 2,863,250 | |||||||||||||||
HOUSEHOLD DURABLES – 6.4% | ||||||||||||||||||||||||||
Flexsteel Industries 3 | 767,500 | 26,839,475 | – | – | – | 4,159,850 | 230,250 | 767,500 | 30,999,325 | |||||||||||||||||
Hooker Furniture 3 | 1,130,000 | 36,442,500 | 254,942 | – | – | 2,688,238 | 406,800 | 1,137,000 | 39,385,680 | |||||||||||||||||
63,281,975 | – | 6,848,088 | 637,050 | 70,385,005 | ||||||||||||||||||||||
66,552,450 | (121,067 | ) | 6,766,297 | 637,050 | 73,248,255 | |||||||||||||||||||||
INDUSTRIALS – 9.3% | ||||||||||||||||||||||||||
AEROSPACE & DEFENSE – 3.8% | ||||||||||||||||||||||||||
National Presto Industries 3 | 393,100 | 34,761,833 | 1,492,053 | – | – | 5,219,314 | 2,462,613 | 408,000 | 41,473,200 | |||||||||||||||||
MACHINERY – 5.5% | ||||||||||||||||||||||||||
Gencor Industries 3,4 | 1,065,000 | 13,099,500 | – | – | – | (149,100 | ) | – | 1,065,000 | 12,950,400 | ||||||||||||||||
Hurco Companies 3 | 580,000 | 17,400,000 | – | – | – | 2,900,000 | 237,800 | 580,000 | 20,300,000 | |||||||||||||||||
Miller Industries 3 | 575,500 | 21,880,510 | 5,026,590 | – | – | 562,860 | 232,884 | 696,500 | 27,469,960 | |||||||||||||||||
52,380,010 | – | 3,313,760 | 470,684 | 60,720,360 | ||||||||||||||||||||||
87,141,843 | – | 8,533,074 | 2,933,297 | 102,193,560 | ||||||||||||||||||||||
INFORMATION TECHNOLOGY – 1.7% | ||||||||||||||||||||||||||
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT – 1.7% | ||||||||||||||||||||||||||
NVE Corporation 3 | 124,000 | 6,966,320 | 9,200,947 | – | – | 3,011,683 | 353,803 | 259,000 | 19,178,950 | |||||||||||||||||
6,966,320 | – | 3,011,683 | 353,803 | 19,178,950 | ||||||||||||||||||||||
160,660,613 | (121,067 | ) | 18,311,054 | 3,924,150 | 194,620,765 |
1 | Percentages represent the percentages of the investments in the Affiliated Companies of the Fund’s net assets. |
2 | Not an Affiliated Company at June 30, 2021. |
3 | At June 30, 2021, the Fund owned 5% or more of the Company’s outstanding voting securities thereby making the Company an Affiliated Company as that term is defined in the Investment Company Act of 1940. |
4 | Non-income producing. |
Subsequent Events:
Subsequent events have been evaluated through the date the financial statements were issued.
The Royce Funds 2021 Semiannual Report to Shareholders | 81
Understanding Your Fund’s Expenses (unaudited)
As a shareholder of a mutual fund, you pay ongoing expenses, including management fees and other Fund expenses including, for some funds, distribution and/or service (12b-1) fees. Using the information below, you can estimate how these ongoing expenses (in dollars) affect your investment and compare them with the ongoing expenses of other funds. You may also incur one-time transaction expenses, including redemption fees, which are not shown in this section and would result in higher total costs. The example is based on an investment of $1,000 invested at January 1, 2021, and held for the entire six-month period ended June 30, 2021. Service, Consultant and R Class shares are generally available only through certain brokers or retirement plan administrators who receive distribution and/or service fees from the Fund for services that they perform. Institutional Class shares are generally available only to institutions or intermediaries with a minimum account size of $1 million.
