Table of Contents
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 811-00266
Tri-Continental Corporation
(Exact name of registrant as specified in charter)
225 Franklin Street, Boston, Massachusetts 02110
(Address of principal executive offices) (Zip code)
Christopher O. Petersen, Esq.
c/o Columbia Management Investment Advisers, LLC
225 Franklin Street
Boston, Massachusetts 02110
Ryan C. Larrenaga, Esq.
c/o Columbia Management Investment Advisers, LLC
225 Franklin Street
Boston, MA 02110
(Name and address of agent for service)
Registrant’s telephone number, including area code: (800) 345-6611
Date of fiscal year end: December 31
Date of reporting period: June 30, 2018
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 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.
Table of Contents
Item 1. | Reports to Stockholders. |
Table of Contents
June 30, 2018
Table of Contents
Table of Contents
Table of Contents
(Unaudited)
Average annual total returns (%) (for the period ended June 30, 2018) | ||||||
Inception | 6 Months cumulative | 1 Year | 5 Years | 10 Years | ||
Market Price | 01/05/29 | 0.92 | 14.52 | 12.74 | 9.08 | |
Net Asset Value | 01/05/29 | 2.72 | 14.24 | 12.40 | 9.09 | |
S&P 500 Index | 2.65 | 14.37 | 13.42 | 10.17 | ||
Blended Benchmark | 1.61 | 10.36 | 10.87 | 9.15 |
Price Per Share | ||||
June 30, 2018 | March 31, 2018 | December 31, 2017 | ||
Market Price ($) | 26.51 | 26.31 | 26.94 | |
Net Asset Value ($) | 29.93 | 29.60 | 29.88 |
Distributions Paid Per Common Share(a) | |
Payable Date | Per Share Amount ($) |
March 29, 2018 | 0.2301 |
June 28, 2018 | 0.4531 (b) |
2 | Tri-Continental Corporation | Semiannual Report 2018 |
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(Unaudited)
Top 10 holdings (%) (at June 30, 2018) | |
Microsoft Corp. | 2.2 |
JPMorgan Chase & Co. | 2.1 |
Facebook, Inc., Class A | 1.9 |
Boeing Co. (The) | 1.6 |
Cisco Systems, Inc. | 1.6 |
Broadcom, Inc. | 1.5 |
AT&T, Inc. | 1.4 |
MasterCard, Inc., Class A | 1.3 |
Pfizer, Inc. | 1.2 |
Adobe Systems, Inc. | 1.1 |
Portfolio breakdown (%) (at June 30, 2018) | |
Common Stocks | 66.0 |
Convertible Bonds | 8.9 |
Convertible Preferred Stocks | 6.7 |
Corporate Bonds & Notes | 15.2 |
Limited Partnerships | 0.5 |
Money Market Funds | 1.4 |
Preferred Debt | 0.6 |
Senior Loans | 0.7 |
Warrants | 0.0 (a) |
Total | 100.0 |
(a) | Rounds to zero. |
Equity sector breakdown (%) (at June 30, 2018) | |
Consumer Discretionary | 10.8 |
Consumer Staples | 6.5 |
Energy | 7.0 |
Financials | 17.2 |
Health Care | 12.9 |
Industrials | 9.4 |
Information Technology | 24.3 |
Materials | 2.0 |
Real Estate | 3.5 |
Telecommunication Services | 1.9 |
Utilities | 4.5 |
Total | 100.0 |
Tri-Continental Corporation | Semiannual Report 2018 | 3 |
Table of Contents
June 30, 2018 (Unaudited)
Common Stocks 65.7% | ||
Issuer | Shares | Value ($) |
Consumer Discretionary 7.9% | ||
Automobiles 0.3% | ||
General Motors Co. | 145,000 | 5,713,000 |
Hotels, Restaurants & Leisure 2.0% | ||
Carnival Corp. | 75,000 | 4,298,250 |
Extended Stay America, Inc. | 415,000 | 8,968,150 |
Marriott International, Inc., Class A | 70,100 | 8,874,660 |
Royal Caribbean Cruises Ltd. | 32,500 | 3,367,000 |
Six Flags Entertainment Corp. | 97,500 | 6,829,875 |
Total | 32,337,935 | |
Household Durables 0.3% | ||
PulteGroup, Inc. | 145,500 | 4,183,125 |
Internet & Direct Marketing Retail 0.9% | ||
Amazon.com, Inc.(a) | 5,950 | 10,113,810 |
Booking Holdings, Inc.(a) | 2,625 | 5,321,111 |
Total | 15,434,921 | |
Leisure Products 0.3% | ||
Hasbro, Inc. | 50,000 | 4,615,500 |
Media 1.0% | ||
Charter Communications, Inc., Class A(a) | 6,400 | 1,876,544 |
Comcast Corp., Class A | 301,500 | 9,892,215 |
News Corp., Class A | 346,500 | 5,370,750 |
Total | 17,139,509 | |
Multiline Retail 0.8% | ||
Kohl’s Corp. | 153,000 | 11,153,700 |
Target Corp. | 18,100 | 1,377,772 |
Total | 12,531,472 | |
Specialty Retail 1.5% | ||
Best Buy Co., Inc. | 202,900 | 15,132,282 |
Foot Locker, Inc. | 17,400 | 916,110 |
Home Depot, Inc. (The) | 42,000 | 8,194,200 |
Total | 24,242,592 | |
Textiles, Apparel & Luxury Goods 0.8% | ||
Ralph Lauren Corp. | 109,900 | 13,816,628 |
Total Consumer Discretionary | 130,014,682 |
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
Consumer Staples 4.2% | ||
Food & Staples Retailing 1.5% | ||
Walgreens Boots Alliance, Inc. | 230,050 | 13,806,451 |
Walmart, Inc. | 136,800 | 11,716,920 |
Total | 25,523,371 | |
Food Products 1.2% | ||
Kellogg Co. | 130,000 | 9,083,100 |
Tyson Foods, Inc., Class A | 159,100 | 10,954,035 |
Total | 20,037,135 | |
Household Products 0.6% | ||
Kimberly-Clark Corp. | 91,650 | 9,654,411 |
Tobacco 0.9% | ||
Altria Group, Inc. | 112,500 | 6,388,875 |
Philip Morris International, Inc. | 105,000 | 8,477,700 |
Total | 14,866,575 | |
Total Consumer Staples | 70,081,492 | |
Energy 3.9% | ||
Energy Equipment & Services 0.3% | ||
National Oilwell Varco, Inc. | 102,400 | 4,444,160 |
Oil, Gas & Consumable Fuels 3.6% | ||
BP PLC, ADR | 180,000 | 8,218,800 |
Chevron Corp.(b) | 33,500 | 4,235,405 |
ConocoPhillips | 259,500 | 18,066,390 |
Marathon Petroleum Corp. | 75,100 | 5,269,016 |
Suncor Energy, Inc. | 215,000 | 8,746,200 |
Valero Energy Corp. | 137,000 | 15,183,710 |
Total | 59,719,521 | |
Total Energy | 64,163,681 | |
Financials 10.6% | ||
Banks 5.3% | ||
Bank of America Corp. | 541,800 | 15,273,342 |
BB&T Corp. | 120,000 | 6,052,800 |
Citigroup, Inc. | 266,900 | 17,860,948 |
Citizens Financial Group, Inc. | 78,200 | 3,041,980 |
Fifth Third Bancorp | 126,300 | 3,624,810 |
4 | Tri-Continental Corporation | Semiannual Report 2018 |
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June 30, 2018 (Unaudited)
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
JPMorgan Chase & Co. | 332,600 | 34,656,920 |
PacWest Bancorp | 152,500 | 7,536,550 |
Total | 88,047,350 | |
