UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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
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, 2020
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 100 F Street, NE, Washington, DC 20549. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Reports to Stockholders.
June 30, 2020
(Unaudited)
Average annual total returns (%) (for the period ended June 30, 2020) | ||||||
Inception | 6 Months cumulative | 1 Year | 5 Years | 10 Years | ||
Market Price | 01/05/29 | -9.51 | -0.82 | 9.24 | 13.55 | |
Net Asset Value | 01/05/29 | -5.72 | 2.12 | 8.71 | 13.11 | |
S&P 500 Index | -3.08 | 7.51 | 10.73 | 13.99 | ||
Blended Benchmark | -2.38 | 6.26 | 8.83 | 11.65 |
Price Per Share | ||||
June 30, 2020 | March 31, 2020 | December 31, 2019 | ||
Market Price ($) | 24.71 | 20.91 | 28.20 | |
Net Asset Value ($) | 28.33 | 24.18 | 31.03 |
Distributions Paid Per Common Share(a) | |
Payable Date | Per Share Amount ($) |
March 26, 2020 | 0.2650 |
June 25, 2020 | 0.4898(b) |
2 | Tri-Continental Corporation | Semiannual Report 2020 |
(Unaudited)
Portfolio breakdown (%) (at June 30, 2020) | |
Common Stocks | 68.9 |
Convertible Bonds | 7.6 |
Convertible Preferred Stocks | 6.3 |
Corporate Bonds & Notes | 14.7 |
Limited Partnerships | 0.5 |
Money Market Funds | 1.1 |
Preferred Debt | 0.5 |
Senior Loans | 0.4 |
Warrants | 0.0(a) |
Total | 100.0 |
(a) | Rounds to zero. |
Equity sector breakdown (%) (at June 30, 2020) | |
Communication Services | 9.2 |
Consumer Discretionary | 9.6 |
Consumer Staples | 7.1 |
Energy | 3.9 |
Financials | 13.4 |
Health Care | 14.4 |
Industrials | 7.5 |
Information Technology | 22.7 |
Materials | 2.1 |
Real Estate | 4.2 |
Utilities | 5.9 |
Total | 100.0 |
Tri-Continental Corporation | Semiannual Report 2020 | 3 |
June 30, 2020 (Unaudited)
Common Stocks 68.5% | ||
Issuer | Shares | Value ($) |
Communication Services 6.6% | ||
Diversified Telecommunication Services 1.7% | ||
AT&T, Inc. | 220,000 | 6,650,600 |
BCE, Inc. | 90,000 | 3,759,300 |
Verizon Communications, Inc. | 305,900 | 16,864,267 |
Total | 27,274,167 | |
Entertainment 0.6% | ||
Electronic Arts, Inc.(a) | 66,300 | 8,754,915 |
Interactive Media & Services 3.9% | ||
Alphabet, Inc., Class A(a) | 24,725 | 35,061,286 |
Facebook, Inc., Class A(a) | 111,100 | 25,227,477 |
Total | 60,288,763 | |
Media 0.4% | ||
Comcast Corp., Class A | 100,000 | 3,898,000 |
Interpublic Group of Companies, Inc. (The) | 109,100 | 1,872,156 |
Total | 5,770,156 | |
Total Communication Services | 102,088,001 | |
Consumer Discretionary 7.0% | ||
Hotels, Restaurants & Leisure 0.9% | ||
Domino’s Pizza, Inc. | 7,800 | 2,881,632 |
Extended Stay America, Inc. | 325,000 | 3,636,750 |
Hilton Worldwide Holdings, Inc. | 59,600 | 4,377,620 |
Wyndham Destinations, Inc. | 115,000 | 3,240,700 |
Total | 14,136,702 | |
Household Durables 0.7% | ||
Newell Brands, Inc. | 275,000 | 4,367,000 |
PulteGroup, Inc. | 190,100 | 6,469,103 |
Total | 10,836,103 | |
Internet & Direct Marketing Retail 2.4% | ||
Amazon.com, Inc.(a) | 8,760 | 24,167,263 |
eBay, Inc. | 249,100 | 13,065,295 |
Total | 37,232,558 | |
Multiline Retail 1.2% | ||
Dollar General Corp. | 14,300 | 2,724,293 |
Target Corp. | 129,900 | 15,578,907 |
Total | 18,303,200 |
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
Specialty Retail 1.8% | ||
Best Buy Co., Inc. | 136,200 | 11,886,174 |
Home Depot, Inc. (The) | 30,600 | 7,665,606 |
Lowe’s Companies, Inc. | 59,800 | 8,080,176 |
Total | 27,631,956 | |
Total Consumer Discretionary | 108,140,519 | |
Consumer Staples 5.1% | ||
Food Products 1.1% | ||
General Mills, Inc. | 200,300 | 12,348,495 |
JM Smucker Co. (The) | 40,600 | 4,295,886 |
Total | 16,644,381 | |
Household Products 2.2% | ||
Kimberly-Clark Corp. | 121,850 | 17,223,497 |
Procter & Gamble Co. (The) | 142,000 | 16,978,940 |
Total | 34,202,437 | |
Tobacco 1.8% | ||
Altria Group, Inc. | 223,000 | 8,752,750 |
Philip Morris International, Inc. | 272,000 | 19,056,320 |
Total | 27,809,070 | |
Total Consumer Staples | 78,655,888 | |
Energy 2.5% | ||
Oil, Gas & Consumable Fuels 2.5% | ||
Chevron Corp.(b) | 124,500 | 11,109,135 |
ConocoPhillips Co. | 231,400 | 9,723,428 |
HollyFrontier Corp. | 149,900 | 4,377,080 |
Phillips 66 | 14,700 | 1,056,930 |
Valero Energy Corp. | 85,300 | 5,017,346 |
Williams Companies, Inc. (The) | 375,000 | 7,132,500 |
Total | 38,416,419 | |
Total Energy | 38,416,419 | |
Financials 9.2% | ||
Banks 3.2% | ||
Bank of America Corp. | 125,900 | 2,990,125 |
Citigroup, Inc. | 433,000 | 22,126,300 |
Citizens Financial Group, Inc. | 102,100 | 2,577,004 |
JPMorgan Chase & Co. | 72,500 | 6,819,350 |
4 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
KeyCorp | 325,000 | 3,958,500 |
PNC Financial Services Group, Inc. (The) | 52,500 | 5,523,525 |
U.S. Bancorp | 150,000 | 5,523,000 |
Total | 49,517,804 | |
Capital Markets 3.6% | ||
Ares Capital Corp. | 525,000 | 7,586,250 |
Bank of New York Mellon Corp. (The) | 164,300 | 6,350,195 |
BlackRock, Inc. | 2,350 | 1,278,611 |
Intercontinental Exchange, Inc. | 134,100 | 12,283,560 |
Moody’s Corp. | 2,500 | 686,825 |
Morgan Stanley | 175,000 | 8,452,500 |
S&P Global, Inc. | 38,500 | 12,684,980 |
State Street Corp. | 60,000 | 3,813,000 |
T. Rowe Price Group, Inc. | 8,900 | 1,099,150 |
TCG BDC, Inc. | 250,000 | 2,142,500 |
Total | 56,377,571 | |
Consumer Finance 0.3% | ||
Synchrony Financial | 242,400 | 5,371,584 |
