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Gabelli Value 25 Fund

Filed: 6 Mar 20, 3:41pm

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            811-05848                    

            The Gabelli Value 25 Fund Inc.            

(Exact name of registrant as specified in charter)

One Corporate Center

                      Rye, New York 10580-1422                      

(Address of principal executive offices) (Zip code)

Bruce N. Alpert

Gabelli Funds, LLC

One Corporate Center

                       Rye, New York 10580-1422                      

(Name and address of agent for service)

Registrant’s telephone number, including area code:  1-800-422-3554

Date of fiscal year end:  December 31

Date of reporting period:  December 31, 2019

FormN-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule30e-1 under the Investment Company Act of 1940 (17 CFR270.30e-1). The Commission may use the information provided on FormN-CSR in its regulatory, disclosure review, inspection, and policymaking roles.

A registrant is required to disclose the information specified by FormN-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in FormN-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.


Item 1. Reports to Stockholders.

The Report to Shareholders is attached herewith.

 


The Gabelli Value 25 Fund Inc.

Annual Report — December 31, 2019

(Y)our Portfolio Management Team

 

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Mario J. Gabelli, CFA      Christopher J. Marangi
Chief Investment Officer        

Co-Chief Investment Officer

      BA, Williams College

            MBA, Columbia

            Business School

To Our Shareholders,

For the year ended December 31, 2019, the net asset value (NAV) per Class A Share of The Gabelli Value 25 Fund Inc. increased 17.8% compared with increases of 31.5% and 25.3% for the Standard & Poor’s (S&P) 500 Index and the Dow Jones Industrial Average, respectively. Other classes of shares are available. See page 4 for performance information for all classes of shares.

Enclosed are the financial statements, including the schedule of investments, as of December 31, 2019.

Performance Discussion (Unaudited)

The investment objective of the Fund is to provide long term capital appreciation. The Fund’s investment strategy is to invest primarily in equity securities of companies that Gabelli Funds, LLC (the Adviser) believes are undervalued and have the potential to achieve significant capital appreciation, overweighting its core 25 equity positions. The Adviser invests in companies whose securities are selling at a significant discount to their private market value (PMV). PMV is the value the Adviser believes informed investors would be willing to pay to acquire the entire company. If investor attention is focused on the underlying asset value of a company due to expected or actual developments or other catalysts, an investment opportunity to realize this PMV may exist. The Fund may invest in companies of any size and from time to time may invest a greater portion in companies with large, medium, or small market capitalizations.

In selecting investments, the Adviser also considers the market price of the issuer’s securities, its balance sheet characteristics and the perceived strength of its management. The Fund’s assets will be invested primarily in

 

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s annual and semiannual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Fund’s website (www.gabelli.com), and you will be notified by mail each time a report is posted and provided with a website link to access the report. If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. To elect to receive all future reports on paper free of charge, please contact your financial intermediary, or, if you invest directly with the Fund, you may call800-422-3554 or send an email request to info@gabelli.com.


common stock. Many of the common stocks the Fund will buy will not pay dividends. These stocks will be bought for the potential that their prices will increase, providing capital appreciation for the Fund. The value of equity securities will fluctuate due to many factors, including the past and predicted earnings of the issuer, the quality of the issuer’s management, general market conditions, and the forecasts for the issuer’s industry and the value of the issuer’s assets.

In absolute terms, 2019 was an excellent year with stocks, corporate bonds, gold and oil all up double digits. This contrasted sharply with 2018 when virtually every asset class declined as a result of a growth scare reminiscent of those in 2011 and 2015. Economic growth in the US indeed slowed but remained above 2%. As it turns out, the 2010s will be the first decade in US history without a recession and home to the longest bull market on record. Life in the political realm has remained more volatile. While Brexit and US trade deals appear on a path to resolution, the coming election is sure to keep 2020 interesting.

Much as a blinding snowstorm can give way to a crystalline paradise, the tumult of late 2018 created a wonderland of bargains in the market. In retrospect it appears investors correctly anticipated an economic slowdown that manifested itself primarily in the industrial and materials sectors (key purchasing manager indices spent the last three quarters of 2019 in contraction) and flat corporate earnings in 2019. However, the markets, ever forward looking, rebounded as theso-called Powell and Trump puts were triggered. Federal Reserve Chairman Jerome Powell backtracked on his project to normalize interest rates, cutting rates three times and increasing bond purchases and overnight funding operations. After escalating trade hostilities with China, President Trump showed an increasing willingness to make amends, culminating in Phase One of a deal announced, but not signed, in December. All the while, the American consumer has remained steadfast, supported by the lowest unemployment rate (3.6%) since 1969 and rising household wealth (+3% to $114 trillion). With a recession postponed yet again and interest rates lower, the total return of the S&P 500 exceeded 30% in 2019, propelled almost entirely by an expansion of the average earnings multiple from 15x to 19x. Equity returns in 2019 were by no means smooth. The market recovered its September 2018 highs in April and traded sideways until the late summer. The first nine months of 2019 followed the script of nine of the last ten years. That is, the most expensive stocks outperformed the cheapest stocks, or as popularly formulated, Growth beat Value. However, coinciding with the beginning of ayear-end push higher, the second week of September saw an abrupt shift as some of the most adored stocks dramatically lagged the forgotten and forlorn stocks. Although Value ultimately lost again to Growth, it outperformed in fits and starts throughout the fourth quarter.

Among the better performing stocks for the fiscal year were: Sony Corp. (7.3% of net assets as of December 31, 2019), a diversified electronics and entertainment company based in Tokyo, Japan. Sony manufactures the PlayStation videogame consoles and games, operates the Sony/Columbia film studio, and Sony Music entertainment. It also manufactures image sensors, mobile devices, consumer electronics, and mirrorless and professional cameras. It holds majority ownership of Sony Financial Services.

Swedish Match AB (4.8%), which manufactures snus, moist snuff, nicotine pouches without tobacco, pouch products with neither nicotine nor tobacco, cigars, chewing tobacco, chew bags, matches and lighters at 13 facilities; in Sweden, the US, the Dominican Republic, the Netherlands, the Philippines, Brazil and Denmark. The company reported increasing sales and operating profits, particularly from its ZYN product; cigars and U.S. chewing tobacco also showed increases.

Newmont Goldcorp (4.8%) mines gold, copper, and silver, with a global presence that covers North and South America, Africa, and Australia. The company declared commercial production for three projects, and its board approved moving its Tanami Expansion 2 project into the execution phase.

 

2


Our weaker performers included AMC Networks Inc. (0.9%), which owns and operates cable television networks including the eponymous AMC, BBC America, IFC, and SundanceTV. Its year to date numbers for September 30 showed only a small increase in revenues, and a decrease in operating income.

MSG Networks Inc. (0.8%) owns and operates two regional sports and entertainment networks broadcasting exclusive live local games from New York and New Jersey based professional sports teams, among other sporting events. The company’s September 30 quarterly results showed a decrease in revenue, operating income, and net income.

US Cellular Corp. (0.5%) is a provider of wireless service and products. The company’s third quarter results revealed a slight increase in revenues but sharp drops in diluted earnings and earnings per share, as it continued its network modernization efforts to prepare its network for 5G.

Thank you for your investment in The Gabelli Value 25 Fund.

We appreciate your confidence and trust.

 

3


Comparative Results                        

 

Average Annual Returns through December 31, 2019 (a) (Unaudited)

 

     
    1 Year   5 Year   10 Year   15 Year   Since
Inception
(9/29/89)
     

Class A (GABVX)

   17.85%     4.25%     9.55%     6.30%     9.82%     

With sales charge (b)

   11.07        3.02        8.90        5.88        9.60        

S&P 500 Index

   31.49        11.70        13.56        9.00        9.95        

Dow Jones Industrial Average

   25.26        12.54        13.34        9.42        10.80        

Nasdaq Composite Index

   36.74        15.00        16.14        11.14        11.00        

Class AAA (GVCAX)

   17.79        4.25        9.56        6.30        9.82        

Class C (GVCCX)

   17.05        3.48        8.74        5.50        9.29        

With contingent deferred sales charge (c)

   16.05        3.48        8.74        5.50        9.29        

Class I (GVCIX)

   18.31        4.62        9.90        6.55        9.95        

In the current prospectuses dated April 30, 2019, the gross expense ratios for Class AAA, A, C, and I Shares are 1.44%, 1.44%, 2.19%, and 1.19% respectively, and the net expense ratios for these share classes after contractual reimbursements by Gabelli Funds, LLC, (the Adviser) are 1.44%, 1.44%, 2.19%, and 1.00%, respectively. See page 11 for the expense ratios for the year ended December 31, 2019. The contractual reimbursement for Class I Shares is in effect through April 30, 2020. Class AAA and Class I Shares do not have a sales charge. The maximum sales charge for Class A and Class C Shares is 5.75% and 1.00%, respectively.