Capital Markets 3.0% | ||
Ares Capital Corp. | 500,000 | 8,225,000 |
BlackRock, Inc. | 21,850 | 10,904,024 |
Moody’s Corp. | 5,200 | 886,912 |
S&P Global, Inc. | 80,400 | 16,392,756 |
T. Rowe Price Group, Inc. | 74,900 | 8,695,141 |
TCG BDC, Inc. | 250,000 | 4,255,000 |
Total | 49,358,833 | |
Insurance 1.5% | ||
Allstate Corp. (The) | 142,600 | 13,015,102 |
Principal Financial Group, Inc. | 115,000 | 6,089,250 |
Prudential Financial, Inc. | 67,400 | 6,302,574 |
Total | 25,406,926 | |
Mortgage Real Estate Investment Trusts (REITS) 0.8% | ||
Blackstone Mortgage Trust, Inc. | 112,500 | 3,535,875 |
Starwood Property Trust, Inc. | 400,000 | 8,684,000 |
Total | 12,219,875 | |
Total Financials | 175,032,984 | |
Health Care 8.9% | ||
Biotechnology 1.8% | ||
Alexion Pharmaceuticals, Inc.(a) | 34,700 | 4,308,005 |
Biogen, Inc.(a) | 16,900 | 4,905,056 |
BioMarin Pharmaceutical, Inc.(a) | 37,600 | 3,541,920 |
Gilead Sciences, Inc. | 167,600 | 11,872,784 |
TESARO, Inc.(a) | 15,200 | 675,944 |
Vertex Pharmaceuticals, Inc.(a) | 26,250 | 4,461,450 |
Total | 29,765,159 | |
Health Care Equipment & Supplies 1.4% | ||
Abbott Laboratories | 90,300 | 5,507,397 |
Baxter International, Inc. | 159,900 | 11,807,016 |
Medtronic PLC | 77,500 | 6,634,775 |
Total | 23,949,188 |
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
Health Care Providers & Services 1.5% | ||
Envision Healthcare Corp.(a) | 18,900 | 831,789 |
Express Scripts Holding Co.(a) | 172,600 | 13,326,446 |
Humana, Inc. | 19,100 | 5,684,733 |
McKesson Corp. | 34,600 | 4,615,640 |
Total | 24,458,608 | |
Pharmaceuticals 4.2% | ||
Bristol-Myers Squibb Co. | 295,100 | 16,330,834 |
Eli Lilly & Co. | 189,400 | 16,161,502 |
Johnson & Johnson | 85,000 | 10,313,900 |
Merck & Co., Inc. | 100,000 | 6,070,000 |
Pfizer, Inc. | 555,809 | 20,164,751 |
Total | 69,040,987 | |
Total Health Care | 147,213,942 | |
Industrials 5.6% | ||
Aerospace & Defense 2.4% | ||
Boeing Co. (The) | 77,400 | 25,968,474 |
General Dynamics Corp. | 47,200 | 8,798,552 |
Lockheed Martin Corp. | 20,000 | 5,908,600 |
Total | 40,675,626 | |
Airlines 0.8% | ||
Delta Air Lines, Inc. | 259,750 | 12,868,015 |
Electrical Equipment 0.7% | ||
Acuity Brands, Inc. | 45,200 | 5,237,324 |
AMETEK, Inc. | 79,800 | 5,758,368 |
Total | 10,995,692 | |
Industrial Conglomerates 0.1% | ||
Honeywell International, Inc. | 15,300 | 2,203,965 |
Machinery 0.2% | ||
Cummins, Inc. | 3,500 | 465,500 |
Stanley Black & Decker, Inc. | 20,000 | 2,656,200 |
Total | 3,121,700 | |
Professional Services —% | ||
Nielsen Holdings PLC | 15,300 | 473,229 |
Tri-Continental Corporation | Semiannual Report 2018 | 5 |
Table of Contents
June 30, 2018 (Unaudited)
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
Road & Rail 0.3% | ||
Kansas City Southern | 7,900 | 837,084 |
Union Pacific Corp. | 27,900 | 3,952,872 |
Total | 4,789,956 | |
Trading Companies & Distributors 0.8% | ||
WW Grainger, Inc. | 42,000 | 12,952,800 |
Transportation Infrastructure 0.3% | ||
Macquarie Infrastructure Corp. | 125,000 | 5,275,000 |
Total Industrials | 93,355,983 | |
Information Technology 17.0% | ||
Communications Equipment 2.0% | ||
Cisco Systems, Inc. | 586,900 | 25,254,307 |
F5 Networks, Inc.(a) | 45,400 | 7,829,230 |
Total | 33,083,537 | |
Electronic Equipment, Instruments & Components 0.4% | ||
Corning, Inc. | 235,000 | 6,464,850 |
Internet Software & Services 3.3% | ||
Alphabet, Inc., Class A(a) | 8,100 | 9,146,439 |
Facebook, Inc., Class A(a) | 158,200 | 30,741,424 |
VeriSign, Inc.(a) | 106,100 | 14,580,262 |
Total | 54,468,125 | |
IT Services 2.2% | ||
Automatic Data Processing, Inc. | 32,500 | 4,359,550 |
Booz Allen Hamilton Holdings Corp. | 90,000 | 3,935,700 |
MasterCard, Inc., Class A | 105,100 | 20,654,252 |
Visa, Inc., Class A | 51,800 | 6,860,910 |
Total | 35,810,412 | |
Semiconductors & Semiconductor Equipment 3.7% | ||
Analog Devices, Inc. | 60,000 | 5,755,200 |
Applied Materials, Inc. | 126,600 | 5,847,654 |
Broadcom, Inc. | 98,700 | 23,948,568 |
Intel Corp. | 235,000 | 11,681,850 |
KLA-Tencor Corp. | 62,100 | 6,367,113 |
Lam Research Corp. | 31,000 | 5,358,350 |
Micron Technology, Inc.(a) | 50,800 | 2,663,952 |
Total | 61,622,687 |
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
Software 3.6% | ||
Adobe Systems, Inc.(a) | 76,300 | 18,602,703 |
Electronic Arts, Inc.(a) | 20,000 | 2,820,400 |
Microsoft Corp. | 361,100 | 35,608,071 |
VMware, Inc., Class A(a) | 14,400 | 2,116,368 |
Total | 59,147,542 | |
Technology Hardware, Storage & Peripherals 1.8% | ||
Apple, Inc. | 98,150 | 18,168,546 |
HP, Inc. | 131,400 | 2,981,466 |
NetApp, Inc. | 67,400 | 5,292,922 |
Western Digital Corp. | 55,000 | 4,257,550 |
Total | 30,700,484 | |
Total Information Technology | 281,297,637 | |
Materials 1.4% | ||
Chemicals 1.0% | ||
Eastman Chemical Co. | 25,500 | 2,548,980 |
LyondellBasell Industries NV, Class A | 137,700 | 15,126,345 |
Total | 17,675,325 | |
Containers & Packaging 0.2% | ||
Avery Dennison Corp. | 15,700 | 1,602,970 |
Packaging Corp. of America | 10,900 | 1,218,511 |
Total | 2,821,481 | |
Metals & Mining 0.2% | ||
Freeport-McMoRan, Inc. | 197,900 | 3,415,754 |
Total Materials | 23,912,560 | |
Real Estate 2.0% | ||
Equity Real Estate Investment Trusts (REITS) 2.0% | ||
Alexandria Real Estate Equities, Inc. | 50,000 | 6,308,500 |
American Tower Corp. | 99,000 | 14,272,830 |
Equinix, Inc. | 16,000 | 6,878,240 |
Host Hotels & Resorts, Inc. | 249,000 | 5,246,430 |
SBA Communications Corp.(a) | 5,600 | 924,672 |
Total | 33,630,672 | |
Total Real Estate | 33,630,672 | |
Telecommunication Services 1.4% | ||
Diversified Telecommunication Services 1.4% | ||
AT&T, Inc. | 716,200 | 22,997,182 |
Total Telecommunication Services | 22,997,182 |
6 | Tri-Continental Corporation | Semiannual Report 2018 |
Table of Contents
June 30, 2018 (Unaudited)
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
