[GRAPHIC OMITTED]
THE GABELLI GLOBAL
CONVERTIBLE SECURITIES FUND
ANNUAL REPORT - DECEMBER 31, 1999
[PHOTO OF HART WOODSON OMITTED]
HART WOODSON
TO OUR SHAREHOLDERS,
Last year was rewarding for global convertible investors. Your Fund
benefited from its investments in the telecommunications and media sectors as
well as its exposure to Japan and Europe. The global economy is experiencing
synchronized economic growth. This is causing commodities prices and interest
rates to rise. Although market volatility is likely to increase as this
transition is made, we expect the markets to be buoyed by supportive fund flows,
strong merger and acquisition activity, and solid earnings growth.
INVESTMENT PERFORMANCE
For the fourth quarter ended December 31, 1999, the Gabelli Global
Convertible Securities Fund's (the "Fund") total return was 20.31%. The Warburg
Dillon Read Global Convertible Index, Merrill Lynch Global Bond Index and Morgan
Stanley Capital International World Free Index of global equity markets had
total returns of 21.57%, (1.05)% and 17.35%, respectively, over the same period.
Each index is an unmanaged indicator of investment performance. The Fund was up
51.10% for 1999. The Warburg Dillon Read Global Convertible Index, Merrill Lynch
Global Bond Index and Morgan Stanley World Free Index had total returns of
35.68%, (3.51)% and 26.82%, respectively, over the same twelve-month period.
For the five-year period ended December 31, 1999, the Fund's total return
averaged 14.92% annually versus average annual total returns of 16.30%, 6.70%
and 19.19% for the Warburg Dillon Read Global Convertible Index, Merrill Lynch
Global Bond Index and Morgan Stanley World Free Index, respectively. Since
inception on February 3, 1994 through December 31, 1999, the Fund had a
cumulative total return of 102.28%, which equates to an average annual total
return of 12.65%.
<PAGE>
INVESTMENT RESULTS (a)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Quarter
--------------------------------------------------------
1st 2nd 3rd 4th Year
--- --- --- --- ----
<C> <S> <C> <C> <C> <C> <C>
1999: Net Asset Value ....... $10.89 $11.91 $12.71 $13.88 $13.88
Total Return .......... 7.6% 9.4% 6.7% 20.3% 51.1%
- -----------------------------------------------------------------------------------------------------------------
1998: Net Asset Value ....... $10.43 $10.36 $9.09 $10.12 $10.12
Total Return .......... 11.1% (0.7)% (12.3)% 12.2% 8.6%
- -----------------------------------------------------------------------------------------------------------------
1997: Net Asset Value ....... $10.27 $10.98 $11.15 $9.39 $9.39
Total Return .......... 0.9% 6.9% 1.5% (6.1)% 2.8%
- -----------------------------------------------------------------------------------------------------------------
1996: Net Asset Value ....... $11.34 $11.55 $11.41 $10.18 $10.18
Total Return .......... 5.1% 1.9% (1.2)% (0.3)% 5.5%
- -----------------------------------------------------------------------------------------------------------------
1995: Net Asset Value ....... $10.09 $10.64 $11.05 $10.79 $10.79
Total Return .......... 1.6% 5.5% 3.9% 1.2% 12.6%
- -----------------------------------------------------------------------------------------------------------------
1994: Net Asset Value ....... $10.38 $10.37 $10.64 $9.93 $9.93
Total Return .......... 3.8%(b) (0.1)% 2.6% (5.2)% 0.9%(b)
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
Average Annual Returns - December 31, 1999 (a)
----------------------------------------------
1 Year ........................................................ 51.10%
5 Year ........................................................ 14.92%
Life of Fund (b) .............................................. 12.65%
- --------------------------------------------------------------------------------
Dividend History
- -----------------------------------------------------------------
Payment (ex) Date Rate Per Share Reinvestment Price
- ----------------- -------------- ------------------
December 27, 1999 $1.390 $13.67
December 28, 1998 $0.080 $ 9.96
December 30, 1997 $1.070 $ 9.33
December 31, 1996 $1.200 $10.18
December 29, 1995 $0.393 $10.79
December 30, 1994 $0.160 $ 9.93
(a) Total returns and average annual returns reflect changes in share price and
reinvestment of dividends and are net of expenses. The net asset value of the
Fund is reduced on the ex-dividend (payment) date by the amount of the dividend
paid. 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 investment operations on February 3,
1994. Note: Investing in foreign securities involves risks not ordinarily
associated with investments in domestic issues, including currency fluctuation,
economic and political risks.
