[Mountain graphic omitted]
THE GABELLI
CONVERTIBLE
SECURITIES
FUND, INC.
FIRST QUARTER REPORT
MARCH 31, 2000
<PAGE>
[Mountain graphic omitted]
THE GABELLI
CONVERTIBLE
SECURITIES
FUND, INC.
Our cover icon represents the underpinnings of Gabelli. The Teton mountains in
Wyoming represent what we believe in in America -- that creativity, ingenuity,
hard work and a global uniqueness provide enduring values. They also stand out
in an increasingly complex, interconnected and interdependent economic world.
INVESTMENT OBJECTIVE:
The Gabelli Convertible Securities Fund, Inc. is a closed-end, diversified
management investment company whose primary objective is to seek a high level of
total return through a combination of current income and capital appreciation by
investing in convertible securities.
THIS REPORT IS PRINTED ON RECYCLED PAPER.
<PAGE>
TO OUR SHAREHOLDERS,
In the first quarter of 2000, we continued to experience a "have and have
not" stock market. Until the very end of the quarter, so called "new economy"
stocks (primarily technology companies) flourished, while "old economy" stocks
languished or retreated. Despite the late sell-off, the tech-heavy Nasdaq
Composite and the small cap growth-oriented Russell 2000 recorded good gains.
However, the S&P 500 closed the quarter only modestly higher, and the Dow Jones
Industrial Average and Value Line Composite declined.
[PHOTO OF MARIO GABELLI OMITTED]
[Mountain graphic omitted]
THE GABELLI
CONVERTIBLE
SECURITIES
FUND, INC.
Bonds--the other component impacting performance trends in the convertible
securities market--bottomed in late January, advanced through late March, and
then retreated in the last week of the quarter. In general, better bond prices
provided a modest tailwind for convertible securities this quarter.
INVESTMENT PERFORMANCE
For the first quarter ended March 31, 2000, The Gabelli Convertible
Securities Fund, Inc.'s ("Convertible Securities Fund") net asset value (NAV)
per share increased 1.34% to $11.32, after adjusting for the $0.20 per share
distribution paid on March 27, 2000. This compares to an increase of 9.61% for
the Lipper Inc. Convertible Securities Fund Average over the same period. The
Lipper average is an unmanaged indicator of investment performance. For the
twelve months ended March 31, 2000, the Fund increased 8.90% versus an increase
of 40.20% for the Lipper Inc. Convertible Securities Fund Average over this
period.
The three- and five-year average annual returns of the Convertible
Securities Fund were 10.25% and 10.08%, respectively. Since inception on July 3,
1989 through March 31, 2000, the Convertible Securities Fund achieved a 174.99%
total return which represents an average annual return of 9.86%.
The Fund's common shares on the New York Stock Exchange ended the quarter
at $9.625, down 7.00% for the quarter, down 4.70% for the past twelve months and
up 36.08% from its initial price of $11.25 on March 31, 1995 after adjusting for
the reinvestment of dividends totaling $4.995 per share which were paid during
this period.
Our Fund is managed with the goal of achieving a 600-800 basis point
spread above long-term treasury yields. We hope to generate these returns over
the long term. This is the type of performance that our Fund has been known for
and we anticipate will continue in the future. Of course, there are no
guarantees.
Over the past few months the Fund's shares have traded at an average
discount of approximately 13% to the net asset value. At these price levels, the
Fund is an ideal opportunity for investors to add to their positions. Our cash
purchase program provides an easy way for registered shareholders to acquire
additional shares at the current market price. Please find the details of our
Voluntary Cash Purchase Plan at the end of this report.
<PAGE>
<TABLE>
<CAPTION>
INVESTMENT RESULTS (a)(c)
- -------------------------------------------------------------------------------------
Quarter
------------------------------------------------------
1ST 2ND 3RD 4TH YEAR
<S> <C> <C> <C> <C> <C>
2000: Net Asset Value ... $11.32 -- -- -- --
Total Return ...... 1.3% -- -- -- --
- -------------------------------------------------------------------------------------
1999: Net Asset Value ... $11.45 $12.13 $11.67 $11.40 $11.40
Total Return ...... 1.8% 7.8% (2.0)% 1.7% 9.4%
- -------------------------------------------------------------------------------------
1998: Net Asset Value ... $11.87 $11.66 $10.96 $11.45 $11.45
Total Return ...... 5.3% 0.0% (4.2)% 7.4% 8.3%
- -------------------------------------------------------------------------------------
1997: Net Asset Value ... $11.13 $11.38 $11.81 $11.48 $11.48
Total Return ...... 1.7% 3.5% 5.0% 2.8% 13.5%
- -------------------------------------------------------------------------------------
1996: Net Asset Value ... $11.28 $11.33 $11.23 $11.08 $11.08
Total Return ...... 3.6% 1.6% 0.3% 2.6% 8.4%
- -------------------------------------------------------------------------------------
1995: Net Asset Value ... $11.14 $11.51 $11.64 $11.01 $11.01
Total Return ...... 5.1% 5.2% 3.0% 1.1% 15.0%
- -------------------------------------------------------------------------------------
1994: Net Asset Value ... $11.54 $11.39 $11.60 $10.60 $10.60
Total Return ...... 0.2% (1.3)% 1.8% (0.9)% (0.2)
- -------------------------------------------------------------------------------------
1993: Net Asset Value ... $12.07 $12.36 $12.75 $11.52 $11.52
Total Return ...... 5.4% 2.4% 3.2% 1.5% 13.1%
- -------------------------------------------------------------------------------------
1992: Net Asset Value ... $11.29 $11.52 $11.90 $11.45 $11.45
Total Return ...... 3.5% 2.0% 3.3% 3.6% 13.0%
- -------------------------------------------------------------------------------------
1991: Net Asset Value ... $11.06 $11.27 $11.57 $10.91 $10.91
Total Return ...... 5.6% 1.9% 2.7% 1.8% 12.5%
- -------------------------------------------------------------------------------------
1990: Net Asset Value ... $10.56 $10.68 $10.56 $10.47 $10.47
Total Return ...... 1.5% 2.1% (1.1)% 3.8% 6.3%
- -------------------------------------------------------------------------------------
1989: Net Asset Value ... -- -- $10.54 $10.51 $10.51
Total Return ...... -- -- 5.4%(b) 0.8% 6.3%(b)
- -------------------------------------------------------------------------------------
</TABLE>
AVERAGE ANNUAL RETURNS - MARCH 31, 2000 (A)
-------------------------------------------
1 Year ....................................... 8.90%
5 Year ....................................... 10.08%
Life of Fund (b) ............................. 9.86%
(a) Total return and average annual return reflect changes in net asset value
and reinvestment of dividends and are net of expenses. Of course, the returns
noted 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.