Utilities 2.8% | ||
Electric Utilities 1.2% | ||
American Electric Power Co., Inc. | 90,000 | 6,232,500 |
Edison International | 100,000 | 6,327,000 |
Entergy Corp. | 96,200 | 7,771,998 |
Total | 20,331,498 | |
Independent Power and Renewable Electricity Producers 0.9% | ||
NRG Energy, Inc. | 187,900 | 5,768,530 |
NRG Yield, Inc. Class A | 490,000 | 8,354,500 |
Total | 14,123,030 | |
Multi-Utilities 0.7% | ||
CenterPoint Energy, Inc. | 309,100 | 8,565,161 |
Public Service Enterprise Group, Inc. | 57,300 | 3,102,222 |
Total | 11,667,383 | |
Total Utilities | 46,121,911 | |
Total Common Stocks (Cost $969,646,295) | 1,087,822,726 |
Convertible Bonds 8.9% | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Cable and Satellite 0.4% | ||||
DISH Network Corp. | ||||
08/15/2026 | 3.375% | 7,000,000 | 6,780,172 | |
Finance Companies 0.2% | ||||
Encore Capital Group, Inc. | ||||
03/15/2022 | 3.250% | 2,984,000 | 3,021,300 | |
Gaming 0.3% | ||||
Caesars Entertainment Corp. | ||||
10/01/2024 | 5.000% | 2,500,000 | 4,275,715 | |
Health Care 0.7% | ||||
Invacare Corp. | ||||
02/15/2021 | 5.000% | 3,245,000 | 4,215,135 | |
Novavax, Inc. | ||||
02/01/2023 | 3.750% | 6,300,000 | 3,663,406 | |
Teladoc, Inc.(c) | ||||
12/15/2022 | 3.000% | 2,500,000 | 3,726,600 | |
Total | 11,605,141 | |||
Home Construction 0.4% | ||||
SunPower Corp. | ||||
01/15/2023 | 4.000% | 7,500,000 | 6,330,668 |
Convertible Bonds (continued) | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Independent Energy 0.6% | ||||
Chesapeake Energy Corp. | ||||
09/15/2026 | 5.500% | 9,500,000 | 9,654,707 | |
12/15/2038 | 2.250% | 10,000 | 9,500 | |
Total | 9,664,207 | |||
Life Insurance 0.2% | ||||
AXA SA(c) | ||||
05/15/2021 | 7.250% | 4,000,000 | 4,174,080 | |
Metals and Mining 0.3% | ||||
Endeavour Mining Corp.(c) | ||||
02/15/2023 | 3.000% | 4,300,000 | 4,367,080 | |
Oil Field Services 0.3% | ||||
Bristow Group, Inc. | ||||
06/01/2023 | 4.500% | 3,658,000 | 4,182,323 | |
Other Industry 0.3% | ||||
Green Plains, Inc. | ||||
09/01/2022 | 4.125% | 4,500,000 | 4,463,865 | |
Other REIT 0.9% | ||||
Blackstone Mortgage Trust, Inc. | ||||
05/05/2022 | 4.375% | 5,000,000 | 4,901,880 | |
IH Merger Sub LLC | ||||
01/15/2022 | 3.500% | 5,800,000 | 6,458,915 | |
New York Mortgage Trust, Inc. | ||||
01/15/2022 | 6.250% | 4,200,000 | 4,154,699 | |
Total | 15,515,494 | |||
Pharmaceuticals 2.9% | ||||
Aegerion Pharmaceuticals, Inc. | ||||
08/15/2019 | 2.000% | 5,000,000 | 3,244,585 | |
Alder Biopharmaceuticals, Inc. | ||||
02/01/2025 | 2.500% | 4,300,000 | 4,466,840 | |
Clovis Oncology, Inc. | ||||
05/01/2025 | 1.250% | 6,000,000 | 5,525,412 | |
Dermira, Inc. | ||||
05/15/2022 | 3.000% | 5,200,000 | 4,279,912 | |
Fluidigm Corp. | ||||
02/01/2034 | 2.750% | 5,300,000 | 4,898,451 | |
Innoviva, Inc. | ||||
Subordinated | ||||
01/15/2023 | 2.125% | 4,100,000 | 3,977,681 | |
Insmed, Inc. | ||||
01/15/2025 | 1.750% | 4,700,000 | 4,314,600 | |
Intercept Pharmaceuticals, Inc. | ||||
07/01/2023 | 3.250% | 7,500,000 | 6,566,610 |
Tri-Continental Corporation | Semiannual Report 2018 | 7 |
Table of Contents
June 30, 2018 (Unaudited)
Convertible Bonds (continued) | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
PTC Therapeutics, Inc. | ||||
08/15/2022 | 3.000% | 4,000,000 | 3,951,896 | |
Radius Health, Inc. | ||||
09/01/2024 | 3.000% | 4,200,000 | 3,896,138 | |
TESARO, Inc. | ||||
10/01/2021 | 3.000% | 1,500,000 | 2,240,851 | |
Total | 47,362,976 | |||
Property & Casualty 0.6% | ||||
Heritage Insurance Holdings, Inc.(c) | ||||
08/01/2037 | 5.875% | 3,300,000 | 4,153,489 | |
MGIC Investment Corp.(c),(d) | ||||
Junior Subordinated | ||||
04/01/2063 | 9.000% | 4,711,000 | 6,405,339 | |
Total | 10,558,828 | |||
Retailers 0.2% | ||||
GNC Holdings, Inc. | ||||
08/15/2020 | 1.500% | 5,700,000 | 3,765,563 | |
Technology 0.5% | ||||
Microchip Technology, Inc. | ||||
Junior Subordinated | ||||
02/15/2037 | 2.250% | 7,200,000 | 8,567,417 | |
Transportation Services 0.1% | ||||
Aegean Marine Petroleum Network, Inc. | ||||
12/15/2021 | 4.250% | 6,000,000 | 2,040,000 | |
Total Convertible Bonds (Cost $150,344,862) | 146,674,829 |
Convertible Preferred Stocks 6.7% | |||
Issuer | Shares | Value ($) | |
Consumer Staples 0.5% | |||
Food Products 0.5% | |||
Bunge Ltd. | 4.875% | 72,500 | 7,794,344 |
Total Consumer Staples | 7,794,344 | ||
Energy 1.0% | |||
Energy Equipment & Services 0.3% | |||
Nabors Industries Ltd. | 6.000% | 85,000 | 3,889,600 |
Oil, Gas & Consumable Fuels 0.7% | |||
Hess Corp. | 8.000% | 100,000 | 7,536,000 |
WPX Energy, Inc. | 6.250% | 60,000 | 4,581,000 |
Total | 12,117,000 | ||
Total Energy | 16,006,600 |
Convertible Preferred Stocks (continued) | |||
Issuer | Shares | Value ($) | |
Financials 2.0% | |||
Banks 1.0% | |||
Bank of America Corp. | 7.250% | 6,700 | 8,378,350 |
Wells Fargo & Co. | 7.500% | 6,500 | 8,186,490 |
Total | 16,564,840 | ||
Capital Markets 0.7% | |||
AMG Capital Trust II | 5.150% | 130,000 | 7,751,250 |
Cowen, Inc. | 5.625% | 5,200 | 4,215,640 |
Total | 11,966,890 | ||
Insurance 0.3% | |||
Assurant, Inc. | 6.500% | 40,000 | 4,481,200 |
Total Financials | 33,012,930 | ||
Health Care 0.5% | |||
Health Care Equipment & Supplies 0.5% | |||
Becton Dickinson and Co. | 6.125% | 140,000 | 8,659,000 |
Total Health Care | 8,659,000 | ||
Industrials 1.0% | |||
Machinery 1.0% | |||
Fortive Corp. | 6,000 | 6,049,380 | |
Rexnord Corp. | 5.750% | 70,000 | 4,373,600 |
Stanley Black & Decker, Inc. | 5.375% | 52,500 | 5,500,950 |
Total | 15,923,930 | ||
Total Industrials | 15,923,930 | ||
Information Technology 0.7% | |||
Electronic Equipment, Instruments & Components 0.5% | |||
Belden, Inc. | 6.750% | 100,000 | 8,367,000 |
Internet Software & Services 0.2% | |||
Mandatory Exchangeable Trust(c) | 5.750% | 20,000 | 4,172,622 |
Total Information Technology | 12,539,622 | ||