Actual Expenses
The first part of the table below provides information about actual account values and actual expenses. You may use the information in this section, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value at June 30, 2021, by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second part of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare 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 the shareholder reports of the 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. Therefore, this section is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
|
| ACTUAL | HYPOTHETICAL (5% PER YEAR BEFORE EXPENSES) | |||||||||||||||||||
|
| Beginning Account | Ending Account Value | Expenses Paid During | Beginning Account | Ending Account Value | Expenses Paid During | Annualized Expense | ||||||||||||||
Investment Class |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Royce Dividend Value Fund |
| $ | 1,000.00 |
| $ | 1,170.27 |
| $ | 5.87 |
| $ | 1,000.00 |
| $ | 1,019.39 |
| $ | 5.46 |
|
| 1.09 | % |
Royce International Premier Fund |
|
| 1,000.00 |
|
| 1,065.19 |
|
| 5.94 |
|
| 1,000.00 |
|
| 1,019.04 |
|
| 5.81 |
|
| 1.16 | % |
Royce Micro-Cap Fund |
|
| 1,000.00 |
|
| 1,252.75 |
|
| 6.70 |
|
| 1,000.00 |
|
| 1,018.84 |
|
| 6.01 |
|
| 1.20 | % |
Royce Opportunity Fund |
|
| 1,000.00 |
|
| 1,308.71 |
|
| 6.58 |
|
| 1,000.00 |
|
| 1,019.09 |
|
| 5.76 |
|
| 1.15 | % |
Royce Pennsylvania Mutual Fund3 |
|
| 1,000.00 |
|
| 1,166.02 |
|
| 4.89 |
|
| 1,000.00 |
|
| 1,020.28 |
|
| 4.56 |
|
| 0.91 | % |
Royce Premier Fund |
|
| 1,000.00 |
|
| 1,103.75 |
|
| 6.10 |
|
| 1,000.00 |
|
| 1,018.99 |
|
| 5.86 |
|
| 1.17 | % |
Royce Small-Cap Value Fund |
|
| 1,000.00 |
|
| 1,232.29 |
|
| 6.86 |
|
| 1,000.00 |
|
| 1,018.65 |
|
| 6.21 |
|
| 1.24 | % |
Royce Smaller-Companies Growth Fund |
|
| 1,000.00 |
|
| 1,190.78 |
|
| 6.41 |
|
| 1,000.00 |
|
| 1,018.94 |
|
| 5.91 |
|
| 1.18 | % |
Royce Special Equity Fund |
|
| 1,000.00 |
|
| 1,141.60 |
|
| 6.32 |
|
| 1,000.00 |
|
| 1,018.89 |
|
| 5.96 |
|
| 1.19 | % |
Royce Total Return Fund |
|
| 1,000.00 |
|
| 1,198.00 |
|
| 6.49 |
|
| 1,000.00 |
|
| 1,018.89 |
|
| 5.96 |
|
| 1.19 | % |
Service Class |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Royce Dividend Value Fund |
|
| 1,000.00 |
|
| 1,168.80 |
|
| 7.21 |
|
| 1,000.00 |
|
| 1,018.15 |
|
| 6.71 |
|
| 1.34 | % |
Royce Global Financial Services Fund |
|
| 1,000.00 |
|
| 1,177.30 |
|
| 8.04 |
|
| 1,000.00 |
|
| 1,017.41 |
|
| 7.45 |
|
| 1.49 | % |
Royce International Premier Fund |
|
| 1,000.00 |
|
| 1,063.98 |
|
| 7.37 |
|
| 1,000.00 |
|
| 1,017.65 |
|
| 7.20 |
|
| 1.44 | % |
Royce Micro-Cap Fund |
|
| 1,000.00 |
|
| 1,250.60 |
|
| 8.31 |
|
| 1,000.00 |
|
| 1,017.41 |
|
| 7.45 |
|
| 1.49 | % |
Royce Opportunity Fund |
|
| 1,000.00 |
|
| 1,306.28 |
|
| 8.23 |
|
| 1,000.00 |
|
| 1,017.65 |
|
| 7.20 |
|
| 1.44 | % |
Royce Pennsylvania Mutual Fund3 |
|
| 1,000.00 |
|
| 1,164.22 |
|
| 6.55 |
|
| 1,000.00 |
|
| 1,018.74 |
|
| 6.11 |
|
| 1.22 | % |
Royce Premier Fund |
|
| 1,000.00 |
|
| 1,102.12 |
|
| 7.77 |
|
| 1,000.00 |
|
| 1,017.41 |
|
| 7.45 |
|
| 1.49 | % |
Royce Small-Cap Value Fund |
|
| 1,000.00 |
|
| 1,230.77 |
|
| 8.24 |
|
| 1,000.00 |
|
| 1,017.41 |
|
| 7.45 |
|
| 1.49 | % |