 

 

(a)   Returns represent past performance and do not guarantee future results. Total returns and average annual returns reflect changes in share price, reinvestment of distributions, and are net of expenses. Investment returns and the principal value of an investment will fluctuate. When shares are redeemed, they may be worth more or less than their original cost. Current performance may be lower or higher than the performance data presented. Visit www.gabelli.com for performance information as of the most recent month end. Returns would have been lower had the Adviser not reimbursed certain expenses of the Fund. The Fund imposes a 2% redemption fee on shares sold or exchanged within seven days of purchase. Investors should carefully consider the investment objectives, risks, charges, and expenses of the Fund before investing. The prospectuses contain information about these and other matters and should be read carefully before investing. To obtain a prospectus, please visit our website at www.gabelli.com. The Class A Share NAVs are used to calculate performance for the periods prior to the issuance of Class AAA Shares on April 30, 2010, Class C Shares on March 15, 2000, and Class I Shares on January 11, 2008. The actual performance of the Class C Shares would have been lower due to the additional fees and expenses associated with this class of shares. The actual performance of the Class AAA Shares and Class I Shares would have been higher due to lower expenses associated with these classes of shares. The S&P 500 Index is a market capitalization weighted index of 500 large capitalization stocks commonly used to represent the U.S. equity market. The Dow Jones Industrial Average and the Nasdaq Composite Index are unmanaged indicators of stock market performance. Dividends are considered reinvested, except for the Nasdaq Composite Index. You cannot invest directly in an index.

 

(b)   Performance results include the effect of the maximum 5.75% sales charge at the beginning of the period.

 

(c)   Assuming payment of the 1% maximum contingent deferred sales charge imposed on redemptions made within one year of purchase.

 

    

    

    

COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN

THE GABELLI VALUE 25 FUND INC. (CLASS A SHARES) AND S&P 500 INDEX (Unaudited)

 

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*

Past performance is not predictive of future results. The performance tables and graph do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

 

4


The Gabelli Value 25 Fund Inc.  
Disclosure of Fund Expenses (Unaudited)  
For the Six Month Period from July 1, 2019 through December 31, 2019  Expense Table

 

 

 

We believe it is important for you to understand the impact of fees and expenses regarding your investment. All mutual funds have operating expenses. As a shareholder of a fund, you incur ongoing costs, which include costs for portfolio management, administrative services, and shareholder reports (like this one), among others. Operating expenses, which are deducted from a fund’s gross income, directly reduce the investment return of a fund. When a fund’s expenses are expressed as a percentage of its average net assets, this figure is known as the expense ratio. The following examples are intended to help you understand the ongoing costs (in dollars) of investing in your Fund and to compare these costs with those of other mutual funds. The examples are based on an investment of $1,000 made at the beginning of the period shown and held for the entire period.

The Expense Table below illustrates your Fund’s costs in two ways:

Actual Fund Return:This section provides information about actual account values and actual expenses. You may use this section to help you to estimate the actual expenses that you paid over the period after any fee waivers and expense reimbursements. The “Ending Account Value” shown is derived from the Fund’sactualreturn during the past six months, and the “Expenses Paid During Period” shows the dollar amount that would have been paid by an investor who started with $1,000 in the Fund. You may use this information, together with the amount you invested, to estimate the expenses that you paid over the period.

To do so, simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for your Fund under the heading “Expenses Paid During Period” to estimate the expenses you paid during this period.

Hypothetical 5% Return:This section provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense

ratio. It assumes a hypothetical annualized return of 5% before expenses during the period shown. In this case – because the hypothetical return used isnotthe Fund’s actual return – the results do not apply to your investment and you cannot use the hypothetical account value and expense to estimate the actual ending account balance or expenses you paid for the period. This example is useful in making comparisons of the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs such as sales charges (loads), redemption fees, or exchange fees, if any, which would be described in the Prospectus. If these costs were applied to your account, your costs would be higher. Therefore, the 5% hypothetical return is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. The “Annualized Expense Ratio” represents the actual expenses for the last six months and may be different from the expense ratio in the Financial Highlights which is for the year ended December 31, 2019.

 

    

Beginning

Account Value

07/01/19

   

Ending

Account Value

12/31/19

   

Annualized
Expense

Ratio

   

Expenses

Paid During

Period*

 

The Gabelli Value 25 Fund Inc.

 

     

Actual Fund Return

 

      

Class AAA

   $1,000.00    $1,022.00    1.39%    $  7.08   

Class A

   $1,000.00    $1,022.30    1.40%    $  7.14   

Class C

   $1,000.00    $1,018.70    2.14%    $10.89   

Class I

   $1,000.00    $1,024.60    1.00%    $  5.10   

Hypothetical 5% Return

 

      

Class AAA

   $1,000.00    $1,018.20    1.39%    $  7.07   

Class A

   $1,000.00    $1,018.15    1.40%    $  7.12   

Class C

   $1,000.00    $1,014.42    2.14%    $10.87   

Class I

   $1,000.00    $1,020.16    1.00%    $  5.09   

 

*

Expenses are equal to the Fund’s annualized expense ratio for the last six months multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half year (184 days), then divided by 365.

 

 

5


Summary of Portfolio Holdings (Unaudited)

The following table presents portfolio holdings as a percent of net assets as of December 31, 2019:

The Gabelli Value 25 Fund Inc.

 

Broadcasting

   15.3

Entertainment

   11.4

Financial Services

   10.1

Electronics

   7.7

Cable and Satellite

   6.6

Consumer Products

   6.1

Environmental Services

   5.8

Food and Beverage

   5.2

Metals and Mining

   4.8

Diversified Industrial

   4.5

Automotive: Parts and Accessories

   3.4

Aerospace

   3.1

Energy and Utilities

   2.6

Business Services

   2.4

Equipment and Supplies

   2.3

Hotels and Gaming

   2.3

Machinery

   1.8

Automotive

   1.0

Telecommunications

   0.8

Real Estate

   0.7

Communications Equipment

   0.7

Wireless Communications

   0.5

Building and Construction

   0.4

Computer Software and Services

   0.3

Specialty Chemicals

   0.2

Other Assets and Liabilities (Net)

   0.0%* 
  

 

 

 
   100.0
  

 

 

 

 

*

Amount represents less than 0.05%.

 

 

The Fund files a complete schedule of portfolio holdings with the Securities and Exchange Commission (the SEC) for the first and third quarters of each fiscal year on FormN-PORT. Shareholders may obtain this information at www.gabelli.com or by calling the Fund at800-GABELLI(800-422-3554). The Fund’s FormN-PORT is available on the SEC’s website at www.sec.gov and may also be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling800-SEC-0330.

Proxy Voting

The Fund files FormN-PX with its complete proxy voting record for the twelve months ended June 30, no later than August 31 of each year. A description of the Fund’s proxy voting policies, procedures, and how the Fund voted proxies relating to portfolio securities is available without charge, upon request, by (i) calling800-GABELLI(800-422-3554); (ii) writing to The Gabelli Funds at One Corporate Center, Rye, NY 10580-1422; or (iii) visiting the SEC’s website at www.sec.gov.

 

6


The Gabelli Value 25 Fund Inc.

Schedule of Investments — December 31, 2019

 

 

Shares

      

Cost

  

Market

Value

 
  COMMON STOCKS — 100.0%

 

  Aerospace — 3.1%   
 233,500   Aerojet Rocketdyne Holdings Inc.†  $1,566,151  $10,661,610 
 5,520,000   Rolls-Royce Holdings plc†   7,111   7,312 
    

 

 

  

 

 

 
     1,573,262   10,668,922 
    

 

 

  

 

 

 
  Automotive — 1.0%   
 125,000   Navistar International Corp.†   3,252,335   3,617,500 
    

 

 

  

 

 

 
  Automotive: Parts and Accessories — 3.4%

 

 
 45,000   Garrett Motion Inc.†   571,742   449,550 
 87,000   Genuine Parts Co.   1,971,037   9,242,010 
 5,000   O’Reilly Automotive Inc.†   612,847   2,191,300 
    

 

 

  

 

 

 
     3,155,626   11,882,860 
    

 

 

  

 

 

 
  Broadcasting — 15.3%   
 7,000   Liberty Broadband Corp., Cl. A†   314,951   871,920 
 46,500   Liberty Broadband Corp., Cl. C†   835,342   5,847,375 
 95,000   

Liberty Media Corp.-
Liberty SiriusXM, Cl. C†

   322,039   4,573,300 
 166,000   MSG Networks Inc., Cl. A†   76,944   2,888,400 
 866,500   ViacomCBS Inc., Cl. A   27,538,744   38,879,855 
    

 

 

  

 

 

 
     29,088,020   53,060,850 
    

 

 

  

 

 

 
  Building and Construction — 0.4%   
 30,000   Johnson Controls International plc   435,269   1,221,300 
    

 

 

  

 

 

 
  Business Services — 2.4%   
 87,000   Macquarie Infrastructure Corp.   2,579,933   3,727,080 
 15,000   Mastercard Inc., Cl. A   303,181   4,478,850 
    

 

 

  

 

 

 
     2,883,114   8,205,930 
    

 

 

  

 

 

 
  Cable and Satellite — 6.6%   
 76,000   AMC Networks Inc., Cl. A†   0   3,002,000 
 130,000   Comcast Corp., Cl. A   1,887,027   5,846,100 
 149,871   DISH Network Corp., Cl. A†   2,904,534   5,315,924 
 83,000   EchoStar Corp., Cl. A†   1,666,895   3,594,730 
 74,000   Liberty Global plc, Cl. A†   433,350   1,682,760 
 38,000   Liberty Global plc, Cl. C†   237,905   828,210 
 24,000   Liberty Latin America Ltd., Cl. C†   426,065   467,040 
 45,000   Rogers Communications Inc., Cl. B   139,504   2,235,150 
    

