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 811-21423
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The Gabelli Dividend & Income Trust
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(Exact name of registrant as specified in charter)
One Corporate Center
Rye, New York 10580-1422
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(Address of principal executive offices) (Zip code)
Bruce N. Alpert
Gabelli Funds, LLC
One Corporate Center
Rye, New York 10580-1422
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(Name and address of agent for service)
registrant's telephone number, including area code: 1-800-422-3554
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Date of fiscal year end: December 31
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Date of reporting period: June 30, 2007
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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. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
The Report to Shareholders is attached herewith.
[LOGO OMITTED]
THE GABELLI
DIVIDEND &
INCOME TRUST
THE GABELLI DIVIDEND & INCOME TRUST
Semi-Annual Report
June 30, 2007
TO OUR SHAREHOLDERS,
The Gabelli Dividend & Income Trust's (the "Fund") net asset value ("NAV")
total return was 8.50% during the first half of 2007, compared with gains of
6.96% and 8.79% for the Standard & Poor's ("S&P") 500 Index and the Dow Jones
Industrial Average, respectively. The Fund's NAV total return outperformed the
benchmark S&P 500 Index for this period, as well as for each of the longer-term
intervals shown in the comparative results table. The total return for the
Fund's publicly traded shares was 6.99% during the first half of the year. On
June 30, 2007, the Fund's NAV was $25.01, while the price of the publicly traded
shares closed at $22.34 on the New York Stock Exchange.
Enclosed are the financial statements and the investment portfolio as of
June 30, 2007.
COMPARATIVE RESULTS
--------------------------------------------------------------------------------------------------------
AVERAGE ANNUAL RETURNS THROUGH JUNE 30, 2007 (A)
------------------------------------------------
Since
Year to Inception
Date 1 Year 3 Year (11/28/03)
-------- ------ ------ ----------
GABELLI DIVIDEND & INCOME TRUST
NAV TOTAL RETURN (B) .......................... 8.50% 22.03% 16.68% 14.59%
INVESTMENT TOTAL RETURN (C) ................... 6.99 29.63 16.42 10.18
S&P 500 Index ................................... 6.96 20.57 11.67 12.29
Dow Jones Industrial Average .................... 8.79 22.98 11.26 11.70
Nasdaq Composite Index .......................... 7.78 19.85 8.33 8.23
(a) REPRESENT PAST PERFORMANCE AND DO NOT GUARANTEE FUTURE RESULTS. INVESTMENT
RETURNS AND THE PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE. WHEN
SHARES ARE SOLD, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE DATA
PRESENTED. VISIT WWW.GABELLI.COM FOR PERFORMANCE INFORMATION AS OF THE MOST
RECENT MONTH END. PERFORMANCE RETURNS FOR PERIODS LESS THAN ONE YEAR ARE
NOT ANNUALIZED. INVESTORS SHOULD CAREFULLY CONSIDER THE INVESTMENT
OBJECTIVES, RISKS, CHARGES, AND EXPENSES OF THE FUND BEFORE INVESTING. THE
DOW JONES INDUSTRIAL AVERAGE IS AN UNMANAGED INDEX OF 30 LARGE
CAPITALIZATION STOCKS. THE S&P 500 AND THE NASDAQ COMPOSITE INDICES ARE
UNMANAGED INDICATORS OF STOCK MARKET PERFORMANCE. DIVIDENDS ARE CONSIDERED
REINVESTED EXCEPT FOR THE NASDAQ COMPOSITE INDEX. YOU CANNOT INVEST
DIRECTLY IN AN INDEX.
(b) TOTAL RETURNS AND AVERAGE ANNUAL RETURNS REFLECT CHANGES IN NAV PER SHARE
AND REINVESTMENT OF DISTRIBUTIONS AT NAV ON THE EX-DIVIDEND DATE AND ARE
NET OF EXPENSES. SINCE INCEPTION RETURN IS BASED ON AN INITIAL NAV OF
$19.06.
(c) TOTAL RETURNS AND AVERAGE ANNUAL RETURNS REFLECT CHANGES IN CLOSING MARKET
VALUES ON THE NEW YORK STOCK EXCHANGE AND REINVESTMENT OF DISTRIBUTIONS.
SINCE INCEPTION RETURN IS BASED ON AN INITIAL OFFERING PRICE OF $20.00.
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We have separated the portfolio managers' commentary from the financial
statements and investment portfolio due to corporate governance regulations
stipulated by the Sarbanes-Oxley Act of 2002. We have done this to ensure that
the content of the portfolio managers' commentary is unrestricted. The financial
statements and investment portfolio are mailed separately from the commentary.
Both the commentary and the financial statements, including the portfolio of
investments, will be available on our website at www.gabelli.com/funds.
--------------------------------------------------------------------------------
THE GABELLI DIVIDEND & INCOME TRUST
SUMMARY OF PORTFOLIO HOLDINGS (UNAUDITED)
The following table presents portfolio holdings as a percent of total
investments as of June 30, 2007:
LONG POSITIONS
Financial Services ................................. 16.9%
Energy and Utilities: Oil .......................... 11.5%
Energy and Utilities: Integrated ................... 9.2%
Telecommunications ................................. 7.5%
Food and Beverage .................................. 7.2%
Energy and Utilities: Electric ..................... 4.5%
Repurchase Agreements .............................. 4.3%
Diversified Industrial ............................. 4.3%
Energy and Utilities: Natural Gas .................. 3.6%
Consumer Products .................................. 3.3%
Health Care ........................................ 3.3%
Energy and Utilities: Services ..................... 2.5%
Equipment and Supplies ............................. 1.9%
Cable and Satellite ................................ 1.9%
Broadcasting ....................................... 1.8%
Retail ............................................. 1.7%
Specialty Chemicals ................................ 1.3%
Building and Construction .......................... 1.3%
Hotels and Gaming .................................. 1.3%
Aerospace .......................................... 1.2%
Electronics ........................................ 1.1%
Automotive: Parts and Accessories .................. 0.8%
Entertainment ...................................... 0.8%
Business Services .................................. 0.7%
Environmental Services ............................. 0.7%
Transportation ..................................... 0.7%
Metals and Mining .................................. 0.6%
Publishing ......................................... 0.6%
Automotive ......................................... 0.5%
Communications Equipment ........................... 0.4%
Wireless Communications ............................ 0.4%
U.S. Treasury Bills ................................ 0.3%
Machinery .......................................... 0.3%
Energy and Utilities ............................... 0.3%
Paper and Forest Products .......................... 0.3%
Energy and Utilities: Water ........................ 0.3%
Aviation: Parts and Services ....................... 0.2%
Commercial Services ................................ 0.2%
Agriculture ........................................ 0.1%
Real Estate Investment Trusts ...................... 0.1%
Computer Software & Services ....................... 0.1%
Real Estate ........................................ 0.0%
Manufactured Housing and Recreational Vehicles ..... 0.0%
Restaurants ........................................ 0.0%
------
100.0%
======
SHORT POSITIONS
Financial Services ................................. (0.4)%
=======
THE FUND FILES A COMPLETE SCHEDULE OF PORTFOLIO HOLDINGS WITH THE SECURITIES AND
EXCHANGE COMMISSION (THE "SEC") FOR THE FIRST AND THIRD QUARTERS OF EACH FISCAL
YEAR ON FORM N-Q, THE LAST OF WHICH WAS FILED FOR THE QUARTER ENDED MARCH 31,
2007. SHAREHOLDERS MAY OBTAIN THIS INFORMATION AT WWW.GABELLI.COM OR BY CALLING
THE FUND AT 800-GABELLI (800-422-3554). THE FUND'S FORM N-Q IS AVAILABLE ON THE
SEC'S WEBSITE AT WWW.SEC.GOV AND MAY ALSO BE REVIEWED AND COPIED AT THE SEC'S
PUBLIC REFERENCE ROOM IN WASHINGTON, DC. INFORMATION ON THE OPERATION OF THE
PUBLIC REFERENCE ROOM MAY BE OBTAINED BY CALLING 1-800-SEC-0330.
PROXY VOTING
The Fund files Form N-PX with its complete proxy voting record for the 12
months ended June 30th, no later than August 31st of each year. A description of
the Fund's proxy voting policies, procedures, and how the Fund voted proxies
relating to portfolio securities is available without charge, upon request, by
(i) calling 800-GABELLI (800-422-3554); (ii) writing to The Gabelli Funds at One
Corporate Center, Rye, NY 10580-1422; or (iii) visiting the SEC's website at
www.sec.gov.
SHAREHOLDER MEETING - MAY 14, 2007 - FINAL RESULTS
The Annual Meeting of Shareholders was held on May 14, 2007 at the
Greenwich Library in Greenwich, Connecticut. At that meeting, common and
preferred shareholders, voting together as a single class, elected Mario J.
Gabelli, Mario d'Urso, and Michael J. Melarkey as Trustees of the Fund. A total
of 73,704,730 votes, 73,980,910 votes, and 73,603,111 votes were cast in favor
of each Trustee and a total of 1,209,512 votes, 933,332 votes, and 1,311,131
votes were withheld for each Trustee, respectively.
Anthony J. Colavita, James P. Conn, Frank J. Fahrenkopf, Jr., Salvatore M.
Salibello, Edward T. Tokar, Anthonie C. van Ekris, and Salvatore J. Zizza
continue to serve in their capacities as Trustees of the Fund.
We thank you for your participation and appreciate your continued support.
2
THE GABELLI DIVIDEND & INCOME TRUST
SCHEDULE OF INVESTMENTS
JUNE 30, 2007 (UNAUDITED)
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS -- 92.4%
AEROSPACE -- 1.2%
10,000 Goodrich Corp. ................ $ 281,823 $ 595,600
60,000 Kaman Corp. ................... 1,070,150 1,871,400
100,000 Rockwell Automation Inc. ...... 6,039,691 6,944,000
2,000,000 Rolls-Royce Group plc+ ........ 14,847,047 21,627,377
118,400,000 Rolls-Royce Group plc,
Cl. B ....................... 231,987 242,516
-------------- --------------
22,470,698 31,280,893
-------------- --------------
AGRICULTURE -- 0.1%
90,000 Archer-Daniels-
Midland Co. ................. 1,972,035 2,978,100
-------------- --------------
AUTOMOTIVE -- 0.5%
28,000 Copart Inc.+ .................. 826,882 856,520
300,000 General Motors Corp. .......... 9,482,613 11,340,000
10,000 Navistar International Corp.+ . 228,717 660,000
-------------- --------------
10,538,212 12,856,520
-------------- --------------
AUTOMOTIVE: PARTS AND ACCESSORIES -- 0.8%
100,000 Dana Corp.+ ................... 289,799 202,000
390,000 Genuine Parts Co. ............. 13,190,936 19,344,000
-------------- --------------
13,480,735 19,546,000
-------------- --------------
AVIATION: PARTS AND SERVICES -- 0.2%
50,200 Sequa Corp., Cl. A+ ........... 3,653,269 5,622,400
-------------- --------------
BROADCASTING -- 1.3%
850,000 Clear Channel
Communications Inc. ......... 31,194,415 32,147,000
-------------- --------------
BUILDING AND CONSTRUCTION -- 1.3%
10,000 Florida Rock Industries Inc. .. 669,746 675,000
15,000 Layne Christensen Co.+ ........ 449,560 614,250
1,844,704 Rinker Group Ltd .............. 28,877,740 29,464,700
47,000 Rinker Group Ltd., ADR ........ 3,716,432 3,741,200
-------------- --------------
33,713,478 34,495,150
-------------- --------------
BUSINESS SERVICES -- 0.7%
15,000 Alliance Data
Systems Corp.+ .............. 1,173,209 1,159,200
10,000 CDW Corp.+ .................... 852,015 849,700
500,000 First Data Corp. .............. 16,270,735 16,335,000
-------------- --------------
18,295,959 18,343,900
-------------- --------------
CABLE AND SATELLITE -- 1.9%
600,000 Cablevision Systems Corp.,
Cl. A+ ...................... 18,455,073 21,714,000
14,200 Cogeco Inc. ................... 276,997 530,676
230,000 EchoStar Communications
Corp., Cl. A+ ............... 6,826,542 9,975,100
81,734 Liberty Global Inc., Cl. A+ ... 1,686,985 3,354,363
MARKET
SHARES COST VALUE
------ ---- -------
34,318 Liberty Global Inc., Cl. C+ ... $ 760,276 $ 1,348,697
250,000 Rogers Communications
Inc., Cl. B ................. 3,160,032 10,622,500
30,000 The DIRECTV Group Inc.+ ....... 469,613 693,300
-------------- --------------
31,635,518 48,238,636
-------------- --------------
COMMERCIAL SERVICES -- 0.2%
140,000 PHH Corp.+ .................... 4,320,252 4,369,400
-------------- --------------
COMMUNICATIONS EQUIPMENT -- 0.0%
20,000 Thomas & Betts Corp.+ ......... 629,282 1,160,000
-------------- --------------
COMPUTER SOFTWARE AND SERVICES -- 0.1%
50,000 Covansys Corp.+ ............... 1,684,031 1,696,500
-------------- --------------
CONSUMER PRODUCTS -- 3.3%
275,000 Alberto-Culver Co. ............ 9,198,976 6,523,000
400,000 Altadis SA .................... 26,685,352 26,635,988
10,000 Altria Group Inc. ............. 373,512 701,400
120,000 Avon Products Inc. ............ 3,524,773 4,410,000
40,000 Eastman Kodak Co. ............. 912,574 1,113,200
44,000 Fortune Brands Inc. ........... 3,616,470 3,624,280
55,000 Hanesbrands Inc.+ ............. 1,344,318 1,486,650
84,000 Harman International
Industries Inc. ............. 10,139,911 9,811,200
3,000 Herbalife Ltd. ................ 113,380 118,950
1,000 Kimberly-Clark Corp. .......... 53,184 66,890
60,000 Mattel Inc. ................... 1,009,842 1,517,400
2,000 Oakley Inc. ................... 56,883 56,800
175,000 Procter & Gamble Co. .......... 9,719,121 10,708,250
1,000,000 Swedish Match AB .............. 12,209,126 19,373,611
-------------- --------------
78,957,422 86,147,619
-------------- --------------
DIVERSIFIED INDUSTRIAL -- 3.9%
153,000 Bouygues SA ................... 5,319,385 12,878,216
230,000 Cooper Industries Ltd.,
Cl. A ....................... 7,420,937 13,130,700
500,000 General Electric Co. .......... 16,320,036 19,140,000
275,000 Honeywell International Inc. .. 9,524,517 15,477,000
100,000 ITT Corp. ..................... 4,506,935 6,828,000
2,000 Pentair Inc. .................. 63,318 77,140
1,000 Textron Inc. .................. 51,500 110,110
1,051,000 Tomkins plc ................... 5,080,148 5,487,370
760,000 Tyco International Ltd. ....... 24,704,447 25,680,400
129,900 WHX Corp.+ .................... 1,279,961 1,104,150
-------------- --------------
74,271,184 99,913,086
-------------- --------------
ELECTRONICS -- 1.1%
5,000 Color Kinetics Inc.+ .......... 166,962 167,050
1,075,000 Intel Corp. ................... 22,362,894 25,542,000
280,000 Trans-Lux Corp.+ .............. 2,037,979 1,738,800
-------------- --------------
24,567,835 27,447,850
-------------- --------------
See accompanying notes to financial statements.
