United States
Securities and Exchange Commission
Washington, D.C. 20549
Form N-CSR
Certified Shareholder Report of Registered Management Investment Companies
811-4743
(Investment Company Act File Number)
Federated Hermes Equity Income Fund, Inc.
______________________________________________________________
(Exact Name of Registrant as Specified in Charter)
Federated Hermes Funds
4000 Ericsson Drive
Warrendale, PA 15086-7561
(Address of Principal Executive Offices)
(412) 288-1900
(Registrant's Telephone Number)
Peter J. Germain, Esquire
1001 Liberty Avenue
Pittsburgh, Pennsylvania 15222-3779
(Name and Address of Agent for Service)
(Notices should be sent to the Agent for Service)
Date of Fiscal Year End: 11/30/23
Date of Reporting Period: Six months ended 05/31/23
Item 1. | Reports to Stockholders |
Share Class | Ticker | A | LEIFX | C | LEICX | F | LFEIX |
R | FDERX | Institutional | LEISX |
Federated Hermes Equity Income Fund, Inc.
Dear Valued Shareholder,
Security Type | Percentage of Total Net Assets |
Domestic Equity Securities | 96.8% |
International Equity Securities | 0.7% |
Cash Equivalents2 | 2.4% |
Other Assets and Liabilities—Net3 | 0.1% |
TOTAL | 100% |
Sector Composition of Equity Holdings | Percentage of Equity Securities |
Health Care | 18.8% |
Financials | 17.4% |
Information Technology | 10.6% |
Consumer Staples | 9.6% |
Industrials | 9.1% |
Communication Services | 8.9% |
Energy | 7.3% |
Consumer Discretionary | 4.9% |
Utilities | 4.9% |
Materials | 4.4% |
Real Estate | 4.1% |
TOTAL | 100% |
1 | See the Fund’s Prospectus for a description of the principal types of securities in which the Fund invests. |
2 | Cash Equivalents include any investments in money market mutual funds and/or overnight repurchase agreements. |
3 | Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities. |
4 | Sector classifications are based upon, and individual portfolio securities are assigned to, the classifications of the Global Industry Classification Standard (GICS) except that the Adviser assigns a classification to securities not classified by the GICS and to securities for which the Adviser does not have access to the classification made by the GICS. |
Shares | Value | ||
COMMON STOCKS— 97.5% | |||
Communication Services— 8.7% | |||
216,226 | 1 | Alphabet, Inc., Class A | $ 26,567,689 |
525,475 | AT&T, Inc. | 8,265,722 | |
154,696 | Comcast Corp., Class A | 6,087,287 | |
225,000 | Deutsche Telekom AG, Class REG | 4,989,535 | |
17,275 | 1 | Meta Platforms, Inc. | 4,573,038 |
39,600 | 1 | Walt Disney Co. | 3,483,216 |
653,075 | 1 | Warner Bros. Discovery, Inc. | 7,366,686 |
TOTAL | 61,333,173 | ||
Consumer Discretionary— 4.8% | |||
148,925 | Foot Locker, Inc. | 3,770,781 | |
186,128 | General Motors Co. | 6,032,409 | |
14,547 | Home Depot, Inc. | 4,123,347 | |
184,698 | KB HOME | 8,002,964 | |
20,161 | McDonald’s Corp. | 5,748,103 | |
83,877 | TJX Cos., Inc. | 6,440,915 | |
TOTAL | 34,118,519 | ||
Consumer Staples— 9.3% | |||
64,928 | Constellation Brands, Inc., Class A | 15,775,556 | |
41,466 | Estee Lauder Cos., Inc., Class A | 7,630,988 | |
70,726 | Kraft Heinz Co./The | 2,703,148 | |
79,438 | Philip Morris International, Inc. | 7,150,214 | |
24,805 | Target Corp. | 3,247,719 | |
189,049 | The Coca-Cola Co. | 11,278,663 | |
124,824 | WalMart, Inc. | 18,332,901 | |
TOTAL | 66,119,189 | ||
Energy— 7.1% | |||
106,815 | Chevron Corp. | 16,088,475 | |
87,178 | ConocoPhillips | 8,656,775 | |
253,409 | Exxon Mobil Corp. | 25,893,332 | |
TOTAL | 50,638,582 | ||
Financials— 17.0% | |||
95,595 | Allstate Corp. | 10,367,278 | |
305,819 | Bank of America Corp. | 8,498,710 | |
37,473 | 1 | Berkshire Hathaway, Inc., Class B | 12,031,831 |
91,500 | Discover Financial Services | 9,400,710 | |