 

 

  

 

 

 
     7,695,280   22,971,914 
    

 

 

  

 

 

 
  Communications Equipment — 0.7%

 

 70,000   Loral Space & Communications Inc.†   3,534,456   2,262,400 
    

 

 

  

 

 

 
  Computer Software and Services — 0.3%

 

 
 75,000   Hewlett Packard Enterprise Co.   995,056   1,189,500 
    

 

 

  

 

 

 
  Consumer Products — 6.1%   
 47,000   Edgewell Personal Care Co.†   965,782   1,455,120 

Shares

      

Cost

  

Market
Value

 
 57,500   Energizer Holdings Inc.  $1,438,058  $2,887,650 
 323,000   Swedish Match AB   4,638,915   16,649,431 
    

 

 

  

 

 

 
     7,042,755   20,992,201 
    

 

 

  

 

 

 
  Diversified Industrial — 4.5%   
 32,000   Ampco-Pittsburgh Corp.†   160,011   96,320 
 90,000   Crane Co.   2,320,635   7,774,200 
 44,500   Honeywell International Inc.   953,754   7,876,500 
    

 

 

  

 

 

 
     3,434,400   15,747,020 
    

 

 

  

 

 

 
  Electronics — 7.7%   
 120,000   Resideo Technologies Inc.†   1,614,687   1,431,600 
 372,000   Sony Corp., ADR   6,287,655   25,296,000 
    

 

 

  

 

 

 
     7,902,342   26,727,600 
    

 

 

  

 

 

 
  Energy and Utilities — 2.6%   
 193,000   National Fuel Gas Co.   8,507,074   8,982,220 
    

 

 

  

 

 

 
  Entertainment — 11.4%   
 40,000   Discovery Inc., Cl. A†   369,758   1,309,600 
 175,000   Discovery Inc., Cl. C†   2,488,263   5,335,750 
 40,000   Fox Corp., Cl. A   1,662,000   1,482,800 
 344,800   Grupo Televisa SAB, ADR   3,487,128   4,044,504 
 16,000   

Liberty Media Corp.-
Liberty Braves, Cl. A†

   285,275   474,400 
 107,040   

Liberty Media Corp.-
Liberty Braves, Cl. C†

   1,849,967   3,161,962 
 62,000   The Madison Square Garden Co., Cl. A†   287,806   18,239,780 
 38,500   The Walt Disney Co.   1,054,840   5,568,255 
    

 

 

  

 

 

 
     11,485,037   39,617,051 
    

 

 

  

 

 

 
  Environmental Services — 5.8%

 

 
 155,000   Republic Services Inc.   1,929,054   13,892,650 
 68,000   Waste Connections Inc.   2,164,568   6,173,720 
    

 

 

  

 

 

 
     4,093,622   20,066,370 
    

 

 

  

 

 

 
  Equipment and Supplies — 2.3%

 

 
 78,000   CIRCOR International Inc.†   928,949   3,606,720 
 85,000   Flowserve Corp.   324,964   4,230,450 
    

 

 

  

 

 

 
     1,253,913   7,837,170 
    

 

 

  

 

 

 
  Financial Services — 10.1%   
 122,000   American Express Co.   3,138,042   15,187,780 
 100,000   H&R Block Inc.   1,854,374   2,348,000 
 35,000   Legg Mason Inc.   648,989   1,256,850 
 224,000   The Bank of New York Mellon Corp.   6,941,666   11,273,920 
 95,000   Wells Fargo & Co.   3,045,615   5,111,000 
    

 

 

  

 

 

 
     15,628,686   35,177,550 
    

 

 

  

 

 

 
  Food and Beverage — 5.2%   
 71,500   Diageo plc, ADR   2,623,597   12,042,030 
 

See accompanying notes to financial statements.

 

7


The Gabelli Value 25 Fund Inc.

Schedule of Investments (Continued) — December 31, 2019

 

 

Shares

      

Cost

   

Market
Value

 
  COMMON STOCKS (Continued)

 

  
  Food and Beverage (Continued)

 

  
 12,000   

Fomento Economico Mexicano SAB de CV, ADR

  $138,150   $1,134,120 
 90,000   Mondelēz International Inc., Cl. A   2,285,660    4,957,200 
    

 

 

   

 

 

 
     5,047,407    18,133,350 
    

 

 

   

 

 

 
  Hotels and Gaming — 2.3%    
 90,000   Ryman Hospitality Properties Inc., REIT   2,324,340    7,799,400 
    

 

 

   

 

 

 
  Machinery — 1.8%    
 183,744   CNH Industrial NV   1,331,785    2,021,184 
 110,000   CNH Industrial NV, Borsa Italiana   990,523    1,207,964 
 40,000   Xylem Inc.   865,812    3,151,600 
    

 

 

   

 

 

 
     3,188,120    6,380,748 
    

 

 

   

 

 

 
  Metals and Mining — 4.8%    
 381,000   Newmont Goldcorp Corp.   7,448,987    16,554,450 
    

 

 

   

 

 

 
  Real Estate — 0.7%    
 61,000   Griffin Industrial Realty Inc.   1,034,832    2,412,550 
    

 

 

   

 

 

 
  Specialty Chemicals — 0.2%    
 5,000   International Flavors & Fragrances Inc.   201,240    645,100 
    

 

 

   

 

 

 

    

Shares

      

Cost

   

Market

Value

 
  Telecommunications — 0.8%    
 115,000   Telephone & Data Systems Inc.  $2,561,474   $2,924,450 
    

 

 

   

 

 

 
  Wireless Communications — 0.5%

 

  
 50,000   United States Cellular Corp.†   2,167,350    1,811,500 
    

 

 

   

 

 

 
  TOTAL COMMON STOCKS   135,933,997    346,889,906 
    

 

 

   

 

 

 
  TOTAL INVESTMENTS — 100.0%  $135,933,997    346,889,906 
    

 

 

   
  Other Assets and Liabilities (Net) — 0.0%

 

   (134,006
      

 

 

 
  NET ASSETS — 100.0%    $346,755,900 
      

 

 

 

                                             

Non-income producing security.

ADR

American Depositary Receipt

REIT

Real Estate Investment Trust

 

 

See accompanying notes to financial statements.

 

8


The Gabelli Value 25 Fund Inc.

 

Statement of Assets and Liabilities  
December 31, 2019  

 

  

Assets:

  

Investments, at value (cost $135,933,997)

   $346,889,906 

Receivable for investments sold

   641,235 

Receivable for Fund shares sold

   375,673 

Receivable from Adviser

   3,152 

Dividends receivable

   965,506 

Prepaid expenses

              36,572 

Total Assets

     348,912,044 

Liabilities:

  

Payable to custodian

   772,946 

Payable for investments purchased

   244,333 

Payable for Fund shares redeemed

   613,504 

Payable for investment advisory fees

   294,646 

Payable for distribution fees

   64,607 

Payable for accounting fees

   11,250 

Other accrued expenses

            154,858 

Total Liabilities

         2,156,144 

Net Assets
(applicable to 25,136,065 shares outstanding)

   $346,755,900 
  

 

 

 

Net Assets Consist of:

  

Paid-in capital

   $137,628,143 

Total distributable earnings

     209,127,757 

Net Assets

   $346,755,900 
  

 

 

 

Shares of Capital Stock, each at $0.001 par value:

 

Class AAA:

 

Net Asset Value, offering, and redemption price per share ($3,172,352 ÷ 230,031 shares outstanding; 50,000,000 shares authorized)

  $13.79 
 

 

 

 

Class A:

 

Net Asset Value and redemption price per share ($286,924,740 ÷ 20,714,900 shares outstanding; 100,000,000 shares authorized)

  $13.85 
 

 

 

 

Maximum offering price per share (NAV ÷ 0.9425, based on maximum sales charge of 5.75% of the offering price)

  $14.69 
 

 

 

 

Class C:

 

Net Asset Value and offering price per share ($3,264,405 ÷ 323,950 shares outstanding; 50,000,000 shares authorized)

  $10.08(a) 
 

 

 

 

Class I:

 

Net Asset Value, offering, and redemption price per share ($53,394,403 ÷ 3,867,184 shares outstanding; 50,000,000 shares authorized)

  $13.81 
 

 

 

 
Statement of Operations 
For the Year Ended December 31, 2019 

 

  

Investment Income:

 

Dividends (net of foreign withholding taxes of $151,794)

 $  5,927,756 

Interest

  38,512 
 

 

 

 

Total Investment Income

  5,966,268 
 

 

 

 

Expenses:

 

Investment advisory fees

  3,604,564 

Distribution fees - Class AAA

  9,697 

Distribution fees - Class A

  746,858 

Distribution fees - Class C

  52,458 

Shareholder services fees

  193,550 

Directors’ fees

  76,024 

Shareholder communications expenses

  73,978 

Legal and audit fees

  71,154 

Registration expenses

  64,662 

Accounting fees

  45,000 

Custodian fees

  44,972 

Interest expense

  3,505 

Tax expense

  1,308 

Miscellaneous expenses

  22,833 
 

 

 

 

Total Expenses

  5,010,563 
 

 

 

 

Less:

 

Expense reimbursements (See Note 3)

  (85,745

Expenses paid indirectly by broker (See Note 6)

  (4,053

Custodian fee credits.

