<PAGE> 1
GABELLI GLOBAL SERIES FUNDS, INC.
One Corporate Center
Rye, New York 10580 - 1434
THE GABELLI GLOBAL TELECOMMUNICATIONS FUND
FIRST QUARTER REPORT
MARCH 31, 1997
TO OUR SHAREHOLDERS:
For the first quarter ended March 31, 1997, The Gabelli Global
Telecommunications Fund's net asset value increased 0.1% to $11.29 per share.
This compares to the 0.7% return of the average global fund as tracked by
Lipper Analytical Services, Inc. The Lipper average covers 194 global open-end
mutual funds which may invest in a diversified group of industry sectors. The
Salomon Brothers Global Telecommunications Index, an unmanaged index of 52
equity security issues of companies in the telecommunications industry,
increased 3.4% over the same period. For the year ended March 31,
INVESTMENT PERFORMANCE (a)
================================================================================
<TABLE>
<CAPTION>
Quarter
---------------------------------------------
1st 2nd 3rd 4th Year
------- ------- ------- ------- --------
<S> <C> <C> <C> <C> <C>
1997: Net Asset Value . . . . . . . . $11.29 -- -- -- --
Total Return . . . . . . . . . 0.1% -- -- -- --
- - ----------------------------------------------------------------------------------------------------------------
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 - March 31, 1997 (a)
-------------------------------------------
<S> <C>
1 Year 3.5%
3 Year 8.7%
Life of Fund(b) 6.9%
</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) Average annual and total 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. Investing in foreign
securities involves risks not ordinarily associated with investments in
domestic issues, including currency fluctuation, economic and political risks.
(b) From commencement of operations on November 1, 1993.
<PAGE> 2
1997, the Fund increased 3.5%, versus 11.1% and 16.5% for the Lipper global
fund average and the Salomon Brothers Global Telecommunications Index,
respectively.
Since inception on November 1, 1993, through March 31, 1997, the Fund
gained 25.7% which reflects an average annual rate of return of 6.9% assuming
reinvestment of dividends.
THE PORTFOLIO
GLOBAL ALLOCATION
The chart to the right represents the Fund's holdings by geographic
region as of March 31, 1997. The geographic allocation will change based on
current global market conditions. Countries and/or regions or companies
represented in the chart and below may or may not be included in the Fund's
portfolio in the future.
<TABLE>
<CAPTION>
HOLDINGS BY GEOGRAPHIC REGION - 3/31/97
<S> <C>
EUROPE 21.8%
UNITED STATES 43.8%
ASIA/PACIFIC RIM 11.0%
LATIN AMERICA 10.6%
CANADA 8.6%
OTHER 4.2%
</TABLE>
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 growing value for
their shareholders.
PORTFOLIO STRUCTURE
We remain "bottom-up" focused, with roughly half the fund's investment
in the U.S. Internationally, the trend continues to be 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 22% of the Fund is invested in Europe, much of that in the UK.
Key holdings are companies with a strong global presence and attractive
valuations. Included are Cable & Wireless, the
2
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UK's second-largest telecom group, and Vodafone, the biggest UK 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.
Asia/Pacific Rim represents about 11.0% of the Fund and Latin America
around 10.6%. 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 key 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, the stock price performance has not kept pace
with the growth in value. Major forces -- strong demand, open markets,
technology, consolidation -- should drive telecom stock prices toward their
Private Market Values, thereby enhancing shareholder value.
COMMENTARY
THE ECONOMY AND THE STOCK MARKET: TOO MUCH OF A GOOD THING
Once again, the economy confounded the Wall Street economists by
growing much faster than consensus expectations. Although inflation has not
yet shown up in the Producer Price and Consumer Price inidices, Federal Reserve
Chairman Alan Greenspan and bond investors decided to err on the side of
caution by taking short- and long-term interest rates higher.
We applaud Fed Chairman Greenspan's preemptive strike against
inflation. We believe he will continue to take the steps necessary to combat
inflation and, in the process, provide confidence in Soft Landing - Part II.
Over the short-term, this may not be pleasant for equities investors. However,
with the elimination of some of the speculative excesses, the market will be on
much better fundamental footing going forward. We do not believe this is the
beginning of a secular bear market, but rather a healthy correction that is
arguably long overdue.