126,640 | Fifth Third Bancorp | 3,073,553 | |
74,689 | Global Payments, Inc. | 7,296,368 |
Shares | Value | ||
COMMON STOCKS— continued | |||
Financials— continued | |||
125,104 | Hartford Financial Services Group, Inc. | $ 8,572,126 | |
115,975 | Intercontinental Exchange, Inc. | 12,287,551 | |
74,691 | JPMorgan Chase & Co. | 10,136,316 | |
30,350 | M&T Bank Corp. | 3,616,506 | |
38,850 | S&P Global, Inc. | 14,274,655 | |
532,375 | Wells Fargo & Co. | 21,193,849 | |
TOTAL | 120,749,453 | ||
Health Care— 18.3% | |||
109,825 | Abbott Laboratories | 11,202,150 | |
309,262 | 1 | Avantor, Inc. | 6,166,684 |
58,053 | Danaher Corp. | 13,330,130 | |
9,025 | Humana, Inc. | 4,529,377 | |
93,427 | Johnson & Johnson | 14,486,791 | |
20,412 | McKesson Corp. | 7,977,826 | |
146,917 | Medtronic PLC | 12,158,851 | |
118,494 | Merck & Co., Inc. | 13,082,922 | |
196,580 | Pfizer, Inc. | 7,473,972 | |
161,546 | 1 | Tenet Healthcare Corp. | 11,502,075 |
28,503 | UnitedHealth Group, Inc. | 13,887,802 | |
110,259 | Zimmer Biomet Holdings, Inc. | 14,040,381 | |
TOTAL | 129,838,961 | ||
Industrials— 8.9% | |||
52,100 | Dover Corp. | 6,946,493 | |
89,466 | FedEx Corp. | 19,501,798 | |
110,975 | Fortune Brands Innovations, Inc. | 6,708,439 | |
32,585 | Honeywell International, Inc. | 6,243,286 | |
127,025 | Knight-Swift Transportation Holdings, Inc. | 6,985,105 | |
22,350 | Parker-Hannifin Corp. | 7,161,834 | |
125,171 | Stanley Black & Decker, Inc. | 9,384,070 | |
TOTAL | 62,931,025 | ||
Information Technology— 10.3% | |||
328,578 | Cisco Systems, Inc. | 16,320,469 | |
123,925 | IBM Corp. | 15,935,516 | |
53,354 | Microchip Technology, Inc. | 4,015,422 | |
38,449 | Microsoft Corp. | 12,626,267 | |
102,203 | MKS Instruments, Inc. | 9,945,374 | |
118,675 | TE Connectivity Ltd. | 14,535,314 | |
TOTAL | 73,378,362 | ||
Materials— 4.3% | |||
104,103 | Freeport-McMoRan, Inc. | 3,574,897 | |
24,469 | Linde PLC | 8,653,707 |
Shares | Value | ||
COMMON STOCKS— continued | |||
Materials— continued | |||
92,807 | Vulcan Materials Co. | $ 18,143,768 | |
TOTAL | 30,372,372 | ||
Real Estate— 4.0% | |||
41,599 | American Tower Corp. | 7,672,519 | |
5,300 | Equinix, Inc. | 3,951,415 | |
134,707 | NNN REIT, Inc. | 5,730,436 | |
89,953 | ProLogis, Inc. | 11,203,646 | |
TOTAL | 28,558,016 | ||
Utilities— 4.8% | |||
718,489 | CenterPoint Energy, Inc. | 20,268,575 | |
95,363 | NextEra Energy, Inc. | 7,005,366 | |
260,375 | PPL Corp. | 6,821,825 | |
TOTAL | 34,095,766 | ||
TOTAL COMMON STOCKS (IDENTIFIED COST $641,060,580) | 692,133,418 | ||
INVESTMENT COMPANY— 2.4% | |||
17,201,198 | Federated Hermes Institutional Prime Value Obligations Fund, Institutional Shares, 5.15%2 (IDENTIFIED COST $17,197,149) | $17,197,757 | |
TOTAL INVESTMENT IN SECURITIES—99.9% (IDENTIFIED COST $658,257,729)3 | 709,331,175 | ||
OTHER ASSETS AND LIABILITIES - NET—0.1%4 | 755,249 | ||
TOTAL NET ASSETS—100% | $710,086,424 |
Federated Hermes Institutional Prime Value Obligations Fund, Institutional Shares | |
Value as of 11/30/2022 | $21,790,903 |
Purchases at Cost | $105,769,264 |
Proceeds from Sales | $(110,366,122) |
Change in Unrealized Appreciation/Depreciation | $(1,741) |
Net Realized Gain/(Loss) | $5,453 |
Value as of 5/31/2023 | $17,197,757 |
Shares Held as of 5/31/2023 | 17,201,198 |
Dividend Income | $420,180 |
1 | Non-income-producing security. |
2 | 7-day net yield. |
3 | Also represents cost of investments for federal tax purposes. |
4 | Assets, other than investments in securities, less liabilities. See Statement of Assets and Liabilities. |
The following acronym(s) are used throughout this portfolio: | ||
REIT | —Real Estate Investment Trust |
Six Months Ended (unaudited) 5/31/2023 | Year Ended November 30, | |||||