  (429
 

 

 

 

Total Reimbursements and Credits

  (90,227
 

 

 

 

Net Expenses

  4,920,336 
 

 

 

 

Net Investment Income

  1,045,932 
 

 

 

 

Net Realized and Unrealized Gain/(Loss) on

 

Investments and Foreign Currency:

 

Net realized gain on investments

  33,959,670 

Net realized loss on foreign currency transactions

  (784
 

 

 

 

Net realized gain on investments and foreign currency transactions

  33,958,886 
 

 

 

 

Net change in unrealized appreciation/depreciation:

 

on investments

  23,492,302 

on foreign currency translations

  (16,098
 

 

 

 

Net change in unrealized appreciation/depreciation on investments and foreign currency translations

  23,476,204 
 

 

 

 

Net Realized and Unrealized Gain/(Loss) on Investments and Foreign Currency

  57,435,090 
 

 

 

 

Net Increase in Net Assets Resulting from Operations

 $58,481,022 
 

 

 

 
 

 

(a)

Redemption price varies based on the length of time held.

 

See accompanying notes to financial statements.

 

9


The Gabelli Value 25 Fund Inc.

 

Statement of Changes in Net Assets

 

 

   Year Ended
December 31,  2019
 Year Ended
December 31,  2018

Operations:

     

Net investment income

   $1,045,932  $313,203

Net realized gain on investments and foreign currency transactions

    33,958,886   33,216,788

Net change in unrealized appreciation/depreciation on investments and foreign currency translations

    23,476,204   (63,989,762)
   

 

 

   

 

 

 

Net Increase/(Decrease) in Net Assets Resulting from Operations

    58,481,022   (30,459,771)
   

 

 

   

 

 

 

Distributions to Shareholders:

     

Accumulated earnings

     

Class AAA

    (301,565)   (300,525)

Class A

    (27,119,154)   (25,249,673)

Class C

    (393,940)   (745,412)

Class I

    (5,242,071)   (4,463,121)
   

 

 

   

 

 

 

Total Distributions to Shareholders

    (33,056,730)   (30,758,731)
   

 

 

   

 

 

 

Capital Share Transactions:

     

Class AAA

    (932,134)   (144,439)

Class A

    (15,808,781)   (30,365,984)

Class C

    (3,807,148)   (526,197)

Class I

    1,898,883   (3,944,470)

Class T*

       (1,118)
   

 

 

   

 

 

 

Net Decrease in Net Assets from Capital Share Transactions

    (18,649,180)   (34,982,208)
   

 

 

   

 

 

 

Redemption Fees

    4,156   7
   

 

 

   

 

 

 

Net Increase/(Decrease) in Net Assets

    6,779,268   (96,200,703)

Net Assets:

     

Beginning of year

    339,976,632   436,177,335
   

 

 

   

 

 

 

End of year

   $346,755,900  $339,976,632
   

 

 

   

 

 

 

 

*

Class T Shares were liquidated on September 21, 2018.

 

See accompanying notes to financial statements.

 

10


The Gabelli Value 25 Fund Inc.

Financial Highlights

 

Selected data for a share of capital stock outstanding throughout each year:

 

      Income (Loss)                         Ratios to Average Net Assets / 
      from Investment Operations   Distributions              Supplemental Data 

Year Ended

December 31

  

Net Asset

Value,

Beginning

of Year

  

Net

Investment

Income

(Loss)(a)

  

Net

Realized

and

Unrealized

Gain (Loss)

on

Investments

   

Total from

Investment

Operations

   

Net

Investment

Income

  

Net

Realized

Gain on

Investments

   

Total

Distributions

   

Redemption

Fees (a)(b)

   

Net Asset

Value,

End of

Year

   

Total

Return†

  

Net Assets,

End of Year

(in 000’s)

   

Net

Investment

Income

(Loss)

  

Operating

Expenses

Before

Reimburse

ments

  

Operating

Expenses

Net of

  Reimbursements(c)

      

Portfolio

Turnover

Rate

 

Class AAA

                         

2019

  $12.91   $ 0.03   $ 2.27    $ 2.30   $(0.03  $(1.39   $(1.42  $ 0.00   $13.79    17.8 $3,172    0.22  1.41%   1.41%     3% 

2018

   15.41   0.00(b)   (1.27   (1.27   0.00(b)   (1.23   (1.23   0.00    12.91    (8.2  3,774    0.03   1.44   1.44     2 

2017

   14.61   0.01   1.85    1.86    (0.02  (1.04   (1.06   0.00    15.41    12.7   4,542    0.09   1.41   1.41     2 

2016

   14.07   0.07   1.57    1.64    (0.07  (1.03   (1.10   0.00    14.61    11.6   4,103    0.48   1.40   1.40     2 

2015

   18.23   0.01   (1.72   (1.71   (0.01  (2.44   (2.45       14.07    (9.5  4,492    0.05   1.39   1.39     3 

Class A

                         

2019

  $12.96   $ 0.03   $ 2.28    $ 2.31   $(0.03  $(1.39   $(1.42  $0.00   $13.85    17.8 $286,925    0.24  1.41%   1.41%     3% 

2018

   15.48   0.00(b)   (1.29   (1.29   0.00(b)   (1.23   (1.23   0.00    12.96    (8.2  281,613    0.03   1.44   1.44     2 

2017

   14.66   0.01   1.86    1.87    (0.01  (1.04   (1.05   0.00    15.48    12.8   362,729    0.09   1.41   1.41     2 

2016

   14.12   0.07   1.57    1.64    (0.07  (1.03   (1.10   0.00    14.66    11.6   386,700    0.48   1.40   1.40     2 

2015

   18.29   0.01   (1.73   (1.72   (0.01  (2.44   (2.45       14.12    (9.5  427,905    0.07   1.39   1.39     3 

Class C

                         

2019

  $9.80   $(0.05  $ 1.72    $ 1.67       $(1.39   $(1.39  $0.00   $10.08    17.0 $3,265    (0.50)%   2.16%   2.16%     3% 

2018

   12.12   (0.09  (1.00   (1.09      (1.23   (1.23   0.00    9.80    (8.9  6,528    (0.72  2.19   2.19     2 

2017

   11.77   (0.08  1.47    1.39       (1.04   (1.04   0.00    12.12    11.8   8,351    (0.67  2.16   2.16     2 

2016

   11.55   (0.03  1.28    1.25       (1.03   (1.03   0.00    11.77    10.8   11,171    (0.27  2.15   2.15     2 

2015

   15.55   (0.10  (1.46   (1.56      (2.44   (2.44       11.55    (10.2  13,317    (0.69  2.14   2.14     3 

Class I

                         

2019

  $12.93   $ 0.10   $ 2.27    $ 2.37   $(0.10  $(1.39   $(1.49  $0.00   $13.81    18.3 $53,394    0.65  1.16%   1.00%(d)     3% 

2018

   15.45   0.07   (1.28   (1.21   (0.08  (1.23   (1.31   0.00    12.93    (7.8  48,062    0.47   1.19   1.00(d)     2 

2017

   14.64   0.08   1.85    1.93    (0.08  (1.04   (1.12   0.00    15.45    13.2   60,554    0.50   1.16   1.00(d)     2 

2016

   14.10   0.12   1.57    1.69    (0.12  (1.03   (1.15   0.00    14.64    11.9   46,922    0.79   1.15   1.13(d)     2 

2015

   18.28   0.05   (1.73   (1.68   (0.06  (2.44   (2.50       14.10    (9.3  64,336    0.28   1.14   1.14     3 

 

Total return represents aggregate total return of a hypothetical $1,000 investment at the beginning of the year and sold at the end of the year including reinvestment of distributions and does not reflect the applicable sales charges.

(a)

Per share amounts have been calculated using the average shares outstanding method.

(b)

Amount represents less than $0.005 per share.

(c)

The Fund received credits from a designated broker who agreed to pay certain Fund operating expenses. For the years ended December 31, 2019, 2018, 2017, 2016, and 2015, there was no impact on the expense ratios.

(d)

Under an expense reimbursement agreement with the Adviser, the Adviser reimbursed certain Class I expenses to the Fund. For the years ended December 31, 2019, 2018, 2017, and 2016, these reimbursements amounted to $85,745, $107,706, $87,199, and $11,790, respectively.

 

See accompanying notes to financial statements.

 

11


The Gabelli Value 25 Fund Inc.

Notes to Financial Statements

 

 

1. Organization.The Gabelli Value 25 Fund Inc. was incorporated on July 20, 1989 in Maryland and commenced investment operations on September 29, 1989. The Fund is a diversifiedopen-end management investment company registered under the Investment Company Act of 1940, as amended (the 1940 Act). The Fund’s primary objective is long term capital appreciation.

2. Significant Accounting Policies.As an investment company, the Fund follows the investment company accounting and reporting guidance, which is part of U.S. generally accepted accounting principles (GAAP) that may require the use of management estimates and assumptions in the preparation of its financial statements. Actual results could differ from those estimates. The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements.

