<PAGE> 1
GABELLI GLOBAL SERIES FUNDS, INC.
One Corporate Center
Rye, New York 10580 - 1434
THE GABELLI GLOBAL TELECOMMUNICATIONS FUND
SEMI-ANNUAL REPORT
JUNE 30, 1997
TO OUR SHAREHOLDERS:
In the second quarter of 1997, equities investors concluded that
inflation was just a bad dream after all and that "Captain Greenspan" was
bringing the economy in for another soft landing. Blue chip stocks remained in
the limelight, but smaller stocks participated in the surge. The Dow Jones
Industrial Average (DJIA) gained 17.1%.
For the second quarter ended June 30, 1997, The Gabelli Global
Telecommunications Fund's total return was 16.7%. The Lipper Analytical
Services Global Fund Index and Salomon Brothers Global Telecommunications Index
had returns of 12.2% and 15.5%, respectively, over the same period. Each index
is an unmanaged indicator of stock market performance. The Fund is up 16.8%
year-to-date. The Lipper Global Fund Index and Salomon Brothers Global
Telecommunications Index rose 12.9% and 19.4%, respectively, over the same six
month period. Since inception on November 1, 1993 through June 30, 1997, the
Fund has a total return of 46.8%, which equates to an average annual return of
11.0%.
INVESTMENT PERFORMANCE (a)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------
Quarter
----------------------------------------
1st 2nd 3rd 4th Year
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
1997: Net Asset Value .......................................... $11.29 $13.17 __ __ __
Total Return ............................................. 0.1% 16.7% __ __ __
- ----------------------------------------------------------------------------------------------------------------------------
1996: Net Asset Value .......................................... $11.72 $12.16 $11.73 $11.28 $11.28
Total Return ............................................. 5.4% 3.8% (3.5)% 3.3% 9.0%
- ----------------------------------------------------------------------------------------------------------------------------
1995: Net Asset Value .......................................... $9.77 $10.29 $11.12 $11.12 $11.12
Total Return ............................................. 0.4% 5.3% 8.1% 1.6% 16.2%
- ----------------------------------------------------------------------------------------------------------------------------
1994: Net Asset Value .......................................... $9.68 $9.62 $10.38 $9.73 $9.73
Total Return ............................................. (5.1)% (0.6)% 7.9% (5.3)% (3.7)%
- ----------------------------------------------------------------------------------------------------------------------------
1993: Net Asset Value .......................................... __ __ __ $10.20 $10.20
Total Return ............................................. __ __ __ 3.0%(b) 3.0%(b)
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------
Average Annual Return - June 30, 1997 (a)
-----------------------------------------
<S> <C>
1 Year ................................................... 16.5%
3 Year ................................................... 14.7%
Life of Fund(b) .......................................... 11.0%
- ---------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Dividend History
- ----------------------------------------------------------------------
Payment (ex) Date Rate Per Share Reinvestment Price
- ----------------- -------------- ------------------
<S> <C> <C>
December 31, 1996 $0.840 $11.28
December 29, 1995 $0.182 $11.12
December 30, 1994 $0.095 $ 9.73
December 31, 1993 $0.102 $10.20
</TABLE>
(a) Total returns and average annual returns reflect changes in share price and
reinvestment of dividends and are net of expenses. Of course, returns represent
past performance and do not guarantee future results. Investment returns and
the principal value of an investment will fluctuate. When shares are redeemed
they may be worth more or less than their original cost. (b) From commencement
of operations on November 1, 1993. Note: Investing in foreign securities
involves risks not ordinarily associated with investments in domestic issues,
including currency fluctuation, economic and political risks.
<PAGE> 2
OUR APPROACH
Our approach is multifaceted. We purchase companies that are
attractively valued relative to what we estimate a buyer would be willing to
pay for the entire company in a private transaction. When the gap between a
company's Private Market Value (PMV) and public market value widens, our
risk/reward parameters improve. To maximize returns, our decision process
requires the expectation of a trigger that will promote a reduction in this
gap. But we will not invest in just any "cheap" company. For most of our
holdings, our selection is based on "bottom up" fundamental analysis, which
requires strong cash flow and earnings power, positive industry dynamics and,
certainly not least, good management with a track record of creating value for
their shareholders.
GLOBAL ALLOCATION
The chart to the right presents the Fund's holdings by geographic
region as of June 30, 1997. The geographic allocation will change based on
current global market conditions. Countries and/or regions represented in the
chart and below may or may not be included in the Fund's future portfolio.
<TABLE>
<S> <C>
UNITED STATES 45.3%
EUROPE 19.8%
LATIN AMERICA 13.5%
ASIA/PACIFIC
RIM 10.4%
CANADA 9.1%
OTHER 1.9%
</TABLE>
PORTFOLIO STRUCTURE
We remain "bottom-up" focused, with roughly half the fund's investment
in the U.S. Internationally, the trend continues to be the liberalization and
privatization of the telecommunications sector. The result is an expanding
universe of publicly-traded telecom companies poised for growth. Deutsche
Telekom, the largest telecom company in Europe and the third-largest in the
world, successfully completed its initial public offering in November 1996.
Many other major telecom companies are expected to "go public" in the years
ahead.
Almost 20% of the Fund is invested in Europe, much of that in the U.K.
Key holdings are companies with a strong global presence and attractive
valuations. Included are Cable & Wireless, the U.K.'s second-largest telecom
group, and Vodafone, the biggest U.K. cellular service provider with attractive
wireless investments on a global basis. Telefonica de Espana is another key
investment in light of its strong telecom franchise and significant discount to
its underlying asset value.
2
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Asia/Pacific Rim represents about 10% of the Fund and Latin America
approximately 13% of the portfolio. These regions are among the most rapidly
growing in the world. Telecommunications forms the "information highways"
necessary for strong economic development. Telebras, the Brazilian telephone
company, and Telekom Malaysia, the primary provider of domestic and
international telecom services in Malaysia, are examples of attractively
valued, rapidly growing investments.
Competition, consolidation and convergence are occurring globally as
companies seek economies of scale. Simply put, "bigger is better."
Telecommunications stocks are selling at large discounts to their estimated
Private Market Values. Moreover, their stock price performances have not kept
pace with the growth in values. Major forces -- strong demand, open markets,
technology, consolidation -- should drive telecom stock prices toward their
Private Market Values, thereby enhancing shareholder value.