2022 | 2021 | 2020 | 2019 | 2018 | ||
Net Asset Value, Beginning of Period | $22.76 | $26.60 | $22.35 | $21.57 | $24.48 | $25.85 |
Income From Investment Operations: | ||||||
Net investment income (loss) | 0.121 | 0.271 | 0.251 | 0.281 | 0.441 | 0.43 |
Net realized and unrealized gain (loss) | (1.54) | (0.11) | 4.24 | 0.78 | 0.28 | (0.52) |
Total From Investment Operations | (1.42) | 0.16 | 4.49 | 1.06 | 0.72 | (0.09) |
Less Distributions: | ||||||
Distributions from net investment income | (0.13) | (0.29) | (0.24) | (0.28) | (0.45) | (0.43) |
Distributions from net realized gain | (1.28) | (3.71) | — | — | (3.18) | (0.85) |
Total Distributions | (1.41) | (4.00) | (0.24) | (0.28) | (3.63) | (1.28) |
Net Asset Value, End of Period | $19.93 | $22.76 | $26.60 | $22.35 | $21.57 | $24.48 |
Total Return2 | (6.40)% | 0.01% | 20.14% | 5.06% | 6.34% | (0.47)% |
Ratios to Average Net Assets: | ||||||
Net expenses3 | 1.11%4 | 1.11% | 1.11% | 1.11% | 1.13% | 1.12% |
Net investment income | 1.18%4 | 1.18% | 0.97% | 1.39% | 2.12% | 1.70% |
Expense waiver/reimbursement5 | 0.03%4 | 0.01% | 0.00%6 | 0.03% | 0.00%6 | 0.00%6 |
Supplemental Data: | ||||||
Net assets, end of period (000 omitted) | $606,282 | $681,158 | $744,115 | $674,622 | $725,715 | $785,283 |
Portfolio turnover7 | 40% | 90% | 77% | 95% | 97% | 133% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. Total returns for periods of less than one year are not annualized. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | Computed on an annualized basis. |
5 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
6 | Represents less than 0.01%. |
7 | Securities that mature are considered sales for purposes of this calculation. |
Six Months Ended (unaudited) 5/31/2023 | Year Ended November 30, | |||||
2022 | 2021 | 2020 | 2019 | 2018 | ||
Net Asset Value, Beginning of Period | $22.60 | $26.47 | $22.30 | $21.52 | $24.44 | $25.81 |
Income From Investment Operations: | ||||||
Net investment income (loss) | 0.041 | 0.091 | 0.051 | 0.121 | 0.281 | 0.23 |
Net realized and unrealized gain (loss) | (1.52) | (0.11) | 4.23 | 0.79 | 0.28 | (0.52) |
Total From Investment Operations | (1.48) | (0.02) | 4.28 | 0.91 | 0.56 | (0.29) |
Less Distributions: | ||||||
Distributions from net investment income | (0.06) | (0.14) | (0.11) | (0.13) | (0.30) | (0.23) |
Distributions from net realized gain | (1.28) | (3.71) | — | — | (3.18) | (0.85) |
Total Distributions | (1.34) | (3.85) | (0.11) | (0.13) | (3.48) | (1.08) |
Net Asset Value, End of Period | $19.78 | $22.60 | $26.47 | $22.30 | $21.52 | $24.44 |
Total Return2 | (6.73)% | (0.78)% | 19.23% | 4.27% | 5.51% | (1.25)% |
Ratios to Average Net Assets: | ||||||
Net expenses3 | 1.91%4 | 1.89% | 1.87% | 1.91% | 1.87% | 1.88% |
Net investment income | 0.37%4 | 0.39% | 0.19% | 0.61% | 1.36% | 0.91% |
Expense waiver/reimbursement5 | 0.00%4, 6 | 0.00%6 | 0.00%6 | 0.00%6 | 0.01% | 0.00%6 |
Supplemental Data: | ||||||
Net assets, end of period (000 omitted) | $11,510 | $14,915 | $18,179 | $20,748 | $25,888 | $33,925 |
Portfolio turnover7 | 40% | 90% | 77% | 95% | 97% | 133% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. Total returns for periods of less than one year are not annualized. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | Computed on an annualized basis. |
5 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
6 | Represents less than 0.01%. |
7 | Securities that mature are considered sales for purposes of this calculation. |
Six Months Ended (unaudited) 5/31/2023 | Year Ended November 30, | |||||
2022 | 2021 | 2020 | 2019 | 2018 | ||
Net Asset Value, Beginning of Period | $22.77 | $26.62 | $22.37 | $21.58 | $24.50 | $25.87 |
Income From Investment Operations: | ||||||