Diversified Financial Services 0.1% | ||
Voya Financial, Inc. | 19,300 | 900,345 |
Insurance 1.3% | ||
Allstate Corp. (The) | 134,600 | 13,054,854 |
MetLife, Inc. | 193,400 | 7,062,968 |
Total | 20,117,822 | |
Mortgage Real Estate Investment Trusts (REITS) 0.7% | ||
Blackstone Mortgage Trust, Inc. | 125,000 | 3,011,250 |
Starwood Property Trust, Inc. | 500,000 | 7,480,000 |
Total | 10,491,250 | |
Total Financials | 142,776,376 | |
Health Care 9.2% | ||
Biotechnology 1.9% | ||
AbbVie, Inc. | 153,220 | 15,043,140 |
Alexion Pharmaceuticals, Inc.(a) | 40,670 | 4,564,801 |
BioMarin Pharmaceutical, Inc.(a) | 34,600 | 4,267,564 |
Vertex Pharmaceuticals, Inc.(a) | 19,750 | 5,733,622 |
Total | 29,609,127 |
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
Health Care Equipment & Supplies 1.1% | ||
Dentsply Sirona, Inc. | 28,660 | 1,262,760 |
Hologic, Inc.(a) | 12,600 | 718,200 |
Medtronic PLC | 163,700 | 15,011,290 |
Total | 16,992,250 | |
Health Care Providers & Services 1.7% | ||
Cardinal Health, Inc. | 154,140 | 8,044,566 |
DaVita, Inc.(a) | 101,100 | 8,001,054 |
Humana, Inc. | 16,700 | 6,475,425 |
McKesson Corp. | 26,800 | 4,111,656 |
Total | 26,632,701 | |
Pharmaceuticals 4.5% | ||
Amryt Pharma PLC, ADR(a) | 307,275 | 2,989,909 |
Bristol-Myers Squibb Co. | 236,200 | 13,888,560 |
Eli Lilly and Co. | 6,800 | 1,116,424 |
Johnson & Johnson | 157,900 | 22,205,477 |
Merck & Co., Inc. | 259,600 | 20,074,868 |
Mylan NV(a) | 384,700 | 6,185,976 |
Pfizer, Inc. | 110,000 | 3,597,000 |
Total | 70,058,214 | |
Total Health Care | 143,292,292 | |
Industrials 5.4% | ||
Aerospace & Defense 1.3% | ||
Lockheed Martin Corp. | 39,900 | 14,560,308 |
Raytheon Technologies Corp. | 82,500 | 5,083,650 |
Total | 19,643,958 | |
Air Freight & Logistics 0.6% | ||
United Parcel Service, Inc., Class B | 75,000 | 8,338,500 |
Airlines 0.4% | ||
Southwest Airlines Co. | 173,500 | 5,930,230 |
Electrical Equipment 1.4% | ||
Eaton Corp. PLC | 219,800 | 19,228,104 |
Rockwell Automation, Inc. | 11,100 | 2,364,300 |
Total | 21,592,404 |
Tri-Continental Corporation | Semiannual Report 2020 | 5 |
June 30, 2020 (Unaudited)
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
Machinery 1.4% | ||
Caterpillar, Inc. | 45,000 | 5,692,500 |
Cummins, Inc. | 64,200 | 11,123,292 |
Illinois Tool Works, Inc. | 30,400 | 5,315,440 |
Total | 22,131,232 | |
Professional Services 0.1% | ||
Robert Half International, Inc. | 36,300 | 1,917,729 |
Road & Rail 0.2% | ||
Norfolk Southern Corp. | 20,000 | 3,511,400 |
Total Industrials | 83,065,453 | |
Information Technology 17.1% | ||
Communications Equipment 1.7% | ||
Cisco Systems, Inc. | 573,400 | 26,743,376 |
Electronic Equipment, Instruments & Components 0.4% | ||
Corning, Inc. | 250,000 | 6,475,000 |
IT Services 3.2% | ||
International Business Machines Corp. | 55,000 | 6,642,350 |
MasterCard, Inc., Class A | 72,700 | 21,497,390 |
VeriSign, Inc.(a) | 66,600 | 13,774,878 |
Visa, Inc., Class A | 34,100 | 6,587,097 |
Total | 48,501,715 | |
Semiconductors & Semiconductor Equipment 3.9% | ||
Broadcom, Inc. | 41,700 | 13,160,937 |
Intel Corp. | 325,800 | 19,492,614 |
KLA Corp. | 13,700 | 2,664,376 |
QUALCOMM, Inc. | 186,400 | 17,001,544 |
Texas Instruments, Inc. | 62,500 | 7,935,625 |
Total | 60,255,096 | |
Software 5.2% | ||
Adobe, Inc.(a) | 28,500 | 12,406,335 |
Autodesk, Inc.(a) | 61,500 | 14,710,185 |
Fortinet, Inc.(a) | 103,100 | 14,152,537 |
Microsoft Corp. | 164,600 | 33,497,746 |
NortonLifeLock, Inc. | 300,000 | 5,949,000 |
Total | 80,715,803 |
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
Technology Hardware, Storage & Peripherals 2.7% | ||
Apple, Inc. | 98,050 | 35,768,640 |
HP, Inc. | 332,500 | 5,795,475 |
Total | 41,564,115 | |
Total Information Technology | 264,255,105 | |
Materials 1.6% | ||
Chemicals 1.3% | ||
Dow, Inc. | 190,000 | 7,744,400 |
LyondellBasell Industries NV, Class A | 185,600 | 12,197,632 |
Total | 19,942,032 | |
Metals & Mining 0.3% | ||
Nucor Corp. | 119,200 | 4,936,072 |
Total Materials | 24,878,104 | |
Real Estate 2.4% | ||
Equity Real Estate Investment Trusts (REITS) 2.4% | ||
Alexandria Real Estate Equities, Inc. | 35,000 | 5,678,750 |
American Tower Corp. | 25,090 | 6,486,769 |
Duke Realty Corp. | 115,000 | 4,069,850 |
Equinix, Inc. | 5,850 | 4,108,455 |
Medical Properties Trust, Inc. | 400,000 | 7,520,000 |
ProLogis, Inc. | 60,100 | 5,609,133 |
SBA Communications Corp. | 5,200 | 1,549,184 |
Vornado Realty Trust | 54,000 | 2,063,340 |
Total | 37,085,481 | |
Total Real Estate | 37,085,481 | |
Utilities 2.4% | ||
Electric Utilities 2.2% | ||
American Electric Power Co., Inc. | 92,500 | 7,366,700 |
Edison International | 87,500 | 4,752,125 |
Entergy Corp. | 48,500 | 4,549,785 |
Exelon Corp. | 168,300 | 6,107,607 |
FirstEnergy Corp. | 87,500 | 3,393,250 |
NRG Energy, Inc. | 274,700 | 8,944,232 |
Total | 35,113,699 | |
Independent Power and Renewable Electricity Producers 0.1% | ||
AES Corp. (The) | 98,500 | 1,427,265 |
6 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Common Stocks (continued) | ||
Issuer | Shares | Value ($) |
Multi-Utilities 0.1% | ||
Sempra Energy | 9,600 | 1,125,408 |
Total Utilities | 37,666,372 | |
Total Common Stocks (Cost $948,545,971) | 1,060,320,010 |
Convertible Bonds 7.5% | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Airlines 0.3% | ||||
Air Canada(c) | ||||
07/01/2025 | 4.000% | 3,700,000 | 3,912,750 | |
Cable and Satellite 0.5% | ||||
DISH Network Corp. | ||||