(b) From commencement of operations on July 3, 1989.
(c) The Fund converted to closed-end status on March 31, 1995.
Dividend History - Common Stock
- -------------------------------------------------
PAYMENT DATE RATE PER SHARE REINVESTMENT PRICE
- ------------ -------------- ------------------
March 27, 2000 $0.200 $ 9.71
December 27, 1999 $0.430 $10.38
September 27, 1999 $0.200 $10.86
June 28, 1999 $0.200 $11.38
March 29, 1999 $0.200 $11.04
December 28, 1998 $0.320 $11.49
September 28, 1998 $0.200 $10.52
June 26, 1998 $0.200 $11.02
March 26, 1998 $0.200 $11.10
December 26, 1997 $0.600 $10.49
September 26, 1997 $0.120 $10.44
June 27, 1997 $0.120 $ 9.96
March 27, 1997 $0.120 $ 9.63
December 27, 1996 $0.375 $ 9.51
September 23, 1996 $0.120 $ 9.73
June 24, 1996 $0.120 $10.17
March 25, 1996 $0.120 $10.41
December 27, 1995 $0.750 $10.95
September 27, 1995 $0.200 $11.10
June 27, 1995 $0.200 $11.21
December 31, 1994 $0.900 $10.60
December 31, 1993 $1.425 $11.52
December 31, 1992 $0.876 $11.45
December 31, 1991 $0.865 $10.91
December 31, 1990 $0.490 $10.47
June 28, 1990 $0.100 $10.68
March 29, 1990 $0.100 $10.55
December 29, 1989 $0.115 $10.51
- -------------------------------------------------
2
<PAGE>
WHAT WE DO
The success of momentum investing in recent years and investors' desire
for instant gratification have combined to make value investing appear dull. At
the risk of being dull, we will once again describe the "boring" value approach
that has seen us through both good and bad markets over the last 10 years at The
Gabelli Convertible Securities Fund and for over 23 years at Gabelli Asset
Management Company. In past reports, we have tried to articulate our investment
philosophy and methodology. The following graphic further illustrates the
interplay among the four components of our valuation approach.
[TRIANGLE GRAPHIC OMITTED; TEXT AS FOLLOWS:]
EPS
PMV
MANAGEMENT
CASH FLOW
RESEARCH
Our focus is on free cash flow: earnings before interest, taxes,
depreciation and amortization (EBITDA) minus the capital expenditures necessary
to grow the business. We believe free cash flow is the best barometer of a
business' value. Rising free cash flow often foreshadows net earnings
improvement. We also look at earnings per share trends. Unlike Wall Street's
ubiquitous earnings momentum players, we do not try to forecast earnings with
accounting precision and then trade stocks based on quarterly expectations and
realities. We simply try to position ourselves in front of long-term earnings
uptrends. In addition, we analyze on and off balance sheet assets and
liabilities such as plant and equipment, inventories, receivables, and legal,
environmental and health care issues. We want to know everything and anything
that will add to or detract from our private market value (PMV) estimates.
Finally, we look for a catalyst: something happening in the company's
industry or indigenous to the company itself that will surface value. In the
case of the independent telephone stocks, the catalyst is a regulatory change.
In the agricultural equipment business, it is the increasing world-wide demand
for American food and feed crops. In other instances, it may be a change in
management, sale or spin-off of a division or the development of a profitable
new business.
Once we identify stocks that qualify as fundamental and conceptual
bargains, we then become patient investors. This has been a proven long-term
method for preserving and enhancing wealth in the U.S. equities market. At the
margin, our new investments are focused on businesses that are well-managed and
will benefit from sustainable long-term economic dynamics. These include macro
trends, such as the globalization of the market in filmed entertainment and
telecommunications, and micro trends, such as an increased focus on productivity
enhancing goods and services.
CONVERTIBLE SECURITIES ARE "HYBRIDS"
It is important to understand our stock selection discipline because price
movement in the underlying equity will generally have the greatest impact on
convertible securities pricing. The convertible securities market consists of
bonds, debentures, corporate notes, preferred stocks and warrants or other
similar securities which may be converted into or exchanged for a prescribed
amount of common stock or other equity security of the same or a different
issuer within a particular period of time at a specified price or formula.
Converts are "hybrid" securities that combine the capital appreciation potential
of equities with the higher yield of fixed income instruments. Our strategy
incorporates the purchase of convertible securities which are trading at a
premium above parity with the common stock but which generally provide a higher
yield and, over time, capital appreciation. We will also seek out "busted"
converts, where
3
<PAGE>
the underlying common stock has dropped significantly and the values of both the
conversion privilege and the convert are down. Such securities will provide both
high yields and long-term capital appreciation potential.
OUR INVESTMENT OBJECTIVES
Our mandate is to preserve and enhance our shareholders' wealth through a
conservative, disciplined approach to convertible securities investing. Our goal
is to generate profitable returns in strong markets and protect principal in
weak markets by taking advantage of the unique characteristics of convertible
securities.
CONVERTIBLE MARKET OVERVIEW
As of March 31, 2000, the U.S. convertible market totaled 178 billion
dollars. The first quarter saw a record amount of new issuance totaling 22.8
billion versus less than 5 billion in the first quarter of 1999. This was the
first time in history that new issue activity in the convertible market
surpassed that of the straight high yield market. This is understandable since
over 80% of the issuers were health care related or technology companies often
lacking a long-term performance record. These companies, who would have
difficulty accessing the high yield market at reasonable levels, were attracted
to the convertible market where they could raise funds cheaply in exchange for
offering an equity option on their stock. However, despite the flurry of new
deals, net new issuance was actually negative 7.3 billion dollars as several
large issues were converted (i.e. EMC and Qualcomm).
As for the secondary market, several characteristics are noteworthy.