Net investment income (loss) | 0.091 | 0.211 | 0.191 | 0.221 | 0.381 | 0.37 |
Net realized and unrealized gain (loss) | (1.53) | (0.12) | 4.24 | 0.79 | 0.28 | (0.52) |
Total From Investment Operations | (1.44) | 0.09 | 4.43 | 1.01 | 0.66 | (0.15) |
Less Distributions: | ||||||
Distributions from net investment income | (0.10) | (0.23) | (0.18) | (0.22) | (0.40) | (0.37) |
Distributions from net realized gain | (1.28) | (3.71) | — | — | (3.18) | (0.85) |
Total Distributions | (1.38) | (3.94) | (0.18) | (0.22) | (3.58) | (1.22) |
Net Asset Value, End of Period | $19.95 | $22.77 | $26.62 | $22.37 | $21.58 | $24.50 |
Total Return2 | (6.48)% | (0.28)% | 19.86% | 4.81% | 6.02% | (0.71)% |
Ratios to Average Net Assets: | ||||||
Net expenses3 | 1.39%4 | 1.37% | 1.35% | 1.39% | 1.38% | 1.36% |
Net investment income | 0.91%4 | 0.92% | 0.72% | 1.11% | 1.86% | 1.45% |
Expense waiver/reimbursement5 | 0.00%4, 6 | 0.00%6 | 0.00%6 | 0.00%6 | 0.00%6 | 0.00%6 |
Supplemental Data: | ||||||
Net assets, end of period (000 omitted) | $32,138 | $36,846 | $42,145 | $39,438 | $40,892 | $47,958 |
Portfolio turnover7 | 40% | 90% | 77% | 95% | 97% | 133% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value, which does not reflect the sales charge, redemption fee or contingent deferred sales charge, if applicable. Total returns for periods of less than one year are not annualized. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | Computed on an annualized basis. |
5 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
6 | Represents less than 0.01%. |
7 | Securities that mature are considered sales for purposes of this calculation. |
Six Months Ended (unaudited) 5/31/2023 | Year Ended November 30, | |||||
2022 | 2021 | 2020 | 2019 | 2018 | ||
Net Asset Value, Beginning of Period | $22.78 | $26.60 | $22.36 | $21.57 | $24.48 | $25.86 |
Income From Investment Operations: | ||||||
Net investment income (loss) | 0.101 | 0.221 | 0.201 | 0.241 | 0.401 | 0.39 |
Net realized and unrealized gain (loss) | (1.54) | (0.10) | 4.24 | 0.79 | 0.29 | (0.53) |
Total From Investment Operations | (1.44) | 0.12 | 4.44 | 1.03 | 0.69 | (0.14) |
Less Distributions: | ||||||
Distributions from net investment income | (0.09) | (0.23) | (0.20) | (0.24) | (0.42) | (0.39) |
Distributions from net realized gain | (1.28) | (3.71) | — | — | (3.18) | (0.85) |
Total Distributions | (1.37) | (3.94) | (0.20) | (0.24) | (3.60) | (1.24) |
Net Asset Value, End of Period | $19.97 | $22.78 | $26.60 | $22.36 | $21.57 | $24.48 |
Total Return2 | (6.49)% | (0.17)% | 19.90% | 4.88% | 6.17% | (0.68)% |
Ratios to Average Net Assets: | ||||||
Net expenses3 | 1.33%4 | 1.33% | 1.28% | 1.32% | 1.28% | 1.29% |
Net investment income | 0.97%4 | 0.97% | 0.79% | 1.19% | 1.95% | 1.52% |
Expense waiver/reimbursement5 | 0.25%4 | 0.25% | 0.25% | 0.25% | 0.26% | 0.25% |
Supplemental Data: | ||||||
Net assets, end of period (000 omitted) | $12,276 | $13,798 | $14,857 | $13,849 | $15,723 | $18,836 |
Portfolio turnover6 | 40% | 90% | 77% | 95% | 97% | 133% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value. Total returns for periods of less than one year are not annualized. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | Computed on an annualized basis. |
5 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
6 | Securities that mature are considered sales for purposes of this calculation. |
Six Months Ended (unaudited) 5/31/2023 | Year Ended November 30, | |||||
2022 | 2021 | 2020 | 2019 | 2018 | ||
Net Asset Value, Beginning of Period | $22.74 | $26.56 | $22.33 | $21.55 | $24.47 | $25.84 |
Income From Investment Operations: | ||||||
Net investment income (loss) | 0.151 | 0.321 | 0.311 | 0.331 | 0.481 | 0.50 |