COMMENTARY
CABLE TELEVISION: ONE MAN'S JUNK IS BILL GATES' TREASURE
We have been analyzing the cable television (CATV) stocks for many
years. We've experienced the thrill of victory--the pricing deregulation and
rampant consolidation of the industry in the mid eighties--and over the last
few years, the agony of defeat--re-regulation and the threat of competition
from telcos and satellite broadcasters. Through it all, we have viewed cable TV
as a good long-term investment. The business has most of the economic and
financial characteristics we favor: an identifiable franchise, high operating
margins, and strong cash flow. We are aware of the negatives: lousy service by
new entrants, high debt, the need for a second round of substantial capital
investment to technologically upgrade systems, and the prospect for increased
competition. However, we remain confident that the value of all those
connections to American homes will ultimately be recognized.
Cablevision Systems Corporation (CVC - $53.50 - ASE) best illustrates
the recent trials and tribulations of cable television operators and investors.
A great growth company in the 1980s, Cablevision built a terrific franchise in
the New York metropolitan area. They were also early to recognize the potential
of cable networks and programming by investing in American Movie Classics,
Bravo, eight regional sports networks, and 50% of MSG (Madison Square Garden,
the NY Knicks and the NY Rangers). In the process, they leveraged the company
to the hilt and were as vulnerable as anyone to potential competition from News
Corporation Limited (NWS - $19.25 - NYSE) Chairman Rupert Murdoch's plan for a
national satellite broadcast system--labeled by Wall Street as the "Death Star"
for the CATV industry. In the last year, Cablevision stock fell from the mid
$50's to a low of $25 per share.
Then, things got interesting. Murdoch's Death Star was grounded.
Recognizing cable television lines were likely to continue to be the speediest
data transmission highway into the home, Microsoft Corporation's (MSFT -
$126.375 - NASDAQ) Bill Gates invested $1 billion in Comcast Corporation (CMCSA
- - $20.9375 - NASDAQ), instantly ratcheting up the value of every cable
television link in the country. Cablevision moved quickly to further
consolidate its system by swapping 33% of its stock to Tele-Communications,
Inc. (TCOMA - $14.875 - NASDAQ) in return for an additional 820,000 subscribers
in the New York metropolitan area. It then closed on the remaining 50% of MSG
from its partner ITT Corporation (ITT - $61.0625 - NYSE). Finally, in a
particularly deft move, Cablevision sold 40% of its Rainbow cable network and
programming unit to News Corp's Fox unit for $850 million, bolstering both its
network/programming assets through a planned national sports
3
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network with its new partners and its debt heavy balance sheet. Cablevision's
stock went from deep in Wall Street's doghouse to the penthouse almost
overnight. We expect a lot more from Cablevision.
Although a much more diversified media company, Time Warner Inc. (TWX -
$48.25 - NYSE) stock has been stuck in the mud due to its substantial cable
television operations. Chairman Gerald Levin has been pressured by Wall Street
and several large institutional and corporate shareholders to reduce the
company's exposure to the business by off-loading cable systems to US West
Media Group (UMG - $20.25 - NYSE) in return for its minority stake in Time
Warner Entertainment. Believing Levin would be forced to throw in the towel on
cable, US West Media Group held out for a higher price (more cable subscribers)
than Levin was willing to part with. Perhaps US West Media has outfoxed itself.
With the escalating value of its assets, Time Warner is now in the driver's
seat in negotiating a deal. We believe Time Warner will eventually reduce its
exposure to cable and focus more on its programming and publishing assets. When
they pull the trigger on cable, they will get a much better price.
We believe the current "Let's Make a Deal" market may run as long as
the popular game show. There is tremendous liquidity in the financial system.
With modest top line revenue growth, minimal pricing flexibility, and limits to
further margin expansion through cost cutting and productivity gains, the
ability of many companies to grow earnings from existing operations is
restrained. The answer for many will be to grow via acquisitions. This will not
take the form of the re-conglomeratization of American business. Instead, we
will see larger companies buying smaller niche companies to complement their
existing businesses. This feeds nicely into our focus on smaller niche
franchises and we expect to be bidding a fond farewell to additional portfolio
holdings in the years ahead. We identified the "urge to consolidate" in
previous reports to you. We have announced and heralded this Third Wave of
Mergers in all of our letters to you since General Electric Company (GE -
$65.375 - NYSE) attempted a hostile takeover of Kemper in February 1994. A
reduction in long-term capital gains rates will fan the flames of an already
raging fire.
LET'S TALK STOCKS
The following are stock specifics on selected holdings of our Fund.
Favorable earnings prospects do not necessarily translate into higher stock
prices, but they do express a positive trend which we believe will develop over
time.
AirTouch Communications Inc. (ATI - $27.375 - NYSE) is one of the premier
players in global wireless communications. Operating in attractive cellular
markets in the U.S. and overseas (including Germany, Japan, Portugal, Sweden,
Belgium, Italy, Spain and South Korea), the company is well-positioned to
participate in the world-wide expansion of wireless communications. Roughly
half of the company's current 8.5 million world-wide cellular customers are
located in the U.S. Annual growth is estimated at 30% to 40%. AirTouch is in
the process of strengthening its cellular position in the U.S. with the
acquisition of US West Media Group's domestic cellular operations and its stake
in PrimeCo Personal Communications in a transaction valued at $5 billion. The
companies expect to close the transaction no later than early next year.
BC TELECOM Inc. (BCT - $23.46 - TSE), formerly British Columbia Telephone
Company, is the second largest telecommunications services company in Canada. A
subsidiary of GTE Corporation (GTE - $43.875 - NYSE)
4
<PAGE> 5
owns 52% of the company. We estimate the private market value of BCT to be $50
per share. Its basic telephone operations provide service to more than two
million telephone lines and are growing at twice the Canadian industry average.
BCT's crown jewel is a rapidly growing cellular phone company which currently
serves 463,000 subscribers. We expect BCT to take advantage of the deregulatory
trend in Canada by entering new businesses in which they are now allowed to
participate.
Cable & Wireless plc (CWP - $27.9375 - NYSE) is a United Kingdom-based company
comprised of broad global telecommunications interests. CWP has finalized plans
to merge its U.K. operations with Nynex CableComms Group plc and Bell Cable
Media plc, bolstering its presence in the increasingly competitive U.K.
communications market. The company now owns 53% of a new, publicly-traded U.K.
based company, Cable & Wireless Communications plc, which owns 100% of Mercury
Communications, the second largest provider of telecom services in Britain, and
a majority of Bell Cable Media, Nynex CableComms and Videotron Holdings plc.
Hong Kong Telecommunications Ltd. (HKT - $23.375 - NYSE), the dominant telecom
service provider in Hong Kong and 58% owned by CWP, remains the "crown jewel"
of the CWP portfolio and represents approximately $20 per CWP share. Deducting
CWP's interest in Hong Kong Telecom at its public market value, we are paying
about three times the EBITDA of CWP's other assets. CWP is attractive based on
its high rate of growth and reasonable stock market valuation.