What can we expect over the balance of this year? We should continue
to see a volatile market as skittish investors wrestle with the latest economic
data trying to determine if inflation is a real threat. While the jury may
still be out on inflation, higher interest rates are a reality and will be
problematic for stocks on several levels. Higher interest rates might trim the
economy and restrain corporate earnings growth, putting consensus estimates of
9% to 10% gains for 1997 in jeopardy. Higher rates also boost the U.S. dollar,
further crimping the U.S. dollar value of international earnings. Whether you
are looking at stocks on the basis of asset values or using a dividend discount
model, public prices of equities tend to decline as interest rates rise, all
else constant. So, price/cash flow and price/earnings multiples would
contract, should interest rates rise.
3
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The wild card will be how investors react to any sustained decline in
stock prices. A tremendous amount of money has flowed into the equities market
in the last three years. Will it back out at the first sign of serious
trouble? It may not be how the great unwashed public reacts, but rather how
the great unwashed professional investors -- those twenty and thirty something
mutual fund managers who have never experienced even a substantial market
correction -- respond to the perceived crisis. Will they see the glass half
empty or half full? We don't know.
While we are dwelling on things on our watch list, we should also
mention the strong dollar. Despite the enormous advances in the quality of
American made goods in a wide variety of industries, the strong dollar will
restrain exports and currency translation will have an adverse impact on the
earnings of U.S. based multi-national companies. Longer term, we must also be
sensitive to the fact that substantial cost reductions and productivity gains
in American industry over the last five years may be close to running their
course. In other words, profit margins are unlikely to advance further.
We don't view a market correction as bad news. In general, we are not
exposed to those sectors and individual companies that have benefited most from
investor euphoria and which are, therefore, most vulnerable to a dramatic
change in investor sentiment. If anything, a market correction should provide a
more level playing field for disciplined investors focusing on the fundamental
value of individual stocks. We are just now emerging from a two year period in
which fundamentals have mattered much less than market momentum. We are
entering what may prove to be an extended period in which stock pickers excel.
MUST CARRY
In an upset rivaling the University of Arizona's victory over Kentucky
in the 1997 NCAA basketball championship, the Supreme Court voted 5 to 4 to
uphold the "must carry" provision for local broadcast companies. The must
carry rule specified that cable television systems must make one-third of their
channel capacity available free to local broadcasters. Led by Ted Turner, the
cable television industry had challenged the rule on the grounds that it
violated their first amendment rights. The industry's economic goal was to
free up channel capacity for new cable television networks providing more
popular programming and paying the cable operator for channel space. The
consensus of the lawyers on both sides of the issue was the cable guys would
win. However, the Supreme Court decided that allowing cable operators to
exclude local broadcast channels would create undue economic hardship for many
broadcasters and threaten the survival of weaker independents.
Who are the winners and losers? The broadcasters, particularly those
with extensive UHF properties get a renewed lease on life as they maintain and
in some cases add to their cable audience. The entrenched cable television
networks, like International Family Entertainment, Inc. (FAM - $20.375 - NYSE),
BET Holdings, Inc. (BTV - $29.625 - NYSE), Gaylord Entertainment Company (GET -
$21.50 - NYSE), HSN, Inc. (HSNI - $25.375 - NASDAQ) and Tele-Communications,
Inc./Liberty Media Group (LBTYA - $19.9375 - NASDAQ) benefit because with cable
channel capacity
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<PAGE> 5
still restrained, the value of their "slots" with cable operators increase in
value. For example, the prospective value of International Family
Entertainment to a News Corporation Limited (NWS - $18.00 - NYSE), which is
trying to expand distribution of its programming, increases substantially. The
biggest losers are the cable television network wannabes who will have to wait
until cable operators complete upgrades to their systems before channel space
is available.
GLOBAL TRENDS: POSITIONING THE PORTFOLIO FOR THE NEW MILLENNIUM
We have identified several global trends in telecommunications which
should continue to surface values: a huge, rapidly growing market; exploding
demand; deregulation; and digital technology. In 1995, telecom services
world-wide was a $600 billion industry. By 2000, it is projected to exceed a
trillion dollars. Today, half the world's population has never made a
telephone call. Consumer desire for value-added communications is driving
rapid growth in traditional land-line telephone and wireless services.
Countries must build information highways for the 21st century.
Around the world, countries are opening their telecom markets to
competition. In the U.S., the Telecommunications Reform Act of 1996 removed
regulatory barriers between industry segments (local telephone, long distance,
and cable TV) to encourage competition and spur development. Europe plans to
open its markets to competitive forces by 1998. Foreign governments in Asia
and elsewhere are opening their markets, creating growth opportunities.