08/15/2026 | 3.375% | 9,000,000 | 8,267,532 | |
Consumer Cyclical Services 0.5% | ||||
Farfetch Ltd.(c) | ||||
05/01/2027 | 3.750% | 3,300,000 | 4,454,045 | |
Zillow Group, Inc. | ||||
05/15/2025 | 2.750% | 3,500,000 | 4,069,485 | |
Total | 8,523,530 | |||
Health Care 0.7% | ||||
CONMED Corp. | ||||
02/01/2024 | 2.625% | 3,700,000 | 3,872,351 | |
Invacare Corp. | ||||
11/15/2024 | 5.000% | 4,000,000 | 3,388,000 | |
Novavax, Inc. | ||||
02/01/2023 | 3.750% | 4,000,000 | 3,839,200 | |
Total | 11,099,551 | |||
Home Construction 0.4% | ||||
SunPower Corp. | ||||
01/15/2023 | 4.000% | 7,500,000 | 6,017,769 | |
Independent Energy 0.0% | ||||
Chesapeake Energy Corp.(d) | ||||
09/15/2026 | 0.000% | 9,000,000 | 315,000 | |
Leisure 0.4% | ||||
NCL Corp Ltd.(c) | ||||
05/15/2024 | 6.000% | 1,500,000 | 1,997,067 | |
Royal Caribbean Cruises Ltd(c) | ||||
06/15/2023 | 4.250% | 4,200,000 | 3,906,000 | |
Total | 5,903,067 |
Convertible Bonds (continued) | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Life Insurance 0.4% | ||||
AXA SA(c) | ||||
05/15/2021 | 7.250% | 6,500,000 | 5,840,016 | |
Other Financial Institutions 0.4% | ||||
RWT Holdings, Inc.(c) | ||||
10/01/2025 | 5.750% | 6,750,000 | 5,532,071 | |
Other Industry 0.2% | ||||
Green Plains, Inc. | ||||
09/01/2022 | 4.125% | 4,600,000 | 3,637,013 | |
Other REIT 0.3% | ||||
Blackstone Mortgage Trust, Inc. | ||||
05/05/2022 | 4.375% | 4,910,000 | 4,603,179 | |
Pharmaceuticals 1.3% | ||||
Aegerion Pharmaceuticals, Inc.(c) | ||||
04/01/2025 | 5.000% | 1,687,570 | 1,636,943 | |
Clovis Oncology, Inc. | ||||
05/01/2025 | 1.250% | 9,300,000 | 5,630,713 | |
Insmed, Inc. | ||||
01/15/2025 | 1.750% | 4,000,000 | 3,887,500 | |
Intercept Pharmaceuticals, Inc. | ||||
07/01/2023 | 3.250% | 4,300,000 | 3,235,847 | |
Radius Health, Inc. | ||||
09/01/2024 | 3.000% | 5,200,000 | 3,804,239 | |
Tilray, Inc. | ||||
10/01/2023 | 5.000% | 5,250,000 | 2,375,625 | |
Total | 20,570,867 | |||
Property & Casualty 0.5% | ||||
Heritage Insurance Holdings, Inc. | ||||
08/01/2037 | 5.875% | 3,500,000 | 3,734,819 | |
MGIC Investment Corp.(c),(e) | ||||
Junior Subordinated | ||||
04/01/2063 | 9.000% | 3,011,000 | 3,563,099 | |
Total | 7,297,918 | |||
Retailers 0.6% | ||||
American Eagle Outfitters, Inc.(c) | ||||
04/15/2025 | 3.750% | 3,500,000 | 4,977,572 | |
Dick’s Sporting Goods, Inc.(c) | ||||
04/15/2025 | 3.250% | 2,900,000 | 4,014,077 | |
Total | 8,991,649 | |||
Technology 1.0% | ||||
Avaya Holdings Corp. | ||||
06/15/2023 | 2.250% | 6,900,000 | 5,641,585 |
Tri-Continental Corporation | Semiannual Report 2020 | 7 |
June 30, 2020 (Unaudited)
Convertible Bonds (continued) | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Microchip Technology, Inc. | ||||
Junior Subordinated | ||||
02/15/2037 | 2.250% | 4,300,000 | 6,265,199 | |
Sabre GLBL, Inc.(c) | ||||
04/15/2025 | 4.000% | 3,000,000 | 3,824,711 | |
Total | 15,731,495 | |||
Total Convertible Bonds (Cost $129,818,579) | 116,243,407 |
Convertible Preferred Stocks 6.3% | |||
Issuer | Shares | Value ($) | |
Communication Services 0.3% | |||
Wireless Telecommunication Services 0.3% | |||
2020 Cash Mandatory Exchangeable Trust(c) | 5.250% | 4,650 | 4,743,233 |
Total Communication Services | 4,743,233 | ||
Consumer Discretionary 0.3% | |||
Auto Components 0.3% | |||
Aptiv PLC(c) | 5.500% | 38,000 | 3,902,106 |
Total Consumer Discretionary | 3,902,106 | ||
Consumer Staples 0.2% | |||
Household Products 0.2% | |||
Energizer Holdings, Inc. | 7.500% | 40,000 | 3,847,874 |
Total Consumer Staples | 3,847,874 | ||
Financials 0.9% | |||
Capital Markets 0.6% | |||
AMG Capital Trust II | 5.150% | 130,000 | 5,137,400 |
Cowen, Inc. | 5.625% | 5,200 | 4,188,270 |
Total | 9,325,670 | ||
Insurance 0.3% | |||
Assurant, Inc. | 6.500% | 37,500 | 3,933,056 |
Total Financials | 13,258,726 | ||
Health Care 1.6% | |||
Health Care Equipment & Supplies 1.0% | |||
Becton Dickinson and Co. | 6.000% | 112,500 | 5,944,500 |
Boston Scientific Corp. | 5.500% | 37,300 | 3,897,850 |
Danaher Corp. | 5.000% | 5,000 | 5,396,600 |
Total | 15,238,950 |
Convertible Preferred Stocks (continued) | |||
Issuer | Shares | Value ($) | |
Health Care Technology 0.2% | |||
Change Healthcare, Inc. | 6.000% | 80,000 | 3,442,608 |
Life Sciences Tools & Services 0.4% | |||
Avantor, Inc. | 6.250% | 95,000 | 5,453,000 |
Total Health Care | 24,134,558 | ||
Industrials 0.3% | |||
Machinery 0.3% | |||
Stanley Black & Decker, Inc. | 5.250% | 47,500 | 4,229,970 |
Total Industrials | 4,229,970 | ||
Real Estate 0.7% | |||
Equity Real Estate Investment Trusts (REITS) 0.7% | |||
Crown Castle International Corp. | 6.875% | 5,000 | 7,441,347 |
QTS Realty Trust, Inc. | 6.500% | 27,000 | 3,859,120 |
Total | 11,300,467 | ||
Total Real Estate | 11,300,467 | ||
Utilities 2.0% | |||
Electric Utilities 0.6% | |||
NextEra Energy, Inc. | 5.279% | 180,000 | 7,604,436 |
PG&E Corp. | 5.500% | 17,350 | 1,637,493 |
Total | 9,241,929 | ||
Multi-Utilities 1.2% | |||
Dominion Energy, Inc. | 7.250% | 75,000 | 7,628,250 |
DTE Energy Co. | 6.250% | 250,000 | 10,578,050 |
Total | 18,206,300 | ||
Water Utilities 0.2% | |||
Essential Utilities, Inc. | 6.000% | 70,000 | 3,957,800 |
Total Utilities | 31,406,029 | ||
Total Convertible Preferred Stocks (Cost $99,724,939) | 96,822,963 |
Corporate Bonds & Notes 14.7% | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Aerospace & Defense 0.6% | ||||
Boeing Co. (The) | ||||