3
THE GABELLI DIVIDEND & INCOME TRUST
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 2007 (UNAUDITED)
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
ENERGY AND UTILITIES: ELECTRIC -- 4.5%
30,000 Allegheny Energy Inc.+ ........ $ 438,040 $ 1,552,200
105,000 ALLETE Inc. ................... 3,452,097 4,940,250
280,000 American Electric
Power Co. Inc. .............. 8,755,206 12,611,200
425,000 DPL Inc. ...................... 8,553,078 12,044,500
17,500 DTE Energy Co. ................ 667,957 843,850
273,000 Electric Power
Development Co. Ltd. ........ 6,654,195 10,864,568
220,000 FPL Group Inc. ................ 7,596,481 12,482,800
590,000 Great Plains Energy Inc. ...... 18,068,826 17,180,800
370,000 Integrys Energy Group Inc. .... 17,973,626 18,770,100
150,000 Pepco Holdings Inc. ........... 2,892,851 4,230,000
240,000 Pinnacle West Capital Corp. ... 9,369,027 9,564,000
110,000 The Southern Co. .............. 3,184,128 3,771,900
255,000 Unisource Energy Corp. ........ 6,714,681 8,386,950
-------------- --------------
94,320,193 117,243,118
-------------- --------------
ENERGY AND UTILITIES: INTEGRATED -- 9.2%
12,000 Alliant Energy Corp. .......... 305,115 466,200
150,000 Ameren Corp. .................. 6,831,599 7,351,500
2,000,000 Aquila Inc.+ .................. 8,464,295 8,180,000
50,000 Avista Corp. .................. 926,534 1,077,500
15,000 Black Hills Corp. ............. 492,427 596,250
33,000 CH Energy Group Inc. .......... 1,524,587 1,484,010
108,000 Chubu Electric
Power Co. Inc. .............. 2,458,019 2,868,305
275,000 CONSOL Energy Inc. ............ 9,393,433 12,680,250
200,000 Consolidated Edison Inc. ...... 8,201,972 9,024,000
20,000 Dominion Resources Inc. ....... 1,455,866 1,726,200
205,000 Duke Energy Corp. ............. 2,873,955 3,751,500
430,000 Edison SpA .................... 1,002,090 1,388,035
300,000 El Paso Corp. ................. 3,557,045 5,169,000
20,000 Endesa SA ..................... 1,093,963 1,088,448
300,000 Enel SpA ...................... 2,324,318 3,238,140
47,000 Enel SpA, ADR ................. 1,839,336 2,523,900
144,000 Energy East Corp. ............. 3,285,119 3,756,960
168,000 FirstEnergy Corp. ............. 5,939,877 10,874,640
150,000 Hawaiian Electric
Industries Inc. ............. 3,585,226 3,553,500
250,000 Hera SpA ...................... 552,073 1,048,081
121,500 Hokkaido Electric
Power Co. Inc. .............. 2,282,208 2,639,695
121,500 Hokuriku Electric
Power Co. ................... 2,131,359 2,353,523
114,958 Iberdrola SA, ADR ............. 5,733,530 6,447,799
80,500 Korea Electric
Power Corp., ADR ............ 1,181,180 1,762,950
121,500 Kyushu Electric
Power Co. Inc. .............. 2,374,466 3,187,371
MARKET
SHARES COST VALUE
------ ---- -------
21,000 Maine & Maritimes Corp.+ ...... $ 594,461 $ 563,850
75,300 MGE Energy Inc. ............... 2,445,126 2,460,051
35,102 National Grid plc, ADR ........ 1,588,562 2,589,826
255,000 NiSource Inc. ................. 5,329,541 5,281,050
600,000 NSTAR ......................... 14,329,143 19,470,000
481,000 OGE Energy Corp. .............. 11,581,024 17,628,650
34,000 Ormat Technologies Inc. ....... 510,000 1,281,120
330,000 Progress Energy Inc. .......... 14,816,426 15,044,700
160,000 Public Service Enterprise
Group Inc. .................. 9,827,650 14,044,800
121,500 Shikoku Electric
Power Co. Inc. .............. 2,264,565 2,866,660
15,000 TECO Energy Inc. .............. 255,758 257,700
121,500 The Chugoku Electric
Power Co. Inc. .............. 2,194,052 2,407,797
35,000 The Empire District
Electric Co. ................ 777,222 782,950
121,500 The Kansai Electric
Power Co. Inc. .............. 2,333,021 2,876,528
108,000 The Tokyo Electric
Power Co. Inc. .............. 2,545,172 3,473,543
121,500 Tohoku Electric
Power Co. Inc. .............. 2,112,763 2,728,508
320,000 TXU Corp. ..................... 21,322,941 21,536,000
205,000 Vectren Corp. ................. 5,572,873 5,520,650
470,000 Westar Energy Inc. ............ 9,309,271 11,411,600
85,000 Wisconsin Energy Corp. ........ 2,690,561 3,759,550
230,000 Xcel Energy Inc. .............. 3,927,605 4,708,100
-------------- --------------
196,137,329 238,931,390
-------------- --------------
ENERGY AND UTILITIES: NATURAL GAS -- 3.6%
8,000 AGL Resources Inc. ............ 217,299 323,840
70,000 Atmos Energy Corp. ............ 1,744,791 2,104,200
20,000 Delta Natural Gas Co. Inc. .... 504,315 517,000
6,000 Energen Corp. ................. 124,550 329,640
500,000 KeySpan Corp. ................. 18,605,417 20,990,000
20,000 Kinder Morgan Energy
Partners LP ................. 824,553 1,103,800
350,000 National Fuel Gas Co. ......... 9,372,113 15,158,500
210,000 Nicor Inc. .................... 7,147,795 9,013,200
220,000 ONEOK Inc. .................... 5,480,182 11,090,200
300,000 SEMCO Energy Inc.+ ............ 1,686,087 2,331,000
200,000 Sempra Energy ................. 5,955,980 11,846,000
30,000 South Jersey Industries Inc. .. 657,687 1,061,400
70,000 Southern Union Co. ............ 1,656,784 2,281,300
150,000 Southwest Gas Corp. ........... 3,610,578 5,071,500
340,000 Spectra Energy Corp. .......... 6,763,930 8,826,400
60,000 The Laclede Group Inc. ........ 1,690,312 1,912,800
-------------- --------------
66,042,373 93,960,780
-------------- --------------
See accompanying notes to financial statements.
4
THE GABELLI DIVIDEND & INCOME TRUST
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 2007 (UNAUDITED)
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
ENERGY AND UTILITIES: OIL -- 11.5%
20,000 Anadarko Petroleum Corp. ...... $ 650,810 $ 1,039,800
40,000 Apache Corp. .................. 1,905,219 3,263,600
46,900 BG Group plc, ADR ............. 1,893,244 3,835,951
160,000 BP plc, ADR ................... 7,479,063 11,542,400
40,000 Cameron
International Corp.+ ........ 1,103,787 2,858,800
140,000 Chesapeake Energy Corp. ....... 2,429,835 4,844,000
319,000 Chevron Corp. ................. 18,574,583 26,872,560
1,000 Cimarex Energy Co. ............ 28,300 39,410
417,000 ConocoPhillips ................ 21,122,661 32,734,500
78,000 Devon Energy Corp. ............ 3,448,499 6,106,620
185,000 Eni SpA, ADR .................. 6,769,273 13,384,750
225,000 Exxon Mobil Corp. ............. 10,427,149 18,873,000
65,000 Hanover Compressor Co.+ ....... 1,177,222 1,550,253
30,000 Hess Corp. .................... 830,468 1,768,800
580,000 Marathon Oil Corp. ............ 18,953,248 34,776,800
145,000 Murphy Oil Corp. .............. 7,348,500 8,618,800
4,000 Nabors Industries Ltd.+ ....... 97,350 133,520
1,000 Niko Resources Ltd. ........... 57,456 91,058
5,000 Noble Corp. ................... 254,820 487,600
370,000 Occidental Petroleum Corp. .... 13,217,802 21,415,600
14,000 Oceaneering
International Inc.+ ......... 390,875 736,960
30,000 PetroChina Co. Ltd., ADR ...... 2,256,659 4,460,400
280,000 Repsol YPF SA, ADR ............ 5,930,532 10,836,000
200,000 Royal Dutch Shell plc,
Cl. A, ADR .................. 9,567,840 16,240,000
900,000 Statoil ASA, ADR .............. 12,881,531 27,909,000
200,000 Sunoco Inc. ................... 10,648,405 15,936,000
200,000 Total SA, ADR ................. 8,718,885 16,196,000
90,000 Transocean Inc.+ .............. 5,288,878 9,538,200
-------------- --------------
173,452,894 296,090,382
-------------- --------------
ENERGY AND UTILITIES: SERVICES -- 2.5%
135,000 ABB Ltd., ADR ................. 1,474,605 3,051,000
20,000 Baker Hughes Inc. ............. 759,763 1,682,600
268,000 Diamond Offshore
Drilling Inc. ............... 15,280,436 27,218,080
640,000 Halliburton Co. ............... 17,703,558 22,080,000
120,000 Schlumberger Ltd. ............. 3,977,835 10,192,800
-------------- --------------
39,196,197 64,224,480
-------------- --------------
ENERGY AND UTILITIES: WATER -- 0.3%
11,000 American States Water Co. ..... 273,608 391,270
53,333 Aqua America Inc. ............. 873,085 1,199,459
6,000 Artesian Resources Corp.,
Cl. A ....................... 113,635 115,200
3,000 California Water
Service Group ............... 94,710 112,470
MARKET
SHARES COST VALUE
------ ---- -------
11,500 Connecticut Water
Service Inc. ................ $ 276,036 $ 280,255
1,000 Consolidated Water
Co. Ltd. .................... 26,770 29,310
6,000 Middlesex Water Co. ........... 111,082 115,260
21,466 Pennichuck Corp. .............. 417,620 542,017
82,000 SJW Corp. ..................... 1,384,964 2,730,600
16,800 Southwest Water Co. ........... 192,169 214,536
5,000 Suez SA ....................... 156,718 287,406
168,000 Suez SA, Strips+ .............. 0 2,274
36,000 United Utilities plc, ADR ..... 774,333 1,024,920
9,000 York Water Co. ................ 115,031 159,750
-------------- --------------
4,809,761 7,204,727
-------------- --------------
ENTERTAINMENT -- 0.6%
8,000 Grupo Televisa SA, ADR ........ 79,516 220,880
300,000 Time Warner Inc. .............. 5,098,815 6,312,000
200,000 Vivendi ....................... 6,289,470 8,637,748
-------------- --------------
11,467,801 15,170,628
-------------- --------------
ENVIRONMENTAL SERVICES -- 0.7%
100,000 Allied Waste
Industries Inc.+ ............ 1,033,110 1,346,000
1,000 Hyflux Ltd. ................... 1,686 1,914
12,375 Veolia Environnement .......... 395,937 971,945
409,000 Waste Management Inc. ......... 14,415,746 15,971,450
-------------- --------------
15,846,479 18,291,309
-------------- --------------
EQUIPMENT AND SUPPLIES -- 1.9%
110,000 CIRCOR International Inc. ..... 2,003,636 4,447,300
30,000 Lufkin Industries Inc. ........ 513,283 1,936,500
60,000 Mueller Industries Inc. ....... 2,463,788 2,066,400
420,000 RPC Inc. ...................... 1,866,263 7,156,800
225,000 Tenaris SA, ADR ............... 10,713,441 11,016,000
300,000 Weatherford
International Ltd.+ ......... 12,987,048 16,572,000
300,000 Xerox Corp.+ .................. 4,332,751 5,544,000
-------------- --------------
34,880,210 48,739,000
-------------- --------------
FINANCIAL SERVICES -- 16.6%
80,000 A.G. Edwards Inc. ............. 7,009,049 6,764,000
100,000 ABN AMRO Holding NV ........... 4,890,466 4,608,513
35,000 ABN AMRO Holding NV,
ADR ......................... 1,699,766 1,607,200
40,000 AFLAC Inc. .................... 2,098,398 2,056,000
180,000 AllianceBernstein
Holding LP .................. 10,531,935 15,676,200
380,000 American Express Co. .......... 16,989,679 23,248,400
300,000 American International
Group Inc. .................. 18,347,321 21,009,000
55,000 Ameriprise Financial Inc. ..... 2,162,745 3,496,350
See accompanying notes to financial statements.