Digital technology is facilitating new services like the Internet,
satellites (e.g., DirecTV) and personal communications services (PCS). New
technology means lower costs for communication companies and lower prices for
consumers.
LET'S TALK STOCKS
The following are stock specifics on selected holdings of our Fund.
Favorable EBITDA 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 - $23.00 - 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 U.S. West Media Group's cellular and personal communications
services (PCS) properties previously held in a shared joint venture.
BC TELECOM Inc. (BCT - $21.85 - TSE) is a full-service telecommunications
company operating in British Columbia, Canada. Its major investor is GTE
Corporation (GTE - $45.50 - NYSE), which owns
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<PAGE> 6
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
324,850 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 - $23.75 - NYSE) is a United Kingdom-based company
comprised of broad global telecommunications interests. CWP has bolstered its
presence in the increasingly competitive U.K. communications market following a
major restructuring. The company now owns 53% of a new, publicly-traded U.K.
based company which owns 100% of Mercury Communications, the second largest
provider of telecom services in Britain (after British Telecommunications), and
a majority of U.K. Cable TV/Telco Companies including Bell Cable Media, Nynex
CableComms and Videotron Holdings plc. Hong Kong Telecom (58% owned by CWP),
the dominant telecom service provider in Hong Kong, remains the "crown jewel"
of the CWP portfolio and represents approximately $18 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.
Comcast Corporation (CMCSA - $16.375 - NASDAQ) is the fourth-largest cable
company in the U.S., serving approximately 4.3 million subscribers. The
company owns a cellular telephone business serving eight million "POP"s in the
high traffic, mid-Atlantic region including parts of New Jersey, Pennsylvania
and Delaware. In addition to its controlling ownership of QVC, the cable TV
retailer, Comcast recently added to its programming investments by purchasing a
controlling interest in the Philadelphia 76ers, Philadelphia Flyers and two
arenas. We estimate Comcast's PMV to be about $29 per share.
Tele-Communications, Inc. (TCOMA - $12.00 - 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, Comcast and Cox, to its innovative Internet access business, dubbed
"@ Home", to its 80% stake in Tele-Communications International, Inc. A major
cost containment effort is beginning to show results, leading to substantial
increases in operating cash flow.
Telecomunicacoes Brasileiras SA (Telebras) (TBR - $102.375 - NYSE) is the
Brazilian government-controlled monopoly telecommunications holding company
consisting of 28 subsidiaries serving more than 14 million 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 five times our estimate of 1997 cash
flow. Future opportunities include the
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prospects of privatization, strong line growth and improvements in efficiency.
The company 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 - $71.75 - 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
Telefonos Chile, Telefonica de Argentina S.A. and Compania Peruana de
Telefonos. 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.
Vodafone Group plc (VOD - $44.125 - NYSE) is a U.K.-based global provider of
wireless telecommunications services. The company's major interests in the U.K.
include cellular, paging and data transmission. 630,000 net new customers were
added last year, to reach a subscriber base of 2,450,000. Vodafone's shares
sell at one of the lowest multiples of EBITDA among the major wireless
companies, despite a pristine balance sheet and prospects for 20% annual growth
in earnings and cash flow. Management is highly respected and has positioned
the company to share in the exciting and rapidly growing global market for
wireless communications.
Telephone and Data Systems, Inc (TDS - $38.375 - ASE) is oriented to create
substantial shareholder value (as compared to focusing on near-term earnings
per share). TDS 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 company. 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. TDS 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.
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MINIMUM INITIAL INVESTMENT - $1,000
Effective August 12, 1996 The Gabelli Global Telecommunications Fund's
minimum initial investment is $1,000 for all accounts. There are no subsequent
investment minimums. No initial minimum is required for those establishing an
Automatic Investment Plan. The Gabelli Global Telecommunications Fund and other
Gabelli Funds are available through the no-transaction fee programs at many
major discount brokerage firms.
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, quarterly reports, closing prices, IRAs, 401(k)s and
other current news. You can also send us e-mail at [email protected].
IN CONCLUSION
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
day for further information.