Net realized and unrealized gain (loss) | (1.54) | (0.11) | 4.25 | 0.78 | 0.28 | (0.53) |
Total From Investment Operations | (1.39) | 0.21 | 4.56 | 1.11 | 0.76 | (0.03) |
Less Distributions: | ||||||
Distributions from net investment income | (0.16) | (0.32) | (0.33) | (0.33) | (0.50) | (0.49) |
Distributions from net realized gain | (1.28) | (3.71) | — | — | (3.18) | (0.85) |
Total Distributions | (1.44) | (4.03) | (0.33) | (0.33) | (3.68) | (1.34) |
Net Asset Value, End of Period | $19.91 | $22.74 | $26.56 | $22.33 | $21.55 | $24.47 |
Total Return2 | (6.29)% | 0.24% | 20.46% | 5.32% | 6.56% | (0.22)% |
Ratios to Average Net Assets: | ||||||
Net expenses3 | 0.88%4 | 0.88% | 0.87% | 0.87% | 0.88% | 0.88% |
Net investment income | 1.41%4 | 1.42% | 1.21% | 1.65% | 2.31% | 1.95% |
Expense waiver/reimbursement5 | 0.02%4 | 0.00%6 | 0.00%6 | 0.00%6 | 0.04% | 0.01% |
Supplemental Data: | ||||||
Net assets, end of period (000 omitted) | $47,880 | $53,816 | $55,666 | $44,309 | $58,626 | $92,893 |
Portfolio turnover7 | 40% | 90% | 77% | 95% | 97% | 133% |
1 | Per share numbers have been calculated using the average shares method. |
2 | Based on net asset value. Total returns for periods of less than one year are not annualized. |
3 | Amount does not reflect net expenses incurred by investment companies in which the Fund may invest. |
4 | Computed on an annualized basis. |
5 | This expense decrease is reflected in both the net expense and the net investment income ratios shown above. Amount does not reflect expense waiver/reimbursement recorded by investment companies in which the Fund may invest. |
6 | Represents less than 0.01%. |
7 | Securities that mature are considered sales for purposes of this calculation. |
May 31, 2023 (unaudited)
Assets: | |
Investment in securities, at value including $17,197,757 of investments in affiliated holdings* (identified cost $658,257,729, including $17,197,149 of identified cost in affiliated holdings) | $709,331,175 |
Due from broker (Note 2) | 2,000 |
Income receivable | 1,810,967 |
Income receivable from affiliated holdings | 29,001 |
Receivable for shares sold | 72,942 |
Total Assets | 711,246,085 |
Liabilities: | |
Payable for shares redeemed | 729,700 |
Payable to bank | 55,935 |
Payable for investment adviser fee (Note 5) | 11,703 |
Payable for administrative fee (Note 5) | 1,526 |
Payable for transfer agent fees | 126,318 |
Payable for auditing fees | 13,928 |
Payable for share registration costs | 12,910 |
Payable for distribution services fee (Note 5) | 17,164 |
Payable for other service fees (Notes 2 and 5) | 141,680 |
Accrued expenses (Note 5) | 48,797 |
Total Liabilities | 1,159,661 |
Net assets for 35,627,284 shares outstanding | $710,086,424 |
Net Assets Consist of: | |
Paid-in capital | $658,568,018 |
Total distributable earnings (loss) | 51,518,406 |
Total Net Assets | $710,086,424 |
Net Asset Value, Offering Price and Redemption Proceeds Per Share: | |
Class A Shares: | |
Net asset value per share ($606,281,986 ÷ 30,415,294 shares outstanding), $0.001 par value, 400,000,000 shares authorized | $19.93 |
Offering price per share (100/94.50 of $19.93) | $21.09 |
Redemption proceeds per share | $19.93 |
Class C Shares: | |
Net asset value per share ($11,510,090 ÷ 581,807 shares outstanding), $0.001 par value, 300,000,000 shares authorized | $19.78 |
Offering price per share | $19.78 |
Redemption proceeds per share (99.00/100 of $19.78) | $19.58 |
Class F Shares: | |
Net asset value per share ($32,138,247 ÷ 1,611,090 shares outstanding), $0.001 par value, 100,000,000 shares authorized | $19.95 |
Offering price per share (100/99.00 of $19.95) | $20.15 |
Redemption proceeds per share (99.00/100 of $19.95) | $19.75 |
Class R Shares: | |