Royce Smaller-Companies Growth Fund |
|
| 1,000.00 |
|
| 1,189.01 |
|
| 8.09 |
|
| 1,000.00 |
|
| 1,017.41 |
|
| 7.45 |
|
| 1.49 | % |
Royce Special Equity Fund |
|
| 1,000.00 |
|
| 1,140.74 |
|
| 7.59 |
|
| 1,000.00 |
|
| 1,017.70 |
|
| 7.15 |
|
| 1.43 | % |
Royce Total Return Fund |
|
| 1,000.00 |
|
| 1,197.47 |
|
| 8.12 |
|
| 1,000.00 |
|
| 1,017.41 |
|
| 7.45 |
|
| 1.49 | % |
Consultant Class |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Royce Dividend Value Fund |
|
| 1,000.00 |
|
| 1,165.06 |
|
| 11.22 |
|
| 1,000.00 |
|
| 1,014.43 |
|
| 10.44 |
|
| 2.09 | % |
Royce International Premier Fund |
|
| 1,000.00 |
|
| 1,060.00 |
|
| 11.19 |
|
| 1,000.00 |
|
| 1,013.93 |
|
| 10.94 |
|
| 2.19 | % |
Royce Micro-Cap Fund |
|
| 1,000.00 |
|
| 1,246.36 |
|
| 12.81 |
|
| 1,000.00 |
|
| 1,013.39 |
|
| 11.48 |
|
| 2.30 | % |
Royce Opportunity Fund |
|
| 1,000.00 |
|
| 1,302.14 |
|
| 12.79 |
|
| 1,000.00 |
|
| 1,013.69 |
|
| 11.18 |
|
| 2.24 | % |
Royce Pennsylvania Mutual Fund3 |
|
| 1,000.00 |
|
| 1,159.85 |
|
| 10.28 |
|
| 1,000.00 |
|
| 1,015.27 |
|
| 9.59 |
|
| 1.92 | % |
Royce Premier Fund |
|
| 1,000.00 |
|
| 1,098.11 |
|
| 11.91 |
|
| 1,000.00 |
|
| 1,013.44 |
|
| 11.43 |
|
| 2.29 | % |
Royce Small-Cap Value Fund |
|
| 1,000.00 |
|
| 1,223.25 |
|
| 14.77 |
|
| 1,000.00 |
|
| 1,011.50 |
|
| 13.37 |
|
| 2.68 | % |
Royce Smaller-Companies Growth Fund |
|
| 1,000.00 |
|
| 1,183.92 |
|
| 12.13 |
|
| 1,000.00 |
|
| 1,013.69 |
|
| 11.18 |
|
| 2.24 | % |
Royce Special Equity Fund |
|
| 1,000.00 |
|
| 1,136.14 |
|
| 12.02 |
|
| 1,000.00 |
|
| 1,013.54 |
|
| 11.33 |
|
| 2.27 | % |
Royce Total Return Fund |
|
| 1,000.00 |
|
| 1,192.30 |
|
| 11.90 |
|
| 1,000.00 |
|
| 1,013.93 |
|
| 10.94 |
|
| 2.19 | % |
82 | The Royce Funds 2021 Semiannual Report to Shareholders |
| ACTUAL | HYPOTHETICAL (5% PER YEAR BEFORE EXPENSES) | |||||||||||||||||||
| Beginning Account | Ending Account Value | Expenses Paid During | Beginning Account | Ending Account Value | Expenses Paid During | Annualized Expense | ||||||||||||||
Institutional Class |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Royce Dividend Value Fund | $ | 1,000.00 |
| $ | 1,169.49 |
| $ | 5.86 |
| $ | 1,000.00 |
| $ | 1,019.39 |
| $ | 5.46 |
| 1.09 | % | |
Royce Global Financial Services Fund |
| 1,000.00 |
|
| 1,177.41 |
|
| 8.04 |
|
| 1,000.00 |
|
| 1,017.41 |
|
| 7.45 |
|
| 1.49 | % |
Royce International Premier Fund |
| 1,000.00 |
|
| 1,066.33 |
|
| 5.33 |
|
| 1,000.00 |
|
| 1,019.64 |
|
| 5.21 |
|
| 1.04 | % |
Royce Opportunity Fund |
| 1,000.00 |
|
| 1,308.88 |
|
| 6.07 |
|
| 1,000.00 |
|
| 1,019.54 |
|
| 5.31 |
|
| 1.06 | % |
Royce Pennsylvania Mutual Fund |
| 1,000.00 |
|
| 1,167.48 |
|
| 4.57 |
|
| 1,000.00 |
|
| 1,020.58 |
|
| 4.26 |
|
| 0.85 | % |
Royce Premier Fund |
| 1,000.00 |
|
| 1,104.35 |
|
| 5.74 |
|
| 1,000.00 |
|
| 1,019.34 |
|
| 5.51 |
|
| 1.10 | % |
Royce Smaller-Companies Growth Fund |
| 1,000.00 |
|
| 1,190.56 |
|
| 6.30 |
|
| 1,000.00 |
|
| 1,019.04 |
|
| 5.81 |
|
| 1.16 | % |
Royce Special Equity Fund |
| 1,000.00 |
|
| 1,142.30 |
|
| 5.90 |
|
| 1,000.00 |
|
| 1,019.29 |
|
| 5.56 |
|
| 1.11 | % |
Royce Total Return Fund |
| 1,000.00 |
|
| 1,199.50 |
|
| 6.00 |
|
| 1,000.00 |
|
| 1,019.34 |
|
| 5.51 |
|
| 1.10 | % |