Sincerely,
/s/ MARIO J. GABELLI /s/ MARC J. GABELLI
MARIO J. GABELLI, CFA MARC J. GABELLI
President and Portfolio Manager Associate Portfolio manager
/s/ IVAN ARTEAGA
IVAN ARTEAGA, CPA
Associate Portfolio Manager
May 1, 1997
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TOP TEN HOLDINGS
MARCH 31, 1997
Telefonica de Espana Vodafone Group plc
Telecomunicacoes Brasileiras SA (Telebras) BC Telecom Inc.
Telephone & Data Systems, Inc. Cia De Telefonos Chile
Cable & Wireless plc Comcast Corporation
AirTouch Communications Inc. Tele-Communications, Inc.
- - --------------------------------------------------------------------------------
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.
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THE GABELLI GLOBAL TELECOMMUNICATION FUND
PORTFOLIO OF INVESTMENTS -- MARCH 31, 1997 (UNAUDITED)
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<TABLE>
<CAPTION>
SHARES VALUE
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<C> <S> <C>
COMMON STOCKS -- 94.45%
ALTERNATIVE TELECOMMUNICATION SERVICE
PROVIDERS -- 1.70%
500 Bouygues Group................... $ 49,681
4,000 Esprit Telecom Group Plc......... 47,500
15,000 GST Telecommunications Inc.+ .... 112,500
15,000 ICG Communications Inc. ......... 170,625
1,000 Intermedia Communications
Inc.+ ......................... 16,625
2,500 Mannesmann AG.................... 951,493
400 Teleport Communications Group
Inc. Cl. A+.................... 9,200
15,000 WorldCom......................... 330,000
-----------
1,687,624
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AVIATION: PARTS AND ACCESSORIES -- 0.71%
13,000 General Motors Corporation Cl.
H.............................. 705,250
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CABLE -- 10.32%
50,000 Adelphia Communications
Corporation Cl. A+............. 268,750
32,000 Bell Cablemedia plc ADR+......... 504,000
30,000 Cablevision Systems Corporation
Cl. A+......................... 892,500
65,000 Century Communications
Corporation Cl. A+............. 300,625
110,000 Comcast Corporation Cl. A+....... 1,801,250
42,000 Comcast U.K. Cable Partners
Limited+....................... 467,250
10,000 General Cable Corporation plc
ADR+........................... 148,750
42,200 International CableTel
Incorporated+.................. 891,475
18,500 NYNEX CableComms Group plc ADR+.. 307,563
20,000 Rogers Communications, Inc. Cl.
B.............................. 125,000
75,000 Tele-Communications, Inc. Cl.
A+............................. 900,000
60,375 Tele-Communications, Inc./Liberty
Media Group Cl. A+............. 1,203,727
35,000 Telecommunications International
Inc. Cl. A+.................... 450,625
6,000 Telewest Communications plc
ADR+........................... 104,250
90,000 United International Holdings
Inc. Cl. A+.................... 855,000
55,000 US WEST Media Group+............. 1,024,375
-----------
10,245,140
-----------
LONG DISTANCE TELEPHONE COMPANIES -- 5.17%
25,000 AT&T Corp. ...................... 868,750
25,000 Call-Net Enterprises Inc.+ ...... 388,367
25,000 Cam-Net Communications Network
Inc.+ ......................... 1,550
165 DDI Corporation.................. 1,041,207
5,000 Fonorola Inc.+ .................. 72,254
100,000 General Communication Inc. Cl.
A+............................. 668,750
6,500 Kokusai Denshin.................. 378,921
5,000 LCI International Inc.+ ......... 83,750
6,000 MCI Communications Corporation... 213,750
66,000 P.D.L. Holdings Limited.......... 387,750
<CAPTION>
SHARES VALUE
- - ------------- -----------
<C> <S> <C>
20,000 Sprint Corporation............... $ 910,000
4,000 Teleglobe Inc. .................. 115,896
-----------
5,130,945
-----------
MISCELLANEOUS -- 1.49%
3,000 Lodgenet Entertainment
Corporation+................... 31,500
6,000 Metromedia International Group
Inc. .......................... 52,125
10,000 News Corporation Limited ADR..... 180,000
10,000 Price Communications
Corporation.................... 97,500
22,000 Time Warner Inc. ................ 951,500
3,000 Veba AG.......................... 171,582
-----------
1,484,207
-----------
PUBLISHING -- 0.43%
14,000 Media General Inc. Class A....... 397,250
100,000 Seat Spa*........................ 34,635
-----------
431,885
-----------
REGIONAL/LOCAL TELEPHONE SERVICES -- 13.71%
44,000 Aliant Communications Inc. ...... 726,000
28,000 ALLTEL Corporation............... 910,000
24,000 Ameritech Corporation............ 1,476,000
38,000 Atlantic Tele-Network Inc.+ ..... 465,500
8,000 Bell Atlantic Corporation........ 487,000
35,000 BellSouth Corporation............ 1,478,750
9,000 Bruncor, Inc. ................... 194,436
1,000 Cincinnati Bell Inc. ............ 56,500
62,000 C-TEC Corporation Cl. B.......... 1,821,250
1,000 First Pacific Company Ltd. Spons.