5
THE GABELLI DIVIDEND & INCOME TRUST
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 2007 (UNAUDITED)
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
FINANCIAL SERVICES (CONTINUED)
42,000 Astoria Financial Corp. ....... $ 1,263,649 $ 1,051,680
370,000 Bank of America Corp. ......... 17,293,298 18,089,300
5,000 BlackRock Inc. ................ 387,461 782,950
90,000 Capital One Financial Corp. ... 6,889,337 7,059,600
30,000 CIGNA Corp. ................... 1,637,940 1,566,600
40,000 CIT Group Inc. ................ 2,209,847 2,193,200
800,000 Citigroup Inc. ................ 40,141,795 41,032,000
230,000 Commerce Bancorp Inc. ......... 7,705,490 8,507,700
60,000 Compass Bancshares Inc. ....... 4,171,094 4,138,800
30,000 Deutsche Bank AG .............. 2,456,595 4,342,200
9,500 Discover Financial
Services+ ................... 284,435 270,750
120,000 Fannie Mae .................... 6,492,036 7,839,600
48,909 Fidelity National
Financial Inc., Cl. A ....... 981,053 1,159,143
21,496 Fidelity National
Information Services Inc. ... 749,854 1,166,803
160,000 Fifth Third Bancorp ........... 7,054,543 6,363,200
100,000 First Horizon
National Corp. .............. 4,259,774 3,900,000
60,000 First Republic Bank ........... 3,230,408 3,219,600
52,100 Flushing Financial Corp. ...... 963,908 836,726
27,000 Hartford Financial
Services Group Inc. ......... 1,748,090 2,659,770
40,000 Hudson City Bancorp Inc. ...... 544,050 488,800
1,000 International Securities
Exchange Holdings Inc. ...... 65,732 65,350
470,000 JPMorgan Chase & Co. .......... 16,947,592 22,771,500
50,000 Legg Mason Inc. ............... 4,462,207 4,919,000
10,000 Lehman Brothers
Holdings Inc. ............... 648,864 745,200
100,000 Marshall & Ilsley Corp. ....... 4,831,076 4,763,000
122,000 Merrill Lynch & Co. Inc. ...... 8,318,909 10,196,760
266,000 Morgan Stanley ................ 18,585,864 22,312,080
64,000 National Australia
Bank Ltd., ADR .............. 7,456,729 11,136,429
190,000 New York Community
Bancorp Inc. ................ 3,648,851 3,233,800
80,000 NewAlliance
Bancshares Inc. ............. 1,234,701 1,177,600
210,000 Nuveen Investments Inc.,
Cl. A ....................... 13,254,460 13,051,500
200,000 PNC Financial Services
Group Inc. .................. 10,703,980 14,316,000
305,000 Popular Inc. .................. 6,541,535 4,901,350
220,000 Regions Financial Corp. ....... 7,211,658 7,282,000
100,000 SLM Corp. ..................... 5,426,047 5,758,000
560,220 Sovereign Bancorp Inc. ........ 12,929,655 11,843,051
44,050 Sterling Bancorp .............. 824,926 706,122
MARKET
SHARES COST VALUE
------ ---- -------
100,000 T. Rowe Price Group Inc. ...... $ 3,368,235 $ 5,189,000
60,000 The Allstate Corp. ............ 3,220,720 3,690,600
350,000 The Bank of
New York Co. Inc. ........... 11,338,881 14,504,000
4,000 The Progressive Corp. ......... 89,520 95,720
290,000 The Travelers
Companies Inc. .............. 10,913,064 15,515,000
5,000 Unitrin Inc. .................. 187,486 245,900
15,974 Valley National Bancorp ....... 378,551 359,255
250,000 Wachovia Corp. ................ 12,026,881 12,812,500
400,000 Waddell & Reed
Financial Inc., Cl. A ....... 8,823,625 10,404,000
10,000 Washington Mutual Inc. ........ 391,600 426,400
3,500 Webster Financial Corp. ....... 155,536 149,345
450,000 Wells Fargo & Co. ............. 13,331,455 15,826,500
85,200 Wilmington Trust Corp. ........ 3,043,530 3,536,652
167,000 Zions Bancorporation .......... 11,735,797 12,843,970
-------------- --------------
376,291,683 429,911,669
-------------- --------------
FOOD AND BEVERAGE -- 7.2%
170,000 Anheuser-Busch
Companies Inc. .............. 7,796,934 8,867,200
229,200 Cadbury Schweppes plc,
ADR ......................... 11,274,498 12,445,560
45,000 Campbell Soup Co. ............. 1,354,288 1,746,450
80,000 China Mengniu
Dairy Co. Ltd. .............. 271,367 275,731
185,000 ConAgra Foods Inc. ............ 4,599,660 4,969,100
900,000 Davide Campari-
Milano SpA .................. 9,199,133 9,446,437
7,000 Dean Foods Co. ................ 327,445 223,090
300,000 General Mills Inc. ............ 14,568,199 17,526,000
360,000 Groupe Danone ................. 19,389,974 29,244,366
100,000 H.J. Heinz Co. ................ 3,521,143 4,747,000
140,000 ITO EN Ltd. ................... 4,626,406 4,605,076
1,000 Kellogg Co. ................... 35,550 51,790
160,000 Kikkoman Corp. ................ 2,198,949 2,380,670
350,000 Kraft Foods Inc., Cl. A ....... 10,695,400 12,337,500
100,000 Morinaga Milk
Industry Co. Ltd. ........... 431,707 402,843
250,000 Nissin Food
Products Co. Ltd. ........... 8,733,847 8,385,787
500,000 Parmalat SpA .................. 1,885,518 2,124,924
339,450 Parmalat SpA, GDR (a) ......... 981,615 1,439,505
343,700 PepsiAmericas Inc. ............ 7,116,399 8,441,272
20,000 PepsiCo Inc. .................. 1,220,070 1,297,000
1,500 Pernod-Ricard SA .............. 305,601 332,848
2,500 Remy Cointreau SA ............. 173,912 187,623
1,100,000 Sara Lee Corp. ................ 18,633,132 19,140,000
290,000 The Coca-Cola Co. ............. 12,717,402 15,169,900
100,000 The Hershey Co. ............... 5,333,855 5,062,000
See accompanying notes to financial statements.
6
THE GABELLI DIVIDEND & INCOME TRUST
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 2007 (UNAUDITED)
MARKET
SHARES COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
FOOD AND BEVERAGE (CONTINUED)
62,000 Wm. Wrigley Jr. Co. ........... $ 2,976,799 $ 3,429,220
3,000 Wm. Wrigley Jr. Co.,
Cl. B ....................... 167,630 165,000
450,000 YAKULT
HONSHA Co. Ltd. ............. 12,437,775 11,403,046
-------------- --------------
162,974,208 185,846,938
-------------- --------------
HEALTH CARE -- 3.3%
4,000 Advanced Medical
Optics Inc.+ ................ 138,875 139,520
1,000 Bausch & Lomb Inc. ............ 66,686 69,440
100,000 Biomet Inc. ................... 4,549,060 4,572,000
115,000 Bristol-Myers Squibb Co. ...... 2,789,992 3,629,400
175,000 Eli Lilly & Co. ............... 9,922,089 9,779,000
10,000 Genesis HealthCare Corp.+ ..... 665,838 684,200
10,000 Health Management
Associates Inc., Cl. A ...... 208,993 113,600
90,000 IMS Health Inc. ............... 2,258,034 2,891,700
220,000 Merck & Co. Inc. .............. 8,376,601 10,956,000
140,000 Owens & Minor Inc. ............ 4,250,284 4,891,600
900,000 Pfizer Inc. ................... 25,071,358 23,013,000
200,000 Sierra Health Services Inc.+ .. 8,288,034 8,316,000
42,000 St. Jude Medical Inc.+ ........ 1,810,813 1,742,580
60,000 Triad Hospitals Inc.+ ......... 2,966,837 3,225,600
1,500 Ventana Medical
Systems Inc.+ ............... 114,633 115,905
130,000 Wyeth ......................... 6,096,113 7,454,200
45,000 Zimmer Holdings Inc.+ ......... 2,850,572 3,820,050
-------------- --------------
80,424,812 85,413,795
-------------- --------------
HOTELS AND GAMING -- 1.3%
22,000 Boyd Gaming Corp. ............. 1,097,278 1,082,180
90,000 Harrah's Entertainment Inc. ... 7,090,379 7,673,400
450,000 Hilton Hotels Corp. ........... 13,987,173 15,061,500
705,882 Ladbrokes plc ................. 9,246,474 6,137,735
45,000 Pinnacle
Entertainment Inc.+ ......... 1,423,938 1,266,750
30,000 Station Casinos Inc. .......... 2,622,475 2,604,000
-------------- --------------
35,467,717 33,825,565
-------------- --------------
MACHINERY -- 0.3%
150,000 CNH Global NV ................. 2,953,367 7,663,500
50,000 Intermec Inc.+ ................ 1,146,944 1,265,500
-------------- --------------
4,100,311 8,929,000
-------------- --------------
MANUFACTURED HOUSING AND RECREATIONAL VEHICLES -- 0.0%
4,000 Skyline Corp. ................. 141,027 120,040
-------------- --------------
MARKET
SHARES COST VALUE
------ ---- -------
METALS AND MINING -- 0.6%
25,000 Alcan Inc. .................... $ 2,018,987 $ 2,032,500
50,000 Alcoa Inc. .................... 1,527,886 2,026,500
10,000 Alliance Holdings GP LP ....... 230,523 297,600
20,000 Arch Coal Inc. ................ 314,774 696,000
8,000 BHP Billiton Ltd., ADR ........ 217,549 478,000
3,000 Fording Canadian
Coal Trust .................. 32,950 98,460
100,000 Freeport-McMoRan
Copper & Gold Inc. .......... 3,495,728 8,282,000
10,000 Massey Energy Co. ............. 235,475 266,500
25,000 Peabody Energy Corp. .......... 353,789 1,209,500
1,000 Rio Tinto plc, ADR ............ 127,360 306,120
3,000 Westmoreland Coal Co.+ ........ 52,605 82,050
-------------- --------------
8,607,626 15,775,230
-------------- --------------
PAPER AND FOREST PRODUCTS -- 0.3%
200,000 International Paper Co. ....... 6,863,452 7,810,000
-------------- --------------
PUBLISHING -- 0.6%
215,000 Dow Jones & Co. Inc. .......... 10,051,108 12,351,750
38,500 Idearc Inc. ................... 1,111,123 1,360,205
59,000 Tribune Co. ................... 1,861,450 1,734,600
-------------- --------------
13,023,681 15,446,555
-------------- --------------
REAL ESTATE -- 0.0%
18,000 Brookfield Asset
Management Inc., Cl. A ...... 186,196 718,200
-------------- --------------
REAL ESTATE INVESTMENT TRUSTS -- 0.1%
110,000 Equity Inns Inc. .............. 2,502,850 2,464,000
30,000 Winston Hotels Inc. ........... 433,995 450,000
-------------- --------------
2,936,845 2,914,000
-------------- --------------
RESTAURANTS -- 0.0%
1,000 Smith & Wollensky
Restaurant Group Inc.+ ...... 9,798 10,860
-------------- --------------
RETAIL -- 1.7%
170,000 CVS Caremark Corp. ............ 6,340,378 6,196,500
500,000 Dollar General Corp. .......... 10,721,440 10,960,000
142,000 Ingles Markets Inc., Cl. A .... 1,615,209 4,891,900
410,000 Safeway Inc. .................. 8,674,488 13,952,300
22,000 Saks Inc. ..................... 395,507 469,700
310,000 Sally Beauty
Holdings Inc.+ .............. 3,837,420 2,790,000
80,000 SUPERVALU Inc. ................ 2,385,810 3,705,600
-------------- --------------
33,970,252 42,966,000
-------------- --------------
SPECIALTY CHEMICALS -- 1.3%
5,000 Arkema, ADR+ .................. 269,656 327,441
140,000 Ashland Inc. .................. 8,906,221 8,953,000
See accompanying notes to financial statements.
7
THE GABELLI DIVIDEND & INCOME TRUST
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 2007 (UNAUDITED)
SHARES/ MARKET
UNITS COST VALUE
------ ---- -------
COMMON STOCKS (CONTINUED)
SPECIALTY CHEMICALS (CONTINUED)
140,000 E.I. du Pont de
Nemours & Co. ............... $ 5,905,751 $ 7,117,600
230,000 Ferro Corp. ................... 4,473,023 5,733,900
3,000 Huntsman Corp. ................ 72,780 72,930
100,000 Olin Corp. .................... 1,826,861 2,100,000
225,000 The Dow Chemical Co. .......... 9,192,760 9,949,500
18,146 Tronox Inc., Cl. B ............ 186,196 254,951
-------------- --------------
30,833,248 34,509,322
-------------- --------------
TELECOMMUNICATIONS -- 6.7%
230,000 Alltel Corp. .................. 15,670,905 15,536,500
400,000 AT&T Inc. ..................... 9,394,488 16,600,000
800,000 Avaya Inc.+ ................... 13,728,000 13,472,000
700,000 BCE Inc. ...................... 16,860,723 26,453,000
47,125 Bell Aliant Regional
Communications
Income Fund+ (a)(b) ......... 1,278,068 1,386,889
71,000 BT Group plc, ADR ............. 2,221,635 4,727,180
2,000 CenturyTel Inc. ............... 58,989 98,100
50,000 Compania de
Telecomunicaciones de
Chile SA, ADR ............... 607,686 475,500
300,000 Deutsche Telekom
AG, ADR ..................... 5,460,643 5,523,000
30,000 Embarq Corp. .................. 1,238,482 1,901,100
55,000 France Telecom SA, ADR ........ 1,338,443 1,511,400
210,000 Hellenic Telecommunications
Organization SA, ADR ........ 1,644,219 3,265,500
250,000 Portugal Telecom SGPS SA ...... 2,985,981 3,461,460
50,000 Portugal Telecom SGPS SA,
ADR ......................... 637,465 694,500
70,000 Qwest Communications
International Inc.+ ......... 205,742 679,000
840,000 Sprint Nextel Corp. ........... 16,438,020 17,396,400
15,000 Telecom Corp. of New
Zealand Ltd., ADR ........... 383,908 418,800
200,000 Telecom Italia SpA, ADR ....... 5,741,078 5,492,000
26,000 Telefonica SA, ADR ............ 1,107,367 1,735,760
207,000 Telefonos de Mexico SAB
de CV, Cl. L, ADR ........... 3,416,166 7,843,230
130,000 Telstra Corp. Ltd., ADR ....... 2,392,135 2,531,204
76,100 TELUS Corp., Non-Voting,
ADR ......................... 1,574,712 4,489,095
760,000 Verizon
Communications Inc. ......... 26,511,422 31,289,200
200,000 Vodafone Group plc, ADR ....... 5,412,380 6,726,000
-------------- --------------
136,308,657 173,706,818
-------------- --------------
MARKET
SHARES COST VALUE
------ ---- -------
TRANSPORTATION -- 0.6%
3,000 EGL Inc.+ ..................... $ 107,313 $ 139,440
10,000 Florida East Coast
Industries Inc. ............. 838,645 829,800
4,000 Frontline Ltd. ................ 137,211 183,400
255,000 GATX Corp. .................... 7,608,244 12,558,764
24,000 Golden Ocean Group Ltd. ....... 14,400 78,346
3,000 Ship Finance
International Ltd. .......... 66,356 89,040
30,000 Teekay Corp. .................. 1,007,822 1,737,300
-------------- --------------
9,779,991 15,616,090
-------------- --------------
WIRELESS COMMUNICATIONS -- 0.4%
7,000 Crown Castle
International Corp.+ ........ 113,182 253,890
110,000 United States
Cellular Corp.+ ............. 5,022,195 9,966,000
3,000 Vimpel-Communications,
ADR ......................... 91,155 316,080
-------------- --------------
5,226,532 10,535,970
-------------- --------------
TOTAL
COMMON STOCKS ................ 1,894,683,598 2,390,154,920
-------------- --------------
CONVERTIBLE PREFERRED STOCKS -- 1.6%
AEROSPACE -- 0.0%
8,200 Northrop Grumman Corp.,
7.000% Cv. Pfd., Ser. B ..... 983,758 1,184,080
-------------- --------------
AUTOMOTIVE -- 0.0%
15,000 General Motors Corp.,
4.500% Cv. Pfd., Ser. A ..... 389,485 328,650
-------------- --------------
BROADCASTING -- 0.0%
20,460 Emmis Communications Corp.,
6.250% Cv. Pfd., Ser. A ..... 960,081 863,003
-------------- --------------
BUILDING AND CONSTRUCTION -- 0.0%
200 Fleetwood Capital Trust,
6.000% Cv. Pfd. ............. 6,210 6,350
-------------- --------------
DIVERSIFIED INDUSTRIAL -- 0.4%
178,400 Owens-Illinois Inc.,
4.750% Cv. Pfd. ............. 5,926,959 7,537,400
80,000 Smurfit-Stone Container Corp.,
7.000% Cv. Pfd., Ser. A ..... 1,996,123 1,876,000
-------------- --------------
7,923,082 9,413,400
-------------- --------------
See accompanying notes to financial statements.