First, credit quality continues to deteriorate. Presently, only 35% of the
market is rated investment grade versus over fifty percent five years ago.
Second, 144A issues, initially available only to qualified institutional buyers,
now make-up 15.6% of the market. Third, mandatory convertible securities, which
lack the downside protection of traditional convertibles, constitute 18% of the
market. We believe these characteristics favor an actively managed portfolio
approach to investing in convertible securities.
In performance terms, the large capitalization and growth sectors of the
convertible market outperformed during the quarter. However in March there was a
turning of the tide as value overshadowed growth gaining 7.28% versus a decline
of 1.10%. In the long run, fundamentals do matter.
COMMENTARY
THE PERILS OF PAULINE
In each episode of the old movie serial, The Perils of Pauline, the
heroine faced certain doom until a hero suddenly appeared to save the day.
Through most of the first quarter of 2000, equities were imperiled by rising
short term interest rates and the perception that Federal Reserve Chairman Alan
Greenspan was determined to restrain the stock market as well as the economy.
With equities dangling from a cliff, a hero in the form of declining market
interest rates (bond yields) rescued stocks from a sharp correction that
appeared ready to turn into a full scale bear market.
Of course, in the old movie shorts, as soon as Pauline escaped from one
life threatening predicament, she was thrust into another. Over the short term,
we suspect the stock market will also face a series of new dangers. The Federal
Reserve should continue to hike short term rates, eventually killing the nascent
bond market rally and putting
4
<PAGE>
pressure back on stocks. Valuations in the technology sector also present a risk
to the market. If some of the technology "bell weathers" fall short of rather
grand earnings expectations, we could see a sharp correction that would drag
down the market indices. There is also the uncertainty of an election year. Will
a Bush victory lead to tax cuts that will help sustain consumer spending or will
a Gore triumph dash the hopes of consumers and investors counting on tax relief?
There are plenty of potential heroes that could once again rescue the
market. Corporate earnings growth is strong, and with synchronized global
growth, may get stronger. If we see evidence of economic deceleration in the
second half, the Fed may take its foot off the monetary brakes and market
interest rates could come down further. We are going to continue to see deals,
particularly in out-of-favor industries where some great companies have become
irresistible business bargains. This may finally prop up the value sector of the
market. Finally, investors love happy endings. Over the last several years,
whenever stocks have stumbled investors have rushed in to lift them to safety.
Will robust corporate earnings growth compensate for higher short term
interest rates? Will the bond rally fizzle, halting the stock market's momentum?
Will technology stocks falter, dragging the market lower? Will a rally in the
dormant value sector help buoy the market indices? Will investors remain so
confident that every market dip is viewed as a buying opportunity or will
investors panic if we see a more prolonged market slide? We do not think anyone
has the answers to all of these questions. We believe convertible securities
offer an attractive alternative to stocks in almost any environment, but
particularly one in which uncertainty is likely to contribute to ongoing stock
market volatility.
OLD ECONOMY, NEW ECONOMY
The financial press and market observers are good at developing simplistic
theories to explain market trends. Today, they have divided the market into "old
economy" and "new economy" stocks. The former are thought to be worthless while
the latter are perceived as almost priceless. A closer look at the situation
reveals the flaws in this current logic.
The so called "new economy" stocks are primarily technology companies
developing new ways to distribute information, products, and services. Some are
fine companies with exceptional growth prospects. However, the "new economy"
superstars don't drill for oil, process chemicals, make household goods, or
manufacture automobiles. They don't knit sweaters or make shoes. They don't
build houses. They don't produce motion pictures or television programs. They
are simply building systems making it possible for "old economy" companies to
provide these essential products and services more efficiently and cost
effectively. Will the best of the "new economy" companies make money and over
the long term enrich investors? Yes. Will "old economy" companies that harness
the power of new technologies prosper and also reward shareholders? Yes.
Presently, you can pay sky high valuations for "new economy" companies or pick
up high quality "old economy" stocks and convertible securities at deep
discounts.
GOOD THINGS COME TO THOSE WHO WAIT
The critical element to our success in the equities and convertible
securities markets has been patience in both the selection process and in
waiting for the values of portfolio positions to be recognized. We will continue
to be patient and opportunistic in selecting converts for the Fund and will
invest in short-term instruments (including time
5
<PAGE>
sensitive work-outs) when appropriate. We bought mostly short-term U.S. Treasury
obligations in the past. However, the U.S. financial system has improved
significantly and we now take advantage of other short-term alternatives. In
this regard, the Convertible Securities Fund at times engages in risk arbitrage
to generate returns. By risk arbitrage we mean investing in "event" driven
situations; primarily, but not exclusively, in announced mergers, acquisitions,
reorganizations and other "workout" opportunities. In order to avoid overall
market risk in these opportunities, the Fund will concentrate on the lower risk
transactions.
We borrow a quote from Warren Buffett to explain our occasional use of
risk arbitrage in the Fund: "Our subsidiaries sometimes engage in arbitrage as
an alternative to holding short-term cash equivalents. We prefer, of course, to
make major long-term commitments. But we often have more cash than good ideas.
At such times arbitrage sometimes promises much greater returns than Treasury
Bills and, equally important, cools any temptation we may have to relax our
standards for long-term investments."
In short, the high cash position in the Fund does not reflect any effort
on our part to time the convertible securities market. It is rather a
consequence of our value oriented discipline. At the same time, some of our
convertible securities have been called by the issuer and we either received
cash or stock. Our portfolio turnover rate reflects this activity, as well as
our investments in "event" driven situations which were consummated during the
year. We are always hard at work evaluating opportunities and identifying
fundamental bargains to progress to a more fully invested posture. However, we
will not stretch our fundamental parameters and introduce greater market risk to
the portfolio.
8% DISTRIBUTION POLICY
The Convertible Securities Fund continues to maintain its 8% Distribution
Policy whereby the Fund pays out 8% of its average net assets each year. The
method is to pay $0.20 per share in each of the first three quarters of the year
and a distribution in the fourth quarter of a sufficient amount to pay 8% of the
average net assets of the Fund or to satisfy the minimum distribution
requirements of the Internal Revenue Code. The Fund recently distributed $0.20
per share on March 27, 2000 in line with this 8% annual distribution policy.