- --------------------------------------------------------------------------------
OUR INVESTMENT OBJECTIVE
The Fund's objective is to obtain a high rate of total return by investing
in global convertible securities. We expect to achieve a competitive rate of
return by investing primarily in coupon paying convertible securities which meet
our selective investment criteria.
OUR APPROACH
We weigh both country-specific and company-specific factors to make our
investment decisions. Country-specific factors include political stability,
economic growth, inflation and trends in interest rates.
2
<PAGE>
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN THE GABELLI GLOBAL
CONVERTIBLE SECURITIES FUND, THE LIPPER CONVERTIBLE SECURITIES FUND AVERAGE AND
THE WARBURG DILLON READ GLOBAL CONVERTIBLE INDEX
[Line graph omitted--plot points as follows]
<TABLE>
<CAPTION>
Gabelli Global Lipper Convertible Warbug Dillon Read
Convertible Securities Fund Securities Fund Average Global Convertible Index
<S> <C> <C> <C>
2/3/94 $10,000 $10,000 $10,000
12/94 10,090 9,324 9,709
12/95 11,360 11,262 11,146
12/96 11,900 12,940 11,883
12/97 12,236 15,219 12,058
12/98 13,293 15,889 14,545
12/99 19,000 20,000 18,000
actual #'s 20,086 20,778 19,735
</TABLE>
* PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
With regard to companies, we seek firms which are undervalued in relation to
their long term potential value. We then look for some dynamic in the country or
company which can unlock this value. In the case of global telecommunications,
the dynamic is the privatization of state-owned monopolies. In developing
countries, it is the need to provide the infrastructure for growth. In Japan, it
is the change from an industrial to a consumer-oriented economy. In commodities,
it is the increase in industrial demand.
GLOBAL ALLOCATION
The accompanying chart represents the Fund's holdings by geographic region
as of December 31, 1999. 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.
HOLDINGS BY GEOGRAPHIC REGION - 12/31/99
[Pie chart omitted--plot points as follows]
United States 35.2%
Europe 32.3%
Japan 27.1%
Asia/Pacific Rim 2.6%
Latin America 1.9%
Canada 0.9%
WHAT ARE GLOBAL CONVERTIBLE SECURITIES?
Global convertible securities are bonds, preferred shares and warrants of
domestic or foreign issuers which may be converted into a fixed number of shares
of the underlying company. Convertibles are hybrid securities which combine the
capital appreciation potential of equities with the higher yield of fixed income
instruments. They can be thought of as a straight bond together with an embedded
call option (or warrant) on the underlying equity.
3
<PAGE>
WHAT ARE THE BENEFITS OF GLOBAL CONVERTIBLE SECURITIES?
Reduced volatility is foremost. Investing in foreign equity markets can be
rewarding but volatile. Our goal is to earn a high, risk-adjusted rate of
return. Due to its fixed income characteristics, a convertible security will
provide more stability than its underlying common stock. In the current market
environment, the Gabelli Global Convertible Securities Fund provides an
attractive alternative by combining the capital appreciation potential of global
equity investing with the higher current income usually associated with bonds.
COMMENTARY
Global synchronized growth is anticipated to continue in the year ahead.
On average, the major world economies are expected to grow by about 3%. It is
anticipated that the U.S. Federal Reserve Board will increase short-term
interest rates to slow Gross Domestic Product ("GDP") growth from around 4.0% to
3.5%. Meanwhile, growth in Europe is expected to increase to over 3.0% from
about 2.0% in 1999. Finally, the recovery in Japan appears to be taking hold
with GDP growth expected to rise from 1.3% in fiscal year 1999 to 2.9% this
year. The question facing global convertible investors is whether or not faster
growth and higher interest rates will mean an end to the bull market in
financial assets? No one knows for sure, but we do not think so. Our optimism is
based on the following points:
First, although commodity prices should continue to rise in line with
stronger global demand, inflation is not likely to rise dramatically. This is
because excess global capacity, increased cross-border competition, and rising
productivity will limit price inflation. This phenomenon is illustrated in the
United States, where the core Consumer Price Index ("CPI"), which excludes the
volatile food and energy sectors, actually fell by 0.6% in 1999 to just 1.9%.
This is the lowest annual increase since 1965.