Compania de Telecomunicaciones de Chile S.A. (CTC - $33.00 - NYSE) is a full
service telecommunications provider. It serves 1.4 million access lines in a
country with 13.2 million inhabitants (a penetration rate of only 11%). The
company's growth will continue to be driven by an aggressive line build-out
plan. Approximately 400,000 telephone lines are to be installed in 1997.
Northern Telecom Limited (NT - $91.00 - NYSE) is a leading global provider of
telecommunications products and services. Northern Telecom is the largest
supplier in Canada and is second to Lucent Technologies Inc. (LU - $72.0625 -
NYSE) in the U.S. The rapid increase in Internet usage is causing traffic
volume to reach many carriers' capacity constraints. Capacity expansion
requires the switching and broadband products that Northern Telecom produces.
Tele-Communications, Inc. (TCOMA - $14.875 - NASDAQ), the largest cable TV
operator in the U.S. serving about 14 million subscribers, is guided by Dr.
John C. Malone one of the most shareholder sensitive managers we have found.
Regulation has historically played a major role in the valuation of cable
properties. We believe that the passage of the Telecommunications Reform Act of
1996, combined with the current deregulatory climate in Congress, could prove
to be a significant catalyst for cable stocks. Strategically, TCOMA is a
well-positioned industry leader, from its wireless telephony PCS venture with
Sprint Corporation, Comcast Corporation and Cox Communications Inc., to its
innovative Internet access business, dubbed "@Home", and its 80% stake in
Tele-Communications International, Inc. (TINTA - $15.4375 - NASDAQ). An
important shift is underway as some TCI properties are being sold to strengthen
its balance sheet and to demonstrate substantial progress in increasing its
operating cash flow. One such sale involved 10 cable systems serving 820,000
subscribers being acquired by Cablevision Systems Corporation.
Telecomunicacoes Brasileiras SA (Telebras) (TBR - $151.75 - NYSE) is the
Brazilian government-controlled monopoly telecommunications holding company
consisting of 28 subsidiaries serving more than 14 million
5
<PAGE> 6
telephone lines and two million cellular customers in a country with a
population of 160 million. The penetration rate is less than 9% for telephone
and 1% for cellular. The stock is attractively priced at less than six times
our estimate of 1997 cash flow. Future opportunities include the prospects of
privatization, strong line growth and improvements in efficiency. Telebras is
benefiting from an improved rate structure which allows the company to recoup
inflation-related cost increases on a more consistent basis.
Telefonica de Espana (TEF - $86.25 - NYSE) is a diversified telecommunications
service provider offering services to more than 15 million lines. The company
also services a fast growing cellular subscriber base which now exceeds two
million subscribers. We consider TEF an ideal way to invest in Latin America,
with a diversified portfolio of telecommunication operations in the region. Its
portfolio of publicly-traded Latin American companies includes: Compania de
Telecomunicaciones de Chile S.A., Telefonica de Argentina S.A. and Compania
Peruana de Telefonos SA. TEF also holds interests in non-public Latin American
telecom operations in Mexico, Colombia, Puerto Rico, Uruguay and Venezuela. The
company's long-term strategy is to create a Pan-American network, leveraging
the Spanish-speaking world. TEF jump-started this effort with its decision to
form a global alliance with British Telecom/MCI's Concert plc, which is gaining
momentum in the race to become the dominant provider of one-stop shopping for
full-service, global telecommunications products.
Telefonos De Mexico SA (TMX- $47.75 - NYSE) is the largest provider of basic
telephone services, including local and long distance service, in Mexico. The
company currently serves 9.0 million access lines and provides service to over
650,000 cellular subscribers as of year-end 1996. TMX is now trading at a more
reasonable valuation of approximately $2,500 per access line following the post
currency crisis market correction in Mexico. The Mexican telecommunications
industry has opened the long distance market to new competitors, which should
increase competition and growth in the industry.
Telephone and Data Systems, Inc (TDS - $37.9375 - ASE) is a domestic provider
of local telephone service to about 493,000 mostly rural access lines and is
the seventh largest cellular telephone company in the U.S. with a fast growing
paging business. TDS is oriented to create substantial shareholder value (as
opposed to focusing on near-term earnings per share). Consolidated operating
cash flow rose 25% in 1996, driven mainly by internal growth in cellular
telephone. Cellular telephone subscribers grew by almost 55% to over one
million at year-end 1996. We expect strong growth at TDS to result in a private
market value of $160 per share by 2000. The company has been active in the PCS
auctions and was the high bidder in eight markets with a combined population of
27 million. TDS's investments in U.S. Cellular, American Portable Telephone and
American Paging, at their current market prices, are worth $35 per TDS share.
MINIMUM INITIAL INVESTMENT - $1,000
Effective August 12, 1996, the Fund's minimum initial investment for
both regular and retirement accounts is $1,000. There are no subsequent
investment minimums. No initial minimum is required for those establishing an
Automatic Investment Plan. Additionally, The Gabelli Global Telecommunications
Fund and other Gabelli Funds are available through the no-transaction fee
programs at many major discount brokerage firms.
6
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INTERNET
You can now visit us on the Internet. Our home page at
http://www.gabelli.com contains information about Gabelli Funds, 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
The strength of the market is understandable considering today's
favorable economic/earnings/interest rate backdrop and the enormous amount of
money being poured into equities mutual funds. Although high by historical
standards, current equities valuations may be justified as long as these "best
of all possible worlds" market conditions can be sustained. If something
happens to disrupt this comfortable scenario--our best guess is it may come in
the form of more widespread earnings disappointments as the slowing economy
begins to impact corporate profitability--the market could run into some
trouble.
We are encouraged by the broadening of this bull market and some
evidence that investors are once again focusing on fundamental value instead of
just momentum. Stock pickers across the land rejoice! Ongoing merger and
acquisition activity should continue to provide a tailwind for our portfolio.
The Fund's daily net asset value is available in the financial press
and each evening after 6:00 PM (Eastern Time) by calling 1-800-GABELLI
(1-800-422-3554). The Fund's NASDAQ symbol is GABTX. Please call us during the
business day for further information.
As always, we thank you for your confidence in our investment abilities
and will work hard to preserve and enhance the assets you have entrusted to us.