Real Estate 0.5% | |||
Equity Real Estate Investment Trusts (REITS) 0.5% | |||
Crown Castle International Corp. | 6.875% | 8,100 | 8,691,925 |
Total Real Estate | 8,691,925 |
8 | Tri-Continental Corporation | Semiannual Report 2018 |
Table of Contents
June 30, 2018 (Unaudited)
Convertible Preferred Stocks (continued) | |||
Issuer | Shares | Value ($) | |
Utilities 0.5% | |||
Multi-Utilities 0.5% | |||
DTE Energy Co. | 6.500% | 167,500 | 8,658,075 |
Total Utilities | 8,658,075 | ||
Total Convertible Preferred Stocks (Cost $107,015,447) | 111,286,426 |
Corporate Bonds & Notes 15.1% | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Automotive 0.5% | ||||
Navistar International Corp.(c) | ||||
11/01/2025 | 6.625% | 8,200,000 | 8,443,655 | |
Brokerage/Asset Managers/Exchanges 0.5% | ||||
LPL Holdings, Inc.(c) | ||||
09/15/2025 | 5.750% | 8,550,000 | 8,314,875 | |
Cable and Satellite 0.8% | ||||
Charter Communications Operating LLC/Capital | ||||
10/23/2045 | 6.484% | 7,600,000 | 8,016,974 | |
Telesat Canada/LLC(c) | ||||
11/15/2024 | 8.875% | 5,360,000 | 5,785,284 | |
Total | 13,802,258 | |||
Consumer Products 0.5% | ||||
Mattel, Inc.(c) | ||||
12/31/2025 | 6.750% | 8,742,000 | 8,510,250 | |
Electric 0.5% | ||||
Covanta Holding Corp. | ||||
07/01/2025 | 5.875% | 8,523,000 | 8,227,047 | |
Finance Companies 1.5% | ||||
Fortress Transportation & Infrastructure Investors LLC(c) | ||||
03/15/2022 | 6.750% | 8,205,000 | 8,389,776 | |
iStar, Inc. | ||||
04/01/2022 | 6.000% | 8,543,000 | 8,547,793 | |
Springleaf Finance Corp. | ||||
03/15/2025 | 6.875% | 8,400,000 | 8,347,080 | |
Total | 25,284,649 | |||
Food and Beverage 0.5% | ||||
Chobani LLC/Finance Corp., Inc.(c) | ||||
04/15/2025 | 7.500% | 4,097,000 | 3,923,951 | |
Lamb Weston Holdings, Inc.(c) | ||||
11/01/2026 | 4.875% | 4,300,000 | 4,181,673 | |
Total | 8,105,624 |
Corporate Bonds & Notes (continued) | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Health Care 0.6% | ||||
Quotient Ltd.(c),(e),(f) | ||||
10/15/2023 | 12.000% | 2,170,000 | 2,170,000 | |
10/15/2023 | 12.000% | 930,000 | 930,000 | |
Surgery Center Holdings, Inc.(c) | ||||
07/01/2025 | 6.750% | 6,800,000 | 6,481,638 | |
Total | 9,581,638 | |||
Healthcare Insurance 0.5% | ||||
Centene Corp. | ||||
01/15/2025 | 4.750% | 8,455,000 | 8,408,303 | |
Home Construction 0.2% | ||||
Lennar Corp. | ||||
11/29/2027 | 4.750% | 4,400,000 | 4,126,025 | |
Independent Energy 0.9% | ||||
Indigo Natural Resources LLC(c) | ||||
02/15/2026 | 6.875% | 8,800,000 | 8,538,473 | |
Talos Production LLC/Finance, Inc.(c) | ||||
04/03/2022 | 11.000% | 6,136,177 | 6,427,645 | |
Total | 14,966,118 | |||
Media and Entertainment 0.5% | ||||
Lions Gate Capital Holdings LLC(c) | ||||
11/01/2024 | 5.875% | 4,050,000 | 4,106,409 | |
Meredith Corp.(c) | ||||
02/01/2026 | 6.875% | 4,100,000 | 4,044,092 | |
Total | 8,150,501 | |||
Metals and Mining 1.1% | ||||
CONSOL Energy, Inc.(c) | ||||
11/15/2025 | 11.000% | 4,200,000 | 4,619,118 | |
Constellium NV(c) | ||||
03/01/2025 | 6.625% | 8,400,000 | 8,463,546 | |
Warrior Met Coal, Inc.(c) | ||||
11/01/2024 | 8.000% | 4,200,000 | 4,333,014 | |
Total | 17,415,678 | |||
Midstream 0.8% | ||||
Rockpoint Gas Storage Canada Ltd.(c) | ||||
03/31/2023 | 7.000% | 4,216,000 | 4,216,046 | |
Summit Midstream Partners LP(d) | ||||
Junior Subordinated | ||||
12/31/2049 | 9.500% | 8,400,000 | 8,250,405 | |
Total | 12,466,451 |
Tri-Continental Corporation | Semiannual Report 2018 | 9 |
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June 30, 2018 (Unaudited)
Corporate Bonds & Notes (continued) | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Oil Field Services 0.5% | ||||
Bristow Group, Inc.(c) | ||||
03/01/2023 | 8.750% | 4,200,000 | 4,090,603 | |
SESI LLC | ||||
09/15/2024 | 7.750% | 4,200,000 | 4,315,785 | |
Total | 8,406,388 | |||
Other Industry 0.4% | ||||
WeWork Companies, Inc.(c) | ||||
05/01/2025 | 7.875% | 6,500,000 | 6,225,524 | |
Packaging 1.0% | ||||
BWAY Holding Co.(c) | ||||
04/15/2025 | 7.250% | 8,600,000 | 8,385,034 | |
Novolex (c) | ||||
01/15/2025 | 6.875% | 8,490,000 | 8,188,087 | |
Total | 16,573,121 | |||
Pharmaceuticals 1.0% | ||||
AMAG Pharmaceuticals, Inc.(c) | ||||
09/01/2023 | 7.875% | 4,100,000 | 4,342,208 | |
Horizon Pharma, Inc.(c) | ||||
11/01/2024 | 8.750% | 4,100,000 | 4,405,200 | |
Valeant Pharmaceuticals International, Inc.(c) | ||||
01/31/2027 | 8.500% | 8,300,000 | 8,405,858 | |
Total | 17,153,266 | |||
Restaurants 0.3% | ||||
IRB Holding Corp.(c) | ||||
02/15/2026 | 6.750% | 4,300,000 | 4,127,346 | |
Retailers 0.1% | ||||
Rite Aid Corp. | ||||
Junior Subordinated | ||||
02/15/2027 | 7.700% | 1,937,000 | 1,651,676 | |
Supermarkets 0.4% | ||||
Safeway, Inc. | ||||
02/01/2031 | 7.250% | 7,512,000 | 6,993,672 | |
Technology 1.0% | ||||
Diebold, Inc. | ||||
04/15/2024 | 8.500% | 8,100,000 | 7,758,448 | |
Genesys Telecommunications Laboratories, Inc./Greeneden Lux 3 Sarl/U.S. Holdings I LLC(c) | ||||
11/30/2024 | 10.000% | 3,750,000 | 4,176,900 | |
Informatica LLC(c) | ||||
07/15/2023 | 7.125% | 4,538,000 | 4,586,275 | |
Total | 16,521,623 |
Corporate Bonds & Notes (continued) | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Transportation Services 0.6% | ||||
Hertz Corp. (The)(c) | ||||
06/01/2022 | 7.625% | 4,250,000 | 4,079,953 | |
Hertz Corp. (The) | ||||
10/15/2022 | 6.250% | 6,700,000 | 5,951,918 | |
Total | 10,031,871 | |||
Wirelines 0.4% | ||||
Frontier Communications Corp. | ||||
09/15/2025 | 11.000% | 8,360,000 | 6,689,028 | |
Total Corporate Bonds & Notes (Cost $253,884,964) | 250,176,587 |
Limited Partnerships 0.5% | ||
Issuer | Shares | Value ($) |
Energy 0.2% | ||
Oil, Gas & Consumable Fuels 0.2% | ||
Enviva Partners LP | 140,000 | 4,074,000 |
Total Energy | 4,074,000 | |
Industrials 0.3% | ||
Trading Companies & Distributors 0.3% | ||