Second, competition and globalization are causing a boom in merger and
acquisition activity as companies strive to improve market position and cut
costs. Last year was another record year for mergers, which totaled 3.3 trillion
dollars globally. While the United States accounted for 52% of the total,
activity is picking up in Europe and Japan as well. This year's introduction of
a single European currency, the Euro, helped spur European mergers to a record
1.2 trillion dollars. Moreover, hostile deals are becoming more and more common,
as evidenced by Vodafone's bid for Mannesmann.
Third, the flow of funds remains positive for equities. This can be seen
in both the supply of and demand for equities. In the United States, net mutual
fund sales flows are estimated to have grown 19.8% in 1999 to 188 billion
dollars while the supply of equities continues to shrink as stock buybacks
exceed initial public offerings. In Europe and Japan, the demand for equities is
increasing as investors seek alternatives to low yielding fixed income
investments to fund their retirements.
4
<PAGE>
Fourth, earnings growth is set to increase globally. Next year, earnings
per share are estimated to grow by 15% in Europe. In the United States, earnings
are forecasted to increase by more than 10% for the Standard and Poor's 500
Index and by as much as 35% for the smaller capitalization stocks represented by
the Russell 2000 Index. In Japan, a profit recovery has begun as capacity
utilization increases and fixed costs are spread over a wider base.
In short, we are optimistic about the year ahead. Although we expect
heightened volatility as financial markets adjust to stronger growth and higher
interest rates, we believe the above mentioned factors will buoy the markets. An
unexpected rise in oil prices, a much weaker U.S. dollar, or a failed recovery
in Japan could all disrupt this scenario, and we intend to monitor these issues
closely in the months ahead.
LET'S TALK CONVERTS
The following are specifics on selected holdings of our Fund. Favorable
earnings prospects do not necessarily translate into higher prices, but they do
express a positive trend which we believe will develop over time. The share
prices of foreign holdings are stated in U.S. dollar equivalent terms as of
December 31, 1999.
CANAL PLUS/MEDIASET (3.50%, 04/01/02) is a prominent Italian media company
operating in broadcasting, advertising, and television rights. The company is
Italy's largest broadcaster, operating three stations and commanding an audience
share of 42% and 60% of the advertising market. The company also owns a film
library, produces television programming, and records and sells music. Mediaset
is also strengthening its foothold in telephony through an investment in Albacom
in Spain.
With Mediaset stock at 15.34 Euros, the convertible trades at 343.00
French Francs. The convertible has a yield advantage of 12 basis points over the
common stock and trades at a 2.96% discount to parity.
TELEFONICA EUROPE BV (2.00%, 07/15/02) is a global telecommunications service
provider in Spanish speaking countries. The company serves industrial,
residential and municipal customers in Spain and throughout Latin America. The
company manages approximately 36 million fixed lines and 13.6 million cellular
lines. The company also retails telephones, mobile phones and faxes in addition
to providing videoconferencing services.
With the common stock at 24.80 Euros, the convertible trades at 254%. The
convertible enjoys a 24.8 basis point yield advantage over the common stock and
trades at a discount to parity of 1.45%.
BOUYGUES SA (1.70%, 01/01/06) is a French company whose main activities include
services and construction. Over half of Bouygues' value is contained in its 54%
interest in Bouygues Telecom. In
5
<PAGE>
addition the company also maintains investments in French television through TF1
and water utilities through Saur. Bouygues is poised to take advantage of a
growing and consolidating French cellular market.
The convertible trades at 595.38 French Francs with the common stock at
631 Euros, a 6.86% discount to parity. The convertible has a 33 basis point
yield advantage over the common stock.
SWISS LIFE/MANNESMANN (1.50%, 05/20/03) is a diversified German manufacturing
company operating an engineering division, automotive division, and
telecommunications unit. The company has finished exiting its problem businesses
and has concentrated its efforts on its telecommunications businesses. The
company is currently in the process of defending itself against a takeover bid
from Vodafone AirTouch claiming that the bid is insufficient.
This U.S. dollar denominated bond trades at 226% with the stock at 241
Euros. That is a 0.89% discount to parity for an additional 40.9 basis points in
yield.
VIVENDI ENVIRONMENT (1.50%, 01/01/05) is a global industrial services group
operating in the utilities, construction, telecommunications and media arenas.
Vivendi owns a unique and complimentary group of media assets in France
including fixed and mobile telephony, cable television, Internet, printing and
publishing.