ADR............................ 63,556
30,000 Frontier Corporation............. 536,250
38,000 GTE Corporation.................. 1,771,750
15,000 Island Telephone Company
Limited........................ 287,211
19,000 Maritime Telegraph and Telephone
Company Limited................ 316,438
12,000 NewTel Enterprises Limited....... 209,827
3,000 NYNEX Corporation................ 136,875
12,000 Pacific Telecom, Inc. ........... 360,000
3,000 Pacific Telesis Group Inc. ...... 113,250
3,000 Peoples Telephone Company
Inc.+ ......................... 10,125
10,000 Quebec-Telephone+................ 171,243
10,000 SBC Communications, Inc. ........ 526,250
28,000 Southern New England
Telecommunications
Corporation.................... 1,004,500
10,000 Telus Corporation................ 154,624
10,000 US WEST Communications Group..... 340,000
-----------
13,617,335
-----------
SATELLITE -- 0.47%
1,000 British Sky Broadcasting Group
ADR............................ 60,625
8,000 Echostar Communications
Corporation Cl. A+............. 164,000
452 Globalstar Capital, Corp. ....... 12,204
2,000 PT Indonesia Satellite........... 53,500
</TABLE>
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THE GABELLI GLOBAL TELECOMMUNICATION FUND
PORTFOLIO OF INVESTMENTS (CONTINUED) -- MARCH 31, 1997 (UNAUDITED)
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<TABLE>
<CAPTION>
SHARES VALUE
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<C> <S> <C>
COMMON STOCKS (CONTINUED)
SATELLITE (CONTINUED)
20,000 TCI Satellite Entertainment Cl
A+............................. $ 155,000
2,000 U.S. Satellite Broadcasting
Co.+ .......................... 21,500
-----------
466,829
-----------
TELECOMMUNICATIONS (OTHER) -- 0.28%
2,500 Great Nordic Stores.............. 261,112
2,000 United Communication Industry.... 12,933
-----------
274,045
-----------
TELEPHONE EQUIPMENT -- 3.12%
60,000 Champion Technology Holdings
ADR............................ 45,300
4,400 Ericsson (L.M.) Telephone Company
ADR............................ 148,775
10,000 General Instrument Corporation... 228,750
9,000 Lucent Technologies, Inc. ....... 474,750
500 Siemens AG -- ADR................ 26,942
2,500 Motorola, Inc. .................. 150,938
25,000 Northern Telecom Limited......... 1,634,375
10,000 Scientific-Atlanta, Inc. ........ 152,500
115,500 Time Engineering Berhad.......... 239,946
-----------
3,102,276
-----------
TELEPHONE NETWORKS -- 36.64%
110,000 BC TELECOM Inc. ................. 2,404,263
45,000 BCE Inc. ........................ 2,070,000
3,000 BHI Corporation.................. 58,125
3,000 British Telecommunications plc
ADR............................ 210,000
120,000 Cable & Wireless plc ADR......... 2,850,000
80,000 Compagnia Telefonos Chile
S.A. .......................... 2,300,000
30,000 CP Pokphand Spons. ADR........... 241,965
525,100 CPT Telefonica del Peru Cl. B.... 1,168,213
1,000 CPT Telefonica del Peru Cl. B
ADR............................ 22,250
9,000 Deutsche Telecom AG+............. 196,875
3,430 Hellenic Telecommunications
Organization S.A. (OTE)........ 74,139
15,000 Hong Kong Telecommunications Ltd.