8
THE GABELLI DIVIDEND & INCOME TRUST
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 2007 (UNAUDITED)
MARKET
SHARES COST VALUE
------ ---- -------
CONVERTIBLE PREFERRED STOCKS (CONTINUED)
ENERGY AND UTILITIES -- 0.3%
5,000 Chesapeake Energy Corp.,
5.000% Cv. Pfd. (a) ......... $ 512,500 $ 728,750
20,000 CMS Energy Corp.,
4.500% Cv. Pfd.,
Ser. B ...................... 1,069,062 1,822,500
130,000 El Paso Energy Capital Trust I,
4.750% Cv. Pfd., Ser. C ..... 4,680,219 5,480,800
-------------- --------------
6,261,781 8,032,050
-------------- --------------
ENTERTAINMENT -- 0.1%
84,800 Six Flags Inc.,
7.250% Cv. Pfd., Ser. B ..... 2,007,467 2,030,960
-------------- --------------
FINANCIAL SERVICES -- 0.3%
1,500 Doral Financial Corp.,
4.750% Cv. Pfd. ............. 207,335 202,500
137,000 Newell Financial Trust I,
5.250% Cv. Pfd. ............. 6,428,812 6,747,250
-------------- --------------
6,636,147 6,949,750
-------------- --------------
HEALTH CARE -- 0.0%
12,000 Omnicare Inc.,
4.000% Cv. Pfd., Ser. B ..... 705,608 598,500
-------------- --------------
TELECOMMUNICATIONS -- 0.4%
50,000 Cincinnati Bell Inc.,
6.750% Cv. Pfd., Ser. B ..... 2,118,418 2,392,500
120,000 Crown Castle International Corp.,
6.250% Cv. Pfd. ............. 5,522,500 6,840,000
-------------- --------------
7,640,918 9,232,500
-------------- --------------
TRANSPORTATION -- 0.1%
1,500 GATX Corp.,
$2.50 Cv. Pfd. .............. 199,475 363,953
982 Kansas City Southern,
4.250% Cv. Pfd. ............. 551,884 1,262,940
-------------- --------------
751,359 1,626,893
-------------- --------------
TOTAL CONVERTIBLE
PREFERRED STOCKS ............. 34,265,896 40,266,136
-------------- --------------
PRINCIPAL
AMOUNT
-------
CONVERTIBLE CORPORATE BONDS -- 1.4%
AUTOMOTIVE: PARTS AND ACCESSORIES -- 0.0%
$ 500,000 Standard Motor Products Inc.,
Sub. Deb. Cv.,
6.750%, 07/15/09 ............ 488,292 478,750
-------------- --------------
PRINCIPAL MARKET
AMOUNT COST VALUE
------ ---- -------
BROADCASTING -- 0.5%
$ 100,000 Lin Television Corp.,
Sub. Deb. Cv.,
2.500%, 05/15/33 ............ $ 91,717 $ 97,500
13,000,000 Sinclair Broadcast Group Inc.,
Sub. Deb. Cv.,
6.000%, 09/15/12 ............ 11,012,714 12,545,000
-------------- --------------
11,104,431 12,642,500
-------------- --------------
COMMUNICATIONS EQUIPMENT -- 0.4%
10,000,000 Agere Systems Inc.,
Sub. Deb. Cv.,
6.500%, 12/15/09 ............ 10,047,088 10,212,500
-------------- --------------
ENTERTAINMENT -- 0.1%
1,500,000 The Walt Disney Co., Cv.,
2.125%, 04/15/23 ............ 1,508,081 1,803,750
-------------- --------------
FINANCIAL SERVICES -- 0.0%
250,000 AON Corp., Deb. Cv.,
3.500%, 11/15/12 ............ 257,088 497,812
-------------- --------------
REAL ESTATE -- 0.0%
Palm Harbor Homes Inc., Cv.,
100,000 3.250%, 05/15/24 ............ 84,877 86,875
1,000,000 3.250%, 05/15/24 (a) ........ 974,162 868,750
-------------- --------------
1,059,039 955,625
-------------- --------------
TELECOMMUNICATIONS -- 0.4%
10,000,000 Nortel Networks Corp., Cv.,
4.250%, 09/01/08 ............ 9,832,798 9,912,500
-------------- --------------
TOTAL CONVERTIBLE
CORPORATE BONDS .............. 34,296,817 36,503,437
-------------- --------------
SHARES
-------
WARRANTS -- 0.0%
FOOD AND BEVERAGE -- 0.0%
650 Parmalat SpA, GDR,
expire 12/31/15+ (a)(b)(c) .. 0 1,608
-------------- --------------
PRINCIPAL
AMOUNT
-------
SHORT-TERM OBLIGATIONS -- 4.6%
REPURCHASE AGREEMENTS -- 4.3%
$55,460,000 Barclays Capital Inc.,
4.250%, dated 06/29/07,
due 07/02/07, proceeds at
maturity, $55,479,642 (d) ... 55,460,000 55,460,000
See accompanying notes to financial statements.
3
THE GABELLI DIVIDEND & INCOME TRUST
SCHEDULE OF INVESTMENTS (CONTINUED)
JUNE 30, 2007 (UNAUDITED)
PRINCIPAL MARKET
AMOUNT COST VALUE
------ ---- -------
SHORT-TERM OBLIGATIONS (CONTINUED)
REPURCHASE AGREEMENTS (CONTINUED)
$55,459,000 Daiwa Securities America Inc.,
4.000%, dated 06/29/07,
due 07/02/07, proceeds at
maturity, $55,477,486 (e) ... $ 55,459,000 $ 55,459,000
-------------- --------------
110,919,000 110,919,000
-------------- --------------
U.S. TREASURY BILLS -- 0.3%
9,000,000 U.S. Treasury Bills,
4.372% to 4.563%++,
07/19/07 to 08/09/07 ........ 8,979,037 8,979,037
-------------- --------------
TOTAL SHORT-TERM
OBLIGATIONS .................. 119,898,037 119,898,037
-------------- --------------
TOTAL INVESTMENTS -- 100.0% ................ $2,083,144,348 2,586,824,138
==============
SECURITIES SOLD SHORT
(Proceeds received $9,824,509) ............................ (9,105,810)
OTHER ASSETS AND LIABILITIES (NET) .......................... 21,396,229
PREFERRED STOCK
(5,814,200 preferred shares outstanding) .................. (500,000,000)
--------------
NET ASSETS -- COMMON SHARES
(83,929,070 common shares outstanding) .................... $2,099,114,557
==============
NET ASSET VALUE PER COMMON SHARE
($2,099,114,557 / 83,929,070 shares outstanding) ......... $25.01
======
MARKET
SHARES PROCEEDS VALUE
------ -------- ------
SECURITIES SOLD SHORT -- (0.4)%
FINANCIAL SERVICES -- (0.4)%
131,000 Morgan Stanley - W/I .......... $ 9,824,509 $ 9,105,810
============== ==============
(a) Security exempt from registration under Rule 144A of the Securities Act of
1933, as amended. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers. At June 30,
2007, the Rule 144A securities are considered liquid and the market value
amounted to $4,425,502 or 0.17% of total investments.
(b) Security fair valued under procedures established by the Board of Trustees.
The procedures may include reviewing available financial information about
the company and reviewing valuation of comparable securities and other
factors on a regular basis. At June 30, 2007, the market value of fair
valued securities amounted to $1,388,497or 0.05% of total investments.
(c) At June 30, 2007, the Fund held investments in restricted and illiquid
securities amounting to $1,608 or 0.00% of total investments, which were
valued under methods approved by the Board, as follows:
06/30/07
ACQUISITION ACQUISITION ACQUISITION CARRYING VALUE
SHARES ISSUER DATE COST PER UNIT
------ ------ ----------- ----------- ------------
650 Parmalat SpA, GDR
warrants expire 12/31/15 .. 11/09/05 $0.00 $2.4738
(d) Collateralized by $43,190,000 U.S. Treasury Bond, 8.125%, due 08/15/21,
market value $56,569,200.
(e) Collateralized by $58,094,000 U.S. Treasury Notes, 3.125%, due 04/15/09,
market value $56,569,033.
W/I When Issued.
+ Non-income producing security.
++ Represents annualized yield at date of purchase.
ADR American Depository Receipt
GDR Global Depository Receipt
% OF
MARKET MARKET
VALUE VALUE
------ -------
GEOGRAPHIC DIVERSIFICATION
North America ........................ 78.8% $2,039,424,553
Europe ............................... 13.3 343,173,162
Latin America ........................ 3.3 85,049,607
Japan ................................ 2.4 63,443,919
Asia/Pacific ......................... 2.2 55,732,897
------ --------------
Total Investments .................... 100.0% $2,586,824,138
====== ==============
See accompanying notes to financial statements.
10
THE GABELLI DIVIDEND & INCOME TRUST
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2007 (UNAUDITED)
ASSETS:
Investments, at value (cost $1,972,225,348) ............. $ 2,475,905,138
Repurchase agreements, at value (cost $110,919,000) ..... 110,919,000
Foreign currency, at value (cost $207,363) .............. 202,440
Deposit at broker ....................................... 8,239,005
Cash .................................................... 9,825,389
Receivable for investments sold ......................... 3,513,920
Unrealized appreciation on swap contracts ............... 3,030,858
Dividends and interest receivable ....................... 4,666,581
Prepaid expense ......................................... 36,760
---------------
TOTAL ASSETS ............................................ 2,616,339,091
---------------
LIABILITIES:
Securities sold short (proceeds $9,824,509) ............. 9,105,810
Payable for investments purchased ....................... 2,981,661
Distributions payable ................................... 344,906
Payable for investment advisory fees .................... 4,288,888
Payable for payroll expenses ............................ 10,427
Payable for accounting fees ............................. 3,872
Other accrued expenses .................................. 488,970
---------------
TOTAL LIABILITIES ....................................... 17,224,534
---------------
PREFERRED STOCK:
Series A Cumulative Preferred Stock (5.875%,
$25 liquidation value, $0.001 par
value, 3,200,000 shares authorized
with 3,200,000 shares issued and
outstanding) .......................................... 80,000,000
Series B Cumulative Preferred Stock
(Auction Market, $25,000 liquidation
value, $0.001 par value, 4,000 shares
authorized with 4,000 shares issued
and outstanding) ...................................... 100,000,000
Series C Cumulative Preferred Stock
(Auction Market, $25,000 liquidation
value, $0.001 par value, 4,800 shares
authorized with 4,800 shares issued
and outstanding) ...................................... 120,000,000
Series D Cumulative Preferred Stock
(6.00%, $25 liquidation value, $0.001 par
value, 2,600,000 shares authorized with
2,600,000 shares issued and
outstanding) .......................................... 65,000,000
Series E Cumulative Preferred Stock (Auction
Rate, $25,000 liquidation value,
$0.001 par value, 5,400 shares authorized
with 5,400 shares issued and
outstanding) .......................................... 135,000,000
---------------
TOTAL PREFERRED STOCK ................................... 500,000,000
---------------
NET ASSETS ATTRIBUTABLE TO
COMMON SHAREHOLDERS ................................... $ 2,099,114,557
===============
NET ASSETS ATTRIBUTABLE TO COMMON
SHAREHOLDERS CONSIST OF:
Paid-in capital, at $0.001 par value .................... $ 1,543,032,693
Accumulated net investment income ....................... 16,446,114
Accumulated net realized gain on
investments, written options, swap
contracts, securities sold
short, and foreign currency transactions .............. 32,215,571
Net unrealized appreciation on investments .............. 503,679,790
Net unrealized appreciation on swap contracts .......... 3,030,858
Net unrealized appreciation on
securities sold short ................................. 718,699
Net unrealized depreciation on foreign
currency translations ................................. (9,168)
---------------
NET ASSETS .............................................. $ 2,099,114,557
===============
NET ASSET VALUE PER COMMON SHARE
($2,099,114,557 / 83,929,070 shares outstanding;
unlimited number of shares authorized) .................. $25.01
======
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2007 (UNAUDITED)
INVESTMENT INCOME:
Dividends (net of foreign taxes of $1,060,612) ............ $ 32,977,391
Interest .................................................. 7,104,168
-------------
TOTAL INVESTMENT INCOME ................................... 40,081,559
-------------
EXPENSES:
Investment advisory fees .................................. 12,693,284
Auction agent fees ........................................ 450,336
Shareholder communications expenses ....................... 277,993
Custodian fees ............................................ 160,049
Payroll expenses .......................................... 130,049
Trustees' fees ............................................ 85,434
Legal and audit fees ...................................... 48,330
Accounting fees ........................................... 22,621
Shareholder services fees ................................. 19,204
Interest expense .......................................... 6,648
Miscellaneous expenses .................................... 180,117
-------------
TOTAL EXPENSES ............................................ 14,074,065
Less: Custodian fee credits ............................... (87,634)
-------------
NET EXPENSES .............................................. 13,986,431
-------------
NET INVESTMENT INCOME ..................................... 26,095,128
-------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS, WRITTEN OPTIONS, SWAP CONTRACTS,
SECURITIES SOLD SHORT, AND FOREIGN CURRENCY:
Net realized gain on investments .......................... 75,048,313
Net realized gain on written options ...................... 384,353
Net realized gain on swap contracts ....................... 1,546,427
Net realized loss on foreign currency transactions ........ (24,482)
-------------
Net realized gain on investments, written options,
swap contracts, and foreign currency transactions ....... 76,954,611
-------------
Net change in unrealized appreciation/depreciation:
on investments .......................................... 75,599,301
on written options ...................................... 220,307
on swap contracts ....................................... (124,451)
on securities sold short ................................ 718,699
on foreign currency translations ........................ (7,949)
-------------
Net change in unrealized appreciation/
depreciation on investments, written
options, swap contracts, securities
sold short, and foreign currency
translations ............................................ 76,405,907
-------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS, WRITTEN OPTIONS, SWAP CONTRACTS,
SECURITIES SOLD SHORT, AND FOREIGN CURRENCY ............. 153,360,518
-------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ......................................... 179,455,646
-------------
Total Distributions to Preferred
Stock Shareholders ...................................... (13,372,396)
Recapture of gain on sale of Fund
shares by an affiliate .................................. 4,338
-------------
NET INCREASE IN NET ASSETS ATTRIBUTABLE TO
COMMON SHAREHOLDERS RESULTING
FROM OPERATIONS ......................................... $ 166,087,588
=============
See accompanying notes to financial statements.