The convertible has a 37 basis point advantage over the common stock and
trades 295.12 French Francs with the stock at 89.65 Euros, an 8% premium to
parity.
DAIWA SECURITIES GROUP INC. (0.50%, 09/26/06) is a Japanese financial services
firm providing brokerage and underwriting services to a global client base. It
is the second of the "big three" securities firms. Daiwa has seen growing
brokerage commissions and investment trust sales and has entered into an
agreement with a Japanese cellular company to provide real-time stock price
information.
The convertible trades at 148.4% with the common stock at 1,599 Japanese
Yen which is a 1.5% premium.
TOYO COMMUNICATION EQUIPMENT CO. LTD. (1.40%, 09/30/04) manufactures
communication equipment including crystal parts for cellular phones, personal
handy phones, pagers, and other consumer electronics. The company is also
involved in wireless, fixed, and network communication systems and industrial
electronics.
The convertible enjoys a 100 basis point advantage over the common stock
and trades at 140% with the stock at 1,900 Japanese Yen, a 5.4% premium to
parity.
6
<PAGE>
UNITEDGLOBALCOM INC. (7.00%, Cv. Pfd.) is a global broadband communications
provider operating in 21 countries and providing video, voice and data services
to roughly 5.5 million subscribers. UnitedGlobalCom continues its aggressive
plan of video growth, local telephony and high speed data services through
strategic consolidations and acquisitions.
The convertible trades at $89.25 with the stock at $70.625, a 5.9% premium
to parity and has a yield advantage of 394 basis points.
TOKYO BROADCASTING SYSTEM INC. (1.80%, 03/31/03) is a media company, nationally
broadcasting television and radio programs. The company is active in television
program production, film production, recorded music, and both domestic and
international cable television programming. Tokyo Broadcasting also produces and
sells software, videotapes, CD-ROMs, and DVDs. The company is in the process of
launching digital satellite broadcasting in a joint venture with Sumitomo and is
also considering spinning off its radio and other production divisions.
The convertible yields 84 basis points better than the common stock and
trades at 155% with the stock at 3,460 Japanese Yen, a 12.65% premium to parity.
MINIMUM INITIAL INVESTMENT - $1,000
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 Convertible Securities Fund and other Gabelli
Funds are available through the no-transaction fee programs at many major
discount brokerage firms.
MONTHLY DISTRIBUTIONS
The Gabelli Global Convertible Securities Fund has established a $0.10 per
share monthly distribution policy for the year 2000. The monthly distributions
will be made as part of the Fund's policy of annually distributing at least 10%
of its net asset value.
MULTI-CLASS SHARES
The Gabelli Global Series Funds, Inc. will begin offering additional
classes of Fund shares in March 2000. For existing shareholders, Class AAA
shares remain no-load. At the same time, however, different types and
combinations of sales charge arrangements for Class A, Class B and Class C
shares are targeted to the needs of particular types of investors. Your Board of
Directors believes that the Fund should be able to provide the distribution
alternatives and investment flexibility provided by other similarly situated
funds that offer multiple classes of shares. We believe that the institution of
multiple classes of shares will enhance the potential for the Fund to attract
additional investors in a manner that could
7
<PAGE>
provide additional benefits for all investors in the Fund. Again, to repeat, the
offering of additional classes of Fund shares will not diminish the ability of
existing and future shareholders to purchase and redeem Class AAA shares at net
asset value.
IN CONCLUSION
We are research-driven stock pickers with a long-term time horizon. Our
goal is to identify attractive convertibles of companies selling at a discount
to their intrinsic value, which have a catalyst to unlock that value. We believe
this philosophy provides us with a margin of safety that buffers us from the
vicissitudes of today's volatile marketplace. We thank you for your continued
support of our investment methodology.
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 GAGCX. Please call us during the
business day for further information.
Sincerely,
/s/ signature
A. HARTSWELL WOODSON, III
Portfolio Manager
January 31, 2000
- --------------------------------------------------------------------------------
TOP TEN HOLDINGS
DECEMBER 31, 1999
-----------------
Canal +/Mediaset THK Co. Ltd.
Telefonica Europe BV Daiwa Securities Group Inc.
Bouygues SA Toyo Communication Equipment Co. Ltd
Swiss Life/Mannesmann AG UnitedGlobalCom Inc.
Vivendi Tokyo Broadcasting System Inc.