05/01/2060 | 5.930% | 5,000,000 | 5,896,288 | |
Spirit AeroSystems, Inc.(c) | ||||
04/15/2025 | 7.500% | 3,900,000 | 3,869,672 | |
Total | 9,765,960 |
8 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Corporate Bonds & Notes (continued) | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Brokerage/Asset Managers/Exchanges 0.5% | ||||
LPL Holdings, Inc.(c) | ||||
09/15/2025 | 5.750% | 7,850,000 | 7,949,567 | |
Cable and Satellite 0.7% | ||||
Charter Communications Operating LLC/Capital | ||||
10/23/2045 | 6.484% | 4,200,000 | 5,570,526 | |
Gogo Intermediate Holdings LLC/Finance Co., Inc.(c) | ||||
05/01/2024 | 9.875% | 4,200,000 | 3,567,649 | |
Telesat Canada/LLC(c) | ||||
10/15/2027 | 6.500% | 2,286,000 | 2,243,219 | |
Total | 11,381,394 | |||
Chemicals 0.8% | ||||
Innophos Holdings, Inc.(c) | ||||
02/15/2028 | 9.375% | 4,300,000 | 4,227,748 | |
Starfruit Finco BV/US Holdco LLC(c) | ||||
10/01/2026 | 8.000% | 8,400,000 | 8,631,779 | |
Total | 12,859,527 | |||
Consumer Cyclical Services 0.4% | ||||
Uber Technologies, Inc.(c) | ||||
11/01/2023 | 7.500% | 4,000,000 | 4,023,573 | |
09/15/2027 | 7.500% | 2,100,000 | 2,104,048 | |
Total | 6,127,621 | |||
Consumer Products 0.6% | ||||
Mattel, Inc.(c) | ||||
12/31/2025 | 6.750% | 3,942,000 | 4,088,647 | |
12/15/2027 | 5.875% | 1,079,000 | 1,111,991 | |
Mattel, Inc. | ||||
10/01/2040 | 6.200% | 1,430,000 | 1,229,837 | |
11/01/2041 | 5.450% | 745,000 | 617,359 | |
Winnebago Industries, Inc.(c),(f) | ||||
07/15/2028 | 6.250% | 1,840,000 | 1,840,000 | |
Total | 8,887,834 | |||
Electric 0.2% | ||||
Enviva Partners LP/Finance Corp.(c) | ||||
01/15/2026 | 6.500% | 3,500,000 | 3,639,739 | |
Environmental 0.5% | ||||
Covanta Holding Corp. | ||||
07/01/2025 | 5.875% | 4,834,000 | 4,889,532 | |
01/01/2027 | 6.000% | 3,000,000 | 3,038,457 | |
Total | 7,927,989 |
Corporate Bonds & Notes (continued) | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Finance Companies 0.9% | ||||
Fortress Transportation & Infrastructure Investors LLC(c) | ||||
10/01/2025 | 6.500% | 6,000,000 | 5,425,257 | |
Springleaf Finance Corp. | ||||
03/15/2025 | 6.875% | 7,500,000 | 7,705,763 | |
Total | 13,131,020 | |||
Food and Beverage 1.0% | ||||
Aramark Services, Inc.(c) | ||||
05/01/2025 | 6.375% | 6,500,000 | 6,711,492 | |
Chobani LLC/Finance Corp., Inc.(c) | ||||
04/15/2025 | 7.500% | 4,597,000 | 4,472,950 | |
Lamb Weston Holdings, Inc.(c) | ||||
11/01/2026 | 4.875% | 3,900,000 | 4,041,836 | |
Total | 15,226,278 | |||
Gaming 0.3% | ||||
Colt Merger Sub, Inc.(c),(f) | ||||
07/01/2027 | 8.125% | 4,106,000 | 3,968,808 | |
Health Care 0.6% | ||||
Quotient Ltd.(c),(g),(h) | ||||
04/15/2024 | 12.000% | 2,170,000 | 2,170,000 | |
04/15/2024 | 12.000% | 930,000 | 930,000 | |
Surgery Center Holdings, Inc.(c) | ||||
07/01/2025 | 6.750% | 6,100,000 | 5,528,626 | |
Total | 8,628,626 | |||
Independent Energy 0.9% | ||||
Indigo Natural Resources LLC(c) | ||||
02/15/2026 | 6.875% | 9,500,000 | 8,823,117 | |
Talos Production LLC/Finance, Inc. | ||||
04/03/2022 | 11.000% | 6,136,178 | 5,706,645 | |
Total | 14,529,762 | |||
Leisure 0.5% | ||||
NCL Corp., Ltd.(c) | ||||
05/15/2024 | 12.250% | 3,700,000 | 3,866,497 | |
Royal Caribbean Cruises Ltd.(c) | ||||
06/15/2023 | 9.125% | 4,272,000 | 4,227,188 | |
Total | 8,093,685 | |||
Media and Entertainment 0.7% | ||||
Lions Gate Capital Holdings LLC(c) | ||||
11/01/2024 | 5.875% | 7,450,000 | 7,151,704 | |
Meredith Corp. | ||||
02/01/2026 | 6.875% | 3,700,000 | 3,092,314 | |
Total | 10,244,018 |
Tri-Continental Corporation | Semiannual Report 2020 | 9 |
June 30, 2020 (Unaudited)
Corporate Bonds & Notes (continued) | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Metals and Mining 0.8% | ||||
CONSOL Energy, Inc.(c) | ||||
11/15/2025 | 11.000% | 4,200,000 | 1,795,952 | |
Constellium NV(c) | ||||
03/01/2025 | 6.625% | 7,300,000 | 7,408,978 | |
Warrior Met Coal, Inc.(c) | ||||
11/01/2024 | 8.000% | 3,832,000 | 3,805,160 | |
Total | 13,010,090 | |||
Midstream 0.3% | ||||
Rockpoint Gas Storage Canada Ltd.(c) | ||||
03/31/2023 | 7.000% | 4,216,000 | 3,875,349 | |
Summit Midstream Partners LP(d) | ||||
Junior Subordinated | ||||
12/31/2049 | 0.000% | 8,400,000 | 1,091,604 | |
Total | 4,966,953 | |||
Oil Field Services 0.2% | ||||
Nabors Industries Ltd.(c) | ||||
01/15/2026 | 7.250% | 3,447,000 | 2,152,139 | |
01/15/2028 | 7.500% | 854,000 | 527,422 | |
Total | 2,679,561 | |||
Other Industry 0.2% | ||||
WeWork Companies, Inc.(c) | ||||
05/01/2025 | 7.875% | 7,700,000 | 3,730,944 | |
Packaging 1.5% | ||||
ARD Finance SA(c),(i) | ||||
06/30/2027 | 6.500% | 8,000,000 | 7,920,861 | |
BWAY Holding Co.(c) | ||||
04/15/2025 | 7.250% | 8,499,999 | 7,696,142 | |
Novolex(c) | ||||
01/15/2025 | 6.875% | 7,290,000 | 7,009,614 | |
Total | 22,626,617 | |||
Pharmaceuticals 0.4% | ||||
Bausch Health Companies, Inc.(c) | ||||
01/31/2027 | 8.500% | 2,800,000 | 2,985,674 | |
01/30/2028 | 5.000% | 1,228,000 | 1,157,129 | |
01/30/2030 | 5.250% | 2,728,000 | 2,585,105 | |
Total | 6,727,908 | |||
Restaurants 0.3% | ||||
IRB Holding Corp.(c) | ||||
02/15/2026 | 6.750% | 4,300,000 | 4,109,202 |
Corporate Bonds & Notes (continued) | ||||
Issuer | Coupon Rate | Principal Amount ($) | Value ($) | |
Supermarkets 0.5% | ||||
Safeway, Inc. | ||||
02/01/2031 | 7.250% | 7,512,000 | 7,997,417 | |
Technology 0.8% | ||||
Diebold, Inc. | ||||
04/15/2024 | 8.500% | 8,100,000 | 6,558,267 | |
Genesys Telecommunications Laboratories, Inc./Greeneden Lux 3 Sarl/U.S. Holdings I LLC(c) | ||||