11
THE GABELLI DIVIDEND & INCOME TRUST
STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO COMMON SHAREHOLDERS
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
--------------- -----------------
OPERATIONS:
Net investment income ............................................................. $ 26,095,128 $ 72,921,975
Net realized gain on investments, written options, swap contracts, and
foreign currency transactions ................................................... 76,954,611 93,722,202
Net change in unrealized appreciation/depreciation on investments, written options,
swap contracts, securities sold short, and foreign currency translations. ....... 76,405,907 243,496,939
--------------- ---------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS .............................. 179,455,646 410,141,116
--------------- ---------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS:
Net investment income ............................................................. (4,430,017)* (10,255,572)
Net realized short-term gain on investments, written options, swap contracts, and
foreign currency transactions ................................................... (1,819,399)* (4,091,893)
Net realized long-term gain on investments, written options, swap contracts,
futures contracts, securities sold short, and foreign currency transactions. .... (7,122,980)* (11,704,448)
--------------- ---------------
TOTAL DISTRIBUTIONS TO PREFERRED SHAREHOLDERS ..................................... (13,372,396) (26,051,913)
--------------- ---------------
NET INCREASE IN NET ASSETS ATTRIBUTABLE TO COMMON SHAREHOLDERS
RESULTING FROM OPERATIONS ....................................................... 166,083,250 384,089,203
--------------- ---------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS:
Net investment income ............................................................. (17,246,860)* (50,995,124)
Net realized short-term gain on investments, written options, swap contracts, and
foreign currency transactions ................................................... (7,083,253)* (20,346,652)
Net realized long-term gain on investments, written options, swap contracts,
futures contracts, securities sold short, and foreign currency transactions. .... (27,731,052)* (58,199,561)
--------------- ---------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS ........................................ (52,061,165) (129,541,337)
--------------- ---------------
FUND SHARE TRANSACTIONS:
Net decrease from repurchase of common shares ..................................... (992,992) (6,491,041)
Recapture of gain on sale of Fund shares by an affiliate .......................... 4,338 --
Offering costs for preferred shares charged to paid-in capital .................... -- (130,874)
--------------- ---------------
NET DECREASE IN NET ASSETS FROM FUND SHARE TRANSACTIONS ........................... (988,654) (6,621,915)
--------------- ---------------
NET INCREASE IN NET ASSETS ATTRIBUTABLE TO COMMON SHAREHOLDERS .................... 113,033,431 247,925,951
NET ASSETS ATTRIBUTABLE TO COMMON SHAREHOLDERS:
Beginning of period ............................................................... 1,986,081,126 1,738,155,175
--------------- ---------------
End of period (including undistributed net investment income of
$16,446,114 and $12,027,863, respectively) ...................................... $ 2,099,114,557 $ 1,986,081,126
=============== ===============
-------------
* Based on fiscal year to date book income. Amounts are subject to change and
recharacterization at fiscal year end.
See accompanying notes to financial statements.
12
THE GABELLI DIVIDEND & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. ORGANIZATION. The Gabelli Dividend & Income Trust (the "Fund") is a
non-diversified closed-end management investment company organized as a Delaware
statutory trust on November 18, 2003 and registered under the Investment Company
Act of 1940, as amended (the "1940 Act"). Investment operations commenced on
November 28, 2003.
The Fund's investment objective is to provide a high level of total return
on its assets with an emphasis on dividends and income. The Fund will attempt to
achieve its investment objective by investing, under normal market conditions,
at least 80% of its assets in dividend paying securities (such as common and
preferred stock) or other income producing securities (such as fixed income debt
securities and securities that are convertible into equity securities).
2. SIGNIFICANT ACCOUNTING POLICIES. The preparation of financial statements in
accordance with United States ("U.S.") generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could differ
from those estimates. The following is a summary of significant accounting
policies followed by the Fund in the preparation of its financial statements.
SECURITY VALUATION. Portfolio securities listed or traded on a nationally
recognized securities exchange or traded in the U.S. over-the-counter market for
which market quotations are readily available are valued at the last quoted sale
price or a market's official closing price as of the close of business on the
day the securities are being valued. If there were no sales that day, the
security is valued at the average of the closing bid and asked prices or, if
there were no asked prices quoted on that day, then the security is valued at
the closing bid price on that day. If no bid or asked prices are quoted on such
day, the security is valued at the most recently available price or, if the
Board of Trustees (the "Board") so determines, by such other method as the Board
shall determine in good faith to reflect its fair market value. Portfolio
securities traded on more than one national securities exchange or market are
valued according to the broadest and most representative market, as determined
by Gabelli Funds, LLC (the "Adviser").
Portfolio securities primarily traded on a foreign market are generally
valued at the preceding closing values of such securities on the relevant
market, but may be fair valued pursuant to procedures established by the Board
if market conditions change significantly after the close of the foreign market
but prior to the close of business on the day the securities are being valued.
Debt instruments with remaining maturities of 60 days or less that are not
credit impaired are valued at amortized cost, unless the Board determines such
amount does not reflect the securities' fair value, in which case these
securities will be fair valued as determined by the Board. Debt instruments
having a maturity greater than 60 days for which market quotations are readily
available are valued at the average of the latest bid and asked prices. If there
were no asked prices quoted on such day, the security is valued using the
closing bid price. Futures contracts are valued at the closing settlement price
of the exchange or board of trade on which the applicable contract is traded.
Securities and assets for which market quotations are not readily available
are fair valued as determined by the Board. Fair valuation methodologies and
procedures may include, but are not limited to: analysis and review of available
financial and non-financial information about the company; comparisons to the
valuation and changes in valuation of similar securities, including a comparison
of foreign securities to the equivalent U.S. dollar value ADR securities at the
close of the U.S. exchange; and evaluation of any other information that could
be indicative of the value of the security.
In September 2006, the Financial Accounting Standards Board (the "FASB")
issued Statement of Financial Accounting Standards ("SFAS") 157, Fair Value
Measurements, which clarifies the definition of fair value and requires
companies to expand their disclosure about the use of fair value to measure
assets and liabilities in interim and annual periods subsequent to initial
recognition. Adoption of SFAS 157 requires the use of the price that would be
received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. SFAS 157 is
effective for financial statements issued for fiscal years beginning after
November 15, 2007, and interim
13
THE GABELLI DIVIDEND & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
periods within those fiscal years. At this time, management is in the process of
reviewing the requirements of SFAS 157 against its current valuation policies to
determine future applicability.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with
primary government securities dealers recognized by the Federal Reserve Board,
with member banks of the Federal Reserve System, or with other brokers or
dealers that meet credit guidelines established by the Adviser and reviewed by
the Board. Under the terms of a typical repurchase agreement, the Fund takes
possession of an underlying debt obligation subject to an obligation of the
seller to repurchase, and the Fund to resell, the obligation at an agreed-upon
price and time, thereby determining the yield during the Fund's holding period.
The Fund will always receive and maintain securities as collateral whose market
value, including accrued interest, will be at least equal to 102% of the dollar
amount invested by the Fund in each agreement. The Fund will make payment for
such securities only upon physical delivery or upon evidence of book entry
transfer of the collateral to the account of the custodian. To the extent that
any repurchase transaction exceeds one business day, the value of the collateral
is marked-to-market on a daily basis to maintain the adequacy of the collateral.
If the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited. At June 30,
2007, the Fund had investments of $110,919,000 in repurchase agreements.
OPTIONS. The Fund may purchase or write call or put options on securities
or indices. As a writer of put options, the Fund receives a premium at the
outset and then bears the risk of unfavorable changes in the price of the
financial instrument underlying the option. The Fund would incur a loss if the
price of the underlying financial instrument decreases between the date the
option is written and the date on which the option is terminated. The Fund would
realize a gain, to the extent of the premium, if the price of the financial
instrument increases between those dates.
As a purchaser of put options, the Fund pays a premium for the right to
sell to the seller of the put option the underlying security at a specified
price. The seller of the put has the obligation to purchase the underlying
security upon exercise at the exercise price. If the price of the underlying
security declines, the Fund would realize a gain upon sale or exercise. If the
price of the underlying security increases or stays the same, the Fund would
realize a loss upon sale or at expiration date, but only to the extent of the
premium paid.
In the case of call options, these exercise prices are referred to as
"in-the-money," "at-the-money," and "out-of-the-money," respectively. The Fund
may write (a) in-the-money call options when the Adviser expects that the price
of the underlying security will remain stable or decline moderately during the
option period, (b) covered at-the-money call options when the Adviser expects
that the price of the underlying security will remain stable or advance
moderately during the option period, and (c) out-of-the-money call options when
the Adviser expects that the premiums received from writing the call option will
be greater than the appreciation in the price of the underlying security above
the exercise price. By writing a call option, the Fund limits its opportunity to
profit from any increase in the market value of the underlying security above
the exercise price of the option. Out-of-the-money, at-the-money, and
in-the-money put options (the reverse of call options as to the relation of
exercise price to market price) may be utilized in the same market environments
that such call options are used in equivalent transactions. At June 30, 2007,
the Fund had no investments in options.
SWAP AGREEMENTS. The Fund may enter into interest rate swap or cap
transactions. The use of swaps and caps is a highly specialized activity that
involves investment techniques and risks different from those associated with
ordinary portfolio transactions. Swap agreements may involve, to varying
degrees, elements of market and counterparty risk, and exposure to loss in
excess of the related amounts reflected in the Statement of Assets and
Liabilities. In an interest rate swap, the Fund would agree to pay to the other
party to the interest rate swap (which is known as the "counterparty")
14
THE GABELLI DIVIDEND & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
periodically a fixed rate payment in exchange for the counterparty agreeing to
pay to the Fund periodically a variable rate payment that is intended to
approximate the Fund's variable rate payment obligation on Series B Preferred
Stock. In an interest rate cap, the Fund would pay a premium to the counterparty
and, to the extent that a specified variable rate index exceeds a predetermined
fixed rate, would receive from that counterparty payments of the difference
based on the notional amount of such cap. Interest rate swap and cap
transactions introduce additional risk because the Fund would remain obligated
to pay preferred stock dividends when due in accordance with the Articles
Supplementary even if the counterparty defaulted.
The Fund has entered into an interest rate swap agreement with Citibank
N.A. Under the agreement the Fund receives a floating rate of interest and pays
a respective fixed rate of interest on the nominal value of the swap. Details of
the swap at June 30, 2007 are as follows:
NOTIONAL FLOATING RATE* TERMINATION NET UNREALIZED
AMOUNT FIXED RATE (RATE RESET MONTHLY) DATE APPRECIATION
--------- ---------- -------------------- ------------ -------------
$100,000,000 4.01% 5.32% June 2, 2010 $3,523,982
----------------
* Based on Libor (London Interbank Offered Rate).
The Fund may enter into equity swap transactions. The use of equity swaps
is a highly specialized activity that involves investment techniques and risks
different from those associated with ordinary portfolio security transactions.
In an equity swap, a set of future cash flows are exchanged between two
counterparties. One of these cash flow streams will typically be based on a
reference interest rate combined with the performance of a notional value of
shares of a stock. The other will be based on the performance of the shares of a
stock.
The Fund has entered into equity swap agreements with Bear, Stearns
International Limited. Details of the swaps at June 30, 2007 are as follows:
NET UNREALIZED
NOTIONAL EQUITY SECURITY INTEREST RATE/ TERMINATION APPRECIATION
AMOUNT RECEIVED EQUITY SECURITY PAID DATE (DEPRECIATION)
--------- --------------- -------------------- ------------ ---------------
Market Value Overnight LIBOR plus
Appreciation on: Market Value Depreciation on:
$4,462,994 (200,000 Shares) Alliance Boots plc Alliance Boots plc 4/15/08 $ 77,876
4,742,004 (344,000 Shares) Cadbury Schweppes plc Cadbury Schweppes plc 2/15/08 (96,907)
18,893,965 (1,500,000 Shares) Imperial Chemical Industries plc Imperial Chemical Industries plc 5/15/08 (498,135)
2,127,433 (100,000 Shares) Hanson plc Hanson plc 4/15/08 24,042
---------
$(493,124)
=========
If there is a default by the counterparty to a swap contract, the Fund will
be limited to contractual remedies pursuant to the agreements related to the
transaction. There is no assurance that the swap contract counterparties will be
able to meet their obligations pursuant to a swap contract or that, in the event
of default, the Fund will succeed in pursuing contractual remedies. The Fund
thus assumes the risk that it may be delayed in or prevented from obtaining
payments owed to it pursuant to a swap contract. The creditworthiness of the
swap contract counterparties is closely monitored in order to minimize this
risk. Depending on the general state of short-term interest rates and the
returns on the Fund's portfolio securities at that point in time, such a default
could negatively affect the Fund's ability to make dividend payments. In
addition, at the time an equity swap or an interest rate swap or cap transaction
reaches its scheduled termination date, there is a risk that the Fund will not
be able to obtain a replacement transaction or that the terms of the replacement
will not be as favorable as on the expiring transaction. If this occurs, it
could have a negative impact on the Fund's ability to make dividend payments.
15
THE GABELLI DIVIDEND & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
The use of derivative instruments involves, to varying degrees, elements of
market and counterparty risk in excess of the amount recognized in the Statement
of Assets and Liabilities.
Unrealized gains related to swaps are reported as an asset and unrealized
losses are reported as a liability in the Statement of Assets and Liabilities.
The change in value of swaps, including the accrual of periodic amounts of
interest to be paid or received on swaps are reported as unrealized gains or
losses in the Statement of Operations. A realized gain or loss is recorded upon
payment or receipt of a periodic payment or termination of swap agreements.
FUTURES CONTRACTS. The Fund may engage in futures contracts for the purpose
of hedging against changes in the value of its portfolio securities and in the
value of securities it intends to purchase. Upon entering into a futures
contract, the Fund is required to deposit with the broker an amount of cash or
cash equivalents equal to a certain percentage of the contract amount. This is
known as the "initial margin". Subsequent payments ("variation margin") are made
or received by the Fund each day, depending on the daily fluctuations in the
value of the contract, which are included in unrealized
appreciation/depreciation on investments and futures contracts. The Fund
recognizes a realized gain or loss when the contract is closed.
There are several risks in connection with the use of futures contracts as
a hedging instrument. The change in value of futures contracts primarily
corresponds with the value of their underlying instruments, which may not
correlate with the change in value of the hedged investments. In addition, there
is the risk that the Fund may not be able to enter into a closing transaction
because of an illiquid secondary market. At June 30, 2007, there were no open
futures contracts.
SECURITIES SOLD SHORT. The Fund may enter into short sale transactions.
Short selling involves selling securities that may or may not be owned and, at
times, borrowing the same securities for delivery to the purchaser, with an
obligation to replace such borrowed securities at a later date. The proceeds
received from short sales are recorded as liabilities and the Fund records an
unrealized gain or loss to the extent of the difference between the proceeds
received and the value of an open short position on the day of determination.
The Fund records a realized gain or loss when the short position is closed out.