Fortress Transportation & Infrastructure Investors LLC | 250,000 | 4,517,500 |
Total Industrials | 4,517,500 | |
Total Limited Partnerships (Cost $8,000,079) | 8,591,500 |
Preferred Debt 0.6% | ||||
Issuer | Coupon Rate | Shares | Value ($) | |
Banking 0.4% | ||||
Citigroup Capital XIII(d) | ||||
10/30/2040 | 8.729% | 220,000 | 5,962,000 | |
Finance Companies 0.2% | ||||
GMAC Capital Trust I(d) | ||||
02/15/2040 | 7.624% | 160,000 | 4,208,000 | |
Total Preferred Debt (Cost $9,796,867) | 10,170,000 |
10 | Tri-Continental Corporation | Semiannual Report 2018 |
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June 30, 2018 (Unaudited)
Senior Loans 0.7% | ||||
Borrower | Coupon Rate | Principal Amount ($) | Value ($) | |
Food and Beverage 0.2% | ||||
HLF Financing SARL(g),(h) | ||||
Term Loan | ||||
3-month USD LIBOR + 5.500% 02/15/2023 | 7.594% | 3,625,000 | 3,649,940 | |
Oil Field Services 0.5% | ||||
EagleClaw Midstream Ventures(g),(h) | ||||
Term Loan | ||||
3-month USD LIBOR + 4.250% 06/24/2024 | 6.421% | 7,923,960 | 7,735,766 | |
Total Senior Loans (Cost $11,475,872) | 11,385,706 |
Warrants —% | ||
Issuer | Shares | Value ($) |
Energy —% | ||
Oil, Gas & Consumable Fuels —% | ||
Goodrich Petroleum Corp.(a),(e),(f),(i) | 11,283 | 0 |
Total Energy | 0 | |
Total Warrants (Cost $—) | 0 | |
Money Market Funds 1.4% | ||
Shares | Value ($) | |
Columbia Short-Term Cash Fund, 1.985%(j),(k) | 12,990,233 | 12,990,233 |
JPMorgan U.S. Government Money Market Fund, Agency Shares, 1.713%(j) | 10,452,964 | 10,452,964 |
Total Money Market Funds (Cost $23,443,123) | 23,443,197 | |
Total Investments in Securities (Cost: $1,533,607,509) | 1,649,550,971 | |
Other Assets & Liabilities, Net | 6,533,432 | |
Net Assets | 1,656,084,403 |
Long futures contracts | ||||||
Description | Number of contracts | Expiration date | Trading currency | Notional amount | Value/Unrealized appreciation ($) | Value/Unrealized depreciation ($) |
S&P 500 E-mini | 104 | 09/2018 | USD | 14,152,320 | — | (19,550) |
(a) | Non-income producing investment. |
(b) | This security or a portion of this security has been pledged as collateral in connection with derivative contracts. |
(c) | Represents privately placed and other securities and instruments exempt from SEC registration (collectively, private placements), such as Section 4(a)(2) and Rule 144A eligible securities, which are often sold only to qualified institutional buyers. The Fund may invest in private placements determined to be liquid as well as those determined to be illiquid. Private placements may be determined to be liquid under guidelines established by the Fund’s Board of Directors. At June 30, 2018, the value of these securities amounted to $189,891,643, which represents 11.47% of net assets. |
(d) | Represents a variable rate security with a step coupon where the rate adjusts according to a schedule for a series of periods, typically lower for an initial period and then increasing to a higher coupon rate thereafter. The interest rate shown was the current rate as of June 30, 2018. |
(e) | Represents fair value as determined in good faith under procedures approved by the Board of Trustees. At June 30, 2018, the value of these securities amounted to $3,100,000, which represents 0.19% of net assets. |
(f) | Valuation based on significant unobservable inputs. |
Tri-Continental Corporation | Semiannual Report 2018 | 11 |
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June 30, 2018 (Unaudited)
(g) | The stated interest rate represents the weighted average interest rate at June 30, 2018 of contracts within the senior loan facility. Interest rates on contracts are primarily determined either weekly, monthly or quarterly by reference to the indicated base lending rate and spread and the reset period. These base lending rates are primarily the London Interbank Offered Rate (“LIBOR”) and other short-term rates. Base lending rates may be subject to a floor or minimum rate. The interest rate for senior loans purchased on a when-issued or delayed delivery basis will be determined upon settlement, therefore no interest rate is disclosed. Senior loans often require prepayments from excess cash flows or permit the borrowers to repay at their election. The degree to which borrowers repay, cannot be predicted with accuracy. As a result, remaining maturities of senior loans may be less than the stated maturities. |
(h) | Variable rate security. The interest rate shown was the current rate as of June 30, 2018. |
(i) | Negligible market value. |
(j) | The rate shown is the seven-day current annualized yield at June 30, 2018. |
(k) | As defined in the Investment Company Act of 1940, an affiliated company is one in which the Fund owns 5% or more of the company’s outstanding voting securities, or a company which is under common ownership or control with the Fund. Holdings and transactions in these affiliated companies during the period ended June 30, 2018 are as follows: |
Issuer | Beginning shares | Shares purchased | Shares sold | Ending shares | Realized gain (loss) — affiliated issuers ($) | Net change in unrealized appreciation (depreciation) — affiliated issuers ($) | Dividends — affiliated issuers ($) | Value — affiliated issuers at end of period ($) |
Columbia Short-Term Cash Fund, 1.985% | ||||||||
13,847,965 | 61,309,500 | (62,167,232) | 12,990,233 | 796 | (968) | 57,508 | 12,990,233 |
ADR | American Depositary Receipt |
USD | US Dollar |
■ | Level 1 — Valuations based on quoted prices for investments in active markets that the Fund has the ability to access at the measurement date. Valuation adjustments are not applied to Level 1 investments. |
■ | Level 2 — Valuations based on other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.). |