Net asset value per share ($12,276,466 ÷ 614,747 shares outstanding), $0.001 par value, 300,000,000 shares authorized | $19.97 |
Offering price per share | $19.97 |
Redemption proceeds per share | $19.97 |
Institutional Shares: | |
Net asset value per share ($47,879,635 ÷ 2,404,346 shares outstanding), $0.001 par value, 400,000,000 shares authorized | $19.91 |
Offering price per share | $19.91 |
Redemption proceeds per share | $19.91 |
* | See information listed after the Fund’s Portfolio of Investments. |
Six Months Ended May 31, 2023 (unaudited)
Investment Income: | |
Dividends (including $420,180 received from affiliated holdings* and net of foreign taxes withheld of $40,212) | $8,629,163 |
Expenses: | |
Investment adviser fee (Note 5) | 2,254,058 |
Administrative fee (Note 5) | 293,832 |
Custodian fees | 15,757 |
Transfer agent fees (Note 2) | 590,605 |
Directors’/Trustees’ fees (Note 5) | 5,443 |
Auditing fees | 17,417 |
Legal fees | 6,091 |
Portfolio accounting fees | 84,676 |
Distribution services fee (Note 5) | 129,213 |
Other service fees (Notes 2 and 5) | 857,382 |
Share registration costs | 47,013 |
Printing and postage | 32,896 |
Miscellaneous (Note 5) | 21,040 |
TOTAL EXPENSES | 4,355,423 |
Waivers and Reimbursements: | |
Reimbursement of investment adviser fee (Note 5) | (8,396) |
Waivers/reimbursements of other operating expenses (Notes 2 and 5) | (98,059) |
TOTAL WAIVERS AND REIMBURSEMENTS | (106,455) |
Net expenses | 4,248,968 |
Net investment income | 4,380,195 |
Realized and Unrealized Gain (Loss) on Investments and Foreign Currency Transactions: | |
Net realized gain on investments (including net realized gain of $5,453 on sales of investments in affiliated holdings*) | 5,593,714 |
Net realized gain on foreign currency transactions | 18,148 |
Net change in unrealized appreciation of investments (including net change in unrealized appreciation of $(1,741) of investments in affiliated holdings*) | (60,048,042) |
Net change in unrealized appreciation/depreciation of translation of assets and liabilities in foreign currency | (359) |
Net realized and unrealized gain (loss) on investments and foreign currency transactions | (54,436,539) |
Change in net assets resulting from operations | $(50,056,344) |
* | See information listed after the Fund’s Portfolio of Investments. |
Six Months Ended (unaudited) 5/31/2023 | Year Ended 11/30/2022 | |
Increase (Decrease) in Net Assets | ||
Operations: | ||
Net investment income | $4,380,195 | $9,624,579 |
Net realized gain (loss) | 5,611,862 | 45,006,765 |
Net change in unrealized appreciation/depreciation | (60,048,401) | (55,217,073) |
CHANGE IN NET ASSETS RESULTING FROM OPERATIONS | (50,056,344) | (585,729) |
Distributions to Shareholders: | ||
Class A Shares | (42,020,979) | (111,660,083) |
Class B Shares1 | (227,774) | (1,135,428) |
Class C Shares | (863,208) | (2,604,402) |
Class F Shares | (2,208,993) | (6,221,777) |
Class R Shares | (831,914) | (2,202,530) |
Institutional Shares | (3,383,759) | (8,562,155) |
CHANGE IN NET ASSETS RESULTING FROM DISTRIBUTIONS TO SHAREHOLDERS | (49,536,627) | (132,386,375) |
Share Transactions: | ||
Proceeds from sale of shares | 17,928,472 | 41,365,976 |
Net asset value of shares issued to shareholders in payment of distributions declared | 47,098,744 | 125,866,721 |
Cost of shares redeemed | (60,190,777) | (112,537,465) |
CHANGE IN NET ASSETS RESULTING FROM SHARE TRANSACTIONS | 4,836,439 | 54,695,232 |
Change in net assets | (94,756,532) | (78,276,872) |
Net Assets: | ||
Beginning of period | 804,842,956 | 883,119,828 |
End of period | $710,086,424 | $804,842,956 |
1 | On February 3, 2023, Class B Shares were converted into Class A Shares. |
Transfer Agent Fees Incurred | Transfer Agent Fees Reimbursed | |