STOCK REPURCHASE PLAN
The Gabelli Convertible Securities Fund is authorized to repurchase up to
250,000 shares of the Convertible Securities Fund's outstanding shares. Pursuant
to this stock repurchase plan, the Convertible Securities Fund may from time to
time purchase shares of its capital stock in the open market when the shares are
trading at a discount of 10% or more from the net asset value of the shares. In
total, through March 31, 2000, 215,300 shares were repurchased in the open
market since the inception of this stock repurchase plan.
LET'S TALK CONVERTS
The following are specifics on selected holdings of our Fund. Favorable
EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization)
prospects do not necessarily translate into higher prices, but they do express a
positive trend which we believe will develop over time.
BELL ATLANTIC CORP. (BEL) (SUB. DEB. CV., 4.25%, 09/15/05) following its merger
with NYNEX and with its pending merger with GTE (GTE - $71.00 - NYSE),
becomes a premier provider of advanced voice and data services from
6
<PAGE>
Maine to Virginia--the world's most information-intensive marketplace. Bell
Atlantic is one of the world's largest and most successful wireless companies,
with domestic operations in 24 states and international investments in Latin
America, Europe and the Pacific Rim. In early April, BEL and VodafoneAirtouch
plc (VOD - $55.5625 - NYSE) finished combining their U.S. wireless operations
into a joint venture called Verizon Wireless which will reach more than 90% of
the U.S. population. Upon completion of the merger with GTE, expected by the end
of the second quarter, BEL will be renamed Verizon Communications and will
become the largest domestic wireless carrier with about 25 million subscribers.
BEL is also a global leader in publishing directories and in providing
Internet-based shopping guides, website creation and hosting, and other
electronic commerce services. The company has a mix of mature and start-up
communications businesses in Europe and the Pacific Rim, including a 24.9% stake
in Telecom Corp. of New Zealand and an 18.5% stake in Cable & Wireless
Communications.
CITIZENS UTILITIES CO. (CZN) (5.00% CV. PFD.) provides telecommunications
services and public services to approximately 1.9 million customers in 22
states. Citizens owns 83% of Electric Lightwave Inc. (ELIX - $23.875 - Nasdaq),
a competitive local exchange carrier ("CLEC") serving primarily the western U.S.
Management has authorized the separation of Citizens' telecommunications
businesses and public services businesses into two stand-alone, publicly traded
companies. Recently, CZN announced agreements to acquire about 1 million rural
access lines in 11 states for $2.8 billion. CZN intends to finance these
transactions by divesting its public services operations. Its water and waste
water operations have been sold for $835 million. The company has an agreement
to sell all its electric and waste water utility operations to Cap Rock Energy
and Kauai Island Electric Company for an aggregate purchase price of $535
million. The company has sold its 16% stake in Centennial Communications Corp.
(CYCL - $24.3125 - Nasdaq) for approximately $205 million. Citizens monetized
its ownership of Century Communications' (CTYA - $45.625 - Nasdaq) stock and
cable operations through a sale to Adelphia Communications for approximately
$220 million.
HILTON HOTELS CORP. (HLT) (SUB. DEB. CV., 5.00%, 05/15/06) is recognized as one
of the world's preeminent hospitality companies. Hilton develops, owns, manages
and franchises hotels, resorts and vacation ownership properties. Based on the
number of hotel rooms, Hilton is the nation's seventh largest hotel company.
Hilton has approximately 260 hotels and resorts in cities throughout the United
States, including 54 owned and/or managed hotels and 199 hotels under franchise
agreements. Flagship properties include The Waldorf-Astoria, the Hilton Chicago
& Towers, Hilton Hawaiian Village (98%-owned) and Palmer House Hilton. HLT
formalized a marketing alliance with British company Hilton Group plc (HG -
$4.6461 - London Stock Exchange) (owner of Hilton International) in January 1997
to reunite the Hilton name worldwide for the first time in over 30 years.
Hilton's casino gaming properties have been spun-off into a new company, Park
Place Entertainment (PPE - $11.5625 - NYSE).
MARK IV INDUSTRIES INC. (SUB. DEB. CV., 4.75%, 11/01/04) is a diversified
manufacturer of a broad range of proprietary and other power and fluid transfer
products and systems that serve primarily industrial and automotive markets. The
company classifies its operations into two business segments. Mark IV Industrial
includes the design, manufacture and distribution of power and fluid management
systems and components for industrial OEM (original equipment manufacturers) and
distribution markets worldwide. Mark IV Automotive includes the design,
manufacture and distribution of power transmission, fuel, and fluid handling
systems and components, and filters and filtration systems, for the global
automotive aftermarket and OEM market.
7
<PAGE>
SPRINT CORP. (FON) ($1.50 CV. PFD., SER. 1; $1.50 CV. PFD., SER. 2) is the third
largest long distance carrier and the second largest independent local telephone
company in the U.S. FON faces risks from prospective new entrants in its long
distance business which may be offset by the "ION" high bandwith network that
the company is developing, and by other new services. On October 5, 1999, MCI
WorldCom (WCOM - $45.312 - Nasdaq) announced plans to acquire Sprint for $125
billion in stock and cash. The transaction is expected to close in about 12
months upon receiving regulatory approval. Sprint PCS Group (PCS - $65.50 -
NYSE) is the leading all digital personal communications services ("PCS")
carrier in the U.S. with over 6 million customers and licenses covering over 230
million people. Sprint PCS will be acquired as part of MCI WorldCom's
acquisition of Sprint Corp.
STANDARD MOTOR PRODUCTS INC. (SMP) (SUB. DEB. CV., 6.75%, 07/15/09),
headquartered in Long Island City, New York, supplies functional replacement
parts for the engine management, electrical and climate control systems of cars,
trucks and buses. The company services all makes and models, both new and old
cars, imported and domestic. SMP has two primary divisions--engine management
and temperature control--and believes it is the number one supplier to the North
American aftermarket in each of these lines.
USA NETWORKS INC. (SUB. DEB. CV., 7.00%, 07/01/03), through its subsidiaries,
engages in diversified media and electronic commerce businesses that include:
electronic retailing, ticketing operations and television broadcasting. Chairman
and CEO Barry Diller has brought together under one umbrella: the USA Network,
the Sci-Fi Channel, USA Networks Studios, USA Broadcasting, The Home Shopping
Network and the Ticketmaster Group. The plan is to integrate these assets,
leveraging programming, production capabilities and electronic commerce across
this strong distribution platform.