11/30/2024 | 10.000% | 3,750,000 | 3,890,673 | |
Sabre GLBL, Inc.(c) | ||||
04/15/2025 | 9.250% | 1,800,000 | 1,895,164 | |
Total | 12,344,104 | |||
Transportation Services 0.2% | ||||
Hertz Corp. (The)(c),(d) | ||||
10/15/2024 | 0.000% | 3,500,000 | 1,089,158 | |
08/01/2026 | 0.000% | 4,500,000 | 1,404,594 | |
Total | 2,493,752 | |||
Wirelines 0.3% | ||||
Front Range BidCo, Inc.(c) | ||||
03/01/2028 | 6.125% | 4,000,000 | 3,888,192 | |
Total Corporate Bonds & Notes (Cost $251,310,952) | 226,936,568 |
Limited Partnerships 0.5% | ||
Issuer | Shares | Value ($) |
Energy 0.5% | ||
Oil, Gas & Consumable Fuels 0.5% | ||
Enviva Partners LP | 110,000 | 3,964,400 |
Rattler Midstream LP | 375,000 | 3,637,500 |
Total | 7,601,900 | |
Total Energy | 7,601,900 | |
Total Limited Partnerships (Cost $8,786,587) | 7,601,900 |
Preferred Debt 0.5% | ||||
Issuer | Coupon Rate | Shares | Value ($) | |
Banking 0.2% | ||||
Citigroup Capital XIII(e) | ||||
10/30/2040 | 7.130% | 135,000 | 3,577,500 |
10 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Preferred Debt (continued) | ||||
Issuer | Coupon Rate | Shares | Value ($) | |
Finance Companies 0.3% | ||||
GMAC Capital Trust I(e) | ||||
02/15/2040 | 6.177% | 162,500 | 3,643,250 | |
Total Preferred Debt (Cost $7,655,767) | 7,220,750 |
Senior Loans 0.4% | ||||
Borrower | Coupon Rate | Principal Amount ($) | Value ($) | |
Oil Field Services 0.4% | ||||
BCP Raptor LLC/EagleClaw Midstream Ventures(j),(k) | ||||
Term Loan | ||||
3-month USD LIBOR + 4.250% Floor 1.000% 06/24/2024 | 5.250% | 7,763,880 | 5,551,174 | |
Total Senior Loans (Cost $7,702,291) | 5,551,174 |
Warrants —% | ||
Issuer | Shares | Value ($) |
Energy —% | ||
Oil, Gas & Consumable Fuels —% | ||
Goodrich Petroleum Corp.(a),(g),(h) | 16,334 | 0 |
Total Energy | 0 | |
Total Warrants (Cost $—) | 0 | |
Money Market Funds 1.1% | ||
Shares | Value ($) | |
Columbia Short-Term Cash Fund, 0.253%(l),(m) | 7,656,868 | 7,656,868 |
JPMorgan U.S. Government Money Market Fund, Agency Shares, 0.023%(l) | 9,814,616 | 9,814,616 |
Total Money Market Funds (Cost $17,471,405) | 17,471,484 | |
Total Investments in Securities (Cost: $1,471,016,491) | 1,538,168,256 | |
Other Assets & Liabilities, Net | 8,456,064 | |
Net Assets | 1,546,624,320 |
Long futures contracts | ||||||
Description | Number of contracts | Expiration date | Trading currency | Notional amount | Value/Unrealized appreciation ($) | Value/Unrealized depreciation ($) |
S&P 500 Index E-mini | 63 | 09/2020 | USD | 9,734,130 | 286,179 | — |
(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 Securities and Exchange Commission registration (collectively, private placements), such as Section 4(a)(2) and Rule 144A eligible securities, which are often sold only to qualified institutional buyers. At June 30, 2020, the total value of these securities amounted to $225,846,249, which represents 14.60% of total net assets. |
(d) | Represents securities that have defaulted on payment of interest. The Fund has stopped accruing interest on these securities. At June 30, 2020, the total value of these securities amounted to $3,900,356, which represents 0.25% of total net assets. |
(e) | 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, 2020. |
Tri-Continental Corporation | Semiannual Report 2020 | 11 |
June 30, 2020 (Unaudited)
(f) | Represents a security purchased on a when-issued basis. |
(g) | Represents fair value as determined in good faith under procedures approved by the Board of Directors. At June 30, 2020, the total value of these securities amounted to $3,100,000, which represents 0.20% of total net assets. |
(h) | Valuation based on significant unobservable inputs. |
(i) | Payment-in-kind security. Interest can be paid by issuing additional par of the security or in cash. |
(j) | The stated interest rate represents the weighted average interest rate at June 30, 2020 of contracts within the senior loan facility. Interest rates on contracts are primarily determined either weekly, monthly or quarterly by reference to the indicated base lending rate and spread and the reset period. These base lending rates are primarily the LIBOR and other short-term rates. Base lending rates may be subject to a floor or minimum rate. The interest rate for senior loans purchased on a when-issued or delayed delivery basis will be determined upon settlement, therefore no interest rate is disclosed. Senior loans often require prepayments from excess cash flows or permit the borrowers to repay at their election. The degree to which borrowers repay, cannot be predicted with accuracy. As a result, remaining maturities of senior loans may be less than the stated maturities. Generally, the Fund is contractually obligated to receive approval from the agent bank and/or borrower prior to the disposition of a senior loan. |
(k) | Variable rate security. The interest rate shown was the current rate as of June 30, 2020. |
(l) | The rate shown is the seven-day current annualized yield at June 30, 2020. |
(m) | As defined in the Investment Company Act of 1940, an affiliated company is one in which the Fund owns 5% or more of the company’s outstanding voting securities, or a company which is under common ownership or control with the Fund. The value of the holdings and transactions in these affiliated companies during the period ended June 30, 2020 are as follows: |