By entering into a short sale, the Fund bears the market risk of an unfavorable
change in the price of the security sold short. Dividends on short sales are
recorded as an expense by the Fund on the ex-dividend date and interest expense
is recorded on the accrual basis. Securities sold short at June 30, 2007 are
reported within the Schedule of Investments.
FORWARD FOREIGN EXCHANGE CONTRACTS. The Fund may engage in forward foreign
exchange contracts for hedging a specific transaction with respect to either the
currency in which the transaction is denominated or another currency as deemed
appropriate by the Adviser. Forward foreign exchange contracts are valued at the
forward rate and are marked-to-market daily. The change in market value is
included in unrealized appreciation/depreciation on investments and foreign
currency translations. When the contract is closed, the Fund records a realized
gain or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
The use of forward foreign exchange contracts does not eliminate
fluctuations in the underlying prices of the Fund's portfolio securities, but it
does establish a rate of exchange that can be achieved in the future. Although
forward foreign exchange contracts limit the risk of loss due to a decline in
the value of the hedged currency, they also limit any potential gain that might
result should the value of the currency increase. In addition, the Fund could be
exposed to risks if the counterparties to the contracts are unable to meet the
terms of their contracts. At June 30, 2007, there were no open forward foreign
exchange contracts.
FOREIGN CURRENCY TRANSLATIONS. The books and records of the Fund are
maintained in U.S. dollars. Foreign currencies, investments, and other assets
and liabilities are translated into U.S. dollars at the current exchange rates.
Purchases and sales of investment securities, income, and expenses are
translated at the exchange rate prevailing on the respective dates
16
THE GABELLI DIVIDEND & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
of such transactions. Unrealized gains and losses that result from changes in
foreign exchange rates and/or changes in market prices of securities have been
included in unrealized appreciation/depreciation on investments and foreign
currency translations. Net realized foreign currency gains and losses resulting
from changes in exchange rates include foreign currency gains and losses between
trade date and settlement date on investment securities transactions, foreign
currency transactions, and the difference between the amounts of interest and
dividends recorded on the books of the Fund and the amounts actually received.
The portion of foreign currency gains and losses related to fluctuation in
exchange rates between the initial trade date and subsequent sale trade date is
included in realized gain/(loss) on investments.
FOREIGN SECURITIES. The Fund may directly purchase securities of foreign
issuers. Investing in securities of foreign issuers involves special risks not
typically associated with investing in securities of U.S. issuers. The risks
include possible revaluation of currencies, the ability to repatriate funds,
less complete financial information about companies, and possible future adverse
political and economic developments. Moreover, securities of many foreign
issuers and their markets may be less liquid and their prices more volatile than
those of securities of comparable U.S. issuers.
FOREIGN TAXES. The Fund may be subject to foreign taxes on income, gains on
investments, or currency repatriation, a portion of which may be recoverable.
The Fund will accrue such taxes and recoveries as applicable, based upon its
current interpretation of tax rules and regulations that exist in the markets in
which it invests.
RESTRICTED AND ILLIQUID SECURITIES. The Fund is not subject to an
independent limitation on the amount it may invest in securities for which the
markets are illiquid. Illiquid securities include securities the disposition of
which is subject to substantial legal or contractual restrictions. The sale of
illiquid securities often requires more time and results in higher brokerage
charges or dealer discounts and other selling expenses than does the sale of
securities eligible for trading on national securities exchanges or in the
over-the-counter markets. Restricted securities may sell at a price lower than
similar securities that are not subject to restrictions on resale. Securities
freely saleable among qualified institutional investors under special rules
adopted by the SEC may be treated as liquid if they satisfy liquidity standards
established by the Board. The continued liquidity of such securities is not as
well assured as that of publicly traded securities, and accordingly the Board
will monitor their liquidity.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME. Securities transactions are
accounted for on the trade date with realized gain or loss on investments
determined by using the identified cost method. Interest income (including
amortization of premium and accretion of discount) is recorded on the accrual
basis. Premiums and discounts on debt securities are amortized using the
effective yield to maturity method. Dividend income is recorded on the
ex-dividend date except for certain dividends which are recorded as soon as the
Fund is informed of the dividend.
CUSTODIAN FEE CREDITS AND INTEREST EXPENSE. When cash balances are
maintained in the custody account, the Fund receives credits which are used to
offset custodian fees. The gross expenses paid under the custody arrangement are
included in custodian fees in the Statement of Operations with the corresponding
expense offset, if any, shown as "custodian fee credits". When cash balances are
overdrawn, the Fund is charged an overdraft fee of 2.00% above the Federal Funds
rate on outstanding balances. This amount, if any, would be shown as "interest
expense" in the Statement of Operations.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions to common shareholders are
recorded on the ex-dividend date. Distributions to shareholders are based on
income and capital gains as determined in accordance with federal income tax
regulations, which may differ from income and capital gains as determined under
U.S. generally accepted accounting principles. These differences are primarily
due to differing treatments of income and gains on various investment securities
and foreign currency transactions held by the Fund, timing differences, and
differing characterizations of distributions
17
THE GABELLI DIVIDEND & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
made by the Fund. Distributions from net investment income include net realized
gains on foreign currency transactions. These book/tax differences are either
temporary or permanent in nature. To the extent these differences are permanent,
adjustments are made to the appropriate capital accounts in the period when the
differences arise. These reclassifications have no impact on the NAV of the
Fund.
Distributions to shareholders of the Fund's 5.875% Series A Cumulative
Preferred Stock, Series B Auction Market Cumulative Preferred Stock, Series C
Auction Market Cumulative Preferred Stock, 6.00% Series D Cumulative Preferred
Stock, and Series E Auction Rate Cumulative Preferred Stock ("Cumulative
Preferred Stock") are recorded on a daily basis and are determined as described
in Note 5.
The tax character of distributions paid during the year ended December 31,
2006 was as follows:
COMMON PREFERRED
--------- ---------
DISTRIBUTIONS PAID FROM:
Ordinary income
(inclusive of short-term
capital gains) ..................... $ 71,341,776 $14,347,465
Net long-term capital gains .......... 58,199,561 11,704,448
------------ -----------
Total distributions paid ............. $129,541,337 $26,051,913
============ ===========
PROVISION FOR INCOME TAXES. The Fund intends to continue to qualify as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended (the "Code"). It is the policy of the Fund to comply with the
requirements of the Code applicable to regulated investment companies and to
distribute substantially all of its net investment company taxable income and
net capital gains. Therefore, no provision for federal income taxes is required.
As of December 31, 2006, the components of accumulated earnings/(losses) on
a tax basis were as follows:
Net unrealized appreciation on
investments, written options,
foreign currency, and swap contracts .................. $431,173,223
Post-October currency loss deferral ..................... (449,565)
Undistributed ordinary income ........................... 11,337,666
Other temporary differences ............................. (1,545)
------------
Total ................................................... $442,059,779
============
The following summarizes the tax cost of investments, written options, swap
contracts, and the related unrealized appreciation/(depreciation) at June 30,
2007:
GROSS GROSS
COST/ UNREALIZED UNREALIZED NET UNREALIZED
PROCEEDS APPRECIATION DEPRECIATION APPRECIATION
-------- ------------ ------------- --------------
Investments ............. $2,084,983,118 $525,098,625 $(23,257,605) $501,841,020
Swap contracts .......... -- 3,625,900 (595,042) 3,030,858
Short sales ............. (9,824,509) 718,699 -- 718,699
-------------- ------------ ------------ ------------
$2,075,158,609 $529,443,224 $(23,852,647) $505,590,577
============== ============ ============ ============
In July 2006, the FASB issued Interpretation No. 48, "Accounting for
Uncertainty in Income Taxes, an Interpretation of FASB Statement No. 109" ("the
Interpretation"). The Interpretation established for all entities, including
pass-through entities such as the Fund, a minimum threshold for financial
statement recognition of the benefit of positions taken in filing tax returns
(including whether an entity is taxable in a particular jurisdiction), and
required certain expanded tax disclosures. The Interpretation was implemented by
the Fund on June 29, 2007 and applied to all open tax years as of the effective
date. Management has evaluated the application of the Interpretation to the
Fund, and the adoption of the Interpretation had no impact on the amounts
reported in the financial statements.
18
THE GABELLI DIVIDEND & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
3. AGREEMENTS AND TRANSACTIONS WITH AFFILIATES. The Fund has entered into an
investment advisory agreement (the "Advisory Agreement") with the Adviser which
provides that the Fund will pay the Adviser a fee, computed weekly and paid
monthly, equal on an annual basis to 1.00% of the value of the Fund's average
weekly net assets including the liquidation value of the preferred stock. In
accordance with the Advisory Agreement, the Adviser provides a continuous
investment program for the Fund's portfolio and oversees the administration of
all aspects of the Fund's business and affairs. The Adviser has agreed to reduce
the management fee on the incremental assets attributable to the Cumulative
Preferred Stock if the total return of the NAV of the common shares of the Fund,
including distributions and advisory fee subject to reduction, does not exceed
the stated dividend rate or corresponding swap rate of each particular series of
the Cumulative Preferred Stock for the fiscal year.
The Fund's total return on the NAV of the common shares is monitored on a
monthly basis to assess whether the total return on the NAV of the common shares
exceeds the stated dividend rate or corresponding swap rate of each particular
series of Cumulative Preferred Stock for the period. For the six months ended
June 30, 2007, the Fund's total return on the NAV of the common shares exceeded
the stated dividend rate or corresponding swap rate of all outstanding Preferred
Stock. Thus, management fees were accrued on these assets.
During the six months ended June 30, 2007, the Fund paid brokerage
commissions of $756,778 to Gabelli & Company, Inc. ("Gabelli & Company"), an
affiliate of the Adviser.
The cost of calculating the Fund's NAV per share is a Fund expense pursuant
to the Advisory Agreement between the Fund and the Adviser. During the six
months ended June 30, 2007, the Fund paid or accrued $22,621 to the Adviser in
connection with the cost of computing the Fund's NAV.
The Fund is assuming its portion of the allocated cost of the Gabelli
Funds' Chief Compliance Officer in the amount of $19,708 for the six months
ended June 30, 2007, which is included in payroll expenses in the Statement of
Operations.
As per the approval of the Board, the Fund compensates officers of the Fund
that are employed by the Fund and are not employed by the Adviser (although the
officers may receive incentive-based variable compensation from affiliates of
the Adviser). For the six months ended June 30, 2007, the Fund paid or accrued
$110,341, which is included in payroll expenses in the Statement of Operations.
The Fund recaptured a gain of $4,338 on the sale of its shares by an
affiliate of the Adviser.
The Fund pays each Trustee that is not considered to be an affiliated
person an annual retainer of $12,000 plus $1,500 for each Board meeting attended
in person and $500 per telephonic meeting, and they are reimbursed for any out
of pocket expenses incurred in attending meetings. All Board committee members
receive $1,000 per meeting attended. In addition, the Audit Committee Chairman
receives an annual fee of $3,000, the Proxy Voting Committee Chairman receives
an annual fee of $1,500, and the Nominating Committee Chairman receives an
annual fee of $2,000. Trustees who are directors or employees of the Adviser or
an affiliated company receive no compensation or expense reimbursement from the
Fund.
4. PORTFOLIO SECURITIES. Purchases and proceeds from the sales of securities for
the six months ended June 30, 2007, other than short-term and U.S Government
securities, aggregated $939,187,337 and $462,095,228, respectively.
19
THE GABELLI DIVIDEND & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
Option contracts written by the Fund during the six months ended June 30,
2007 were as follows:
NUMBER OF
CONTRACTS PREMIUMS
----------- -----------
Options outstanding at December 31, 2006 ... 5,544 $ 1,898,621
Options written ............................ 364 76,346
Options exercised .......................... (3,833) (1,590,614)
Options expired ............................ (2,075) (384,353)
------ -----------
Options outstanding at June 30, 2007 ....... -- $ --
====== ===========
5. CAPITAL. The Fund is authorized to issue an unlimited number of common shares
of beneficial interest (par value $0.001). The Board has authorized the
repurchase of its shares on the open market when the shares are trading at a
discount of 7.5% or more (or such other percentage as the Board may determine
from time to time) from the NAV of the shares. During the six months ended June
30, 2007, the Fund repurchased 44,100 shares of beneficial interest in the open
market at a cost of $992,992 and an average discount of approximately 11.24%
from its NAV. All shares of beneficial interest repurchased have been retired.
Transactions in shares of beneficial interest were as follows:
SIX MONTHS ENDED
JUNE 30, 2007 YEAR ENDED
(UNAUDITED) DECEMBER 31, 2006
---------------------- ----------------------
SHARES AMOUNT SHARES AMOUNT
----------- ---------- ---------- ---------
Net decrease from
repurchase of common shares ....... (44,100) $(992,992) (340,235) $(6,491,041)
The Fund's Declaration of Trust, as amended, authorizes the issuance of an
unlimited number of shares of $0.001 par value Cumulative Preferred Stock. The
Cumulative Preferred Stock is senior to the common shares and results in the
financial leveraging of the common shares. Such leveraging tends to magnify both
the risks and opportunities to common shareholders. Dividends on shares of the
Cumulative Preferred Stock are cumulative. The Fund is required by the 1940 Act
and by the Statements of Preferences to meet certain asset coverage tests with
respect to the Cumulative Preferred Stock. If the Fund fails to meet these
requirements and does not correct such failure, the Fund may be required to
redeem, in part or in full, the 5.875% Series A, Series B Auction Market, Series
C Auction Market, 6.00% Series D, and Series E Auction Rate Cumulative Preferred
Stock at redemption prices of $25, $25,000, $25,000, $25, and $25,000,
respectively, per share plus an amount equal to the accumulated and unpaid
dividends whether or not declared on such shares in order to meet these
requirements. Additionally, failure to meet the foregoing asset coverage
requirements could restrict the Fund's ability to pay dividends to common
shareholders and could lead to sales of portfolio securities at inopportune
times. The income received on the Fund's assets may vary in a manner unrelated
to the fixed and variable rates, which could have either a beneficial or
detrimental impact on net investment income and gains available to common
shareholders.
On October 12, 2004, the Fund received net proceeds of $77,280,971 (after
underwriting discounts of $2,520,000 and offering expenses of $199,029) from the
public offering of 3,200,000 shares of 5.875% Series A Cumulative Preferred
Stock. Commencing October 12, 2009 and thereafter, the Fund, at its option, may
redeem the 5.875% Series A Cumulative Preferred Stock in whole or in part at the
redemption price at any time. The Board has authorized the repurchase of Series
A Cumulative Preferred Stock in the open market at prices less than the $25
liquidation value per share. During the six months ended June 30, 2007, the Fund
did not repurchase any shares of 5.875% Series A Cumulative Preferred Stock. At
June 30, 2007, 3,200,000 shares of 5.875% Series A Cumulative Preferred Stock
were outstanding and accrued dividends amounted to $78,334.