DIVIDENDS
The Fund recently distributed a dividend of $0.20 per share to Common
Shareholders on March 27, 2000 in line with the Fund's 8% annual distribution
policy. For the twelve months ended March 31, 2000, the Fund distributed a total
of $1.03 per share to Common Shareholders. Our Preferred Shareholders were paid
a dividend of $0.50 per share on March 27, 2000. For the twelve months ended
March 31, 2000, the Preferred Shareholders received a total distribution of
$2.00 per share, which is the annual dividend rate on the Preferred Shares.
DAILY NAVS NOW DISTRIBUTED BY NASDAQ
Since our inception, we have made the net asset value available on nightly
recordings through 1-800-GABELLI. Now, Nasdaq is also disseminating the daily
per share net asset values (NAVs) for the Gabelli Convertible Securities Fund,
which is traded on the New York Stock Exchange. The NAV ticker symbol via Nasdaq
is "XGCVX."
The NAVs are available through any stock quote lookup service and on
broker Nasdaq level one terminals. The dissemination of daily NAVs allows
investors and brokers to better track the long-term performance of the Fund's
underlying portfolio. We support Nasdaq's efforts in making closed-end funds'
NAVs available on a daily basis.
8
<PAGE>
INTERNET
You can now visit us on the Internet. Our home page at
http://www.gabelli.com contains information about Gabelli Asset Management Inc.,
the Gabelli Mutual Funds, IRAs, 401(k)s, quarterly reports, closing prices and
other current news. You can send us e-mail at [email protected].
IN CONCLUSION
We are quite pleased to have delivered solid returns with almost no
exposure to the hot technology sector, which offers convertible securities
investors little opportunity to participate. This further validates our thesis
that research and securities selection are the twin keys to adding value to the
investment process. As always, the short term future of the financial markets is
uncertain and, in our opinion, unpredictable. We will continue to rely on
research and judgment to achieve our shared objectives.
Sincerely,
/s/signature
MARIO J. GABELLI
President and
Chief Investment Officer
April 14, 2000
- --------------------------------------------------------------------------------
TOP TEN CONVERTIBLE HOLDINGS
MARCH 31, 2000
--------------
Mark IV Industries (Sub. Deb. Cv., 4.75%, 11/01/04)
Citizens Utilities (5.00% Cv. Pfd.)
Kaman Corp. (Sub. Deb. Cv., 6.00%, 03/15/12)
Hilton Hotels Corp. (Sub. Deb. Cv., 5.00%, 05/15/06)
Standard Motor Products (Sub. Deb. Cv., 6.75%, 07/15/09)
Sprint ($1.50 Cv. Pfd., Ser. 1; $1.50 Cv. Pfd., Ser. 2)
Atlantic Richfield Co. ($2.80 Cv. Pfd.)
Sequa Corp. ($5.00 Cv. Pfd.)
Sealed Air Corp. ($2.00 Cv. Pfd., Ser. A)
Cendant Corp. (1.30% Cv. Pfd., 7.50% Cv. Pfd.)
- --------------------------------------------------------------------------------
NOTE: The views expressed in this report reflect those of the portfolio manager
only through the end of the period of this report as stated on the cover. The
manager's views are subject to change at any time based on market and other
conditions.
9
<PAGE>
THE GABELLI CONVERTIBLE SECURITIES FUND, INC.
PORTFOLIO OF INVESTMENTS
MARCH 31, 2000 (UNAUDITED)
PRINCIPAL MARKET
AMOUNT VALUE
--------- ------
CONVERTIBLE CORPORATE BONDS -- 25.2%
AUTOMOTIVE: PARTS AND ACCESSORIES -- 3.1%
$ 700,000 Exide Corp. Sub. Deb. Cv.
2.90%, 12/15/05 (b) ......... $ 368,812
350,000 Pep Boys - Manny, Moe & Jack
Sub. Deb. Cv.
Zero Cpn., 09/20/11 ......... 182,875
4,450,000 Standard Motor Products Inc.
Sub. Deb. Cv.
6.75%, 07/15/09 ............. 3,198,437
------------
3,750,124
------------
AVIATION: PARTS AND SERVICES -- 3.1%
4,189,000 Kaman Corp. Sub. Deb. Cv.
6.00%, 03/15/12 ............. 3,743,919
------------
BUSINESS SERVICES -- 2.0%
900,000 BBN Corp. Sub. Deb. Cv.
6.00%, 04/01/12 (a) ......... 870,750
1,760,000 Trans-Lux Corp. Sub. Deb. Cv.
7.50%, 12/01/06 ............. 1,463,000
------------
2,333,750
------------
COMPUTER SOFTWARE AND SERVICES -- 0.1%
400,000 QuadraMed Corp. Sub. Deb. Cv.
5.25%, 05/01/05 ............. 171,000
------------
CONSUMER PRODUCTS -- 0.6%
1,500,000 Pillowtex Corp. Sub. Deb. Cv.
6.00%, 03/15/12 ............. 420,000
750,000 Standard Commercial Corp.
Sub. Deb. Cv.
7.25%, 03/31/07 ............. 352,500
------------
772,500
------------
CONSUMER SERVICES -- 0.4%
500,000 Ogden Corp. Sub. Deb. Cv.
6.00%, 06/01/02 ............. 425,000
------------
ELECTRONIC EQUIPMENT -- 0.1%
ASM Lithography Holding Cv.
40,000 2.50%, 04/09/05 ............. 76,748
10,000 2.50%, 04/09/05 (b) ......... 19,187
------------
95,935
------------
ENERGY AND UTILITIES -- 1.0%
100,000 Friede Goldman Halter Inc.
Sub. Deb. Cv.
4.50%, 09/15/04 ............. 52,125
1,100,000 Moran Energy Inc. Sub. Deb. Cv.
8.75%, 01/15/08 ............. 1,039,500
PRINCIPAL MARKET
AMOUNT VALUE
--------- ------
$ 100,000 Texaco Capital Inc. Cv.
3.50%, 08/05/04 ............. $ 95,500
------------
1,187,125
------------
ENTERTAINMENT -- 0.7%
800,000 USA Networks Inc. Sub. Deb. Cv.