Affiliated issuers | Beginning of period($) | Purchases($) | Sales($) | Net change in unrealized appreciation (depreciation)($) | End of period($) | Realized gain (loss)($) | Dividends($) | End of period shares |
Columbia Short-Term Cash Fund, 0.253% | ||||||||
14,272,519 | 50,398,335 | (57,014,065) | 79 | 7,656,868 | 13 | 43,806 | 7,656,868 |
ADR | American Depositary Receipt |
LIBOR | London Interbank Offered Rate |
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). |
12 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Investments falling into the Level 3 category are primarily supported by quoted prices from brokers and dealers participating in the market for those investments. However, these may be classified as Level 3 investments due to lack of market transparency and corroboration to support these quoted prices. Additionally, valuation models may be used as the pricing source for any remaining investments classified as Level 3. These models may rely on one or more significant unobservable inputs and/or significant assumptions by the Investment Manager. Inputs used in valuations may include, but are not limited to, financial statement analysis, capital account balances, discount rates and estimated cash flows, and comparable company data.
Level 1 ($) | Level 2 ($) | Level 3 ($) | Total ($) | |
Investments in Securities | ||||
Common Stocks | ||||
Communication Services | 102,088,001 | — | — | 102,088,001 |
Consumer Discretionary | 108,140,519 | — | — | 108,140,519 |
Consumer Staples | 78,655,888 | — | — | 78,655,888 |
Energy | 38,416,419 | — | — | 38,416,419 |
Financials | 142,776,376 | — | — | 142,776,376 |
Health Care | 140,302,383 | 2,989,909 | — | 143,292,292 |
Industrials | 83,065,453 | — | — | 83,065,453 |
Information Technology | 264,255,105 | — | — | 264,255,105 |
Materials | 24,878,104 | — | — | 24,878,104 |
Real Estate | 37,085,481 | — | — | 37,085,481 |
Utilities | 37,666,372 | — | — | 37,666,372 |
Total Common Stocks | 1,057,330,101 | 2,989,909 | — | 1,060,320,010 |
Convertible Bonds | — | 116,243,407 | — | 116,243,407 |
Convertible Preferred Stocks | ||||
Communication Services | — | 4,743,233 | — | 4,743,233 |
Consumer Discretionary | — | 3,902,106 | — | 3,902,106 |
Consumer Staples | — | 3,847,874 | — | 3,847,874 |
Financials | — | 13,258,726 | — | 13,258,726 |
Health Care | — | 24,134,558 | — | 24,134,558 |
Industrials | — | 4,229,970 | — | 4,229,970 |
Real Estate | — | 11,300,467 | — | 11,300,467 |
Utilities | — | 31,406,029 | — | 31,406,029 |
Total Convertible Preferred Stocks | — | 96,822,963 | — | 96,822,963 |
Corporate Bonds & Notes | — | 223,836,568 | 3,100,000 | 226,936,568 |
Limited Partnerships | ||||
Energy | 7,601,900 | — | — | 7,601,900 |
Total Limited Partnerships | 7,601,900 | — | — | 7,601,900 |
Preferred Debt | 7,220,750 | — | — | 7,220,750 |
Senior Loans | — | 5,551,174 | — | 5,551,174 |
Warrants | ||||
Energy | — | — | 0* | 0* |
Total Warrants | — | — | 0* | 0* |
Money Market Funds | 17,471,484 | — | — | 17,471,484 |
Total Investments in Securities | 1,089,624,235 | 445,444,021 | 3,100,000 | 1,538,168,256 |
Investments in Derivatives |
Tri-Continental Corporation | Semiannual Report 2020 | 13 |
June 30, 2020 (Unaudited)
Level 1 ($) | Level 2 ($) | Level 3 ($) | Total ($) | |
Asset | ||||
Futures Contracts | 286,179 | — | — | 286,179 |
Total | 1,089,910,414 | 445,444,021 | 3,100,000 | 1,538,454,435 |
* | Rounds to zero. |
14 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Assets | |
Investments in securities, at value | |
Unaffiliated issuers (cost $1,463,359,702) | $1,530,511,388 |
Affiliated issuers (cost $7,656,789) | 7,656,868 |
Cash | 31,445 |
Receivable for: | |
Investments sold | 13,134,955 |
Dividends | 2,505,464 |
Interest | 5,543,361 |
Foreign tax reclaims | 40,630 |
Variation margin for futures contracts | 133,875 |
Other assets | 43,681 |
Total assets | 1,559,601,667 |
Liabilities | |
Payable for: | |
Investments purchased | 5,734,900 |
Investments purchased on a delayed delivery basis | 5,949,418 |
Common Stock payable | 544,438 |
Preferred Stock dividends | 470,463 |
Management services fees | 17,128 |
Stockholder servicing and transfer agent fees | 13,815 |
Compensation of board members | 217,411 |
Compensation of chief compliance officer | 184 |
Other expenses | 29,590 |
Total liabilities | 12,977,347 |
Net assets | $1,546,624,320 |
Preferred Stock | 37,637,000 |
Net assets for Common Stock | 1,508,987,320 |
Represented by | |
$2.50 Cumulative Preferred Stock, $50 par value, assets coverage per share $2,055 | |
Shares issued and outstanding — 752,740 | 37,637,000 |
Common Stock, $0.50 par value: | |
Shares issued and outstanding — 53,260,860 | 26,630,430 |
Capital surplus | 1,431,079,046 |
Total distributable earnings (loss) | 51,277,844 |
Net assets | $1,546,624,320 |
Net asset value per share of outstanding Common Stock | $28.33 |
Market price per share of Common Stock | $24.71 |
Tri-Continental Corporation | Semiannual Report 2020 | 15 |
Six Months Ended June 30, 2020 (Unaudited)
Net investment income | |
Income: | |
Dividends — unaffiliated issuers | $22,495,114 |
Dividends — affiliated issuers | 43,806 |
Interest | 10,840,686 |
Foreign taxes withheld | (16,161) |
Total income | 33,363,445 |
Expenses: | |
Management services fees | 3,147,500 |
Stockholder servicing and transfer agent fees | 200,186 |
Compensation of board members | 20,112 |
Custodian fees | 7,196 |