R Class |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Royce Opportunity Fund |
| 1,000.00 |
|
| 1,304.35 |
|
| 10.06 |
|
| 1,000.00 |
|
| 1,016.07 |
|
| 8.80 |
|
| 1.76 | % |
Royce Pennsylvania Mutual Fund |
| 1,000.00 |
|
| 1,161.09 |
|
| 9.16 |
|
| 1,000.00 |
|
| 1,016.31 |
|
| 8.55 |
|
| 1.71 | % |
Royce Premier Fund |
| 1,000.00 |
|
| 1,100.08 |
|
| 9.89 |
|
| 1,000.00 |
|
| 1,015.37 |
|
| 9.49 |
|
| 1.90 | % |
Royce Small-Cap Value Fund |
| 1,000.00 |
|
| 1,227.49 |
|
| 10.99 |
|
| 1,000.00 |
|
| 1,014.93 |
|
| 9.94 |
|
| 1.99 | % |
Royce Total Return Fund |
| 1,000.00 |
|
| 1,194.66 |
|
| 9.90 |
|
| 1,000.00 |
|
| 1,015.77 |
|
| 9.10 |
|
| 1.82 | % |
2 | Annualized expense ratio used to derive figures in the table is based on the most recent fiscal half-year. |
3 | GiftShare accounts pay an annual $50 trustee fee to Alliance Trust Company, as trustee. If these fees were included above, your costs would be higher. |
The Royce Funds 2021 Semiannual Report to Shareholders | 83 |
|
All Trustees and Officers may be reached c/o The Royce Funds, 745 Fifth Avenue, New York, NY 10151
Christopher D. Clark, Trustee 1, President
Age: 56 | Number of Funds Overseen: 16 | Tenure: Since 2014
Principal Occupation(s) During Past Five Years: Chief Executive Officer (since July 2016), President (since July 2014), Co-Chief Investment Officer (since January 2014), Managing Director of Royce, a Member of the Board of Managers of Royce, having been employed by Royce since May 2007.
Patricia W. Chadwick, Trustee
Age: 72 | Number of Funds Overseen: 16 | Tenure: Since 2009
Non-Royce Directorships: Trustee of Voya Mutual Funds and Director of Wisconsin Energy Corp.
Principal Occupation(s) During Past 5 Years: Consultant and President of Ravengate Partners LLC (since 2000).
Christopher C. Grisanti, Trustee
Age: 59 | Number of Funds Overseen: 16 | Tenure: Since 2017
Non-Royce Directorships: None
Principal Occupation(s) During Past Five Years: Chief Equity Strategist and Senior Portfolio Manager at MAI Capital Management LLC, an investment advisory firm (since May 2020). Previously, Mr. Grisanti was Co-Founder and Chief Executive Officer of Grisanti Capital Management LLC, an investment advisory firm (from 1999 to 2020). Mr. Grisanti’s prior business experience also includes serving as Director of Research and Portfolio Manager at Spears Benzak, Salomon & Farrell (from 1994 to 1999) and a senior associate at the law firm of Simpson, Thacher & Bartlett (from 1988 to 1994).
Cecile B. Harper, Trustee
Age: 58 | Number of Funds Overseen: 16 | Tenure: Since 2020
Non-Royce Directorships: None
Principal Occupation(s) During Past Five Years: Board Member of Pyramid Peak Foundation (since January 2012); and Chief Operating Officer at the College Foundation at the University of Virginia (since October 2019). Ms. Harper’s prior business experience includes serving as Principal of Southeastern Asset Management (from December 1993 to September 2019); and a Board Member of Regional One Health Foundation (from June 2013 to September 2019).
Arthur S. Mehlman, Trustee
Age: 79 | Number of Funds Overseen: 362 | Tenure: Since 2004
Non-Royce Directorships: Director/Trustee of registered investment companies constituting the 20 Legg Mason Funds.