ADR............................ 245,625
8,000 PT Telekomunikasi Indonesia*..... 241,000
1,000 Hungarian Telephone & Cable
Corporation.................... 9,750
40 Japan Telecom Co. Ltd. .......... 675,420
8,000 MIDCOM Communications Inc.+ ..... 64,000
167 Nippon Telegraph & Telephone
Corporation+................... 1,176,075
10,000 Nippon Telegraph & Telephone
Corporation ADR................ 358,750
50,000 Nordictel Holdings AB+........... 1,029,938
800 Pakistan Telecommunications
GDR+........................... 60,000
26,900 Philippine Long Distance
Telephone Company.............. 1,610,638
12,000 Portugal Telecom S.A. ADR........ 441,000
25,000 Kominklijke PTT Nederland NV
ADR............................ 906,250
<CAPTION>
SHARES VALUE
- - ------------- -----------
<C> <S> <C>
20,000 Singapore Telecommunications
Limited........................ $ 41,522
28,000 STET SpA -- Societa Financiaria
Telfonica SpA ADR.............. 1,214,500
8,000 Tele Danmark A/S ADR............. 209,000
18,000 Telecom Argentina Stet -- France
Telecom S.A. ADR............... 828,000
326,086 Telecom Asia..................... 555,401
2,000 Telecom Asia ADR................. 35,200
19,000 Telecom Corporation of New
Zealand Ltd. ADR............... 1,349,000
350,000 Telecom Italia SpA+.............. 871,551
36,000 Telecomunicacoes Brasileiras
(Telebras) S.A. Spons. ADR..... 3,685,500
938,570 Telecomunicacoes de Sao Paulo SA
(Telesp)....................... 234,864
4,000,000 Telecommunications of Jamaica.... 404,000
45,000 Telefonica de Argentina S.A.
ADR............................ 1,321,875
55,000 Telefonica de Espana ADR......... 3,802,750
50,000 Telefonos De Mexico S.A. Cl. L
ADR............................ 1,925,000
190,000 Telekom Malaysia Berhad.......... 1,479,225
8,075 Thai Telephone & Telecom GDR..... 20,296
-----------
36,391,960
-----------
WIRELESS COMMUNICATIONS -- 20.41%
40,000 ABC Communications Holdings
Ltd. .......................... 9,292
100,000 AirTouch Communications Inc.+ ... 2,300,000
73,000 Aerial Communications Inc.+ ..... 401,500
2,000 American Mobile Satellite
Corporation+................... 22,500
72,000 American Paging, Incorporated+... 252,000
100 Asia Satellite Telcommunications
Holdings Ltd. ................. 2,563
14,200 Associated Group, Inc. Cl. A+.... 536,050
16,000 Associated Group, Inc. Cl. B+.... 580,000
14,000 BCE Mobile Communications
Inc.+ ......................... 424,855
20,000 Cellular Communications
International Inc.+ ........... 555,000
105,000 Centennial Cellular Corp. Cl.
A+............................. 1,089,375
30,000 Century Telephone Enterprises,
Inc. .......................... 885,000
2,000 Commnet Cellular Inc.+ .......... 51,000
50,000 COMSAT Corporation............... 1,218,750
400 Omnipoint Corporation............ 3,900
150,000 Technology Resources
Industries..................... 326,745
1,000 CoreComm Inc. ................... 14,500
4,000 Globalstar Telecommunications
Limited+....................... 214,000
44,000 Grupo Iusacell S.A. ADR Ser.
D+............................. 368,500
26,000 Himachal(a)...................... 32,933
24,000 Jasmine International(a)......... 33,718
15,000 Loral Space & Communications
Ltd.+ ......................... 211,875
5,300 Matrix Telecommunications
Ltd.+ ......................... 8,540
1,500 Metrocall, Inc.+ ................ 6,188
8,000 Mobile Telecommunication
Technologies Corp.+ ........... 50,000
</TABLE>
10
<PAGE> 11
THE GABELLI GLOBAL TELECOMMUNICATION FUND
PORTFOLIO OF INVESTMENTS (CONTINUED) -- MARCH 31, 1997 (UNAUDITED)
- - --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
OR SHARES VALUE
- - ------------- -----------
<C> <S> <C>
COMMON STOCKS (CONTINUED)
WIRELESS COMMUNICATIONS (CONTINUED)
11,000 NEXTEL Communications, Inc. Cl.