7.00%, 07/01/03 ............. 819,000
------------
EQUIPMENT AND SUPPLIES -- 7.0%
1,620,000 Kollmorgen Corp. Sub. Deb. Cv.
8.75%, 05/01/09 ............. 1,587,600
7,500,000 Mark IV Industries Inc. Sub. Deb. Cv.
4.75%, 11/01/04 ............. 6,393,750
350,000 Robbins & Myers Inc.
Sub. Deb. Cv.
6.50%, 09/01/03 ............. 335,344
------------
8,316,694
------------
FOOD AND BEVERAGE -- 0.1%
110,000 Boston Chicken Inc.
Sub. Deb. Cv.
7.75%, 05/01/04+ ............ 687
150,000 Chiquita Brands International
Inc. Cv.
7.00%, 03/28/01 ............. 129,000
------------
129,687
------------
HEALTH CARE -- 0.1%
10,000 Inhale Therapeutic Systems
Sub. Deb. Cv.
6.75%, 10/13/06 (b) ......... 23,119
150,000 Sabratek Corp.
Sub. Deb. Cv.
6.00%, 04/15/05+ ............ 58,500
------------
81,619
------------
HOTELS AND GAMING -- 2.7%
4,250,000 Hilton Hotels Corp. Sub. Deb. Cv.
5.00%, 05/15/06 ............. 3,219,375
------------
METALS AND MINING -- 0.3%
500,000 Coeur d'Alene Mines Corp.
Sub. Deb. Cv.
6.00%, 06/10/02 ............. 317,500
------------
PAPER AND FOREST PRODUCTS -- 1.0%
200,000 Riverwood International Corp.
Sub. Deb. Cv.
6.75%, 09/15/03 ............. 230,890
1,200,000 Thermo Fibertek Inc. Cv.
4.50%, 07/15/04 (b) ......... 1,021,500
------------
1,252,390
------------
10
<PAGE>
THE GABELLI CONVERTIBLE SECURITIES FUND, INC.
PORTFOLIO OF INVESTMENTS (CONTINUED)
MARCH 31, 2000 (UNAUDITED)
PRINCIPAL MARKET
AMOUNT VALUE
--------- ------
CONVERTIBLE CORPORATE BONDS (CONTINUED)
PUBLISHING -- 1.6%
$ 700,000 News America Holdings Inc.
Sub. Deb. Cv.
Zero Cpn., 03/31/02 ......... $ 1,682,625
200,000 Times Mirror Ltd. Sub. Deb. Cv.
Zero Cpn., 04/15/17 ......... 110,500
50,000 United News & Media plc
Sub. Deb. Cv.
6.125%, 12/03/03 (c) ........ 99,547
------------
1,892,672
------------
REAL ESTATE AND DEVELOPMENT -- 0.1%
125,000 Rockefeller Center Properties Inc.
Sub. Deb. Cv.
Zero Cpn., 12/31/00 ......... 102,812
------------
RETAIL -- 0.1%
60,000 Costco Companies Inc.
Sub. Deb. Cv.
Zero Cpn., 08/19/17 ......... 71,700
100,000 JumboSports Inc.
Sub. Deb. Cv.
4.25%, 11/01/00+ ............ 5,500
------------
77,200
------------
TECHNOLOGY -- 0.2%
300,000 Thermo Electron Corp.
Sub. Deb. Cv.
4.25%, 01/01/03 (b) ......... 279,375
------------
TELECOMMUNICATIONS -- 0.6%
80,000 Amnex Inc. Sub. Deb. Cv.
8.50%, 09/25/02 (b) ......... 3,592
90,000 Bell Atlantic Corp. Cv.
4.25%, 09/15/05 (b) ......... 129,487
500,000 Rogers Communications Inc.
Sub. Deb. Cv.
2.00%, 11/26/05 ............. 510,600
50,000 Telefonica Europe BV
Sub. Deb. Cv.
2.00%, 07/15/02 ............. 128,500
------------
772,179
------------
WIRELESS COMMUNICATIONS -- 0.3%
500,000 U.S. Cellular Corp.
Sub. Deb. Cv.
Zero Cpn., 06/15/15 ......... 341,875
------------
TOTAL CONVERTIBLE
CORPORATE BONDS ............. 30,081,731
------------
MARKET
SHARES VALUE
------ ------
CONVERTIBLE PREFERRED STOCKS -- 19.1%
AGRICULTURE -- 0.2%
4,200 Monsanto Co.
6.50% Cv. Pfd. .............. $ 192,150
------------
AVIATION: PARTS AND SERVICES -- 1.3%
Coltec Capital Trust
25,000 5.25% Cv. Pfd. .............. 893,750
17,000 5.25% Cv. Pfd. (b) .......... 607,750
------------
1,501,500
------------
BUSINESS SERVICES -- 1.5%
Cendant Corp.
5,000 7.50% Cv. Pfd. .............. 143,437
66,000 1.30% Cv. Pfd. .............. 1,617,000
------------
1,760,437
------------
CABLE -- 0.1%
1,000 MediaOne Group Inc.
4.50% Cv. Pfd. Ser. D+ ...... 25,062
1,300 UnitedGlobalCom Inc.
7.00% Cv. Pfd. (a) .......... 123,663
------------
148,725
------------
DIVERSIFIED INDUSTRIAL -- 1.1%
1,400 GATX Corp.
$2.50 Cv. Pfd. .............. 261,538
40,000 WHX Corp.
6.50% Cv. Pfd. Ser. A ....... 1,080,000
------------
1,341,538
------------
ENERGY AND UTILITIES -- 2.2%
6,000 Atlantic Richfield Co.
$2.80 Cv. Pfd. .............. 2,490,000
1,000 Houston Industries Inc.
7.00% Cv. Pfd. .............. 159,000
------------
2,649,000
------------
ENTERTAINMENT -- 0.4%
4,500 Metromedia International Group Inc.
7.25% Cv. Pfd. .............. 144,000
5,000 Seagram Co.
7.50% Cv. Pfd. .............. 277,500
------------
421,500
------------
EQUIPMENT AND SUPPLIES -- 1.6%
25,300 Sequa Corp.
$5.00 Cv. Pfd. .............. 1,872,200
------------
11
<PAGE>
THE GABELLI CONVERTIBLE SECURITIES FUND, INC.