Principal Occupation(s) During Past Five Years: Director of The League for People with Disabilities, Inc.; Director of University of Maryland Foundation (non-profits). Formerly: Director of Municipal Mortgage & Equity, LLC (from October 2004 to April 1, 2011); Director of University of Maryland College Park Foundation (non-profit) (from 1998 to 2005); Partner, KPMG LLP (international accounting firm) (from 1972 to 2002); Director of Maryland Business Roundtable for Education (from July 1984 to June 2002).
G. Peter O’Brien, Trustee
Age: 75 | Number of Funds Overseen: 362 | Tenure: Since 2001
Non-Royce Directorships: Director/Trustee of registered investment companies constituting the 20 Legg Mason Funds.
Principal Occupation(s) During Past Five Years: Trustee Emeritus of Colgate University (since 2005); Board Member of Hill House, Inc. (since 1999); Formerly Director of TICC Capital Corp (from 2003-2017): Trustee of Colgate University (from 1996 to 2005), President of Hill House, Inc. (from 2001 to 2005) and Managing Director/Equity Capital Markets Group of Merrill Lynch & Co. (from 1971 to 1999).
Michael K. Shields, Trustee
Age: 63 | Number of Funds Overseen: 16 | Tenure: Since 2015
Principal Occupation(s) During Past Five Years: President and Chief Executive Officer of Piedmont Trust Company, a privately-owned North Carolina trust company and wealth management firm (since May 2012). Mr. Shields’s prior business experience includes managing institutional and mutual fund equity portfolios in New York at Scudder, Stevens & Clark where he was a Principal in the Global Equity Group (1992 – 1997) and US Trust where he was President & CIO of a wholly-owned investment firm subsidiary (1997 – 2002).
Francis D. Gannon, Vice President
Age: 53 | Tenure: Since 2014
Principal Occupation(s) During Past Five Years: Co-Chief Investment Officer (since January 2014) and Managing Director of Royce, having been employed by Royce since September 2006.
Daniel A. O’Byrne, Vice President
Age: 59 | Tenure: Since 1994
Principal Occupation(s) During Past Five Years: Principal and Vice President of Royce, having been employed by Royce since October 1986.
Peter K. Hoglund, Treasurer
Age: 55 | Tenure: Since 2015
Principal Occupation(s) During Past Five Years: Chief Financial Officer, Chief Administrative Officer, and Managing Director of Royce, having been employed by Royce since December 2014. Prior to joining Royce, Mr. Hoglund spent more than 20 years with Munder Capital Management in Birmingham, MI, serving as Managing Director and Chief Financial Officer and overseeing all financial aspects of the firm. He began his career at Munder as a portfolio manager.
John E. Denneen, Secretary and Chief Legal Officer
Age: 54 | Tenure: 1996-2001 and Since 2002
Principal Occupation(s) During Past Five Years: General Counsel, Managing Director, and, since June 2015, a Member of the Board of Managers of Royce. Chief Legal and Compliance Officer and Secretary of Royce.
Lisa Curcio, Chief Compliance Officer
Age: 61 | Tenure: Since 2004
Principal Occupation(s) During Past Five Years: Chief Compliance Officer of The Royce Funds (since October 2004) and Compliance Officer of Royce (since June 2004).
2As of July 1, 2021, Messrs. Mehlman and O’Brien oversee 75 Funds.
Trustees will hold office until their successors have been duly elected and qualified or until their earlier resignation or removal. The Statement of Additional Information, which contains additional information about the Trust’s trustees and officers, is available and can be obtained without charge at www.royceinvest.com or by calling (800) 221-4268.
84 | The Royce Funds 2021 Semiannual Report to Shareholders |
|
Liquidity Risk Management Program
The Securities and Exchange Commission adopted Rule 22e-4 under the Investment Company Act of 1940 (the “Liquidity Rule”) to promote effective liquidity risk management throughout the open-end investment company industry, thereby reducing the risk that funds will be unable to meet their redemption obligations and mitigating dilution of the interests of fund shareholders. As required by the Liquidity Rule, The Royce Fund (the “Trust”) adopted and implemented a written Liquidity Risk Management Program (as amended from time to time, the “LRMP”) which took effect on December 1, 2018.
The LRMP is designed to assess and manage the liquidity risk of each series of the Trust (each, a “Fund” and together, the “Funds”), taking into consideration each Fund’s: (i) investment strategy and the liquidity of its portfolio investments during normal and reasonably foreseeable stressed conditions; (ii) short and long-term cash flow projections; (iii) holdings of cash and cash equivalents; and (iv) access to other funding sources, including custodian overdrafts and the Funds’ line of credit. In this context, liquidity risk refers to the risk that a Fund could not meet requests to redeem its shares without significant dilution of remaining investors’ interests in the Fund.