New Accounting Pronouncements.To improve the effectiveness of fair value disclosure requirements, the Financial Accounting Standards Board recently issued Accounting Standard Update (ASU)2018-13, Fair Value Measurement Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement (ASU2018-13), which adds, removes, and modifies certain aspects relating to fair value disclosure. ASU2018-13 is effective for interim and annual reporting periods beginning after December 15, 2019; early adoption of the additions relating to ASU2018-13 is not required, even if early adoption is elected for the removals and modifications under ASU2018-13. Management has early adopted the removals and modifications set forth in ASU2018-13 in these financial statements and has not early adopted the additions set forth in ASU2018-13.

Security Valuation.Portfolio securities listed or traded on a nationally recognized securities exchange or traded in the U.S.over-the-counter market for which market quotations are readily available are valued at the last quoted sale price or a market’s official closing price as of the close of business on the day the securities are being valued. If there were no sales that day, the security is valued at the average of the closing bid and asked prices or, if there were no asked prices quoted on that day, then the security is valued at the closing bid price on that day. If no bid or asked prices are quoted on such day, the security is valued at the most recently available price or, if the Board of Directors (the Board) so determines, by such other method as the Board shall determine in good faith to reflect its fair market value. Portfolio securities traded on more than one national securities exchange or market are valued according to the broadest and most representative market, as determined by Gabelli Funds, LLC (the Adviser).

Portfolio securities primarily traded on a foreign market are generally valued at the preceding closing values of such securities on the relevant market, but may be fair valued pursuant to procedures established by the Board if market conditions change significantly after the close of the foreign market, but prior to the close of business on the day the securities are being valued. Debt obligations for which market quotations are readily available are valued at the average of the latest bid and asked prices. If there were no asked prices quoted on such day, the security is valued using the closing bid price, unless the Board determines that such amount does not reflect the securities’ fair value, in which case these securities will be fair valued as determined by the Board. Certain securities are valued principally using dealer quotations. Futures contracts are valued at the closing settlement price of the exchange or board of trade on which the applicable contract is traded. OTC futures and options on futures for which market quotations are readily available will be valued by quotations received from a pricing service or, if no quotations are available from a pricing service, by quotations obtained from one or more dealers in the instrument in question by the Adviser.

 

12


The Gabelli Value 25 Fund Inc.

Notes to Financial Statements (Continued)

 

 

Securities and assets for which market quotations are not readily available are fair valued as determined by the Board. Fair valuation methodologies and procedures may include, but are not limited to: analysis and review of available financial andnon-financial information about the company; comparisons with the valuation and changes in valuation of similar securities, including a comparison of foreign securities with the equivalent U.S. dollar value American Depositary Receipt securities at the close of the U.S. exchange; and evaluation of any other information that could be indicative of the value of the security.

The inputs and valuation techniques used to measure fair value of the Fund’s investments are summarized into three levels as described in the hierarchy below:

 

  

Level 1 — quoted prices in active markets for identical securities;

 

  

Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.); and

 

  

Level 3 — significant unobservable inputs (including the Board’s determinations as to the fair value of investments).

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input both individually and in the aggregate that is significant to the fair value measurement. The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The summary of the Fund’s investments in securities by inputs used to value the Fund’s investments as of December 31, 2019 is as follows:

 

  Valuation Inputs
  Level 1
Quoted Prices
  Level 2 Other Significant
Observable  Inputs
  Total Market Value
at  12/31/19

INVESTMENTS IN SECURITIES:

        

ASSETS (Market Value):

        

Common Stocks:

        

Aerospace

  $10,661,610   $7,312   $10,668,922

Other Industries (a)

   336,220,984        336,220,984

Total Common Stocks

   346,882,594    7,312    346,889,906

TOTAL INVESTMENTS IN SECURITIES – ASSETS

  $346,882,594   $7,312   $346,889,906

 

(a)

Please refer to the Schedule of Investments for the industry classifications of these portfolio holdings.

During the year ended December 31, 2019 the Fund did not have transfers into or out of Level 3.

 

13


The Gabelli Value 25 Fund Inc.

Notes to Financial Statements (Continued)

 

 

Additional Information to Evaluate Qualitative Information.

General.The Fund uses recognized industry pricing services – approved by the Board and unaffiliated with the Adviser – to value most of its securities, and uses broker quotes provided by market makers of securities not valued by these and other recognized pricing sources. Several different pricing feeds are received to value domestic equity securities, international equity securities, preferred equity securities, and fixed income securities. The data within these feeds are ultimately sourced from major stock exchanges and trading systems where these securities trade. The prices supplied by external sources are checked by obtaining quotations or actual transaction prices from market participants. If a price obtained from the pricing source is deemed unreliable, prices will be sought from another pricing service or from a broker/dealer that trades that security or similar securities.

Fair Valuation.Fair valued securities may be common or preferred equities, warrants, options, rights, or fixed income obligations. Where appropriate, Level 3 securities are those for which market quotations are not available, such as securities not traded for several days, or for which current bids are not available, or which are restricted as to transfer. Among the factors to be considered to fair value a security are recent prices of comparable securities that are publicly traded, reliable prices of securities not publicly traded, the use of valuation models, current analyst reports, valuing the income or cash flow of the issuer, or cost if the preceding factors do not apply. A significant change in the unobservable inputs could result in a lower or higher value in Level 3 securities. The circumstances of Level 3 securities are frequently monitored to determine if fair valuation measures continue to apply.

The Adviser reports quarterly to the Board the results of the application of fair valuation policies and procedures. These may include backtesting the prices realized in subsequent trades of these fair valued securities to fair values previously recognized.

Foreign Currency Translations.The books and records of the Fund are maintained in U.S. dollars. Foreign currencies, investments, and other assets and liabilities are translated into U.S. dollars at current exchange rates. Purchases and sales of investment securities, income, and expenses are translated at the exchange rate prevailing on the respective dates of such transactions. Unrealized gains and losses that result from changes in foreign exchange rates and/or changes in market prices of securities have been included in unrealized appreciation/depreciation on investments and foreign currency translations. Net realized foreign currency gains and losses resulting from changes in exchange rates include foreign currency gains and losses between trade date and settlement date on investment securities transactions, foreign currency transactions, and the difference between the amounts of interest and dividends recorded on the books of the Fund and the amounts actually received. The portion of foreign currency gains and losses related to fluctuation in exchange rates between the initial purchase trade date and subsequent sale trade date is included in realized gain/(loss) on investments.

Foreign Securities.The Fund may directly purchase securities of foreign issuers. Investing in securities of foreign issuers involves special risks not typically associated with investing in securities of U.S. issuers. The risks include possible revaluation of currencies, the inability to repatriate funds, less complete financial information about companies, and possible future adverse political and economic developments. Moreover, securities of many foreign issuers and their markets may be less liquid and their prices more volatile than securities of comparable U.S. issuers.

 

14


The Gabelli Value 25 Fund Inc.

Notes to Financial Statements (Continued)

 

 

Foreign Taxes.The Fund may be subject to foreign taxes on income, gains on investments, or currency repatriation, a portion of which may be recoverable. The Fund will accrue such taxes and recoveries as applicable, based upon its current interpretation of tax rules and regulations that exist in the markets in which it invests.

Restricted Securities.The Fund may invest up to 10% of its net assets in securities for which the markets are restricted. Restricted securities include securities whose disposition is subject to substantial legal or contractual restrictions. The sale of restricted securities often requires more time and results in higher brokerage charges or dealer discounts and other selling expenses than does the sale of securities eligible for trading on national securities exchanges or in theover-the-counter markets. Restricted securities may sell at a price lower than similar securities that are not subject to restrictions on resale. Securities freely saleable among qualified institutional investors under special rules adopted by the SEC may be treated as liquid if they satisfy liquidity standards established by the Board. The continued liquidity of such securities is not as well assured as that of publicly traded securities, and accordingly the Board will monitor their liquidity. At December 31, 2019, the Fund held no restricted securities.

Securities Transactions and Investment Income.Securities transactions are accounted for on the trade date with realized gain/(loss) on investments determined by using the identified cost method. Interest income (including amortization of premium and accretion of discount) is recorded on an accrual basis. Premiums and discounts on debt securities are amortized using the effective yield to maturity method. Dividend income is recorded on theex-dividend date, except for certain dividends from foreign securities that are recorded as soon after theex-dividend date as the Fund becomes aware of such dividends.

Determination of Net Asset Value and Calculation of Expenses.Certain administrative expenses are common to, and allocated among, various affiliated funds. Such allocations are made on the basis of each fund’s average net assets or other criteria directly affecting the expenses as determined by the Adviser pursuant to procedures established by the Board.

In calculating the NAV per share of each class, investment income, realized and unrealized gains and losses, redemption fees, and expenses other than class specific expenses are allocated daily to each class of shares based upon the proportion of net assets of each class at the beginning of each day. Distribution expenses are borne solely by the class incurring the expense.