- --------------------------------------------------------------------------------
NOTE: The views expressed in this report reflect those of the portfolio manager
only through the end of the period stated in this report. The manager's views
are subject to change at any time based on market and other conditions.
8
<PAGE>
THE GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
PORTFOLIO OF INVESTMENTS -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT COST VALUE
--------- ---- ------
CORPORATE BONDS -- 75.5%
AUTOMOTIVE: PARTS AND ACCESSORIES -- 2.9%
20,000,000(b) Nissan Motor Co. Ltd.,
Sub. Deb. Cv.
1.60%, 03/31/03 .............. $ 237,371 $ 192,816
$ 125,000 Standard Motor Products Inc.,
Sub. Deb. Cv.
6.75%, 07/15/09 .............. 125,000 99,766
20,000,000(b) Tokai Rika Co. Ltd.,
1.05%, 03/31/06 .............. 199,883 217,089
----------- -----------
562,254 509,671
----------- -----------
BROADCASTING -- 7.8%
1,000,000(c) Canal Plus / Mediaset,
Sub. Deb. Cv.
3.50%, 04/01/02 .............. 180,551 526,744
190,000 Clear Channel
Communications Inc.,
2.63%, 04/01/03 .............. 246,224 281,912
100,000 Scandinavian Broadcasting
System SA,
Sub. Deb. Cv.
7.00%, 12/01/04 .............. 111,405 171,875
26,000,000(b) Tokyo Broadcasting
System Inc.,
Sub. Deb. Cv.
1.80%, 03/31/03 .............. 291,758 394,441
----------- -----------
829,938 1,374,972
----------- -----------
BUILDING AND CONSTRUCTION -- 2.8%
196,800(d) Bouygues SA, Cv.
1.70%, 01/01/06 .............. 251,502 483,102
----------- -----------
BUSINESS SERVICES -- 3.7%
100,000 Omnicom Group Inc.,
2.25%, 01/06/13 .............. 156,912 204,625
131,976(d) Vivendi, Cv.
1.25%, 01/01/04 .............. 149,112 138,731
284,550(d) Vivendi Environment, Cv.
1.50%, 01/01/05 .............. 309,549 312,525
----------- -----------
615,573 655,881
----------- -----------
COMMUNICATIONS EQUIPMENT -- 5.9%
20,000,000(b) Forval Corp.,
Sub. Deb. Cv.
1.35%, 09/30/03 .............. 188,561 178,722
200,000 Swiss Life / Mannesmann AG,
Sub. Deb. Cv.
1.50%, 05/20/03 .............. 251,029 453,500
PRINCIPAL MARKET
AMOUNT COST VALUE
--------- ---- ------
30,000,000(b) Toyo Communication
Equipment Co. Ltd.,
Sub. Deb. Cv.
1.40%, 09/30/04 .............. $ 345,014 $ 411,080
----------- -----------
784,604 1,043,302
----------- -----------
COMPUTER HARDWARE -- 1.6%
$ 250,000 CMC Magnetics Corp., Cv.
1.00%, 10/06/04 (a) .......... 250,000 281,250
----------- -----------
COMPUTER SOFTWARE AND SERVICES -- 6.3%
20,000,000(b) Capcom Co. Ltd.,
0.80%, 09/28/01 .............. 188,300 215,327
25,000 EMC Corp.,
3.25%, 03/15/02 .............. 128,097 241,437
200,000 Getronics NV,
Sub. Deb. Cv.
0.25%, 04/21/04 .............. 269,868 366,135
150,000 Siebel Systems Inc.,
5.50%, 09/15/06 (a) .......... 150,000 290,888
----------- -----------
736,265 1,113,787
----------- -----------
CONSUMER PRODUCTS -- 1.7%
60,000 Financiere Agache,
Zero Coupon, 4/23/04 ......... 194,295 290,239
----------- -----------
DIVERSIFIED INDUSTRIAL -- 1.9%
100,000 Comverse Technology Inc.,
4.50%, 07/01/05 .............. 206,724 341,125
----------- -----------
ELECTRONICS -- 9.3%
150,000 ASM Lithography Holding,
Sub. Deb. Cv.
4.25%, 11/30/04 .............. 175,631 174,375
100,000 Level One Communications Inc.,
4.00%, 09/01/04 .............. 210,565 268,750
20,000,000(b) Mimasu Semiconductor
Industry Co.,
0.80%, 05/31/06 .............. 205,765 194,773
20,000,000(b) NEC Corp., Cv.