20
THE GABELLI DIVIDEND & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
On October 12, 2004, the Fund received net proceeds of $217,488,958 (after
underwriting discounts of $2,200,000 and offering expenses of $311,042) from the
public offering of 4,000 shares of Series B and 4,800 shares of Series C Auction
Market Cumulative Preferred Stock, respectively. The dividend rate, as set by
the auction process, which is generally held every seven days, is expected to
vary with short-term interest rates. The dividend rates of Series B Auction
Market Cumulative Preferred Stock ranged from 4.70% to 5.31% during the six
months ended June 30, 2007. The dividend rates of Series C Auction Market
Cumulative Preferred Stock ranged from 4.70% to 5.27% during the six months
ended June 30, 2007. Existing shareholders may submit an order to hold, bid, or
sell such shares on each auction date. Series B and C Auction Market Cumulative
Preferred Stock shareholders may also trade shares in the secondary market. The
Fund, at its option, may redeem the Series B and C Auction Market Cumulative
Preferred Stock in whole or in part at the redemption price at any time. During
the six months ended June 30, 2007, the Fund did not redeem any shares of Series
B and C Auction Market Cumulative Preferred Stock. At June 30, 2007, 4,000 and
4,800 shares of the Series B and C Auction Market Cumulative Preferred Stock
were outstanding with an annualized dividend rate of 5.20% and 5.21% per share
and accrued dividends amounted to $72,222 and $52,100, respectively.
On November 3, 2005, the Fund received net proceeds of $62,617,239 (after
underwriting discounts of $2,047,500 and offering expenses of $335,261) from the
public offering of 2,600,000 shares of 6.00% Series D Cumulative Preferred
Stock. Commencing November 3, 2010 and thereafter, the Fund, at its option, may
redeem the 6.00% Series D Cumulative Preferred Stock in whole or in part at the
redemption price at any time. The Board has authorized the repurchase of Series
D Cumulative Preferred Stock in the open market at prices less than the $25
liquidation value per share. During the six months ended June 30, 2007, the Fund
did not repurchase any shares of 6.00% Series D Cumulative Preferred Stock. At
June 30, 2007, 2,600,000 shares of 6.00% Series D Cumulative Preferred Stock
were outstanding and accrued dividends amounted to $65,000.
On November 3, 2005, the Fund received net proceeds of $133,379,387 (after
underwriting discounts of $1,350,000 and offering expenses of $270,613) from the
public offering of 5,400 shares of Series E Auction Rate Cumulative Preferred
Stock. The dividend rate, as set by the auction process, which is generally held
every seven days, is expected to vary with short-term interest rates. The
dividend rates of Series E Auction Rate Cumulative Preferred Stock ranged from
4.50% to 5.29% during the six months ended June 30, 2007. Existing shareholders
may submit an order to hold, bid, or sell such shares on each auction date.
Series E Auction Rate Preferred Stock shareholders may also trade shares in the
secondary market. The Fund, at its option, may redeem the Series E Auction Rate
Preferred Stock in whole or in part at the redemption price at any time. During
the six months ended June 30, 2007, the Fund did not redeem any shares of Series
E Auction Rate Preferred Stock. At June 30, 2007, 5,400 shares of Series E
Auction Rate Preferred Stock were outstanding with an annualized dividend rate
of 5.15% and accrued dividends amounted to $77,250.
The holders of Cumulative Preferred Stock generally are entitled to one
vote per share held on each matter submitted to a vote of shareholders of the
Fund and will vote together with holders of common shares as a single class. The
holders of Cumulative Preferred Stock voting together as a single class also
have the right currently to elect two Trustees and under certain circumstances
are entitled to elect a majority of the Board of Trustees. In addition, the
affirmative vote of a majority of the votes entitled to be cast by holders of
all outstanding shares of the preferred stock, voting as a single class, will be
required to approve any plan of reorganization adversely affecting the preferred
stock, and the approval of two-thirds of each class, voting separately, of the
Fund's outstanding voting stock must approve the conversion of the Fund from a
closed-end to an open-end investment company. The approval of a majority (as
defined in the 1940 Act) of the outstanding preferred stock and a majority (as
defined in the 1940 Act) of the Fund's outstanding voting securities are
required to approve certain other actions, including changes in the Fund's
investment objectives or fundamental investment policies.
21
THE GABELLI DIVIDEND & INCOME TRUST
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
6. INDEMNIFICATIONS. The Fund enters into contracts that contain a variety of
indemnifications. The Fund's maximum exposure under these arrangements is
unknown. However, the Fund has not had prior claims or losses pursuant to these
contracts and expects the risk of loss to be remote.
7. OTHER MATTERS. The Adviser and/or affiliates received subpoenas from the
Attorney General of the State of New York and the SEC requesting information on
mutual fund share trading practices involving certain funds managed by the
Adviser. GAMCO Investors, Inc. ("GAMCO"), the Adviser's parent company,
responded to these requests for documents and testimony. In June 2006, GAMCO
began discussions with the SEC regarding a possible resolution of their inquiry.
In February 2007, the Adviser made an offer of settlement to the staff of the
SEC for communication to the Commission for its consideration to resolve this
matter. This offer of settlement is subject to agreement regarding the specific
language of the SEC's administrative order and other settlement documents. On a
separate matter, in September 2005, the Adviser was informed by the staff of the
SEC that the staff may recommend to the Commission that an administrative remedy
and a monetary penalty be sought from the Adviser in connection with the actions
of two of seven closed-end funds managed by the Adviser relating to Section
19(a) and Rule 19a-1 of the 1940 Act. These provisions require registered
investment companies to provide written statements to shareholders when a
dividend is made from a source other than net investment income. While the two
closed-end funds sent annual statements and provided other materials containing
this information, the funds did not send written statements to shareholders with
each distribution in 2002 and 2003. The Adviser believes that all of the funds
are now in compliance. The Adviser believes that these matters would have no
effect on the Fund or any material adverse effect on the Adviser or its ability
to manage the Fund. The staff's notice to the Adviser did not relate to the
Fund.
22
THE GABELLI DIVIDEND & INCOME TRUST
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A SHARE OF SIX MONTHS ENDED YEAR ENDED DECEMBER 31,
BENEFICIAL INTEREST OUTSTANDING JUNE 30, 2007 ---------------------------------- PERIOD ENDED
THROUGHOUT EACH PERIOD: (UNAUDITED) 2006 2005 2004 DECEMBER 31, 2003 (H)
---------------- ---------- -------- --------- ---------------------
OPERATING PERFORMANCE:
Net asset value, beginning of period .............. $ 23.65 $ 20.62 $ 20.12 $ 19.26 $ 19.06(i)
---------- ---------- ---------- ---------- ----------
Net investment income ............................. 0.31 0.87 0.55 0.40 --
Net realized and unrealized gain on investments,
written options, swap contracts,
securities sold short,
and foreign currency transactions ............... 1.83 4.00 1.33 1.80 0.20
---------- ---------- ---------- ---------- ----------
Total from investment operations .................. 2.14 4.87 1.88 2.20 0.20
---------- ---------- ---------- ---------- ----------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS: (A)
Net investment income ............................. (0.05)(d) (0.12) (0.06) (0.01) --
Net realized gain on investments .................. (0.11)(d) (0.19) (0.10) (0.01) --
---------- ---------- ---------- ---------- ----------
Total distributions to preferred
stock shareholders .............................. (0.16) (0.31) (0.16) (0.02) --
---------- ---------- ---------- ---------- ----------
NET INCREASE IN NET ASSETS ATTRIBUTABLE TO COMMON
SHAREHOLDERS RESULTING FROM OPERATIONS .......... 1.98 4.56 1.72 2.18 --
---------- ---------- ---------- ---------- ----------
DISTRIBUTIONS TO COMMON SHAREHOLDERS:
Net investment income ............................. (0.21)(d) (0.61) (0.48) (0.39) --
Net realized gain on investments .................. (0.41)(d) (0.93) (0.72) (0.24) --
Return of capital ................................. -- -- -- (0.57) --
---------- ---------- ---------- ---------- ----------
Total distributions to common shareholders ........ (0.62) (1.54) (1.20) (1.20) --
---------- ---------- ---------- ---------- ----------
FUND SHARE TRANSACTIONS:
Decrease in net asset value from
common share transactions ...................... -- -- -- (0.05) --
Increase in net asset value from
repurchase of common shares .................... 0.00(e) 0.01 0.02 -- --
Recapture of gain on sale of Fund
shares by an affiliate ......................... 0.00(e) -- -- -- --
Offering costs for common shares
charged to paid-in capital ..................... -- -- -- (0.01) --
Offering costs for preferred shares
charged to paid-in capital ..................... -- (0.00)(e) (0.04) (0.06) --
---------- ---------- ---------- ---------- ----------
Total from fund share transactions ................ 0.00(e) 0.01 (0.02) (0.12) --
---------- ---------- ---------- ---------- ----------
NET ASSET VALUE ATTRIBUTABLE
TO COMMON SHAREHOLDERS,
END OF PERIOD ................................... $ 25.01 $ 23.65 $ 20.62 $ 20.12 $ 19.26
========== ========== ========== ========== ==========
NAV total return + ................................ 8.79% 24.09% 9.47% 11.56% 1.0%*
========== ========== ========== ========== ==========
Market value, end of period ....................... $ 22.34 $ 21.47 $ 17.62 $ 17.95 $ 20.00
========== ========== ========== ========== ==========
Investment total return ++ ........................ 6.99% 31.82% 4.85% (4.15)% 0.0%**
========== ========== ========== ========== ==========
See accompanying notes to financial statements.
23
THE GABELLI DIVIDEND & INCOME TRUST
FINANCIAL HIGHLIGHTS (CONTINUED)
SELECTED DATA FOR A SHARE OF SIX MONTHS ENDED YEAR ENDED DECEMBER 31,
BENEFICIAL INTEREST OUTSTANDING JUNE 30, 2007 ---------------------------------- PERIOD ENDED
THROUGHOUT EACH PERIOD: (UNAUDITED) 2006 2005 2004 DECEMBER 31, 2003 (H)
---------------- ---------- -------- --------- ---------------------
RATIOS AND SUPPLEMENTAL DATA:
Net assets including liquidation
value of preferred shares,
end of period (in 000's) .......................$2,599,115 $2,486,081 $2,238,155 $2,006,703 --
Net assets attributable to common shares,
end of period (in 000's) .......................$2,099,115 $1,986,081 $1,738,155 $1,706,703 $1,451,650
Ratio of net investment income to
average net assets attributable
to common shares before preferred
share distributions ............................ 2.56%(f) 3.91% 2.75% 2.17% (0.04)%(f)
Ratio of operating expenses to average
net assets attributable to
common shares net of advisory
fee reduction, if any .......................... 1.38%(f)(g) 1.41%(g) 1.33%(g) 1.12% 1.38%(f)
Ratio of operating expenses to
average net assets including
liquidation value of preferred
shares net of advisory
fee reduction, if any .......................... 1.11%(f)(g) 1.11%(g) 1.12%(g) 1.07% --
Portfolio turnover rate .......................... 20.1% 28.8% 25.6% 33.3% 0.4%
5.875% CUMULATIVE PREFERRED STOCK
Liquidation value, end of period (in 000's) ......$ 80,000 $ 80,000 $ 80,000 $ 80,000 --
Total shares outstanding (in 000's) 3,200 3,200 3,200 3,200 --
Liquidation preference per share .................$ 25.00 $ 25.00 $ 25.00 $ 25.00 --
Average market value (b) .........................$ 24.39 $ 23.86 $ 24.82 $ 24.68 --
Asset coverage per share .........................$ 129.96 $ 124.30 $ 111.91 $ 167.23 --
AUCTION MARKET SERIES B CUMULATIVE PREFERRED STOCK
Liquidation value, end of period (in 000's) ......$ 100,000 $ 100,000 $ 100,000 $ 100,000 --
Total shares outstanding (in 000's) .............. 4 4 4 4 --
Liquidation preference per share .................$ 25,000 $ 25,000 $ 25,000 $ 25,000 --
Average market value (b) .........................$ 25,000 $ 25,000 $ 25,000 $ 25,000 --
Asset coverage per share .........................$ 129,956 $ 124,304 $ 111,908 $ 167,225 --
AUCTION MARKET SERIES C CUMULATIVE PREFERRED STOCK
Liquidation value, end of period (in 000's) ......$ 120,000 $ 120,000 $ 120,000 $ 120,000 --
Total shares outstanding (in 000's) .............. 5 5 5 5 --
Liquidation preference per share .................$ 25,000 $ 25,000 $ 25,000 $ 25,000 --
Average market value (b) .........................$ 25,000 $ 25,000 $ 25,000 $ 25,000 --
Asset coverage per share .........................$ 129,956 $ 124,304 $ 111,908 $ 167,225 --
6.00% CUMULATIVE PREFERRED STOCK
Liquidation value, end of period (in 000's) ......$ 65,000 $ 65,000 $ 65,000 -- --
Total shares outstanding (in 000's) .............. 2,600 2,600 2,600 -- --
Liquidation preference per share .................$ 25.00 $ 25.00 $ 25.00 -- --
Average market value (b) .........................$ 24.92 $ 24.37 $ 24.72 -- --
Asset coverage per share .........................$ 129.96 $ 124.30 $ 111.91 -- --
AUCTION RATE SERIES E CUMULATIVE PREFERRED STOCK
Liquidation value, end of period (in 000's) ......$ 135,000 $ 135,000 $ 135,000 -- --
Total shares outstanding (in 000's) .............. 5 5 5 -- --
Liquidation preference per share .................$ 25,000 $ 25,000 $ 25,000 -- --
Average market value (b) .........................$ 25,000 $ 25,000 $ 25,000 -- --
Asset coverage per share .........................$ 129,956 $ 124,304 $ 111,908 -- --
ASSET COVERAGE (C) ............................... 520% 497% 448% 669% --
(a) Calculated based upon average common shares outstanding on the record dates
throughout the year.
(b) Based on weekly prices.
(c) Asset coverage is calculated by combining all series of preferred stock.
(d) Based on fiscal year to date book income. Amounts are subject to change and
recharacterization at fiscal year end.
(e) Amount represents less than $0.005 per share.
(f) Annualized.
(g) The ratios do not include a reduction of expenses for custodian fee credits
on cash balances maintained with the custodian. Including such custodian
fee credits for the six months ended June 30, 2007, the ratios of operating
expenses to average net assets attributable to common stock net of fee
reduction would have been 1.37% and the ratios of operating expenses to
average net assets including liquidation value of preferred shares net of
fee reduction would have been 1.10%. Custodian fee credits for the fiscal
years ended December 31, 2006 and 2005 were minimal.
(h) The Gabelli Dividend & Income Trust commenced investment operations on
November 28, 2003.
(i) The beginning NAV includes a $0.04 reduction for costs associated with the
initial public offering.
* Based on net asset value per share at commencement of operations of $19.06
per share.