Distributions to Shareholders.Distributions to shareholders are recorded on theex-dividend date. Distributions to shareholders are based on income and capital gains as determined in accordance with federal income tax regulations, which may differ from income and capital gains as determined under GAAP. These differences are primarily due to differing treatments of income and gains on various investment securities and foreign currency transactions held by the Fund, timing differences, and differing characterizations of distributions made by the Fund. Distributions from net investment income for federal income tax purposes include net realized gains on foreign currency transactions. These book/tax differences are either temporary or permanent in nature. Permanent differences were primarily due to utilization of tax equalization, prior year long term capital gain reversal on real estate investment trusts, and tax treatment of currency gains and losses. To the extent these differences are permanent, adjustments are made to the appropriate capital accounts in the period when the differences arise. For the year ended December 31, 2019, reclassifications were made to increasepaid-in capital by $2,130,775, with an offsetting adjustment to total distributable earnings. These reclassifications have no impact on the NAV of the Fund.

 

15


The Gabelli Value 25 Fund Inc.

Notes to Financial Statements (Continued)

 

 

The tax character of distributions paid during the years ended December 31, 2019 and 2018 was as follows:

 

   Year Ended
December 31, 2019
  Year Ended
December 31, 2018

Distributions paid from:*

      

Ordinary income (inclusive of short term capital gains)

   $1,173,912   $334,638

Net long term capital gains

    34,010,094    32,902,226
   

 

 

    

 

 

 

Total distributions paid

   $35,184,006   $33,236,864
   

 

 

    

 

 

 

 

*

Total distributions paid differs from the Statement of Changes in Net Assets due to the utilization of equalization.

Provision for Income Taxes.The Fund intends to continue to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended (the Code). It is the policy of the Fund to comply with the requirements of the Code applicable to regulated investment companies and to distribute substantially all of its net investment company taxable income and net capital gains. Therefore, no provision for federal income taxes is required.

As of December 31, 2019, the components of accumulated earnings/losses on a tax basis were as follows:

 

Undistributed long term capital gains

  $7,314 

Net unrealized appreciation on investments and foreign currency translations

   209,120,443 
  

 

 

 

Total

  $209,127,757 
  

 

 

 

At December 31, 2019, the temporary differences between book basis and tax basis net unrealized appreciation on investments were primarily due to deferral of losses from wash sales for tax purposes and tax basis adjustments on investments in real estate investment trusts.

The following summarizes the tax cost of investments and the related net unrealized appreciation at December 31, 2019:

 

   Cost  Gross
Unrealized
Appreciation
  Gross
Unrealized
Depreciation
 Net Unrealized
Appreciation

Investments

  $137,757,118  $214,293,621  $(5,160,833) $209,132,788

The Fund is required to evaluate tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns to determine whether the tax positions are“more-likely-than-not” of being sustained by the applicable tax authority. Income tax and related interest and penalties would be recognized by the Fund as tax expense in the Statement of Operations if the tax positions were deemed not to meet themore-likely-than-not threshold. Except as disclosed in the Statement of Operations, for the year ended December 31, 2019, the Fund did not incur any income tax, interest, or penalties. As of December 31, 2019, the Adviser has reviewed all open tax years and concluded that there was no impact to the Fund’s net assets or results of operations. The Fund’s federal and state tax returns for the prior three fiscal years remain open, subject to examination. On an ongoing basis, the Adviser will monitor the Fund’s tax positions to determine if adjustments to this conclusion are necessary.

3. Investment Advisory Agreement and Other Transactions.The Fund has entered into an investment advisory agreement (the Advisory Agreement) with the Adviser which provides that the Fund will pay the Adviser a fee, computed daily and paid monthly, at the annual rate of 1.00% of the value of its average daily net assets. In accordance with the Advisory Agreement, the Adviser provides a continuous investment program for the

 

16


The Gabelli Value 25 Fund Inc.

Notes to Financial Statements (Continued)

 

 

Fund’s portfolio, oversees the administration of all aspects of the Fund’s business and affairs, and pays the compensation of all Officers and Directors of the Fund who are affiliated persons of the Adviser.

Since October 1, 2016, the Adviser has continually agreed to waive its investment advisory fee and/or reimburse expenses of Class I Shares to the extent necessary to maintain the total operating expenses (excluding brokerage, acquired fund fees and expenses, interest, taxes, and extraordinary expenses) until at least April 30, 2020 at no more than 1.00% of the value of its average daily net assets. In addition, the Fund has agreed, during the three year period following any waiver or reimbursement by the Adviser, to repay such amount to the extent, that after giving the effect to the repayment, such adjusted annualized total operating expenses of the Fund would not exceed 1.00% of the value of the Fund’s average daily net assets for Class I. This contractual agreement is renewable annually and is in place until at least April 30, 2020. At December 31, 2019, the cumulative amount which the Fund may repay the Adviser is $280,650.

 

For the year ended December 31, 2017, expiring December 31, 2020

  $87,199 

For the year ended December 31, 2018, expiring December 31, 2021

   107,706 

For the year ended December 31, 2019, expiring December 31, 2022

   85,745 
  

 

 

 
  $280,650 
  

 

 

 

The Fund pays each Director who is not considered an affiliated person an annual retainer of $9,000 plus $2,000 for each Board meeting attended, and they are reimbursed for any out of pocket expenses incurred in attending meetings. All Board committee members receive $500 per meeting attended. The Chairman of the Audit Committee and the Lead Director each receives an annual fee of $2,000. The Chairman of the Nominating Committee receives an annual fee of $2,500. A Director may receive a single meeting fee, allocated among the participating funds, for attending certain meetings held on behalf of multiple funds. Directors who are directors or employees of the Adviser or an affiliated company receive no compensation or expense reimbursement from the Fund.

4. Distribution Plan.The Fund’s Board has adopted a distribution plan (the Plan) for each class of shares, except for Class I Shares, pursuant to Rule12b-1 under the 1940 Act. Under the Class AAA, Class A, and Class C Share Plans, payments are authorized to G.distributors, LLC (the Distributor), an affiliate of the Adviser, at annual rates of 0.25%, 0.25%, and 1.00%, respectively, of the average daily net assets of those classes, the annual limitations under each Plan. Such payments are accrued daily and paid monthly.

5. Portfolio Securities.Purchases and sales of securities during the year ended December 31, 2019, other than short term securities and U.S. Government obligations, aggregated $11,796,318 and $67,405,664, respectively.

6. Transactions with Affiliates and Other Arrangements.During the year ended December 31, 2019, the Fund paid $21,084 in brokerage commissions on security trades to G.research, LLC, an affiliate of the Adviser. Additionally, the Distributor retained a total of $2,288 from investors representing commissions (sales charges and underwriting fees) on sales and redemptions of Fund shares.

During the year ended December 31, 2019, the Fund received credits from a designated broker who agreed to pay certain Fund operating expenses. The amount of such expenses paid through this directed brokerage arrangement during this period was $4,053.

 

17


The Gabelli Value 25 Fund Inc.

Notes to Financial Statements (Continued)

 

 

The cost of calculating the Fund’s NAV per share is a Fund expense pursuant to the Advisory Agreement. Under thesub-administration agreement with Bank of New York Mellon, the fees paid include the cost of calculating the Fund’s NAV. The Fund reimburses the Adviser for this service. During the year ended December 31, 2019, the Fund accrued $45,000 in accounting fees in the Statement of Operations.

7. Capital Stock.The Fund offers four classes of shares – Class AAA Shares, Class A Shares, Class C Shares, and Class I Shares. Class AAA Shares and Class I Shares are offered without a sales charge. Class A Shares are subject to a maximumfront-end sales charge of 5.75%. Class C Shares are subject to a 1.00% contingent deferred sales charge for one year after purchase.

The Fund imposes a redemption fee of 2.00% on all classes of shares that are redeemed or exchanged on or before the seventh day after the date of a purchase. The redemption fee is deducted from the proceeds otherwise payable to the redeeming shareholders and is retained by the Fund as an increase inpaid-in capital. The redemption fees retained by the Fund during the years ended December 31, 2019 and 2018, if any, can be found in the Statement of Changes in Net Assets under Redemption Fees.

Transactions in shares of capital stock were as follows:

 

   Year Ended
December 31, 2019
     Year Ended
December 31, 2018
 
   Shares   Amount     Shares   Amount 

Class AAA

          

Shares sold

   33,243   $454,241      57,842   $834,317 

Shares issued upon reinvestment of distributions

   20,261    279,404      22,909    294,155 

Shares redeemed

   (115,894   (1,665,779     (83,070   (1,272,911
  

 

 

   

 

 

     

 

 

   

 

 

 

Net decrease

   (62,390  $(932,134     (2,319  $(144,439
  

 

 

   

 

 

     

 

 

   

 

 

 

Class A

          

Shares sold

   305,518   $4,428,447      141,733   $2,139,174 

Shares issued upon reinvestment of distributions

   1,870,240    25,902,820      1,868,662    24,086,847 

Shares redeemed

   (3,186,378   (46,140,048     (3,719,152   (56,592,005
  

 

 

   

 

 

     

 

 

   

 

 

 

Net decrease

   (1,010,620  $(15,808,781     (1,708,757  $(30,365,984
  

 

 

   

 

 

     

 

 

   

 

 

 

Class C

          

Shares sold

   27,357   $279,119      118,768   $1,287,635 

Shares issued upon reinvestment of distributions

   36,955    372,137      74,169    723,144 

Shares redeemed

   (406,190   (4,458,404     (215,892   (2,536,976
  

 

 

   

 

 

     

 

 

   

 

 

 

Net decrease

   (341,878  $(3,807,148     (22,955  $(526,197
  

 

 

   

 

 

     

 

 

   

 

 

 

Class I

          

Shares sold

   227,995   $3,298,971      415,344   $6,550,513 

Shares issued upon reinvestment of distributions

   358,981    4,953,942      340,330    4,376,640 

Shares redeemed

   (438,059   (6,354,030     (956,604   (14,871,623
  

 

 

   

 

 

     

 

 

   

 

 

 

Net increase/(decrease)

   148,917   $1,898,883      (200,930  $(3,944,470
  

 

 

   

 

 

     

 

 

   

 

 

 

Class T*

          

Shares redeemed

             (67  $(1,118
  

 

 

   

 

 

     

 

 

   

 

 

 

Net decrease

             (67  $(1,118
  

 

 

   

 

 

     

 

 

   

 

 

 

 

*

Class T Shares were liquidated on September 21, 2018.