1.90%, 03/31/04 .............. 212,212 277,968
10,000,000(b) Sony Corp.,
Sub. Deb. Cv.
1.40%, 03/31/05 .............. 264,590 370,461
250,000 STMicroelectronics NV,
Zero Coupon, 09/22/09 ........ 265,110 343,125
----------- -----------
1,333,873 1,629,452
----------- -----------
See accompanying notes to financial statements.
9
<PAGE>
THE GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)-- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT COST VALUE
--------- ---- ------
ENERGY AND UTILITIES -- 1.2%
$ 110,000 Devon Energy Corp.,
4.95%, 08/15/08 .............. $ 118,018 $ 107,800
100,000 Diamond Offshore Drilling Inc.,
Sub. Deb. Cv.
3.75%, 02/15/07 .............. 107,311 101,500
----------- -----------
225,329 209,300
----------- -----------
ENTERTAINMENT -- 1.2%
20,000,000(b) Toho Co. Ltd., Cv.
0.90%, 08/31/04 .............. 206,708 215,132
----------- -----------
EQUIPMENT AND SUPPLIES -- 3.5%
100,000 Antec Corp.,
Sub. Deb. Cv.
4.50%, 05/15/03 .............. 100,000 160,688
30,000,000(b) THK Co. Ltd.,
0.30%, 09/30/03 .............. 326,969 446,315
----------- -----------
426,969 607,003
----------- -----------
FINANCIAL SERVICES -- 8.4%
15,000,000(b) Bank of Fukuoka Ltd.,
1.10%, 09/28/07 .............. 136,683 194,088
150,000 Cregem Finance NV,
Sub. Deb. Cv.
2.75%, 01/06/04 .............. 162,920 174,375
30,000,000(b) Daiwa Securities Group Inc.,
Sub. Deb, Cv.
0.50%, 09/29/06 .............. 339,372 441,911
200,000 Deutsche Bank Finance NV,
Sub. Deb. Cv.
2.00%, 12/22/03 .............. 217,774 214,041
125,775(d) Finaxa,
Sub. Deb. Cv.
3.00%, 01/01/07 .............. 207,636 214,318
25,000,000 Marubeni Corp.,
Sub. Deb. Cv.
0.85%, 03/31/06 .............. 255,914 242,488
----------- -----------
1,320,299 1,481,221
----------- -----------
HEALTH CARE -- 5.7%
150,000 Centocor Inc.,
Sub. Deb. Cv.
4.75%, 02/15/05 .............. 218,862 200,437
20,000,000(b) Kanto Biomedical
Laboratory Co. Ltd.,
1.60%, 11/30/06 .............. 195,681 245,473
500,000 Roche Holding Ltd.,
Zero Coupon, 04/20/10 (a) .... 305,392 302,190
20,000,000(b) Yamanouchi Pharmaceutical
Co. Ltd., Cv.
1.50%, 12/31/02 .............. 194,446 258,393
----------- -----------
914,381 1,006,493
----------- -----------
PRINCIPAL MARKET
AMOUNT COST VALUE
--------- ---- ------
PUBLISHING -- 3.5%
$100,000 Daily Mail & General Trust plc,
2.50%, 10/05/04 .............. $ 167,302 $ 163,953
250,000 Medya Holding,
Sub. Deb. Cv.
10.00%, 06/28/01 ............. 249,856 168,750
150,000 United News & Media plc,
Sub. Deb. Cv.
6.13%, 12/03/03 .............. 278,485 280,311
----------- -----------
695,643 613,014
----------- -----------
TELECOMMUNICATIONS -- 6.5%
250,000 Bell Atlantic Financial, Cv.