The Board of Trustees of the Trust (the “Board”) approved the designation of the Chief Risk Officer of Royce Investment Partners (“Royce”) as the administrator of the LRMP (in such capacity, the “Administrator”). The Administrator reports directly to the Board and serves at its pleasure in her capacity as Administrator. Such person also reports directly to Royce’s Chief Executive Officer in her capacity as Royce’s Chief Risk Officer. The members of Royce’s Risk Management Committee and its Legal & Compliance Department serve the Administrator in an advisory capacity. The Administrator may also consult with Royce’s portfolio management, administration, and trading personnel to the extent such person deems it necessary or appropriate to carry out the duties assigned to the Administrator under the LRMP. The Trust has retained a third-party liquidity vendor that performs various functions in connection with the administration of the LRMP, including classifying the liquidity of each Fund investment.
In accordance with the requirements of the Liquidity Rule and the LRMP, each Fund must classify each of its investments into one of four liquidity categories described below based on a determination of a reasonable expectation for how long it would take to convert the investment to cash (or sell or dispose of the investment) without significantly changing its market value.
• | Highly liquid investments – cash or convertible to cash within three business days or less. |
• | Moderately liquid investments – convertible to cash in three to seven calendar days. |
• | Less liquid investments – can be sold or disposed of, but not settled, within seven calendar days. |
• | Illiquid investments – cannot not be sold or disposed of within seven calendar days. |
In addition, the LRMP prohibits a Fund from acquiring any illiquid investment if, immediately after such acquisition, it would have invested more than 15% of its net assets in illiquid investments. Liquidity classification determinations take into account a variety of factors, including various market, trading and investment-specific considerations, as well as market depth, and generally utilize analysis from the third-party liquidity vendor.
Each Fund has been classified as a “primarily highly liquid fund” under the LRMP. For these purposes, a primarily highly liquid fund must hold more than 50% of its net assets in highly liquid investments. A Fund would cease to be a primarily highly liquid fund if its highly liquid investments fell to 50% or less of its net assets as of the end of any calendar month.
The Administrator presented a report to the Board at its meeting on February 18, 2021 that addressed the adequacy and effectiveness of the LRMP during the period January 1, 2020 to December 31, 2020 (the “covered period”). Among other things, the report provided summary information regarding overall market liquidity and the Funds’ compliance with various liquidity-related requirements along with examples of how the Administrator, Royce’s Risk Management Committee, and the relevant portfolio managers monitored and reacted to changes in liquidity profiles during the covered period. The report also addressed the enhanced liquidity monitoring and stress testing undertaken by the Administrator and Royce’s Risk Management Committee in response to the increased market volatility resulting from the Covid-19 pandemic. The report concluded that:
• | each Fund remained a primarily highly liquid fund during the covered period; |
• | no Fund breached the 15% limit on illiquid investments during the covered period; |
• | the LRMP remains reasonably designed and implemented to assess and manage each Fund’s liquidity risk; and |
• | each Fund was able to meet requests for redemption without significant dilution of remaining investors’ interests in the Fund during the covered period. |
No assurance can be given that the LRMP will achieve its objectives in the future. Please refer to the Trust’s statutory prospectus for more information regarding each Fund’s exposure to liquidity risk and other principal risks and a description of how the Funds expect to satisfy redemption requests.
The Royce Funds 2021 Semiannual Report to Shareholders | 85 |
|
Note to Performance and Other Important Information
The thoughts expressed in this report concerning recent market movements and future prospects for small company stocks are solely the opinion of Royce at June 30, 2021, and, of course, historical market trends are not necessarily indicative of future market movements. Statements regarding the future prospects for particular securities held in the Funds’ portfolios and Royce’s investment intentions with respect to those securities reflect Royce’s opinions as of June 30, 2021 and are subject to change at any time without notice. There can be no assurance that securities mentioned in this report will be included in any Royce-managed portfolio in the future. There can be no assurance that companies that currently pay a dividend will continue to do so in the future.
Sector weightings are determined using the Global Industry classification Standard (“GICS”). GICS was developed by, and is the exclusive property of, Standard & Poor’s Financial Services LLC (“S&P”) and MSCI Inc. (“MSCI”). GICS is the trademark of S&P and MSCI. “Global Industry Classification Standard (GICS)” and “GICS Direct” are service marks of S&P and MSCI.