PORTFOLIO OF INVESTMENTS (CONTINUED)
MARCH 31, 2000 (UNAUDITED)
MARKET
SHARES VALUE
------ ------
CONVERTIBLE PREFERRED
STOCKS (CONTINUED)
PAPER AND FOREST PRODUCTS -- 1.5%
34,500 Sealed Air Corp.
$2.00 Cv. Pfd. Ser. A ....... $ 1,791,844
------------
PUBLISHING -- 0.4%
15,000 Reader's Digest Association Inc.
$1.9336 Cv. Pfd. ............ 465,000
5,000 Tribune Co.
6.25% Cv. Pfd. .............. 68,125
------------
533,125
------------
RETAIL -- 0.2%
2,000 Automatic Common Exchange
Security Trust II
6.50% Cv. Pfd. .............. 16,250
3,000 CVS Corp.
6.00% Cv. Pfd. .............. 202,688
------------
218,938
------------
SPECIALTY CHEMICALS -- 0.0%
2,000 Merrill Lynch & Co. (IMC Global)
6.25% Cv. Pfd. .............. 34,000
------------
TELECOMMUNICATIONS -- 7.6%
2,000 BroadWing Inc.
6.75% Cv. Pfd. Ser. B ....... 116,000
80,000 Citizens Utilities Co.
5.00% Cv. Pfd. .............. 5,000,000
8,000 Philippine Long Distance Telephone Co.
$3.50 Cv. Pfd. Ser. III ..... 333,000
Sprint Corp.
3,000 $1.50 Cv. Pfd. Ser. 1 ....... 1,762,500
2,200 $1.50 Cv. Pfd. Ser. 2 ....... 1,320,000
1,500 TCI Pacific Communications Inc.
5.00% Cv. Pfd. .............. 523,695
------------
9,055,195
------------
WIRELESS COMMUNICATIONS -- 1.0%
6,500 Voicestream Wireless Corp.
7.00% Cv. Pfd. .............. 1,212,250
------------
TOTAL CONVERTIBLE
PREFERRED STOCKS ............ 22,732,402
------------
COMMON STOCKS -- 25.8%
AEROSPACE -- 1.0%
20,000 Cordant Technologies Inc. ..... 1,131,250
------------
AVIATION: PARTS AND SERVICES -- 0.2%
18,000 Kaman Corp., Cl. A ............ 175,500
------------
MARKET
SHARES VALUE
------ ------
BROADCASTING -- 0.2%
40,000 Granite Broadcasting Corp.+ ... $ 285,000
------------
BUSINESS SERVICES -- 4.5%
11,300 Amway Asia Pacific Ltd. ....... 199,869
200,000 U.S. Foodservice+ ............. 5,150,000
------------
5,349,869
------------
CABLE -- 1.0%
15,000 MediaOne Group Inc.+ .......... 1,215,029
------------
ENERGY AND UTILITIES -- 7.4%
20,000 AGL Resources Inc. ............ 367,500
20,000 CH Energy Group Inc. .......... 607,500
10,000 Columbia Energy Group ......... 592,500
4,000 EnergyNorth Inc. .............. 233,500
12,000 E'Town Corp. .................. 759,000
5,000 Eastern Enterprises ........... 299,375
50,000 LG&E Energy Corp. ............. 1,143,750
15,000 MCN Energy Group Inc. ......... 375,000
62,000 Southwest Gas Corp. ........... 1,181,875
47,600 United Water Resources Inc. ... 1,654,100
50,000 WICOR Inc. .................... 1,550,000
------------
8,764,100
------------
EQUIPMENT AND SUPPLIES -- 0.2%
50,000 Fedders Corp., Cl. A .......... 284,375
------------
FINANCIAL SERVICES -- 5.6%
25,000 Argonaut Group Inc. ........... 501,563
20,000 Duff & Phelps Credit Rating Co. 1,993,750
100,000 Travelers Property Casualty
Corp., Cl. A ................ 4,125,000
------------
6,620,313
------------
RETAIL -- 0.5%
12,000 Delhaize America Inc., Cl. A .. 207,000
6,000 Hannaford Bros. Co. ........... 442,500
------------
649,500
------------
TELECOMMUNICATIONS -- 5.2%
28,000 Esat Telecom Group plc, ADR+ .. 2,796,500
82,283 SBC Communications Inc. ....... 3,455,888
------------
6,252,388
------------
TOTAL COMMON STOCKS ........... 30,727,324
------------
12
<PAGE>
THE GABELLI CONVERTIBLE SECURITIES FUND, INC.
PORTFOLIO OF INVESTMENTS (CONTINUED)
MARCH 31, 2000 (UNAUDITED)
PRINCIPAL MARKET
AMOUNT VALUE
-------- ------
U.S. GOVERNMENT OBLIGATIONS -- 28.7%
$34,315,000 U.S. Treasury Bills, 5.47% to 6.06%++,
due 04/18/00 to 06/15/00 .... $ 34,215,366
------------
TOTAL INVESTMENTS -- 98.8%
(Cost $112,189,602) ...................... 117,756,823
------------
OTHER ASSETS, LIABILITIES
AND LIQUIDATION
VALUE OF CUMULATIVE
PREFERRED STOCK -- (24.0)% ............... (28,543,722)
------------
NET ASSETS - COMMON STOCK -- 74.8%
(7,877,645 common shares outstanding) .... 89,213,101
------------
NET ASSETS - CUMULATIVE
PREFERRED STOCK -- 25.2%
(1,200,000 preferred shares outstanding) . 30,000,000
------------
TOTAL NET ASSETS -- 100.0% ................. $119,213,101
============
NET ASSET VALUE PER COMMON SHARE
($89,213,101 / 7,877,645 common shares
outstanding) ............................. $11.32
======
--------------------
For Federal tax purposes:
Aggregate cost ........................ $112,189,602
============
Gross unrealized appreciation ......... $ 11,355,531
Gross unrealized depreciation ......... (5,788,310)
------------
Net unrealized appreciation ........... $ 5,567,221
============
--------------------
(a) Security fair valued as determined by the Board of Directors.
(b) 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 March 31, 2000, the market value of Rule 144A securities amounted
to $2,323,335 or 1.9% of total net assets.
(c) Principal amount denoted in British Pounds.
+ Non-income producing security.