Sincerely,
/s/ MARIO J. GABELLI /s/ MARC J. GABELLI
MARIO J. GABELLI, CFA MARC J. GABELLI
Portfolio Manager and Associate Portfolio Manager
Chief Investment Officer
/s/ IVAN ARTEAGA
IVAN ARTEAGA, CPA
Associate Portfolio Manager
August 1, 1997
7
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THE GABELLI GLOBAL TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS -- JUNE 30, 1997 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
- ------------ ------------
<C> <S> <C>
COMMON STOCKS -- 95.67%
ALTERNATIVE TELECOMMUNICATION SERVICE
PROVIDERS -- 2.67%
7,000 American Communications Services
Inc.+............................ $ 50,750
500 Bouygues Group..................... 41,121
10,000 Brooks Fiber Properties Inc.+...... 337,500
4,000 Esprit Telecom Group plc+.......... 32,000
20,000 GST Telecommunications Inc.+....... 202,500
20,000 ICG Communications Inc.+........... 385,000
2,000 Intermedia Communications Inc.+.... 64,750
2,500 Mannesmann AG...................... 1,116,046
5,000 McLeodUSA Inc., Cl. A.............. 168,750
400 Teleport Communications Group Inc.,
Cl. A............................ 13,650
15,000 WorldCom Inc. ..................... 480,000
------------
2,892,067
------------
BROADCASTING -- 0.22%
400 Pathe SA........................... 79,333
18,000 Price Communications
Corporation+..................... 157,500
------------
236,833
------------
CABLE -- 10.54%
50,000 Adelphia Communications
Corporation, Cl. A.+............. 356,250
32,000 Cablevision Systems Corporation,
Cl. A+........................... 1,728,000
70,000 Century Communications Corporation,
Cl. A+........................... 376,250
95,000 Comcast Corporation, Cl. A......... 1,989,063
42,000 Comcast U.K. Cable Partners
Ltd.+............................ 504,000
10,000 General Cable plc ADR+............. 135,000
40,000 NTL Inc.+.......................... 995,000
20,000 Rogers Communications, Inc., Cl.
B+............................... 123,750
70,000 Tele-Communications, Inc., Cl.
A+............................... 1,041,250
60,375 Tele-Communications, Inc./Liberty
Media Group, Cl. A+.............. 1,433,906
32,000 Tele-Communications International,
Inc., Cl. A+..................... 494,000
6,000 Telewest Communications plc ADR+... 93,750
90,000 United International Holdings,
Inc., Cl. A+..................... 933,750
60,000 US WEST Media Group+............... 1,215,000
------------
11,418,969
------------
COMMUNICATIONS EQUIPMENT -- 3.67%
60,000 Champion Technology Holdings ADR... 38,700
4,400 Ericsson (L.M.) Telephone Company
ADR.............................. 173,250
10,000 General Instrument Corporation+.... 250,000
9,000 Lucent Technologies Inc. .......... 648,563
2,500 Motorola, Inc. .................... 190,000
25,000 Northern Telecom Limited........... 2,275,000
10,000 Scientific - Atlanta, Inc. ........ 218,750
500 Siemens AG ADR..................... 29,712
100,000 Time Engineering Berhad............ 151,287
------------
3,975,262
------------
ENERGY -- 0.16%
3,000 Veba AG............................ 169,341
------------
ENTERTAINMENT -- 1.43%
23,462 Ascent Entertainment Group Inc.+... 214,094
6,000 Metromedia International Group
Inc.+............................ 76,125
20,000 Time Warner Inc. .................. 965,000
10,000 Viacom Inc., Cl. A+................ 296,875
------------
1,552,094
------------
LONG DISTANCE TELEPHONE COMPANIES -- 5.14%
25,000 AT&T Corp.......................... 876,563
25,000 Call-Net Enterprises Inc.+......... 420,891
25,000 Cam-Net Communications Network
Inc.+............................ 2,500
165 DDI Corp........................... 1,217,691
5,000 Fonorola Inc.+..................... 84,178
100,000 General Communication, Inc., Cl.
A+............................... 800,000
6,500 Kokusai Denshin.................... 449,860
5,000 LCI International, Inc.+........... 109,375
6,000 MCI Communications Corporation..... 229,688
66,000 P.D.L. Holdings Limited............ 330,000
20,000 Sprint Corporation................. 1,052,500
------------
5,573,246
------------
PUBLISHING -- 0.58%
10,000 Media General, Inc., Cl. A......... 400,000
10,000 News Corporation Limited ADR....... 192,500
100,000 Seat SpA+.......................... 32,292
------------
624,792
------------
REGIONAL/LOCAL TELEPHONE SERVICES -- 12.08%
44,000 Aliant Communications Inc. ........ 858,000
20,000 ALLTEL Corporation................. 668,750
24,000 Ameritech Corporation.............. 1,630,499
38,000 Atlantic Tele-Network, Inc.+....... 420,356
3,000 Bell Atlantic Corporation.......... 227,625
27,000 BellSouth Corporation.............. 1,252,125
9,000 Bruncor Inc. ...................... 194,859
2,000 Cincinnati Bell Inc. .............. 63,000
80,000 C-TEC Corporation, Cl. B+.......... 2,062,499
10,000 First Pacific Company Ltd.
Sponsored ADR.................... 63,893
35,000 Frontier Corporation............... 697,813
35,000 GTE Corporation.................... 1,535,624
15,000 Island Telephone Company Limited... 312,274
19,000 Maritime Telegraph and Telephone
Company Limited.................. 367,343
12,000 NewTel Enterprises Limited......... 236,785
3,000 NYNEX Corporation.................. 172,875
3,000 Peoples Telephone Company, Inc.+... 10,313
10,000 Quebec-Telephone+.................. 179,580
9,000 SBC Communications Inc. ........... 556,875
33,000 Southern New England
Telecommunications Corporation... 1,282,875
</TABLE>
The accompanying notes are an integral part of the financial statements.
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THE GABELLI GLOBAL TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS (CONTINUED) -- JUNE 30, 1997 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
- ------------ ------------
COMMON STOCKS (CONTINUED)
REGIONAL/LOCAL TELEPHONE SERVICES (CONTINUED)
<S> <C> <C>
10,000 Telus Corporation.................. $ 183,563
3,000 US WEST Communications Group....... 113,063
------------
13,090,589
------------
SATELLITE -- 0.71%
1,000 British Sky Broadcasting Group
ADR.............................. 44,688
8,000 Echostar Communications Corp., Cl.