8. Indemnifications.The Fund enters into contracts that contain a variety of indemnifications. The Fund’s maximum exposure under these arrangements is unknown. However, the Fund has not had prior claims or

 

18


The Gabelli Value 25 Fund Inc.

Notes to Financial Statements (Continued)

 

 

losses pursuant to these contracts. Management has reviewed the Fund’s existing contracts and expects the risk of loss to be remote.

9. Subsequent Events.Management has evaluated the impact on the Fund of all subsequent events occurring through the date the financial statements were issued and has determined that there were no subsequent events requiring recognition or disclosure in the financial statements.

 

19


The Gabelli Value 25 Fund Inc.

Report of Independent Registered Public Accounting Firm

 

To the Board of Directors and Shareholders of

The Gabelli Value 25 Fund Inc.:

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of The Gabelli Value 25 Fund Inc. (the “Fund”) as of December 31, 2019, the related statement of operations for the year ended December 31, 2019, the statement of changes in net assets for each of the two years in the period ended December 31, 2019, including the related notes, and the financial highlights for each of the five years in the period ended December 31, 2019 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of December 31, 2019, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended December 31, 2019 and the financial highlights for each of the five years in the period ended December 31, 2019 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of December 31, 2019 by correspondence with the custodian and broker; when replies were not received from the broker, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/ PricewaterhouseCoopers LLP

New York, New York

February 27, 2020

We have served as the auditor of one or more investment companies in Gabelli/GAMCO Fund Complex since 1986.

 

20


The Gabelli Value 25 Fund Inc.

Additional Fund Information (Unaudited)

 

The business and affairs of the Fund are managed under the direction of the Fund’s Board of Directors. Information pertaining to the Directors and officers of the Fund is set forth below. The Fund’s Statement of Additional Information includes additional information about the Fund’s Directors and is available without charge, upon request, by calling800-GABELLI(800-422-3554) or by writing to The Gabelli Value 25 Fund Inc. at One Corporate Center, Rye, NY 10580-1422.

 

Name, Position(s)

Address1

and Age

 

Term of Office

and Length of

Time Served2

 

Number of Funds

in Fund Complex

Overseen by Director

 

Principal Occupation(s)

During Past Five Years

 

Other Directorships

Held by Director3

INTERESTED DIRECTOR4:

    

Mario J. Gabelli, CFA

Director and Chief Investment Officer

Age: 77

 Since 1989 33 Chairman, Chief Executive Officer, and Chief Investment Officer– Value Portfolios of GAMCO Investors, Inc. and Chief Investment Officer– Value Portfolios of Gabelli Funds, LLC and GAMCO Asset Management Inc.; Director/ Trustee or Chief Investment Officer of other registered investment companies within the Gabelli/GAMCO Fund Complex; Chief Executive Officer of GGCP, Inc.; Executive Chairman of Associated Capital Group, Inc. Director of Morgan Group Holdings, Inc. (holding company) (2001-2019); Chairman of the Board and Chief Executive Officer of LICT Corp. (multimedia and communication services company); Director of CIBL, Inc. (broadcasting and wireless communications); Director of ICTC Group Inc. (communications) (2013-2018)

INDEPENDENT DIRECTORS5:

    

Anthony J. Colavita6

Director

Age: 84

 Since 1989 20 President of the law firm of Anthony J. Colavita, P.C. 

Robert J. Morrissey

Director

Age: 80

 Since 1989 7 Partner in the law firm of Morrissey, Hawkins & Lynch Chairman of the Board of Directors, Belmont Savings Bank

Kuni Nakamura

Director

Age: 51

 Since 2016 33 President of Advanced Polymer, Inc. (chemical manufacturing company); President of KEN Enterprises, Inc. (real estate) 

 

21


The Gabelli Value 25 Fund Inc.

Additional Fund Information (Continued) (Unaudited)

 

 

Name, Position(s)  Term of Office     
Address1  and Length of    Principal Occupation(s)

and Age

  

Time Served2

    

During Past Five Years

OFFICERS:

      

Bruce N. Alpert

President

Age: 68

  Since 1989    Executive Vice President and Chief Operating Officer of Gabelli Funds, LLC since 1988; Officer of registered investment companies within the Gabelli/GAMCO Fund Complex; Senior Vice President of GAMCO Investors, Inc. since 2008

John C. Ball

Treasurer

Age: 43

  Since 2017    Treasurer of funds within the Gabelli/GAMCO Fund Complex since 2017; Vice President and Assistant Treasurer of AMG Funds, 2014-2017; Vice President of State Street Corporation, 2007-2014

Agnes Mullady

Vice President

Age: 61

  Since 2006    Officer of registered investment companies within the Gabelli/GAMCO Fund Complex since 2006; President and Chief Operating Officer of the Fund Division of Gabelli Funds, LLC since 2015; Chief Executive Officer of G.distributors, LLC since 2010; Senior Vice President of GAMCO Investors, Inc. since 2009; Vice President of Gabelli Funds, LLC since 2007; Executive Vice President of Associated Capital Group, Inc. since 2016

Andrea R. Mango

Secretary

Age: 47

  Since 2013    Vice President of GAMCO Investors, Inc. since 2016; Counsel of Gabelli Funds, LLC since 2013; Secretary of registered investment companies within the Gabelli/GAMCO Fund Complex since 2013; Vice President ofclosed-end funds within the Gabelli/GAMCO Fund Complex since 2014

Richard J. Walz

Chief Compliance Officer

Age: 60

  Since 2013    Chief Compliance Officer of registered investment companies within the Gabelli/GAMCO Fund Complex since 2013

 

1 

Address: One Corporate Center, Rye, NY 10580-1422, unless otherwise noted.

2 

Each Director will hold office for an indefinite term until the earliest of (i) the next meeting of shareholders, if any, called for the purpose of considering the election orre-election of such Director and until the election and qualification of his or her successor, if any, elected at such meeting, or (ii) the date a Director resigns or retires, or a Director is removed by the Board of Directors or shareholders, in accordance with the Fund’sBy-Laws and Articles of Incorporation. Each officer will hold office for an indefinite term until the date he or she resigns or retires or until his or her successor is elected and qualified. For officers, includes time served in other officer positions with the Fund.

3 

This column includes only directorships of companies required to report to the SEC under the Securities Exchange Act of 1934, as amended, i.e., public companies, or other investment companies registered under the 1940 Act.

4 

“Interested person” of the Fund as defined in the 1940 Act. Mr. Gabelli is considered an “interested person” because of his affiliation with Gabelli Funds, LLC which acts as the Fund’s investment adviser.

5 

Directors who are not interested persons are considered “Independent” Directors.

6 

Mr. Colavita’s son, Anthony S. Colavita, serves as a director of other funds in the Fund Complex.

 

22


THE GABELLI VALUE 25 FUND INC.

One Corporate Center

Rye, NY 10580-1422

Portfolio Management Team Biographies

Mario J. Gabelli, CFA,is Chairman, Chief Executive Officer, and Chief Investment Officer - Value Portfolios of GAMCO Investors, Inc. that he founded in 1977, and Chief Investment Officer - Value Portfolios of Gabelli Funds, LLC and GAMCO Asset Management Inc. He is also Executive Chairman of Associated Capital Group, Inc. Mr. Gabelli is a summa cum laude graduate of Fordham University and holds an MBA degree from Columbia Business School and Honorary Doctorates from Fordham University and Roger Williams University.

Christopher J. Marangijoined Gabelli in 2003 as a research analyst. Currently he is a Managing Director andCo-Chief Investment Officer for GAMCO Investors, Inc.’s Value team. In addition, he serves as a portfolio manager of Gabelli Funds, LLC and manages several funds within the Gabelli/GAMCO Fund Complex. Mr. Marangi graduated magna cum laude and Phi Beta Kappa with a BA in Political Economy from Williams College and holds an MBA degree with honors from Columbia Business School.

 

2019 TAX NOTICE TO SHAREHOLDERS(Unaudited)

For the year ended December 31, 2019, the Fund paid to shareholders ordinary income distributions (comprised of net investment income and short term capital gains) totaling $0.0324, $0.0388, $0.0050, and $0.1022 per share for Class AAA, Class A, Class C, and Class I Shares, respectively, and long term capital gains totaling $34,010,094 or the maximum allowable. The distribution of long term capital gains has been designated as a capital gain dividend by the Fund’s Board of Directors. For the year ended December 31, 2019, 100% of the ordinary income distribution qualifies for the dividends received deduction available to corporations. The Fund designates 100% of the ordinary income distribution as qualified dividend income pursuant to the Jobs and Growth Tax Relief Reconciliation Act of 2003. The Fund designates 0.70% of the ordinary income distribution as qualified interest income pursuant to the Tax Relief, Unemployment Reauthorization, and Job Creation Act of 2010. The Fund designates 100% of the ordinary income distribution as qualified short term gain pursuant to the American Jobs Creation Act of 2004.