■ | Level 3 — Valuations based on significant unobservable inputs (including the Fund’s own assumptions and judgment in determining the fair value of investments). |
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Under the direction of the Fund’s Board of Directors (the Board), the Investment Manager’s Valuation Committee (the Committee) is responsible for overseeing the valuation procedures approved by the Board. The Committee consists of voting and non-voting members from various groups within the Investment Manager’s organization, including operations and accounting, trading and investments, compliance, risk management and legal.
Level 1 quoted prices in active markets for identical assets ($) | Level 2 other significant observable inputs ($) | Level 3 significant unobservable inputs ($) | Investments measured at net asset value ($) | Total ($) | |
Investments in Securities | |||||
Common Stocks | |||||
Consumer Discretionary | 130,014,682 | — | — | — | 130,014,682 |
Consumer Staples | 70,081,492 | — | — | — | 70,081,492 |
Energy | 64,163,681 | — | — | — | 64,163,681 |
Financials | 175,032,984 | — | — | — | 175,032,984 |
Health Care | 147,213,942 | — | — | — | 147,213,942 |
Industrials | 93,355,983 | — | — | — | 93,355,983 |
Information Technology | 281,297,637 | — | — | — | 281,297,637 |
Materials | 23,912,560 | — | — | — | 23,912,560 |
Real Estate | 33,630,672 | — | — | — | 33,630,672 |
Telecommunication Services | 22,997,182 | — | — | — | 22,997,182 |
Utilities | 46,121,911 | — | — | — | 46,121,911 |
Total Common Stocks | 1,087,822,726 | — | — | — | 1,087,822,726 |
Convertible Bonds | — | 146,674,829 | — | — | 146,674,829 |
Convertible Preferred Stocks | |||||
Consumer Staples | — | 7,794,344 | — | — | 7,794,344 |
Energy | 16,006,600 | — | — | — | 16,006,600 |
Financials | 21,046,040 | 11,966,890 | — | — | 33,012,930 |
Health Care | 8,659,000 | — | — | — | 8,659,000 |
Industrials | 9,874,550 | 6,049,380 | — | — | 15,923,930 |
Information Technology | 8,367,000 | 4,172,622 | — | — | 12,539,622 |
Real Estate | 8,691,925 | — | — | — | 8,691,925 |
Utilities | 8,658,075 | — | — | — | 8,658,075 |
Total Convertible Preferred Stocks | 81,303,190 | 29,983,236 | — | — | 111,286,426 |
Corporate Bonds & Notes | — | 247,076,587 | 3,100,000 | — | 250,176,587 |
Limited Partnerships | |||||
Energy | 4,074,000 | — | — | — | 4,074,000 |
Industrials | 4,517,500 | — | — | — | 4,517,500 |
Total Limited Partnerships | 8,591,500 | — | — | — | 8,591,500 |
Preferred Debt | 10,170,000 | — | — | — | 10,170,000 |
Senior Loans | — | 11,385,706 | — | — | 11,385,706 |
Tri-Continental Corporation | Semiannual Report 2018 | 13 |
Table of Contents
June 30, 2018 (Unaudited)
Level 1 quoted prices in active markets for identical assets ($) | Level 2 other significant observable inputs ($) | Level 3 significant unobservable inputs ($) | Investments measured at net asset value ($) | Total ($) | |
Warrants | |||||
Energy | — | — | 0* | — | 0* |
Money Market Funds | 10,452,964 | — | — | 12,990,233 | 23,443,197 |
Total Investments in Securities | 1,198,340,380 | 435,120,358 | 3,100,000 | 12,990,233 | 1,649,550,971 |
Investments in Derivatives | |||||
Liability | |||||
Futures Contracts | (19,550) | — | — | — | (19,550) |
Total | 1,198,320,830 | 435,120,358 | 3,100,000 | 12,990,233 | 1,649,531,421 |
* | Rounds to zero. |
14 | Tri-Continental Corporation | Semiannual Report 2018 |
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June 30, 2018 (Unaudited)
Assets | |
Investments in securities, at value | |
Unaffiliated issuers (cost $1,520,617,350) | $1,636,560,738 |
Affiliated issuers (cost $12,990,159) | 12,990,233 |
Receivable for: | |
Investments sold | 5,550,847 |
Dividends | 1,933,217 |
Interest | 6,743,456 |
Variation margin for futures contracts | 10,920 |
Other assets | 43,681 |
Total assets | 1,663,833,092 |
Liabilities | |
Due to custodian | 3,000 |
Payable for: | |
Investments purchased | 6,549,887 |
Common Stock payable | 494,927 |
Preferred Stock dividends | 470,463 |
Management services fees | 18,568 |
Stockholder servicing and transfer agent fees | 8,416 |
Compensation of board members | 165,909 |
Compensation of chief compliance officer | 178 |
Other expenses | 37,341 |
Total liabilities | 7,748,689 |
Net assets | $1,656,084,403 |
Preferred Stock | 37,637,000 |
Net assets for Common Stock | 1,618,447,403 |
Net asset value per share of outstanding Common Stock | $29.93 |
Market price per share of Common Stock | $26.51 |
Tri-Continental Corporation | Semiannual Report 2018 | 15 |
Table of Contents
June 30, 2018 (Unaudited)
Capital Stock | |
$2.50 Cumulative Preferred Stock, $50 par value, assets coverage per share $2,200 | |
Shares issued and outstanding — 752,740 | $37,637,000 |
Common Stock, $0.50 par value: | |
Shares issued and outstanding — 54,083,093 | 27,041,547 |
Surplus | |
Capital surplus | 1,453,031,873 |
Excess of distributions over net investment income | (891,602) |
Accumulated net realized gain | 23,341,673 |
Unrealized appreciation (depreciation) on: | |
Investments — unaffiliated issuers | 115,943,388 |
Investments — affiliated issuers | 74 |
Futures contracts | (19,550) |
Net assets | 1,656,084,403 |
16 | Tri-Continental Corporation | Semiannual Report 2018 |
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Six Months Ended June 30, 2018 (Unaudited)
Net investment income | |
Income: | |
Dividends — unaffiliated issuers | $18,022,046 |
Dividends — affiliated issuers | 57,508 |
Interest | 11,968,937 |
Foreign taxes withheld | (20,057) |
Total income | 30,028,434 |
Expenses: | |
Management services fees | 3,434,522 |
Stockholder servicing and transfer agent fees | 292,077 |
Compensation of board members | 38,135 |
Custodian fees | 10,847 |
Printing and postage fees | 51,567 |
Stockholders’ meeting fees | 26,131 |
Audit fees | 22,383 |
Legal fees | 19,702 |