A+............................... 125,000
6,000 General Motors Corporation, Class
H................................ 346,500
30,000 TCI Satellite Entertainment Inc.,
Cl. A+........................... 236,250
2,000 U.S. Satellite Broadcasting Co.+... 16,500
------------
768,938
------------
TELECOMMUNICATIONS (OTHER) -- 0.25%
2,500 Great Nordic Stores................ 265,517
------------
TELEPHONE NETWORKS -- 37.87%
110,000 BC TELECOM Inc. ................... 2,580,739
80,000 BCE Inc. .......................... 2,240,000
3,000 BHI Corporation.................... 66,000
2,000 British Telecommunictions plc
ADR.............................. 148,500
155,800 Cable & Wireless plc ADR........... 4,314,638
68,000 Compania de Telecomunicaciones de
Chile S.A. ADR................... 2,244,000
30,000 CP Pokphand Sponsored ADR.......... 232,338
500,000 CPT Telefonica del Peru, Cl. B..... 1,315,094
1,000 CPT Telefonica del Peru, Cl. B
ADR.............................. 26,188
9,000 Deutsche Telekom AG................ 217,125
50,000 Europolitan Holdings AB+........... 1,097,514
3,430 Hellenic Telecommunications
Organization S.A.(OTE)(a)........ 80,546
15,000 Hong Kong Telecommunications Ltd.
ADR.............................. 350,625
2,000 Hungarian Telephone & Cable
Corp.+........................... 17,500
40 Japan Telecom Company, Ltd.+....... 767,587
16,000 Koninklijke PTT Nederland NV ADR... 634,000
8,000 MIDCOM Communications Inc.+........ 42,500
187 Nippon Telegraph & Telephone
Corp.+........................... 1,603,247
10,000 Nippon Telegraph & Telephone Corp.
ADR.............................. 487,500
800 Pakistan Telecommunications
GDR+(a).......................... 60,400
26,900 Philippine Long Distance Telephone
Company.......................... 1,728,325
12,000 Portugal Telecom S.A. ADR.......... 481,500
8,000 PT Telekomunikasi Indonesia........ 260,000
20,000 Singapore Telecommunications
Ltd. ............................ 36,923
28,000 STET - Societa Finanziaria
Telefonica SpA ADR............... 1,634,500
8,000 Tele Danmark A/S ADR............... 209,000
18,000 Telecom Argentina Stet -- France
Telecom S.A. ADR................. 945,000
301,086 Telecom Asia+...................... 561,864
32,000 Telecom Corporation of New Zealand
Ltd. ADR......................... 1,304,000
447,860 Telecom Italia SpA................. 1,243,842
4,000,000 Telecommunications of Jamaica....... 384,000
29,000 Telecomunicacoes Brasileiras SA
(Telebras) Sponsored ADR.......... 4,400,749
938,570 Telecomunicacoes de Sao Paulo SA
(Telesp).......................... 276,255
45,000 Telefonica de Argentina S.A. ADR.... 1,558,125
47,000 Telefonica de Espana ADR............ 4,053,750
48,000 Telefonos De Mexico SA, Cl. L ADR... 2,292,000
240,000 Telekom Malaysia Berhad............. 1,121,584
8,075 Thai Telephone & Telecom GDR+(a).... 10,565
-----------
41,028,023
-----------
WIRELESS COMMUNICATIONS -- 20.35%
5,001 360(o) Communications Company+...... 85,636
40,000 ABC Communications Holdings Ltd. ... 9,294
115,000 Aerial Communications Inc.+......... 977,500
95,000 AirTouch Communications Inc. ....... 2,600,625
2,000 American Mobile Satellite
Corporation....................... 20,500
65,000 American Paging Inc.+............... 97,500
100 Asia Satellite Telecommunications
Holdings Ltd. .................... 3,013
14,200 Associated Group, Inc. Cl. A+....... 568,000
15,000 Associated Group, Inc., Cl. B+...... 620,000
14,000 BCE Mobile Communications Inc....... 434,902
20,000 Cellular Communications
International, Inc.+.............. 670,000
101,000 Centennial Cellular Corp., Cl. A+... 1,603,375
30,000 Century Telephone Enterprises,
Inc. ............................. 1,010,625
2,000 CommNet Cellular Inc.+.............. 69,500
48,000 COMSAT Corporation.................. 1,143,000
1,000 CoreComm Inc.+...................... 17,250
8,000 Globalstar Telecommunications+...... 245,000
42,000 Grupo Iusacell SA ADR, Ser. D+...... 619,500
26,000 Himachal Futuristic(a).............. 39,198
29,000 Iridium World Communications
Ltd.+............................. 525,625
24,000 Jasmine International(a)............ 23,367
15,000 Loral Space & Communications
Ltd.+............................. 225,000
5,300 Matrix Telecommunications Ltd.+..... 5,595
1,500 Metrocall, Inc.+.................... 6,750
8,000 Mobile Telecommunications
Technologies Corp................. 114,500
11,000 NEXTEL Communications, Inc., CI.
A+................................ 208,313
6,000 Omnipoint Corporation+.............. 83,125
10,000 Palmer Wireless Inc.+............... 168,750
8,000 Pittencrieff Communications,
Inc.+............................. 44,000
30,000 PriCellular Corporation+............ 275,625
2,000 PT Indonesia Satellite ADR.......... 59,875
40,000 Rogers Cantel Mobile Communications,
Inc., CI. B+...................... 757,500
1,000 Rural Cellular Corp., CI. A+........ 10,313
70,000 Securicor Group plc................. 331,968
125,000 Technology Resources Industries..... 214,851
747,860 Telecom Italia Mobile SpA........... 2,306,862
4,000 Teleglobe Inc....................... 159,305
</TABLE>
The accompanying notes are an integral part of the financial statements.
9
<PAGE> 10
THE GABELLI GLOBAL TELECOMMUNICATIONS FUND
PORTFOLIO OF INVESTMENTS (CONTINUED) -- JUNE 30, 1997 (UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARKET
SHARES VALUE
- ------------ ------------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
WIRELESS COMMUNICATIONS (CONTINUED)
90,000 Telephone & Data Systems, Inc...... $ 3,419,999
2,000 Thyssen AG......................... 480,802
20,000 Total Access Communications plc.... 92,797
3,000 United States Cellular
Corporation+..................... 88,875
1,500 Vanguard Cellular Systems, Inc.,
CI. A+........................... 20,438
1,000 Vimpel Communications+............. 38,000
32,000 Vodafone Group plc ADR............. 1,550,000
------------
22,046,653
------------
TOTAL COMMON STOCKS................ 103,642,324
------------
CONVERTIBLE PREFERRED STOCKS -- 2.29%
CABLE -- 1.29%
19,000 Tele-Communications, Inc. Cv. Pfd.,
Ser. E........................... 1,396,500
------------
LONG DISTANCE TELEPHONE COMPANIES -- 0.13%
4,000 Sprint Corporation 8.25% Cv.
Pfd.............................. 144,500
------------
TELEPHONE NETWORKS -- 0.54%
10,000 Philippine Long Distance Telephone
Company 7.00% Cv. Pfd., Ser.