All indexes referred to are unmanaged and capitalization weighted. Each index’s returns include net reinvested dividends and/or interest income. Frank Russell Company (“Russell”) is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell® is a trademark of Frank Russell Company. Neither Russell nor its licensors accept any liability for any errors or omissions in the Russell Indexes and/or Russell ratings or underlying data and no party may rely on any Russell Indexes and/or Russell ratings and/or underlying data contained in this communication. No further distribution of Russell Data is permitted without Russell’s express written consent. Russell does not promote, sponsor or endorse the content of this communication. The Russell 2000 Index is an index of domestic small-cap stocks. It measures the performance of the 2,000 smallest publicly traded U.S. companies in the Russell 3000 Index. The Russell 2000 Value and Growth Indexes consist of the respective value and growth stocks within the Russell 2000 as determined by Russell Investments. The Russell 2000 Pure Value Index is an unmanaged index composed of securities with strong value characteristics selected from the Russell 2000 Index. Securities are weighted based on their style score. The Russell 2000 Pure Growth Index is an unmanaged index composed of securities with strong growth characteristics selected from the Russell 2000 Index. Securities are weighted based on their style score. The Russell 1000 Index is an index of domestic large-cap stocks. It measures the performance of the 1,000 largest publicly traded U.S. companies in the Russell 3000 Index. The Russell Microcap Index includes 1,000 of the smallest securities in the Russell 2000 Index, along with the next smallest eligible securities as determined by Russell. The Russell 2500 is an unmanaged, capitalization-weighted index of the 2,500 smallest publicly traded U.S. companies in the Russell 3000 index. Source: MSCI. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indexes or any securities or financial products. This report is not approved, endorsed, reviewed or produced by MSCI. None of the MSCI data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. The MSCI ACWI Small Cap Index is an unmanaged, capitalization-weighted index of global small-cap stocks. The MSCI ACWI ex USA Small Cap Index is an unmanaged, capitalization-weighted index of global small-cap stocks, excluding the United States. The MSCI ACWI ex USA Large Cap Index is an unmanaged, capitalization-weighted index of global large-cap stocks, excluding the United States. The performance of an index does not represent exactly any particular investment, as you cannot invest directly in an index. Returns for the Russell market indexes used in this report were based on information supplied to Royce by Russell Investments. Royce has not independently verified the above described information.
The Price-Earnings, or P/E, Ratio is calculated by dividing a company’s share price by its trailing 12-month earnings-per-share (EPS). The Price-to-Book, or P/B, Ratio is calculated by dividing a company’s share price by its book value per share. Standard deviation is a statistical measure within which a fund’s total returns have varied over time. The greater the standard deviation, the greater a fund’s volatility. Beta is a measure of the volatility or risk of an investment compared to the market as a whole. Alpha describes an investment strategy’s ability to beat the market. The Morningstar Style Map uses proprietary scores of a stock’s value and growth characteristics to determine its placement in one of the five categories listed on the horizontal axis. These characteristics are then compared to those of other stocks within the same market capitalization band. Each is scored from zero to 100 for both value and growth attributes. The value score is subtracted from the growth score to determine the overall style score. For the vertical, market cap axis, Morningstar subdivides into size groups. Giant-cap stocks are defined as those that account for the top 40% of the capitalization of each style zone; large-cap stocks represent the next 30%; mid-cap stocks the next 20%; small-cap stocks the next 7%; micro-cap stocks the smallest 3%. For the Morningstar Small Blend Category: ©2021 Morningstar. All Rights Reserved. The information regarding the category in this piece is: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Cyclical and Defensive are defined as follows: Cyclical: Communication Services, Consumer Discretionary, Energy, Financials, Industrials, Information Technology, and Materials. Defensive: Consumer Staples, Health Care, Real Estate, and Utilities. Investments in securities of micro-cap, small-cap, and/or mid-cap companies may involve considerably more risk than investments in securities of larger-cap companies. (Please see “Primary Risks for Fund Investors” in the prospectus.) Investments in foreign securities, which generally may involve political, economic, currency, and other risks not encountered in U.S. investments. (Please see “Investing in Foreign Securities” in the prospectus.) A Fund that invests a significant portion of its assets in a limited number of stocks may be subject to considerably more risk than a more broadly diversified Fund because a decline in the value of any of these stocks would cause that Fund’s overall value to decline to a greater degree. A broadly diversified portfolio does not, however, ensure a profit for a Fund or guarantee against loss. Please read the prospectus carefully before investing or sending money. A copy of the Funds’ current prospectus and Statement of Additional Information may be obtained by calling (800) 221-4268 or by visiting www.royceinvest.com. All publicly released material Fund information is disclosed by the Funds on their website at www.royceinvest.com. The Royce Funds is a service mark of The Royce Funds. Distributor: Royce Fund Services, LLC.