Class A Shares | $488,157 | $(77,831) |
Class B Shares | 2,392 | (788) |
Class C Shares | 11,344 | — |
Class F Shares | 26,271 | — |
Class R Shares | 22,007 | — |
Institutional Shares | 40,434 | (3,233) |
TOTAL | $590,605 | $(81,852) |
Other Service Fees Incurred | |
Class A Shares | $796,791 |
Class B Shares | 1,750 |
Class C Shares | 16,174 |
Class F Shares | 42,667 |
TOTAL | $857,382 |
Six Months Ended 5/31/2023 | Year Ended 11/30/2022 | |||
Class A Shares: | Shares | Amount | Shares | Amount |
Shares sold | 439,441 | $9,167,964 | 1,061,443 | $24,583,546 |
Shares issued to shareholders in payment of distributions declared | 1,933,905 | 39,771,601 | 4,426,548 | 105,794,702 |
Conversion of Class B Shares to Class A Shares1 | 173,563 | 3,728,125 | — | — |
Shares redeemed | (2,061,624) | (42,918,651) | (3,533,173) | (81,351,502) |
NET CHANGE RESULTING FROM CLASS A SHARE TRANSACTIONS | 485,285 | $9,749,039 | 1,954,818 | $49,026,746 |
Six Months Ended 5/31/2023 | Year Ended 11/30/2022 | |||
Class B Shares: | Shares | Amount | Shares | Amount |
Shares sold | 175,927 | $3,736,255 | 10,659 | $249,531 |
Shares issued to shareholders in payment of distributions declared | 10,397 | 211,890 | 40,568 | 964,392 |
Conversion of Class B Shares to Class A Shares1 | (175,528) | (3,728,125) | — | — |
Shares redeemed | (202,043) | (4,297,361) | (168,936) | (3,903,573) |
NET CHANGE RESULTING FROM CLASS B SHARE TRANSACTIONS | (191,247) | $(4,077,341) | (117,709) | $(2,689,650) |
Six Months Ended 5/31/2023 | Year Ended 11/30/2022 | |||
Class C Shares: | Shares | Amount | Shares | Amount |
Shares sold | 24,131 | $496,467 | 164,368 | $3,820,247 |
Shares issued to shareholders in payment of distributions declared | 42,216 | 862,421 | 109,140 | 2,601,011 |
Shares redeemed | (144,441) | (2,992,558) | (300,380) | (6,897,390) |
NET CHANGE RESULTING FROM CLASS C SHARE TRANSACTIONS | (78,094) | $(1,633,670) | (26,872) | $(476,132) |
Six Months Ended 5/31/2023 | Year Ended 11/30/2022 | |||
Class F Shares: | Shares | Amount | Shares | Amount |
Shares sold | 37,059 | $793,253 | 54,646 | $1,238,166 |
Shares issued to shareholders in payment of distributions declared | 102,958 | 2,119,730 | 249,426 | 5,972,460 |
Shares redeemed | (146,790) | (3,079,624) | (269,546) | (6,128,101) |
NET CHANGE RESULTING FROM CLASS F SHARE TRANSACTIONS | (6,773) | $(166,641) | 34,526 | $1,082,525 |
Six Months Ended 5/31/2023 | Year Ended 11/30/2022 | |||
Class R Shares: | Shares | Amount | Shares | Amount |
Shares sold | 39,221 | $816,806 | 83,101 | $1,895,276 |
Shares issued to shareholders in payment of distributions declared | 40,021 | 824,104 | 91,250 | 2,183,547 |
Shares redeemed | (70,296) | (1,454,542) | (126,973) | (2,927,197) |
NET CHANGE RESULTING FROM CLASS R SHARE TRANSACTIONS | 8,946 | $186,368 | 47,378 | $1,151,626 |
Six Months Ended 5/31/2023 | Year Ended 11/30/2022 | |||
Institutional Shares: | Shares | Amount | Shares | Amount |
Shares sold | 139,475 | $2,917,727 | 419,376 | $9,579,210 |
Shares issued to shareholders in payment of distributions declared | 161,076 | 3,308,998 | 350,296 | 8,350,609 |
Shares redeemed | (262,971) | (5,448,041) | (498,854) | (11,329,702) |
NET CHANGE RESULTING FROM INSTITUTIONAL SHARE TRANSACTIONS | 37,580 | $778,684 | 270,818 | $6,600,117 |
NET CHANGE RESULTING FROM TOTAL FUND SHARE TRANSACTIONS | 255,697 | $4,836,439 | 2,162,959 | $54,695,232 |
1 | On February 3, 2023, Class B Shares were converted into Class A Shares. Within the Statement of Changes in Net Assets, the conversion from Class B Shares is within the Cost of shares redeemed and the conversion to Class A Shares is within Proceeds from sale of shares. |
Administrative Fee | Average Daily Net Assets of the Investment Complex |