Compensation of chief compliance officer | 167 |
Other | 113,255 |
Total expenses | 4,008,786 |
Net investment income(a) | 26,019,648 |
Realized and unrealized gain (loss) — net | |
Net realized gain (loss) on: | |
Investments — unaffiliated issuers | 25,336,288 |
Investments — affiliated issuers | 796 |
Foreign currency translations | (1,604) |
Futures contracts | 585,317 |
Net realized gain | 25,920,797 |
Net change in unrealized appreciation (depreciation) on: | |
Investments — unaffiliated issuers | (13,597,527) |
Investments — affiliated issuers | (968) |
Futures contracts | (31,699) |
Net change in unrealized appreciation (depreciation) | (13,630,194) |
Net realized and unrealized gain | 12,290,603 |
Net increase in net assets resulting from operations | $38,310,251 |
(a) | Net investment income for Common Stock is $25,078,723, which is net of Preferred Stock dividends of $940,925. |
Tri-Continental Corporation | Semiannual Report 2018 | 17 |
Table of Contents
Six Months Ended June 30, 2018 (Unaudited) | Year Ended December 31, 2017 | |
Operations | ||
Net investment income | $26,019,648 | $51,619,806 |
Net realized gain | 25,920,797 | 182,595,612 |
Net change in unrealized appreciation (depreciation) | (13,630,194) | 46,743,025 |
Net increase in net assets resulting from operations | 38,310,251 | 280,958,443 |
Distributions to stockholders | ||
Net investment income | ||
Preferred Stock | (940,925) | (1,881,850) |
Common Stock | (24,497,601) | (59,435,096) |
Net realized gains | ||
Common Stock | (12,341,453) | (5,188,617) |
Total distributions to stockholders | (37,779,979) | (66,505,563) |
Decrease in net assets from capital stock activity | (19,636,127) | (47,742,610) |
Total increase (decrease) in net assets | (19,105,855) | 166,710,270 |
Net assets at beginning of period | 1,675,190,258 | 1,508,479,988 |
Net assets at end of period | $1,656,084,403 | $1,675,190,258 |
Excess of distributions over net investment income | $(891,602) | $(1,472,724) |
Six Months Ended | Year Ended | |||
June 30, 2018 | December 31, 2017 | |||
Shares | Dollars ($) | Shares | Dollars ($) | |
Capital stock activity | ||||
Common Stock issued at market price in distributions | 511,438 | 13,792,538 | 811,797 | 20,317,190 |
Common Stock issued for investment plan purchases | 31,643 | 857,203 | 75,986 | 1,801,761 |
Common Stock purchased from investment plan participants | (329,828) | (8,905,489) | (768,195) | (18,577,483) |
Common Stock purchased in the open market | (938,302) | (25,380,379) | (2,070,003) | (51,284,146) |
Net proceeds from issuance of shares of Common Stock upon exercise of warrants | — | — | 73 | 68 |
Total net decrease | (725,049) | (19,636,127) | (1,950,342) | (47,742,610) |
18 | Tri-Continental Corporation | Semiannual Report 2018 |
Table of Contents
Six Months Ended June 30, 2018 (Unaudited) | Year ended December 31, | |||||
2017 | 2016 | 2015 | 2014 | 2013 | ||
Per share data | ||||||
Net asset value, beginning of period | $29.88 | $25.91 | $23.49 | $24.76 | $23.11 | $18.77 |
Income from investment operations: | ||||||
Net investment income | 0.48 | 0.93 | 0.90 | 0.81 | 0.73 | 0.69 |
Net realized and unrealized gain (loss) | 0.27 | 4.24 | 2.33 | (1.37) | 1.70 | 4.36 |
Total from investment operations | 0.75 | 5.17 | 3.23 | (0.56) | 2.43 | 5.05 |
Less distributions to Stockholders from: | ||||||
Net investment income — Preferred Stock | (0.02) | (0.03) | (0.03) | (0.03) | (0.03) | (0.03) |
Net investment income — Common Stock | (0.45) | (1.07) | (0.91) | (0.81) | (0.75) | (0.68) |
Net realized gains — Common Stock | (0.23) | (0.10) | — | — | — | — |
Total distributions to Stockholders | (0.70) | (1.20) | (0.94) | (0.84) | (0.78) | (0.71) |
Dilution in net asset value from dividend reinvestment | — | — | (0.06) | (0.05) | — | — |
Increase resulting from share repurchases | — | — | 0.19 | 0.18 | — | — |
Net asset value, end of period | $29.93 | $29.88 | $25.91 | $23.49 | $24.76 | $23.11 |
Adjusted net asset value, end of period(a) | $29.82 | $29.77 | $25.83 | $23.42 | $24.68 | $23.04 |
Market price, end of period | $26.51 | $26.94 | $22.05 | $20.02 | $21.41 | $19.98 |
Total return | ||||||
Based upon net asset value | 2.72% | 20.82% | 15.25% | (1.36%) | 11.09% | 27.76% |
Based upon market price | 0.92% | 28.00% | 15.08% | (2.78%) | 11.11% | 29.58% |
Ratios to average net assets | ||||||
Expenses to average net assets for Common Stock(b) | 0.49% (c) | 0.49% | 0.50% | 0.50% | 0.49% | 0.50% |
Net investment income to average net assets for Common Stock | 3.06% (c) | 3.21% | 3.59% | 3.16% | 2.91% | 3.12% |
Supplemental data | ||||||
Net assets, end of period (000’s): | ||||||
Common Stock | $1,618,447 | $1,637,553 | $1,470,843 | $1,382,712 | $1,511,285 | $1,435,734 |
Preferred Stock | $37,637 | $37,637 | $37,637 | $37,637 | $37,637 | $37,637 |
Total net assets | $1,656,084 | $1,675,190 | $1,508,480 | $1,420,349 | $1,548,922 | $1,473,371 |
Portfolio turnover | 36% | 95% | 82% | 76% | 76% | 62% |
Notes to Financial Highlights | |
(a) | Assumes the exercise of outstanding warrants. |
(b) | In addition to the fees and expenses that the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of any other funds in which it invests. Such indirect expenses are not included in the Fund’s reported expense ratios. |
(c) | Annualized. |
Tri-Continental Corporation | Semiannual Report 2018 | 19 |
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Liability derivatives | ||
Risk exposure category | Statement of capital stock and surplus location | Fair value ($) |
Equity risk | Surplus — unrealized depreciation on futures contracts | 19,550* |
* | Includes cumulative appreciation (depreciation) as reported in the tables following the Portfolio of Investments. Only the current day’s variation margin is reported in receivables or payables in the Statement of Assets and Liabilities. |