++ Represents annualized yield at date of purchase.
ADR - American Depositary Receipt.
13
<PAGE>
AUTOMATIC DIVIDEND REINVESTMENT
AND VOLUNTARY CASH PURCHASE PLAN
ENROLLMENT IN THE PLAN
It is the Policy of The Gabelli Convertible Securities Fund, Inc.
("Convertible Securities Fund") to automatically reinvest dividends. As a
"registered" shareholder you automatically become a participant in the
Convertible Securities Fund's Automatic Dividend Reinvestment Plan (the "Plan").
The Plan authorizes the Convertible Securities Fund to issue shares 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 Convertible Securities Fund. Plan participants may send their stock
certificates to State Street Bank and Trust Company ("State Street") to be held
in their dividend reinvestment account. Registered shareholders wishing to
receive their distribution in cash must submit this request in writing to:
The Gabelli Convertible Securities Fund, Inc.
c/o State Street Bank and Trust Company
P.O. Box 8200
Boston, MA 02266-8200
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 State Street at 1 (800) 336-6983.
SHAREHOLDERS WISHING TO LIQUIDATE REINVESTED SHARES held at State Street Bank
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. 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 dividends 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 Convertible Securities 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 Convertible Securities 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 trading day, the next trading day. If the
14
<PAGE>
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 Convertible
Securities Fund valued at market price. If the Convertible Securities Fund
should declare a dividend or capital gains distribution payable only in cash,
State Street will buy Common Stock in the open market, or on the New York Stock
Exchange or elsewhere, for the participants' accounts, except that State Street
will endeavor to terminate purchases in the open market and cause the
Convertible Securities 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.
The Convertible Securities 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 State Street on at
least 90 days' written notice to participants in the Plan.
VOLUNTARY CASH PURCHASE PLAN
The Voluntary Cash Purchase Plan is yet another vehicle for our shareholders
to increase their investment in the Convertible Securities 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 State Street Bank and Trust Company for investments
in the Convertible Securities Fund shares at the then current market price.
Shareholders may send an amount from $250 to $10,000. State Street Bank and
Trust Company will use these funds to purchase shares in the open market on or
about the 1st and 15th of each month. State Street Bank and Trust Company 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 State Street Bank and Trust Company, P.O.
Box 8200, Boston, MA 02266-8200 such that State Street receives such payments
approximately 10 days before the investment date. 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 State Street Bank and Trust Company at least 48 hours before such payment is
to be invested.
For more information regarding the Dividend Reinvestment Plan and Voluntary
Cash Purchase Plan, brochures are available by calling (914) 921-5070 or by
writing directly to the Convertible Securities Fund.
15
<PAGE>
[This page intentionally left blank.]
16
<PAGE>
DIRECTORS AND OFFICERS
THE GABELLI CONVERTIBLE SECURITIES FUND, INC.
ONE CORPORATE CENTER, RYE, NY 10580-1434
DIRECTORS
Mario J. Gabelli, CFA
CHAIRMAN & CHIEF INVESTMENT OFFICER
GABELLI ASSET MANAGEMENT INC.
E. Val Cerutti
CHIEF EXECUTIVE OFFICER
CERUTTI CONSULTANTS, INC.
Felix J. Christiana
FORMER SENIOR VICE PRESIDENT
DOLLAR DRY DOCK SAVINGS BANK
Anthony J. Colavita, P.C.
ATTORNEY-AT-LAW
ANTHONY J. COLAVITA, P.C.
Dugald A. Fletcher
PRESIDENT, FLETCHER & COMPANY, INC.
Karl Otto Pohl
FORMER PRESIDENT, DEUTSCHE BUNDESBANK
Anthony R. Pustorino
CERTIFIED PUBLIC ACCOUNTANT
PROFESSOR, PACE UNIVERSITY
Anthonie C. van Ekris
MANAGING DIRECTOR
BALMAC INTERNATIONAL, INC.
Salvatore J. Zizza
CHAIRMAN
THE BETHLEHEM CORP.
OFFICERS AND PORTFOLIO MANAGERS
Mario J. Gabelli, CFA
PRESIDENT & CHIEF INVESTMENT OFFICER
Bruce N. Alpert
VICE PRESIDENT & TREASURER
Peter W. Latartara
VICE PRESIDENT
A. Hartswell Woodson, III
ASSOCIATE PORTFOLIO MANAGER
James E. McKee
SECRETARY
INVESTMENT ADVISOR
Gabelli Funds, LLC
One Corporate Center
Rye, New York 10580-1434
CUSTODIAN, TRANSFER AGENT AND REGISTRAR
State Street Bank and Trust Company
LEGAL COUNSEL
Skadden, Arps, Slate, Meagher & Flom LLP
STOCK EXCHANGE LISTING
COMMON 8.00% PREFERRED
-------- ---------------
NYSE-Symbol: GCV GCV Pr
Shares Outstanding: 7,877,645 1,200,000
The Net Asset Value appears in the Publicly Traded Funds column, under the
heading "Convertible Securities Funds," in Sunday's The New York Times and in
Monday's The Wall Street Journal.
It is also listed in Barron's Mutual Funds/Closed End Funds section under the
heading "Convertible Securities Funds".
The Net Asset Value may be obtained each day by calling (914) 921-5071.
- --------------------------------------------------------------------------------
For general information about the Gabelli Funds,
call 1-800-GABELLI (1-800-422-3554), fax us
at 914-921-5118, visit our Internet homepage at:
HTTP://WWW.GABELLI.COM, or e-mail us at:
[email protected]
- --------------------------------------------------------------------------------
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940, as amended, that the Convertible Securities Fund may from
time to time purchase shares of its Common Stock in the open market when the
Convertible Securities Fund shares are trading at a discount of 10% or more from
the net asset value of the shares. The Convertible Securities Fund may also,
from time to time, purchase shares of its Cumulative Preferred Stock in the open
market when the shares are trading at a discount to the Liquidation Value of
$25.00.
- --------------------------------------------------------------------------------
<PAGE>
THE GABELLI CONVERTIBLE SECURITIES FUND, INC.
ONE CORPORATE CENTER
RYE, NY 10580-1434
(914) 921-5070
HTTP://WWW.GABELLI.COM
FIRST QUARTER REPORT
MARCH 31, 2000
GBFCS 03/00