III.............................. 580,000
------------
WIRELESS COMMUNICATIONS -- 0.33%
3,000 AirTouch Communications Inc. 4.25%
Cv. Pfd., Cl. C.................. 144,000
5,000 AirTouch Communications Inc. 6.00%
Cv. Pfd., Cl. B.................. 142,500
3,000 Mobile Telecommunication
Technologies Corp.+(a)........... 75,375
------------
361,875
------------
TOTAL CONVERTIBLE PREFERRED
STOCKS........................... 2,482,875
------------
PREFERRED STOCKS -- 0.62%
COMMUNICATIONS EQUIPMENT -- 0.14%
2,000 Nokia Corp. ADR, CI. A............. 147,500
------------
TELEPHONE NETWORKS -- 0.48%
3,355,677 Telecomunicacoes de Rio de Janeiro
SA (Telerj) Pfd.................. 514,101
40,900 Telecomunicacoes de Sao Paulo SA
(Telesp) Pfd..................... 13,557
------------
527,658
------------
TOTAL PREFERRED STOCKS............. 675,158
------------
WARRANTS -- 0.00%
3,430 Hellenic Telecommunications
Organization S.A. (OTE)
Rights+(a)....................... 421
------------
TOTAL WARRANTS..................... 421
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL MARKET
AMOUNT VALUE
- ------------- ------------
<C> <S> <C>
CONVERTIBLE CORPORATE BONDS -- 1.11%
TELEPHONE NETWORKS -- 0.84%
$1,000,000 Telekom Malaysia Berhad Sub. Deb.
Cv. 4.00%, 10/03/04(a)......... $ 913,750
------------
WIRELESS COMMUNICATIONS -- 0.27%
250,000 Technology Resources Industries
Sub. Deb. Cv. 2.75%,
11/28/04(a).................... 293,750
------------
TOTAL CONVERTIBLE CORPORATE
BONDS.......................... 1,207,500
------------
U.S. GOVERNMENT OBLIGATIONS -- 0.55%
600,000 U.S. Treasury Bills, 4.85% due
08/14/97....................... 596,443
------------
TOTAL U.S. GOVERNMENT
OBLIGATIONS.................... 596,443
------------
TOTAL INVESTMENTS -- 100.24%
(COST--$82,609,261)............ 108,604,721
LIABILITIES IN EXCESS OF OTHER
ASSETS -- (0.24)%.............. (261,184)
------------
NET ASSETS -- 100.00%
(8,223,678 shares outstanding)... $108,343,537
===========
NET ASSET VALUE AND REDEMPTION
PRICE PER SHARE................ $13.17
=====
</TABLE>
- ---------------
<TABLE>
<C> <C> <S>
(a) -- Security exempt from registration under Rule 144A of
the Securities Act of 1933. These securities may be
resold in transactions exempt from registration,
normally to qualified institutional buyers. At June
30, 1997, Rule 144A securities amounted to
$1,497,372 or 1.38% of net assets.
+ -- Non-income producing security
ADR -- American Depositary Receipt
GDR -- Global Depositary Receipt
</TABLE>
For Federal income tax purposes:
<TABLE>
<S> <C>
Aggregate cost......................... $ 82,609,261
===========
Gross unrealized appreciation.......... $ 30,300,693
Gross unrealized depreciation.......... (4,305,233)
------------
Net unrealized appreciation............ $ 25,995,460
===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
10
<PAGE> 11
THE GABELLI GLOBAL TELECOMMUNICATIONS FUND
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 1997 (UNAUDITED)
- ----------------------------------------------------------
<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value (Cost
$82,609,261)................................ $108,604,721
Cash.......................................... 310,174
Receivable for investments sold............... 156,366
Receivable for Fund shares sold............... 58,044
Dividends and interest receivable............. 380,320
Deferred organizational expenses.............. 29,411
-----------
TOTAL ASSETS................................ 109,539,036
-----------
LIABILITIES:
Payable to Advisor............................ 88,578
Payable to Custodian.......................... 4,800
Payable for distribution fees................. 22,146
Payable for investments purchased............. 91,024
Payable for Fund shares redeemed.............. 792,458
Other accrued expenses........................ 196,493
-----------
TOTAL LIABILITIES........................... 1,195,499
-----------
NET ASSETS (applicable to 8,223,678 shares
outstanding).................................. $108,343,537
===========
NET ASSET VALUE AND REDEMPTION PRICE PER
SHARE..................................... $ 13.17
===========
NET ASSETS CONSIST OF:
Capital Stock, at par value................... $ 8,224
Additional paid-in capital.................... 77,073,001
Accumulated net investment income............. 173,862
Accumulated undistributed net realized gains
on investments and foreign currency
transactions................................ 5,093,604
Net unrealized appreciation on investments and
assets and liabilities denominated in
foreign currency............................ 25,994,846
-----------
NET ASSETS.................................. $108,343,537
===========
</TABLE>
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 (UNAUDITED)
- ----------------------------------------------------------
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign taxes of $108,924)... $ 1,053,832
Interest....................................... 68,789
-----------
Total Investment Income...................... 1,122,621
-----------
EXPENSES:
Investment advisory fee........................ 514,499
Transfer and shareholder servicing agent....... 173,402
Distribution expenses.......................... 128,617
Printing and mailing........................... 25,662
Custodian fees and expenses.................... 22,132
Legal and audit fees........................... 21,154
Interest expenses.............................. 21,132
Registration fees.............................. 14,184
Amortization of organization expenses.......... 7,750
Directors' fees and expenses................... 2,917
Miscellaneous.................................. 3,675
-----------
Total expenses............................... 935,124
-----------
NET INVESTMENT INCOME........................... 187,497
-----------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS
AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain on investments and foreign
currency transactions........................ 5,567,091
Net change in unrealized appreciation.......... 10,391,378
-----------
Net gain on investments...................... 15,958,469
-----------
NET INCREASE IN NET ASSETS RESULTING FROM
OPERATIONS..................................... $16,145,966
===========
</TABLE>
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30, 1997 YEAR ENDED
(UNAUDITED) DECEMBER 31, 1996
---------------- -----------------
<S> <C> <C>
INCREASE IN NET ASSETS:
Net investment income............................................................... $ 187,497 $ 411,485
Net realized and unrealized gain on investments and foreign currency transactions... 5,567,091 7,081,146
Net change in unrealized appreciation............................................... 10,391,378 2,695,936
------------ ------------
Net increase in net assets resulting from operations.............................. 16,145,966 10,188,567
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income............................................................... -- (413,426)
Net realized gains.................................................................. -- (7,136,096)
------------ ------------
-- (7,549,522)
------------ ------------
Share transactions -- net........................................................... (16,346,088) (16,940,085)
------------ ------------
Net decrease in net assets...................................................... (200,122) (14,301,040)
NET ASSETS:
Beginning of period................................................................. 108,543,659 122,844,699
------------ ------------
End of period....................................................................... $108,343,537 $ 108,543,659
============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
11
<PAGE> 12
THE GABELLI GLOBAL TELECOMMUNICATIONS FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES. The primary investment objective of The
Gabelli Global Telecommunications Fund (the "Fund") is capital appreciation. The
Fund is a series of Gabelli Global Series Funds, Inc. (the "Corporation"),
incorporated in Maryland on July 16, 1993. The Fund is a no-load, open-end,
non-diversified management investment company and one of five separately managed
portfolios of the Corporation. The Fund commenced investment operations on
November 1, 1993. The preparation of financial statements in accordance with
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, quoted by the National Association of Securities
Dealers Automated Quotations, Inc. ("NASDAQ") or traded on foreign exchanges are
valued at the last sale price on that exchange (if there were no sales that day,
the security is valued at the average of the bid and asked prices). All other
portfolio securities for which over-the-counter market quotations are readily
available are valued at the latest average of their bid and asked prices. When
market quotations are not readily available, portfolio securities are valued at
their fair value as determined in good faith under procedures established by and
under the general supervision of the Corporation's Directors. Short-term debt
securities with remaining maturities of 60 days or less are valued at amortized
cost, unless the Directors determine such does not reflect the securities' fair
value, in which case these securities will be valued at their fair value as
determined by the Directors. Options are valued at the last sale price on the
exchange on which they are listed. If no sales of such options have taken place
that day, they will be valued at the mean between their closing bid and asked
prices.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with
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 Directors. 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 100% 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.