Printing and postage fees | 44,885 |
Stockholders’ meeting fees | 28,144 |
Audit fees | 24,952 |
Legal fees | 12,352 |
Compensation of chief compliance officer | 177 |
Other | 111,974 |
Total expenses | 3,597,478 |
Net investment income(a) | 29,765,967 |
Realized and unrealized gain (loss) — net | |
Net realized gain (loss) on: | |
Investments — unaffiliated issuers | (9,710,229) |
Investments — affiliated issuers | 13 |
Foreign currency translations | (318) |
Futures contracts | (1,395,901) |
Net realized loss | (11,106,435) |
Net change in unrealized appreciation (depreciation) on: | |
Investments — unaffiliated issuers | (124,058,364) |
Investments — affiliated issuers | 79 |
Foreign currency translations | (628) |
Futures contracts | 80,338 |
Net change in unrealized appreciation (depreciation) | (123,978,575) |
Net realized and unrealized loss | (135,085,010) |
Net decrease in net assets resulting from operations | $(105,319,043) |
(a) | Net investment income for Common Stock is $28,825,042, which is net of Preferred Stock dividends of $940,925. |
16 | Tri-Continental Corporation | Semiannual Report 2020 |
Six Months Ended June 30, 2020 (Unaudited) | Year Ended December 31, 2019 | |
Operations | ||
Net investment income | $29,765,967 | $54,453,061 |
Net realized gain (loss) | (11,106,435) | 55,259,826 |
Net change in unrealized appreciation (depreciation) | (123,978,575) | 231,584,558 |
Net increase (decrease) in net assets resulting from operations | (105,319,043) | 341,297,445 |
Distributions to stockholders | ||
Net investment income and net realized gains | ||
Preferred Stock | (940,925) | (1,881,850) |
Common Stock | (40,063,231) | (102,133,705) |
Total distributions to stockholders | (41,004,156) | (104,015,555) |
Decrease in net assets from capital stock activity | (9,090,096) | (4,092,488) |
Total increase (decrease) in net assets | (155,413,295) | 233,189,402 |
Net assets at beginning of period | 1,702,037,615 | 1,468,848,213 |
Net assets at end of period | $1,546,624,320 | $1,702,037,615 |
Six Months Ended | Year Ended | |||
June 30, 2020 | December 31, 2019 | |||
Shares | Dollars ($) | Shares | Dollars ($) | |
Capital stock activity | ||||
Common Stock issued at market price in distributions | 624,692 | 14,776,832 | 1,584,799 | 43,420,364 |
Common Stock issued to cash purchase plan participants | 27,752 | 676,877 | 62,596 | 1,702,919 |
Common Stock purchased from cash purchase plan participants | (321,104) | (7,887,064) | (698,672) | (18,805,476) |
Common Stock purchased in the open market | (713,901) | (16,656,741) | (1,158,674) | (30,410,295) |
Total net decrease | (382,561) | (9,090,096) | (209,951) | (4,092,488) |
Tri-Continental Corporation | Semiannual Report 2020 | 17 |
Six Months Ended June 30, 2020 (Unaudited) | Year ended December 31, | |||||
2019 | 2018 | 2017 | 2016 | 2015 | ||
Per share data | ||||||
Net asset value, beginning of period | $31.03 | $26.58 | $29.88 | $25.91 | $23.49 | $24.76 |
Income from investment operations: | ||||||
Net investment income | 0.56 | 1.03 | 0.99 | 0.93 | 0.90 | 0.81 |
Net realized and unrealized gain (loss) | (2.49) | 5.39 | (2.35) | 4.24 | 2.33 | (1.37) |
Total from investment operations | (1.93) | 6.42 | (1.36) | 5.17 | 3.23 | (0.56) |
Less distributions to Stockholders from: | ||||||
Net investment income — Preferred Stock | (0.02) | (0.04) | (0.03) | (0.03) | (0.03) | (0.03) |
Net investment income — Common Stock | (0.54) | (1.01) | (0.96) | (1.07) | (0.91) | (0.81) |
Net realized gains — Common Stock | (0.21) | (0.92) | (0.95) | (0.10) | — | — |
Total distributions to Stockholders | (0.77) | (1.97) | (1.94) | (1.20) | (0.94) | (0.84) |
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 | $28.33 | $31.03 | $26.58 | $29.88 | $25.91 | $23.49 |
Adjusted net asset value, end of period(a) | $28.23 | $30.92 | $26.48 | $29.77 | $25.83 | $23.42 |
Market price, end of period | $24.71 | $28.20 | $23.52 | $26.94 | $22.05 | $20.02 |
Total return | ||||||
Based upon net asset value | (5.72%) | 25.20% | (4.10%) | 20.82% | 15.25% | (1.36%) |
Based upon market price | (9.51%) | 28.59% | (5.88%) | 28.00% | 15.08% | (2.78%) |
Ratios to average net assets | ||||||
Expenses to average net assets for Common Stock(b) | 0.48%(c) | 0.49% | 0.49% | 0.49% | 0.50% | 0.50% |
Net investment income to average net assets for Common Stock | 3.85%(c) | 3.32% | 3.14% | 3.21% | 3.59% | 3.16% |
Supplemental data | ||||||
Net assets, end of period (000’s): | ||||||
Common Stock | $1,508,987 | $1,664,401 | $1,431,211 | $1,637,553 | $1,470,843 | $1,382,712 |
Preferred Stock | $37,637 | $37,637 | $37,637 | $37,637 | $37,637 | $37,637 |
Total net assets | $1,546,624 | $1,702,038 | $1,468,848 | $1,675,190 | $1,508,480 | $1,420,349 |
Portfolio turnover | 36% | 60% | 63% | 95% | 82% | 76% |
Notes to Financial Highlights | |
(a) | Assumes the exercise of outstanding warrants. |
(b) | In addition to the fees and expenses that the Fund bears directly, the Fund indirectly bears a pro rata share of the fees and expenses of any other funds in which it invests. Such indirect expenses are not included in the Fund’s reported expense ratios. |
(c) | Annualized. |
18 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Tri-Continental Corporation | Semiannual Report 2020 | 19 |
June 30, 2020 (Unaudited)
20 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Tri-Continental Corporation | Semiannual Report 2020 | 21 |