U.S. Government Income

The percentage of the ordinary income distribution paid by the Fund during 2019 which was derived from U.S. Treasury securities was 0.56%.

                                                 

All designations are based on financial information available as of the date of this annual report and, accordingly, are subject to change. For each item, it is the intention of the Fund to designate the maximum amount permitted under the Internal Revenue Code and the regulations thereunder.

 

We have separated the portfolio managers’ commentary from the financial statements and investment portfolio due to corporate governance regulations stipulated by the Sarbanes-Oxley Act of 2002. We have done this to ensure that the content of the portfolio managers’ commentary is unrestricted. Both the commentary and the financial statements, including the portfolio of investments, will be available on our website at www.gabelli.com.


 

THE GABELLI VALUE 25 FUND INC.

One Corporate Center

Rye, New York 10580-1422

 

t

800-GABELLI(800-422-3554)

f

914-921-5118

e

info@gabelli.com

 

GABELLI.COM

Net Asset Value per share available daily

by calling800-GABELLI after 7:00 P.M.

 

BOARD OF DIRECTORS

 

Mario J. Gabelli, CFA

Chairman and Chief

Executive Officer,

GAMCO Investors, Inc.

Executive Chairman,

Associated Capital Group, Inc.

 

Anthony J. Colavita

President,

Anthony J. Colavita, P.C.

 

Robert J. Morrissey

Partner,

Morrissey, Hawkins & Lynch

 

Kuni Nakamura

President,

Advanced Polymer, Inc.

  

OFFICERS

 

Bruce N. Alpert

President

 

John C. Ball

Treasurer

 

Agnes Mullady

Vice President

 

Andrea R. Mango

Secretary

 

Richard J. Walz

Chief Compliance Officer

 

DISTRIBUTOR

G.distributors, LLC

 

CUSTODIAN

The Bank of New York Mellon

 

TRANSFER AGENT AND

DIVIDEND DISBURSING

AGENT

DST Asset Manager Solutions, Inc.

 

LEGAL COUNSEL

Paul Hastings LLP

 

 

This report is submitted for the general information of the shareholders of The Gabelli Value 25 Fund Inc. It is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus.

 

 

 

 

GAB409Q419AR

LOGO  

 


Item 2. Code of Ethics.

 

 (a)

The registrant, as of the end of the period covered by this report, has adopted a code of ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party.

 

 (c)

There have been no amendments, during the period covered by this report, to a provision of the code of ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party, and that relates to any element of the code of ethics description.

 

 (d)

The registrant has not granted any waivers, including an implicit waiver, from a provision of the code of ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the registrant or a third party, that relates to one or more of the items set forth in paragraph (b) of this item’s instructions.

Item 3. Audit Committee Financial Expert.

As of the end of the period covered by the report, the registrant’s Board of Directors has determined that Kuni Nakamura is qualified to serve as an audit committee financial expert serving on its audit committee and that he is “independent,” as defined by Item 3 of FormN-CSR.

Item 4. Principal Accountant Fees and Services.

Audit Fees

 

 (a)

The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of the registrant’s annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years are $44,166 for 2018 and $44,166 for 2019.

Audit-Related Fees

 

 (b)

The aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the registrant’s financial statements and are not reported under paragraph (a) of this Item are $0 for 2018 and $0 for 2019.


Tax Fees

 

 (c)

The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning are $4,100 for 2018 and $4,250 for 2019. Tax fees represent tax compliance services provided in connection with the review of the Registrant’s tax returns.

All Other Fees

 

 (d)

The aggregate fees billed in each of the last two fiscal years for products and services provided by the principal accountant, other than the services reported in paragraphs (a) through (c) of this Item are $0 for 2018 and $0 for 2019.

 

 (e)(1)

Disclose the audit committee’spre-approval policies and procedures described in paragraph (c)(7) of Rule2-01 of RegulationS-X.

 

   

Pre-Approval Policies and Procedures. The Audit Committee (“Committee”) of the registrant is responsible forpre-approving (i) all audit and permissiblenon-audit services to be provided by the independent registered public accounting firm to the registrant and (ii) all permissiblenon-audit services to be provided by the independent registered public accounting firm to the Adviser, Gabelli Funds, LLC, and any affiliate of Gabelli Funds, LLC (“Gabelli”) that provides services to the registrant (a “Covered Services Provider”) if the independent registered public accounting firm’s engagement related directly to the operations and financial reporting of the registrant. The Committee may delegate its responsibility topre-approve any such audit and permissiblenon-audit services to the Chairperson of the Committee, and the Chairperson must report to the Committee, at its next regularly scheduled meeting after the Chairperson’spre-approval of such services, his or her decision(s). The Committee may also establish detailedpre-approval policies and procedures forpre-approval of such services in accordance with applicable laws, including the delegation of some or all of the Committee’spre-approval responsibilities to the other persons (other than Gabelli or the registrant’s officers).Pre-approval by the Committee of any permissiblenon-audit services is not required so long as: (i) the permissiblenon-audit services were not recognized by the registrant at the time of the engagement to benon-audit services; and (ii) such services are promptly brought to the attention of the Committee and approved by the Committee or Chairperson prior to the completion of the audit.

 

 (e)(2)

The percentage of services described in each of paragraphs (b) through (d) of this Item that were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule2-01 of RegulationS-X are as follows:

(b) N/A

(c) 0%

(d) N/A


 (f)

The percentage of hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees was less than fifty percent.

 

 (g)

The aggregatenon-audit fees billed by the registrant’s accountant for services rendered to the registrant, and rendered to the registrant’s investment adviser (not including anysub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for each of the last two fiscal years of the registrant was $0 for 2018 and $0 for 2019.

 

 (h)

The registrant’s audit committee of the board of directors has considered whether the provision ofnon-audit services that were rendered to the registrant’s investment adviser (not including anysub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were notpre-approved pursuant to paragraph (c)(7)(ii) of Rule2-01 of RegulationS-X is compatible with maintaining the principal accountant’s independence.

Item 5. Audit Committee of Listed Registrants.

Not applicable.

Item 6. Investments.

 

(a)

Schedule of Investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the report to shareholders filed under Item 1 of this form.

 

(b)

Not applicable.

 

Item 7.

Disclosure of Proxy Voting Policies and Procedures forClosed-End Management Investment Companies.

Not applicable.

Item 8. Portfolio Managers ofClosed-End Management Investment Companies.

Not applicable.

 

Item 9.

Purchases of Equity Securities byClosed-End Management Investment Company and Affiliated Purchasers.

Not applicable.

Item 10. Submission of Matters to a Vote of Security Holders.

There have been no material changes to the procedures by which the shareholders may recommend nominees to the registrant’s Board of Directors, where those changes were implemented after the registrant last provided disclosure in response to the requirements of Item 407(c)(2)(iv) of RegulationS-K (17 CFR 229.407) (as required by Item 22(b)(15) of Schedule 14A (17 CFR240.14a-101)), or this Item.


Item 11. Controls and Procedures.

 

 (a)

The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR270.30a-3(c))) are effective, as of a date within 90 days of the filing date of the report that includes the disclosure required by this paragraph, based on their evaluation of these controls and procedures required by Rule30a-3(b) under the 1940 Act (17 CFR270.30a-3(b)) and Rules13a-15(b) or15d-15(b) under the Securities Exchange Act of 1934, as amended (17 CFR240.13a-15(b) or240.15d-15(b)).

 

 (b)

There were no changes in the registrant’s internal control over financial reporting (as defined in Rule30a-3(d) under the 1940 Act (17 CFR270.30a-3(d))) that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

 

Item 12.

Disclosure of Securities Lending Activities forClosed-End Management Investment Companies.

Not applicable.

Item 13. Exhibits.

 

 (a)(1)

Code of ethics, or any amendment thereto, that is the subject of disclosure required by Item 2 is attached hereto.

 

 (a)(2)

Certifications pursuant to Rule30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.

 

 (a)(3)

Not applicable.

 

 (a)(4)

Not applicable.

 

 (b)

Certifications pursuant to Rule30a-2(b) under the 1940 Act and Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto.

 


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

(Registrant)                             The Gabelli Value 25 Fund Inc.                                                             

 

By (Signature and Title)*      /s/ Bruce N. Alpert                                                                                 

                                               Bruce N. Alpert, Principal Executive Officer

 

Date                                       March 6, 2020                                                                                           

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

By (Signature and Title)*      /s/ Bruce N. Alpert                                                                                    

                                               Bruce N. Alpert, Principal Executive Officer

 

Date                                       March 6, 2020                                                                                              

 

By (Signature and Title)*      /s/ John C. Ball                                                                                            

                                               John C. Ball, Principal Financial Officer and Treasurer

 

Date                                       March 6, 2020                                                                                               

* Print the name and title of each signing officer under his or her signature.