FOREIGN CURRENCY TRANSACTIONS. The books and records of the Fund are maintained
in U.S. dollars as follows:
(i) market value of investment securities and other assets and liabilities are
recorded at the exchange rate on the valuation date.
(ii) purchases and sales of investment securities, income and expenses are
recorded at the exchange rate prevailing on the respective date of such
transactions.
FORWARD FOREIGN CURRENCY 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 Advisor. Forward foreign currency contracts are valued at the
forward rate and are marked-to-market daily. The change in market value is
recorded by the Fund as an unrealized gain or loss. 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 currency 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
currency 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.
12
<PAGE> 13
THE GABELLI GLOBAL TELECOMMUNICATIONS FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
At June 30, 1997, the Fund had the following forward foreign currency contracts
open:
<TABLE>
<CAPTION>
SETTLEMENT UNREALIZED
AMOUNT FOREIGN CURRENCY DATE VALUE GAIN/(LOSS)
- -------- --------------------- ---------- -------- -----------
<C> <S> <C> <C> <C>
535,131 Bought French Francs 07/01/97 $ 91,024 $(202)
32,395 Sell Peruvian Sols 07/01/97 12,225 5
-------- --------
$103,249 $(197)
======== ========
</TABLE>
SECURITIES TRANSACTIONS AND INVESTMENT INCOME. Securities transactions are
accounted for on the trade date, with realized gain or loss on investments
determined using specific identification as the cost method. Interest income
(including amortization of premium and accretion of discount) is recorded as
earned. Dividend income and dividend and capital gain distributions to
shareholders are recorded on the ex-dividend date.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders are recorded on the ex-dividend date. Income distributions and
capital gain distributions are determined in accordance with income tax
regulations which may differ from generally accepted accounting principles.
These differences are primarily due to differing treatments of income and gains
on various investment securities held by the Fund, timing differences and
differing characterization of distributions made by the Fund.
PROVISION FOR INCOME TAXES. The Fund has qualified and intends to continue to
qualify as a regulated investment company under Subchapter M of the Internal
Revenue Code of 1986, as amended. As a result, no Federal income tax provision
is required.
Dividends and interest from non-U.S. sources received by the Fund are generally
subject to non-U.S. withholding taxes at rates ranging up to 30%. Such
withholding taxes may be reduced or eliminated under the terms of applicable
U.S. income tax treaties, and the Fund intends to undertake any procedural steps
required to claim the benefits of such treaties. If the value of more than 50%
of the Fund's total assets at the close of any taxable year consists of stocks
or securities of non-U.S. corporations, the Fund is permitted and may elect to
treat any non-U.S. taxes paid by it as paid by its shareholders.
2. INVESTMENT ADVISORY AGREEMENT. The Fund has entered into an investment
advisory agreement (the "Advisory Agreement") with the Advisor which provides
that the Fund will pay the Advisor a fee, computed daily and paid monthly, at
the annual rate of 1.00 percent of the value of the Fund's average daily net
assets. In accordance with the Advisory Agreement, the Advisor provides a
continuous investment program for the Fund's portfolio, oversees the
administration of all aspects of the Fund's business and affairs, and pays the
compensation of all Officers and Directors of the Fund who are its affiliates.
The Advisor is obligated to reimburse the Fund in the event the Fund's expenses
exceed the most restrictive expense ratio limitation imposed by any state,
currently believed to be 2.5% of the first $30 million of the Fund's average
daily net assets (excluding taxes, interest, distribution expenses and
extraordinary items). No such reimbursement was required during the six months
ended June 30, 1997.
3. ORGANIZATION EXPENSES. The organization expenses of the Fund are being
amortized on a straight-line basis over a period of 60 months. The Advisor has
agreed that in the event that any of the initial 10,000 shares it acquired on
September 30, 1993 are redeemed during the period of amortization of the Fund's
organization expenses, the redemption proceeds will be reduced by any such
unamortized organization expenses in the same proportion as the number of
initial shares being redeemed bears to the number of initial shares outstanding
at the time of redemption.
4. DISTRIBUTION PLAN. The Fund has adopted a distribution plan (the "Plan")
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Pursuant to
this Plan, the Fund reimburses the Distributor, Gabelli & Company, Inc.
("Gabelli & Company"), an indirect wholly-owned subsidiary of the Advisor, for
expenses incurred by the Distributor in connection with the distribution and
activities primarily intended to result in the sale of shares of the Fund. The
distribution expenses are reimbursed at an annual rate up to 0.25 percent of the
value of the Fund's average daily net assets which accrue daily and are paid
monthly. For the six months ended June 30, 1997, the Fund incurred distribution
costs of $128,617, or 0.25% of average net assets. The Board of Directors
approved that distribution costs incurred by Gabelli & Company totaling
$311,749, which are in excess of the 0.25% limitation, may be recovered from the
Fund in future periods.