86 | The Royce Funds 2021 Semiannual Report to Shareholders |
|
Notes to Performance and Other Important Information (continued)
Forward-Looking Statement
This material contains forward-looking statements within the meaning of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that involve risks and uncertainties, including, among others, statements as to:
• | the Funds’ future operating results, |
• | the prospects of the Funds’ portfolio companies, |
• | the impact of investments that the Funds have made or may make, the dependence of the Funds’ future success on the general economy and its impact on the companies and industries in which the Funds invest, and |
• | the ability of the Funds’ portfolio companies to achieve their objectives. |
This review and report use words such as “anticipates,” “believes,” “expects,” “future,” “intends,” and similar expressions to identify forward-looking statements. Actual results may differ materially from those projected in the forward-looking statements for any reason.
The Royce Funds have based the forward-looking statements included in this review and report on information available to us on the date of the report, and we assume no obligation to update any such forward-looking statements. Although The Royce Funds undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events, or otherwise, you are advised to consult any additional disclosures that we may make through future shareholder communications or reports.
Disclosure of Portfolio Holdings
The Funds’ complete portfolio holdings are also available on Exhibit F to Form N-PORT, which filings are made with the SEC within 60 days of the end of the first and third fiscal quarters. The Funds’ Form N-PORT filings are available on the SEC’s website at http://www.sec.gov.
The Royce Funds 2021 Semiannual Report to Shareholders | 87 |
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|
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88 | The Royce Funds 2021 Semiannual Report to Shareholders |
About Royce Investment Partners
Unparalleled Knowledge + Experience
Pioneers in small-cap investing, with 45+ years
of experience, depth of knowledge, and focus.
Independent Thinking
The confidence to go against consensus, the insight
to uncover opportunities others might miss, and the
tenacity to stay the course through market cycles.
Specialized Approaches
U.S., international, and global investment strategies
that pursue approaches with different risk profiles.
Unwavering Commitment
Our team of 16 portfolio managers has significant
personal investments in the strategies they manage.
Contact Us
GENERAL INFORMATION
General Royce Funds information including:
• How to open an account
• An overview of our firm and Funds
• Ordering literature including Prospectuses
(800) 221-4268
____________________________________
ACCOUNT INFORMATION
Speak with a representative about:
• Your account, transactions, and forms
(800) 841-1180
____________________________________
FINANCIAL ADVISORS, CONSULTANTS,
AND INSTITUTIONS
Speak with your regional Royce contact regarding:
• Scheduling a meeting or call
• Information about our firm, strategies, and funds
• Resources for financial professionals, such as
portfolio attribution reports
(800) 337-6923
____________________________________
AUTOMATED ACCOUNT INFORMATION
24-hour Automated Telephone Service
(800) 787-6923
OE-REP-0621
Item 2. Code(s) of Ethics. Not applicable to this semi-annual report.
Item 3. Audit Committee Financial Expert. Not applicable to this semi-annual report.
Item 4. Principal Accountant Fees and Services. Not applicable to this semi-annual report.
Item 5. Audit Committee of Listed Registrants. Not Applicable.
Item 6. Investments.
(a) See Item 1.
(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. Not Applicable.
Item 11. Controls and Procedures.
(a) Disclosure Controls and Procedures. The Principal Executive and Financial Officers concluded that the Registrant's Disclosure Controls and Procedures are effective based on their evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report.
(b) Internal Control over Financial Reporting. There were no significant changes in Registrant's internal control over financial reporting or in other factors that could significantly affect this control subsequent to the date of the evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses during the period covered by this report.
Item 12. Exhibits. Attached hereto.
(a)(1) Not applicable to this semi-annual report.
(a)(2) Separate certifications by the Registrant’s Principal Executive Officer and Principal Financial Officer as required by Rule 30a-2(a) under the Investment Company Act of 1940.
(a)(3) Not Applicable
(b) Separate certifications by the Registrant’s Principal Executive Officer and Principal Financial Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and required by Rule 30a-2(b) under the Investment Company Act of 1940.
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.
THE ROYCE FUND
BY: /s/ Christopher D. Clark
Christopher D. Clark
President
Date: August 25, 2021
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.
THE ROYCE FUND | THE ROYCE FUND |
BY: /s/ Christopher D. Clark | BY: /s/ Peter K. Hoglund |
Christopher D. Clark | Peter K. Hoglund |
President | Chief Financial Officer |
Date: August 25, 2021 | Date: August 25, 2021 |