0.100% | on assets up to $50 billion |
0.075% | on assets over $50 billion |
Percentage of Average Daily Net Assets of Class | |
Class A Shares | 0.05% |
Class C Shares | 0.75% |
Class F Shares | 0.25% |
Class R Shares | 0.50% |
Distribution Services Fees Incurred | Distribution Services Fees Waived | |
Class B Shares | $5,249 | $— |
Class C Shares | 48,829 | — |
Class F Shares | 42,722 | — |
Class R Shares | 32,413 | (16,207) |
TOTAL | $129,213 | $(16,207) |
Purchases | $296,484,846 |
Sales | $333,145,195 |
Beginning Account Value 12/1/2022 | Ending Account Value 5/31/2023 | Expenses Paid During Period1 | |
Actual: | |||
Class A Shares | $1,000 | $936.00 | $5.36 |
Class C Shares | $1,000 | $932.70 | $9.20 |
Class F Shares | $1,000 | $935.20 | $6.71 |
Class R Shares | $1,000 | $935.10 | $6.42 |
Institutional Shares | $1,000 | $937.10 | $4.25 |
Hypothetical (assuming a 5% return before expenses): | |||
Class A Shares | $1,000 | $1,019.40 | $5.59 |
Class C Shares | $1,000 | $1,015.41 | $9.60 |
Class F Shares | $1,000 | $1,018.00 | $6.99 |
Class R Shares | $1,000 | $1,018.30 | $6.69 |
Institutional Shares | $1,000 | $1,020.54 | $4.43 |
1 | Expenses are equal to the Fund’s annualized net expense ratios, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half-year period). The annualized net expense ratios are as follows: |
Class A Shares | 1.11% |
Class C Shares | 1.91% |
Class F Shares | 1.39% |
Class R Shares | 1.33% |
Institutional Shares | 0.88% |
Annual Evaluation of Adequacy and Effectiveness
IMPORTANT NOTICE ABOUT FUND DOCUMENT DELIVERY
Federated Hermes Funds
4000 Ericsson Drive
Warrendale, PA 15086-7561
or call 1-800-341-7400.
CUSIP 313915308
CUSIP 313915407
CUSIP 313915605
CUSIP 313915506
Item 2. | Code of Ethics |
Not Applicable
Item 3. | Audit Committee Financial Expert |
Not Applicable
Item 4. | Principal Accountant Fees and Services |
Not Applicable
Item 5. | Audit Committee of Listed Registrants |
Not Applicable
Item 6. | Schedule of Investments |
(a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this form.
(b) Not Applicable; Fund had no divestments during the reporting period covered since the previous Form N-CSR filing.
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 |
No Changes to Report
Item 11. | Controls and Procedures |
(a) The registrant’s President and Treasurer have concluded that the registrant’s disclosure controls and procedures (as defined in rule 30a-3(c) under the Act) are effective in design and operation and are sufficient to form the basis of the certifications required by Rule 30a-(2) under the Act, based on their evaluation of these disclosure controls and procedures within 90 days of the filing date of this report on Form N-CSR.
(b) There were no changes in the registrant’s internal control over financial reporting (as defined in rule 30a-3(d) under the Act) during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 12. | Disclosure of Securities Lending Activities for Closed-End Management Investment Companies |
Not Applicable
Item 13. | Exhibits |
(a)(1) Code of Ethics- Not Applicable to this Report.
(a)(2) Certifications of Principal Executive Officer and Principal Financial Officer.
��
(a)(3) Not Applicable.
(b) Certifications pursuant to 18 U.S.C. Section 1350.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Registrant Federated Hermes Equity Income Fund, Inc.
By /S/ Lori A. Hensler
Lori A. Hensler
Principal Financial Officer
Date July 21, 2023
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By /S/ J. Christopher Donahue
J. Christopher Donahue
Principal Executive Officer
Date July 21, 2023
By /S/ Lori A. Hensler
Lori A. Hensler
Principal Financial Officer
Date July 21, 2023