** Based on market value per share at initial public offering of $20.00 per
share.
+ Based on net asset value per share, adjusted for reinvestment of
distributions at prices obtained under the Fund's dividend reinvestment
plan. Total return for periods of less than one year are not annualized.
++ Based on market value per share, adjusted for reinvestment of distributions
at prices obtained under the Fund's dividend reinvestment plan. Total
return for periods of less than one year are not annualized.
See accompanying notes to financial statements.
24
AUTOMATIC DIVIDEND REINVESTMENT
AND VOLUNTARY CASH PURCHASE PLANS
ENROLLMENT IN THE PLAN
It is the policy of The Gabelli Dividend &Income Trust (the "Fund") to
automatically reinvest dividends payable to common shareholders. As a
"registered" shareholder you automatically become a participant in the Fund's
Automatic Dividend Reinvestment Plan (the "Plan"). The Plan authorizes the Fund
to issue shares of common stock to participants upon an income dividend or a
capital gains distribution regardless of whether the shares are trading at a
discount or a premium to net asset value. All distributions to shareholders
whose shares are registered in their own names will be automatically reinvested
pursuant to the Plan in additional shares of the Fund. Plan participants may
send their stock certificates to Computershare Trust Company, N.A.
("Computershare") to be held in their dividend reinvestment account. Registered
shareholders wishing to receive their distributions in cash must submit this
request in writing to:
The Gabelli Dividend & Income Trust
c/o Computershare
P.O. Box 43010
Providence, RI 02940-3010
Shareholders requesting this cash election must include the shareholder's
name and address as they appear on the share certificate. Shareholders with
additional questions regarding the Plan or requesting a copy of the terms of the
Plan may contact Computershare at (800) 336-6983.
If your shares are held in the name of a broker, bank, or nominee, you
should contact such institution. If such institution is not participating in the
Plan, your account will be credited with a cash dividend. In order to
participate in the Plan through such institution, it may be necessary for you to
have your shares taken out of "street name" and re-registered in your own name.
Once registered in your own name your distributions will be automatically
reinvested. Certain brokers participate in the Plan. Shareholders holding shares
in "street name" at participating institutions will have dividends automatically
reinvested. Shareholders wishing a cash dividend at such institution must
contact their broker to make this change.
The number of shares of common stock distributed to participants in the
Plan in lieu of cash dividends is determined in the following manner. Under the
Plan, whenever the market price of the Fund's common stock is equal to or
exceeds net asset value at the time shares are valued for purposes of
determining the number of shares equivalent to the cash dividends or capital
gains distribution, participants are issued shares of common stock valued at the
greater of (i) the net asset value as most recently determined or (ii) 95% of
the then current market price of the Fund's common stock. The valuation date is
the dividend or distribution payment date or, if that date is not a New York
Stock Exchange ("NYSE") trading day, the next trading day. If the net asset
value of the common stock at the time of valuation exceeds the market price of
the common stock, participants will receive shares from the Fund valued at
market price. If the Fund should declare a dividend or capital gains
distribution payable only in cash, Computershare will buy shares of common stock
in the open market, or on the NYSE or elsewhere, for the participants' accounts,
except that Computershare will endeavor to terminate purchases in the open
market and cause the Fund to issue shares at net asset value if, following the
commencement of such purchases, the market value of the common stock exceeds the
then current net asset value.
The automatic reinvestment of dividends and capital gains distributions
will not relieve participants of any income tax which may be payable on such
distributions. A participant in the Plan will be treated for federal income tax
purposes as having received, on a dividend payment date, a dividend or
distribution in an amount equal to the cash the participant could have received
instead of shares.
25
VOLUNTARY CASH PURCHASE PLAN
The Voluntary Cash Purchase Plan is yet another vehicle for our
shareholders to increase their investment in the Fund. In order to participate
in the Voluntary Cash Purchase Plan, shareholders must have their shares
registered in their own name.
Participants in the Voluntary Cash Purchase Plan have the option of making
additional cash payments to Computershare for investments in the Fund's common
shares at the then current market price. Shareholders may send an amount from
$250 to $10,000. Computershare will use these funds to purchase shares in the
open market on or about the 1st and 15th of each month. Computershare will
charge each shareholder who participates $0.75, plus a pro rata share of the
brokerage commissions. Brokerage charges for such purchases are expected to be
less than the usual brokerage charge for such transactions. It is suggested that
any voluntary cash payments be sent to Computershare, P.O. Box 43010,
Providence, RI 02940-3010 such that Computershare receives such payments
approximately 10 days before the 1st and 15th of the month. Funds not received
at least five days before the investment date shall be held for investment until
the next purchase date. A payment may be withdrawn without charge if notice is
received by Computershare at least 48 hours before such payment is to be
invested.
SHAREHOLDERS WISHING TO LIQUIDATE SHARES HELD AT COMPUTERSHARE must do so
in writing or by telephone. Please submit your request to the above mentioned
address or telephone number. Include in your request your name, address, and
account number. The cost to liquidate shares is $2.50 per transaction as well as
the brokerage commission incurred. Brokerage charges are expected to be less
than the usual brokerage charge for such transactions.
For more information regarding the Automatic Dividend Reinvestment Plan and
Voluntary Cash Purchase Plan, brochures are available by calling (914) 921-5070
or by writing directly to the Fund.
The Fund reserves the right to amend or terminate the Plan as applied to
any voluntary cash payments made and any dividend or distribution paid
subsequent to written notice of the change sent to the members of the Plan at
least 90 days before the record date for such dividend or distribution. The Plan
also may be amended or terminated by Computershare on at least 90 days written
notice to participants in the Plan.
26
TRUSTEES AND OFFICERS
THE GABELLI DIVIDEND & INCOME TRUST
ONE CORPORATE CENTER, RYE, NY 10580-1422
TRUSTEES OFFICERS
Mario J. Gabelli, CFA Bruce N. Alpert
CHAIRMAN & CHIEF EXECUTIVE OFFICER, PRESIDENT
GAMCO INVESTORS, INC.
Carter W. Austin
Anthony J. Colavita VICE PRESIDENT
ATTORNEY-AT-LAW,
ANTHONY J. COLAVITA, P.C. Peter D. Goldstein
CHIEF COMPLIANCE OFFICER
James P. Conn
FORMER MANAGING DIRECTOR & James E. McKee
CHIEF INVESTMENT OFFICER, SECRETARY
FINANCIAL SECURITY ASSURANCE HOLDINGS LTD.
Agnes Mullady
Mario d'Urso TREASURER
CHAIRMAN, MITTEL CAPITAL MARKETS SPA
INVESTMENT ADVISER
Frank J. Fahrenkopf, Jr. Gabelli Funds, LLC
PRESIDENT & CHIEF EXECUTIVE OFFICER, One Corporate Center
AMERICAN GAMING ASSOCIATION Rye, New York 10580-1422
Michael J. Melarkey CUSTODIAN
ATTORNEY-AT-LAW, State Street Bank and Trust Company
AVANSINO, MELARKEY, KNOBEL & MULLIGAN
COUNSEL
Salvatore M. Salibello Skadden, Arps, Slate, Meagher & Flom, LLP
CERTIFIED PUBLIC ACCOUNTANT,
SALIBELLO & BRODER, LLP TRANSFER AGENT AND REGISTRAR
Computershare Trust Company, N.A.
Edward T. Tokar
SENIOR MANAGING DIRECTOR, STOCK EXCHANGE LISTING
BEACON TRUST COMPANY 5.875% 6.00%
Common Preferred Preferred
Anthonie C. van Ekris ------ --------- ---------
CHAIRMAN, BALMAC INTERNATIONAL, INC. NYSE-Symbol: GDV GDV PrA GDVPrD
Shares Outstanding: 83,929,070 3,200,000 2,600,000
Salvatore J. Zizza
CHAIRMAN, ZIZZA & CO., LTD. The Net Asset Value per share appears in
the Publicly Traded Funds column, under
the heading "General Equity Funds," in
Monday's The Wall Street Journal. It is
also listed in Barron's Mutual
Funds/Closed End Funds section under the
heading "General Equity Funds."
The Net Asset Value per share may be
obtained each day by calling (914)
921-5070 or visiting www.gabelli.com.
--------------------------------------------------------------------------------
For general information about the Gabelli Funds, call 800-GABELLI
(800-422-3554), fax us at 914-921-5118, visit Gabelli Funds' Internet homepage
at: WWW.GABELLI.COM or e-mail us at: closedend@gabelli.com
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940, as amended, that the Fund may, from time to time, purchase
its common shares in the open market when the Fund's shares are trading at a
discount of 7.5% or more from the net asset value of the shares. The Fund may
also, from time to time, purchase its Series A and Series D Cumulative Preferred
Shares in the open market when the shares are trading at a discount to the
Liquidation Value of $25.00.
--------------------------------------------------------------------------------
THE GABELLI DIVIDEND & INCOME TRUST
ONE CORPORATE CENTER
RYE, NY 10580-1422
(914) 921-5070
WWW.GABELLI.COM
SEMI-ANNUAL REPORT
JUNE 30, 2007
GDV Q2/2007
ITEM 2. CODE OF ETHICS.
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Schedule of Investments in securities of unaffiliated issuers as of the close of
the reporting period is included as part of the report to shareholders filed
under Item 1 of this form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
There has been no change, as of the date of this filing, in any of the portfolio
managers identified in response to paragraph (a)(1) of this Item in the
registrant's most recently filed annual report on Form N-CSR.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
REGISTRANT PURCHASES OF EQUITY SECURITIES
=============================================================================================================================
(C) TOTAL NUMBER OF (D) MAXIMUM NUMBER (OR
SHARES (OR UNITS) APPROXIMATE DOLLAR VALUE) OF
(A) TOTAL NUMBER OF PURCHASED AS PART OF SHARES (OR UNITS) THAT MAY YET
SHARES (OR UNITS) (B) AVERAGE PRICE PAID PUBLICLY ANNOUNCED PLANS BE PURCHASED UNDER THE PLANS
PERIOD PURCHASED PER SHARE (OR UNIT) OR PROGRAMS OR PROGRAMS
=============================================================================================================================
Month #1 Common - N/A Common - N/A Common - N/A Common - 83,973,170
01/01/07
through Preferred Series A - N/A Preferred Series A - N/A Preferred Series A - N/A Preferred Series A - 3,200,000
01/31/07
Preferred Series D - N/A Preferred Series D - N/A Preferred Series D - N/A Preferred Series D - 2,600,000
=============================================================================================================================
Month #2 Common - N/A Common - N/A Common - N/A Common - 83,973,170
02/01/07
through Preferred Series A - N/A Preferred Series A - N/A Preferred Series A - N/A Preferred Series A - 3,200,000
02/28/07
Preferred Series D - N/A Preferred Series D - N/A Preferred Series D - N/A Preferred Series D - 2,600,000
=============================================================================================================================
Month #3 Common - N/A Common - N/A Common - N/A Common - 83,973,170
03/01/07
through Preferred Series A - N/A Preferred Series A - N/A Preferred Series A - N/A Preferred Series A - 3,200,000
03/31/07
Preferred Series D - N/A Preferred Series D - N/A Preferred Series D - N/A Preferred Series D - 2,600,000
=============================================================================================================================
Month #4 Common - N/A Common - N/A Common - N/A Common - 83,973,170
04/01/07
through Preferred Series A - N/A Preferred Series A - N/A Preferred Series A - N/A Preferred Series A - 3,200,000
04/30/07
Preferred Series D - N/A Preferred Series D - N/A Preferred Series D - N/A Preferred Series D - 2,600,000
=============================================================================================================================
Month #5 Common - 20,000 Common - $20.6225 Common - 20,000 Common - 83,973,170 - 20,000 =
05/01/07 83,953,170
through Preferred Series A - N/A Preferred Series A - N/A Preferred Series A - N/A
05/31/07 Preferred Series A - 3,200,000
Preferred Series D - N/A Preferred Series D - N/A Preferred Series D - N/A
Preferred Series D - 2,600,000
=============================================================================================================================
Month #6 Common - 24,100 Common - $22.4125 Common - 24,100 Common - 83,953,170 - 24,100 =
06/01/07 83,929,070
through Preferred Series A - N/A Preferred Series A - N/A Preferred Series A - N/A
06/30/07 Preferred Series A - 3,200,000
Preferred Series D - N/A Preferred Series D - N/A Preferred Series D - N/A
Preferred Series D - 2,600,000
=============================================================================================================================
Total Common - 44,100 Common - $22.5168 Common - 44,100 N/A
Preferred Series A - N/A Preferred Series A - N/A Preferred Series A - N/A
Preferred Series D - N/A Preferred Series D - N/A Preferred Series D - N/A
=============================================================================================================================
Footnote columns (c) and (d) of the table, by disclosing the following
information in the aggregate for all plans or programs publicly announced:
a. The date each plan or program was announced - The notice of the
potential repurchase of common and preferred shares occurs quarterly in
the Fund's quarterly report in accordance with Section 23(c) of the
Investment Company Act of 1940, as amended.
b. The dollar amount (or share or unit amount) approved - Any or all
common shares outstanding may be repurchased when the Fund's common
shares are trading at a discount of 7.5% or more from the net asset
value of the shares. Any or all preferred shares outstanding may be
repurchased when the Fund's preferred shares are trading at a discount
to the liquidation value of $25.00.
c. The expiration date (if any) of each plan or program - The Fund's
repurchase plans are ongoing.
d. Each plan or program that has expired during the period covered by the
table - The Fund's repurchase plans are ongoing.
e. Each plan or program the registrant has determined to terminate prior
to expiration, or under which the registrant does not intend to make
further purchases. - The Fund's repurchase plans are ongoing.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's Board of Trustees, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR
229.407) (as required by Item 22(b)(15) of Schedule 14A (17 CFR 240.14a-101)),
or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of the report that includes the disclosure
required by this paragraph, based on their evaluation of these
controls and procedures required by Rule 30a-3(b) under the 1940 Act
(17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the
Securities Exchange Act of 1934, as amended (17 CFR 240.13a-15(b) or
240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act
(17 CFR 270.30a-3(d)) 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.
ITEM 12. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and
Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.
(a)(3) Not applicable.
(b) Certifications pursuant to Rule 30a-2(b) under the 1940 Act and
Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(registrant) The Gabelli Dividend & Income Trust
--------------------------------------------------------------------
By (Signature and Title)* /s/ Bruce N. Alpert
-------------------------------------------------------
Bruce N. Alpert, Principal Executive Officer
Date August 31, 2007
----------------------------------------------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Bruce N. Alpert
-------------------------------------------------------
Bruce N. Alpert, Principal Executive Officer
Date August 31, 2007
----------------------------------------------------------------------------
By (Signature and Title)* /s/ Agnes Mullady
-------------------------------------------------------
Agnes Mullady,
Principal Financial Officer and Treasurer
Date August 31, 2007
----------------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.