13
<PAGE> 14
THE GABELLI GLOBAL TELECOMMUNICATIONS FUND
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
5. PORTFOLIO SECURITIES. Purchases and sales of securities for the six months
ended June 30, 1997, other than U.S. government obligations and short-term
securities, aggregated $6,465,049 and $22,629,759, respectively.
6. TRANSACTIONS WITH AFFILIATES. During the six months ended June 30, 1997, the
Fund paid brokerage commissions of $4,028 to Gabelli & Company and its
affiliates.
7. BANK LOAN. The Fund has access to an unsecured line of credit from the
Custodian for temporary purposes. Borrowings under this arrangement bear
interest at 0.75% above the Federal Funds rate on outstanding balances. There
was no outstanding loan as of June 30, 1997.
The average daily amount of borrowings outstanding during the six months ended
June 30, 1997 was $420,750, with a related weighted average interest rate of
6.29%. The maximum amount borrowed at any time during the six months ended June
30, 1997 was $490,000.
8. CAPITAL STOCK TRANSACTIONS. Transactions in shares of common stock were as
follows:
<TABLE>
<CAPTION>
Six Months Ended Year Ended
June 30, 1997 December 31, 1996
----------------------------- -----------------------------
Shares Amount Shares Amount
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Shares sold.................................................... 1,505,433 $ 17,600,570 2,412,958 $ 28,511,972
Shares issued upon reinvestment of dividends................... -- -- 646,152 7,288,589
Shares redeemed................................................ (2,905,553) (33,946,658) (4,482,256) (52,740,646)
---------- ------------ ---------- ------------
Net decrease................................................... (1,400,120) $ (16,346,088) (1,423,146) $ (16,940,085)
========== ============ ========== ============
</TABLE>
14
<PAGE> 15
THE GABELLI GLOBAL TELECOMMUNICATIONS FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Selected data for a share of capital stock outstanding throughout each period:
<TABLE>
<CAPTION>
Six Months November 1, 1993
Ended June 30, Year Ended December 31, (Commencement of
1997 ---------------------------------- Operations) through
(Unaudited) 1996 1995 1994 December 31, 1993
-------------- -------- -------- -------- -------------------
<S> <C> <C> <C> <C> <C>
OPERATING PERFORMANCE:
Net asset value, beginning of period.............. $ 11.28 $ 11.12 $ 9.73 $ 10.20 $ 10.00
-------- -------- -------- ------- -------
Net investment income............................. 0.02 0.05 0.06 0.07 0.01
Net realized and unrealized gain/(loss) on
investments..................................... 1.87 0.95 1.51 (0.44) 0.29
-------- -------- -------- ------- -------
Total from investment operations.................. 1.89 1.00 1.57 (0.37) 0.30
-------- -------- -------- ------- -------
DISTRIBUTIONS:
Dividends from net investment income.............. -- (0.05) (0.06) (0.07) (0.01)
Dividends from net realized gain on investments... -- (0.79) (0.12) (0.03) (0.09)
-------- -------- -------- ------- -------
Total distributions............................... -- (0.84) (0.18) (0.10) (0.10)
-------- -------- -------- ------- -------
NET ASSET VALUE, END OF PERIOD.................... $ 13.17 $ 11.28 $ 11.12 $ 9.73 $ 10.20
======== ======== ======== ======= =======
Total Return(a)................................... 16.8% 9.0% 16.2% (3.7)% 3.0%
RATIOS TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA:
Net assets, end of period (in thousands).......... $108,344 $108,544 $122,845 $137,731 $45,290
Ratio of operating expenses to average net
assets.......................................... 1.82%(b) 1.72% 1.75% 1.80% 2.54%(b)
Ratio of net investment income to average net
assets.......................................... 0.36%(b) 0.34% 0.53% 0.74% 1.28%(b)
Portfolio turnover rate........................... 6% 7% 24% 14% 0%
Average commission rate(c)........................ $ 0.0257 $ 0.0365 -- -- --
</TABLE>
- ---------------
(a) Total return is calculated assuming a purchase of shares on the first day
and a sale on the last day of each period reported and includes reinvestment
of distributions. Total return for the period of less than one year is not
annualized.
(b) Annualized.
(c) For fiscal years beginning on or after September 1, 1995, the SEC requires
the Fund to disclose its average commission rate paid per share of security.
TOP TEN HOLDINGS
JUNE 30, 1997
-------------
Telecomunicacoes Brasileiras SA (Telebras) BC TELECOM Inc.
Telefonica de Espana Tele-Communications, Inc.
Telephone & Data Systems, Inc. Telefonos De Mexico SA
Cable & Wireless plc Northern Telecom Limited
AirTouch Communications Inc. Compania de Telecomunicaciones
de Chile S.A.
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.
15
<PAGE> 16
Gabelli Global Series Funds, Inc.
THE GABELLI GLOBAL TELECOMMUNICATIONS FUND
One Corporate Center
Rye, New York 10580-1434
1-800-GABELLI
[1-800-422-3554]
FAX: 1-914-921-5118
HTTP://WWW.GABELLI.COM
E-MAIL: [email protected]
(Net Asset Value may be obtained daily by calling
1-800-GABELLI after 6:00 P.M.)
BOARD OF DIRECTORS
Mario J. Gabelli, CFA Karl Otto Pohl
Chairman and Chief Former President
Investment Officer Deutsche Bundesbank
Gabelli Funds, Inc.
Felix J. Christiana Werner J. Roeder, MD
Former Senior Vice President Director of Surgery
Dollar Dry Dock Savings Bank Lawrence Hospital
Anthony J. Colavita Anthonie C. van Ekris
Attorney-at-Law Managing Director
Anthony J. Colavita, P.C. BALMAC International, Inc.
John D. Gabelli
Vice President
Gabelli & Company, Inc.
OFFICERS
Mario J. Gabelli, CFA Marc J. Gabelli
President Associate Portfolio Manager
Bruce N. Alpert Ivan Arteaga, CPA
Vice President and Treasurer Associate Portfolio Manager
James E. McKee
Secretary
DISTRIBUTOR
Gabelli & Company, Inc.
CUSTODIAN, TRANSFER AGENT AND DIVIDEND AGENT
State Street Bank and Trust Company
LEGAL COUNSEL
Skadden, Arps, Slate, Meagher & Flom L.L.P.
- --------------------------------------------------------------------------------
This report is submitted for the general information of the shareholders of The
Gabelli Global Telecommunications Fund. It is not authorized for distribution to
prospective investors unless preceded or accompanied by an effective prospectus.
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[PHOTO]
THE
GABELLI
GLOBAL
TELECOMMUNICATIONS
FUND
SEMI-ANNUAL REPORT
JUNE 30, 1997