Amount of realized gain (loss) on derivatives recognized in income | |
Risk exposure category | Futures contracts ($) |
Equity risk | 585,317 |
Change in unrealized appreciation (depreciation) on derivatives recognized in income | |
Risk exposure category | Futures contracts ($) |
Equity risk | (31,699) |
Derivative instrument | Average notional amounts ($)* |
Futures contracts — long | 11,569,260 |
* | Based on the ending quarterly outstanding amounts for the six months ended June 30, 2018. |
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June 30, 2018 (Unaudited)
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June 30, 2018 (Unaudited)
Federal tax cost ($) | Gross unrealized appreciation ($) | Gross unrealized (depreciation) ($) | Net unrealized appreciation ($) |
1,537,751,000 | 175,606,000 | (59,682,000) | 115,924,000 |
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June 30, 2018 (Unaudited)
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June 30, 2018 (Unaudited)
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June 30, 2018 (Unaudited)
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Director | For | Withheld |
George S. Batejan | 35,761,120 | 3,527,823 |
Kathleen Blatz | 35,727,848 | 3,561,094 |
Edward J. Boudreau, Jr. | 35,753,843 | 3,535,100 |
Pamela G. Carlton | 35,652,234 | 3,636,708 |
For | Against | Abstain |
35,902,539 | 3,080,449 | 305,961 |
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Item 2. | Code of Ethics. |
Not applicable for semiannual reports.
Item 3. | Audit Committee Financial Expert. |
Not applicable for semiannual reports.
Item 4. | Principal Accountant Fees and Services. |
Not applicable for semiannual reports.
Item 5. | Audit Committee of Listed Registrants. |
Not applicable for semiannual reports.
Item 6. | Investments |
(a) | The registrant’s “Schedule I – Investments in securities of unaffiliated issuers” (as set forth in 17 CFR 210.12-12) is included in Item 1 of this Form N-CSR. |
(b) | Not applicable. |
Item 7. | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. |
Not applicable for semiannual reports.
Item 8. | Portfolio Managers of Closed-End Management Investment Companies. |
Not applicable for semiannual reports.
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Item 9. | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. |
Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(1) | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs(1) | ||||
01-01-18 to 01-31-18 | 257,151 | 27.63 | 257,151 | 2,483,256 | ||||
02-01-18 to 02-29-18 | 207,773 | 27.07 | 207,773 | 2,275,483 | ||||
03-01-18 to 03-31-18 | 175,834 | 26.89 | 175,834 | 2,099,649 | ||||
04-01-18 to 04-30-18 | 235,283 | 26.57 | 235,283 | 1,864,366 | ||||
05-01-18 to 05-31-18 | 234,258 | 26.91 | 234,258 | 1,630,108 | ||||
06-01-18 to 06-30-18 | 148,531 | 27.09 | 148,531 | 1,481,577 |
(1) | The registrant has a stock repurchase program. For 2018, the registrant is authorized to repurchase up to 5% of its outstanding Common Stock directly from stockholders and in the open market, provided that, with respect to shares repurchased in the open market the excess of the net asset value of a share of Common Stock over its market price (the discount) is greater than 10%. The table reflects trade date + 1, rather than trade date, which is used for financial statement purposes; therefore, shares reflected may vary from capital stock activity presented in the shareholder report. |
Item 10. | Submission of Matters to a Vote of Security Holders. |
There were no material changes to the procedures by which shareholders may recommend nominees to the registrant’s board of directors.
Item 11. | Controls and Procedures. |
(a) | The registrant’s principal executive officer and principal financial officers, based on their evaluation of the registrant’s disclosure controls and procedures as of a date within 90 days of the filing of this report, have concluded that such controls and procedures are adequately designed to ensure that material information required to be disclosed by the registrant in Form N-CSR is accumulated and communicated to the registrant’s management, including the principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. |
(b) | There was no change in the registrant’s internal control over financial reporting that occurred during the registrant’s second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
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Item 12. | Disclosure of Securities Lending Activities for Closed-End Management Investment Companies |
Not applicable.
Item 13. | Exhibits. |
(a)(1) | Code of ethics required to be disclosed under Item 2 of Form N-CSR: Not applicable for semiannual reports. |
(a)(2) | Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) attached hereto as Exhibit 99.CERT. |
(a)(3) | Not applicable. |
(b) | Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) attached hereto as Exhibit 99.906CERT. |
(a)(2) | Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) attached hereto as Exhibit 99.CERT. |
(a)(3) | None. |
(b) | Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) attached hereto as Exhibit 99.906CERT. |
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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) | Tri-Continental Corporation |
By (Signature and Title) | /s/ Christopher O. Petersen | |
Christopher O. Petersen, President and Principal Executive Officer |
Date | August 20, 2018 |
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/ Christopher O. Petersen | |
Christopher O. Petersen, President and Principal Executive Officer |
Date | August 20, 2018 |
By (Signature and Title) | /s/ Michael G. Clarke | |
Michael G. Clarke, Treasurer and Chief Financial Officer |
Date | August 20, 2018 |