June 30, 2020 (Unaudited)
Asset derivatives | ||
Risk exposure category | Statement of assets and liabilities location | Fair value ($) |
Equity risk | Component of total distributable earnings (loss) — unrealized appreciation on futures contracts | 286,179* |
* | 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 ($) |
Equity risk | (1,395,901) |
Change in unrealized appreciation (depreciation) on derivatives recognized in income | |
Risk exposure category | Futures contracts ($) |
Equity risk | 80,338 |
Derivative instrument | Average notional amounts ($)* |
Futures contracts — long | 6,858,583 |
* | Based on the ending quarterly outstanding amounts for the six months ended June 30, 2020. |
22 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Tri-Continental Corporation | Semiannual Report 2020 | 23 |
June 30, 2020 (Unaudited)
24 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Federal tax cost ($) | Gross unrealized appreciation ($) | Gross unrealized (depreciation) ($) | Net unrealized appreciation ($) |
1,471,016,000 | 190,878,000 | (123,440,000) | 67,438,000 |
Tri-Continental Corporation | Semiannual Report 2020 | 25 |
June 30, 2020 (Unaudited)
26 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Tri-Continental Corporation | Semiannual Report 2020 | 27 |
June 30, 2020 (Unaudited)
28 | Tri-Continental Corporation | Semiannual Report 2020 |
June 30, 2020 (Unaudited)
Tri-Continental Corporation | Semiannual Report 2020 | 29 |
• | the Fund had sufficient liquidity to both meet redemptions and operate effectively on behalf of shareholders; |
• | there were no material changes to the Program during the period; |
• | the implementation of the Program was effective to manage the Fund’s liquidity risk; and |
• | the Program operated adequately during the period. |
30 | Tri-Continental Corporation | Semiannual Report 2020 |
Nature, extent and quality of services provided by Columbia Threadneedle
Tri-Continental Corporation | Semiannual Report 2020 | 31 |
The Board considered the reports of its independent fee consultant, JDL Consultants, LLC (JDL), which assisted in the Board’s analysis of the Funds’ performance and expenses, the reasonableness of the Funds’ fee rates, and JDL’s conclusion that the management fees being charged to the Fund are reasonable. The Board accorded particular weight to the notion that the primary objective of the level of fees is to achieve a rational pricing model applied consistently across the various product lines in the Fund family, while assuring that the overall fees for each Fund (with certain defined exceptions) are generally in line with the "pricing philosophy" currently in effect (i.e., that Fund total expense ratios, in general, approximate or are lower than the median expense ratios of funds in the same Lipper comparison universe). The Board took into account that the Fund’s total expense ratio (after considering proposed expense caps/waivers) was below the peer universe’s median expense ratio shown in the reports. Based on its review, the Board concluded that the Fund’s management fee was fair and reasonable in light of the extent and quality of services that the Fund receives.
Director | For | Against |
Brian J. Gallagher | 33,947,405 | 2,459,952 |
Patricia M. Flynn | 34,018,539 | 2,388,818 |
Catherine James Paglia | 33,981,826 | 2,425,531 |
32 | Tri-Continental Corporation | Semiannual Report 2020 |
Proposal 2
For | Against | Abstain |
32,777,961 | 3,165,544 | 405,597 |
Tri-Continental Corporation | Semiannual Report 2020 | 33 |
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.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
|
|
|
| Total Number of Shares | Maximum Number of |
| Total Number |
| Average | Purchased as Part of | Shares that May Yet Be |
| of Shares | Price Paid | Publicly Announced | Purchased Under the | |
Period | Purchased | Per Share | Plans or Programs(1) | Plans or Programs(1) | |
01-01-20 to 01-31-20 | 83,854 | $ | 28.44 | 83,854 | 2,599,437 |
02-01-20 to 02-29-20 | 78,318 | 28.31 | 78,318 | 2,521,119 |
03-01-20 to 03-31-20 | 234,615 | 21.78 | 234,615 | 2,286,504 |
04-01-20 to 04-30-20 | 239,831 | 22.08 | 239,831 | 2,046,673 |
05-01-20 to 05-31-20 | 219,745 | 23.48 | 219,745 | 1,826,928 |
06-01-20 to 06-30-20 | 189,995 | 24.95 | 189,995 | 1,636,933 |
(1)The registrant has a stock repurchase program. For 2020, 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 acitivty 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 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 period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies
Not applicable.
Item 13. Exhibits.
(a)(1) Code of ethics required to be disclosed under Item 2 of Form N-CSR: Not applicable for semiannual reports.
(a)(3) Not applicable.
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 21, 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/ Christopher O. Petersen | ||
|
| Christopher O. Petersen, President and Principal Executive Officer | |
Date |
| August 21, 2020 |
|
By (Signature and Title) | /s/ Michael G. Clarke | ||
|
| Michael G. Clarke, Chief Financial Officer, Principal Financial Officer | |
|
| and Senior Vice President | |
Date |
| August 21, 2020 |
|
By (Signature and Title) | /s/ Joseph Beranek | ||
|
| Joseph Beranek, Treasurer, Chief Accounting Officer and Principal | |
|
| Financial Officer | |
Date |
| August 21, 2020 |
|