A+............................. $ 147,125
8,000 Palmer Wireless Inc. ............ 98,000
1,000 PanAmSat Corporation+............ 28,750
8,000 Pittencrieff Communications,
Inc.+ ......................... 28,500
31,000 PriCellular Corporation.......... 255,750
43,000 Rogers Cantel Mobile
Communications Cl. B........... 790,124
1,000 Rural Cellular Corp. Cl. A+...... 10,500
70,000 Securicor Group plc.............. 336,363
5,001 360 degrees Communications
Company+....................... 86,261
800,000 Telecom Italia Mobile SpA+....... 2,293,085
90,000 Telephone and Data Systems,
Inc. .......................... 3,453,750
2,000 Thyssen AG....................... 451,343
22,000 Total Access Communications
plc............................ 95,156
3,000 United States Cellular
Corporation+................... 74,625
1,500 Vanguard Cellular Systems, Inc.
Cl. A+......................... 16,500
1,000 Vimpel Communications+........... 32,000
56,000 Vodafone Group plc ADR........... 2,471,000
-----------
20,267,616
-----------
TOTAL COMMON STOCKS (Cost:
$81,371,420)................... 93,805,112
-----------
CONVERTIBLE CORPORATE BONDS -- 2.12%
TELEPHONE NETWORKS -- 0.96%
$1,000,000 Telekom Malaysia Berhad Sub. Deb.
Cv. 4.000%, 10/03/04(a)........ 951,250
-----------
WIRELESS COMMUNICATIONS -- 1.16%
300,000,000(b) Softe SA Unsub. Deb. Cv. 4.25%,
07/30/98....................... 360,086
250,000 Technology Resources Industries
Sub. Deb. Cv. 2.75%,
11/28/04(a).................... 287,500
500,000 Tele 2000 Sub. Deb. Cv. 9.75%,
04/14/97(a).................... 510,000
-----------
1,157,586
-----------
TOTAL CONVERTIBLE CORPORATE BONDS
(Cost: $1,940,545)............. 2,108,836
-----------
CONVERTIBLE PREFERRED STOCKS -- 2.21%
CABLE -- 1.16%
19,000 Tele-Communications, Inc. Cv.
Pfd. Ser. E.................... $ 1,149,500
-----------
<CAPTION>
SHARES VALUE
- - ------------- -----------
<C> <S> <C>
LONG DISTANCE TELEPHONE COMPANIES -- 0.69%
10,000 Philippine Long Distance
Telephone Company 7.00% Cv.
Pfd. Ser. 111.................. $ 550,000
4,000 Sprint Corporation 8.25% Cv.
Pfd. .......................... 137,500
-----------
687,500
-----------
TELECOMMUNICATION --
WIRELESS COMMUNICATIONS -- 0.36%
6,222 AirTouch Communications, Inc.
6.00% Cv. Pfd. Cl. B........... 159,439
3,000 AirTouch Communications, Inc.
4.25% Cv. Pfd. Cl. C........... 131,250
5,000 Mobile Telecommunication
Technologies Corp
144 -- A(a).................... 68,750
-----------
359,439
-----------
TOTAL CONVERTIBLE PREFERRED
STOCKS (Cost: $2,421,863)...... 2,196,439
-----------
PREFERRED STOCKS -- 0.54%
TELEPHONE EQUIPMENT -- 0.12%
2,000 Nokia Corp. ADR -- A............. 116,500
-----------
WIRELESS COMMUNICATIONS -- 0.42%
Tel Rio de Janeiro Pfd. ......... 416,374
-----------
TOTAL PREFERRED STOCKS (Cost:
$280,139)...................... 532,874
-----------
TOTAL INVESTMENTS -- 99.32%
(Cost: $86,013,967)............ 98,643,261
OTHER ASSETS LESS
LIABILITIES -- 0.68%........... 679,426
-----------
NET ASSETS -- 100.00%............ $99,322,687
===========
(Shares outstanding 8,794,773)... $11.29
=====
</TABLE>
- - ------------------
<TABLE>
<C> <C> <S>
+ -- Non-income producing security
ADR -- American Depositary Receipt
SDR -- Global Depositary Receipt
(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 March
31, 1997, Rule 144A securities amounted to $1,884,151
or 1.9% of net assets.
(b) -- Principal amount denoted in Italian Lira.
</TABLE>
11
<PAGE> 12
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 LLP
- - ----------------------------------------------------------
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.
- - ----------------------------------------------------------
[PHOTO]
THE
GABELLI
GLOBAL
TELECOMMUNICATIONS
FUND
FIRST QUARTER REPORT
MARCH 31, 1997