4.25%, 09/15/05 .............. 261,985 308,125
200,000 Telefonica Europe BV,
2.00%, 07/15/02 .............. 302,814 506,500
250,000 Telefonos de Mexico SA,
4.25%, 06/15/04 .............. 288,345 325,938
----------- -----------
853,144 1,140,563
----------- -----------
WIRELESS COMMUNICATIONS -- 1.6%
300,000 U.S. Cellular Corp.,
Zero Coupon, 06/15/15 ........ 169,167 289,125
----------- -----------
TOTAL CORPORATE BONDS ........... 10,576,668 13,284,632
----------- -----------
SHARES
------
PREFERRED STOCKS -- 18.2%
BROADCASTING -- 1.8%
4,000 Emmis Communiations Corp.,
6.25% Pfd., Ser. A+ .......... 247,500 318,000
----------- -----------
BUSINESS SERVICES -- 1.5%
8,000 Amdocs Ltd.,
6.75% Cv. Pfd. ............... 267,400 257,000
----------- -----------
CABLE -- 5.0%
2,000 Houston Industries Inc./
Time Warner Inc.,
7.00% Cv. Pfd. ............... 108,600 241,000
2,200 MediaOne Group Inc.,
6.25% Cv. Pfd. ............... 221,760 237,600
4,500 UnitedGlobalCom Inc.,
7.00% Cv. Pfd. (a) ........... 265,125 401,625
----------- -----------
595,485 880,225
----------- -----------
CONSUMER SERVICES -- 0.6%
4,000 Carriage Services Inc.,
7.00% Cv. Pfd. (a) ........... 200,000 116,000
----------- -----------
ENERGY AND UTILITIES -- 0.9%
EVI Inc.,
300 5.00% Cv. Pfd. ............... 9,412 11,512
4,000 5.00% Cv. Pfd. (a) ........... 200,000 153,500
----------- -----------
209,412 165,012
----------- -----------
See accompanying notes to financial statements.
10
<PAGE>
THE GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
PORTFOLIO OF INVESTMENTS (CONTINUED)-- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
MARKET
SHARES COST VALUE
------ ---- ------
PREFERRED STOCKS (Continued)
ENTERTAINMENT -- 0.5%
2,000 Village Roadshow Ltd.,
6.50% Cv. Pfd. (a) ........... $ 85,000 $ 83,250
----------- -----------
FOOD AND BEVERAGE -- 0.9%
3,400 Seagram Co.,
7.50% ACES ................... 173,407 153,000
----------- -----------
PAPER AND FOREST PRODUCTS -- 0.5%
2,000 Amcor Ltd.,
7.25% Cv. Pfd. ............... 94,000 86,000
----------- -----------
PUBLISHING -- 1.1%
7,000 Reader's Digest Association
Inc., Cv. Pfd. ............... 208,819 189,875
----------- -----------
TELECOMMUNICATIONS -- 3.6%
5,000 BroadWing Inc.,
6.75% Cv. Pfd., Ser. B ....... 261,500 296,250
6,000 Global Telesystems Group Inc.,
7.25% Cv. Pfd. ............... 289,500 331,000
----------- -----------
551,000 627,250
----------- -----------
WIRELESS COMMUNICATIONS -- 1.8%
4,000 Winstar Communications Inc.,
7.00% Cv. Pfd. ............... 173,500 317,500
----------- -----------
TOTAL PREFERRED STOCKS 2,805,523 3,193,112
----------- -----------
COMMON STOCKS -- 3.8%
BUSINESS SERVICES -- 1.2%
500 Havas Advertising SA ............ 118,822 213,033
----------- -----------
CABLE -- 1.6%
3,262 Cablevision Systems
Corp., Cl. A+ ................ 60,707 246,281
331 MediaOne Group Inc.+ ............ 13,860 25,388
----------- -----------
74,567 271,669
----------- -----------
DIVERSIFIED INDUSTRIAL -- 0.3%
5,720 Elektrim SA ..................... 72,644 56,716
----------- -----------
RETAIL -- 0.7%
9,000 OA System Plaza Co. Ltd. ........ 149,326 121,562
----------- -----------
TELECOMMUNICATIONS -- 0.0%
58 Winstar Communications Inc.+ .... 0 4,365
----------- -----------
TOTAL COMMON STOCKS ............. 415,359 667,345
----------- -----------
MARKET
SHARES COST VALUE
------ ---- ------
WARRANTS -- 0.2%
DIVERSIFIED INDUSTRIAL -- 0.2%
900 Bandai Co. Ltd. ................. $ 131,750 $ 33,750
----------- -----------
ENTERTAINMENT -- 0.0%
100 Mori Seiki+ ..................... 60,000 50
----------- -----------
TOTAL WARRANTS .................. 191,750 33,800
----------- -----------
TOTAL
INVESTMENTS -- 97.7% ......... $13,989,300 17,178,889
===========
OTHER ASSETS AND
LIABILITIES (NET) -- 2.3% .................. 413,960
-----------
NET ASSETS -- 100.0%
(1,267,890 shares outstanding) ............. $17,592,849
===========
NET ASSET VALUE,
OFFERING AND REDEMPTION
PRICE PER SHARE ............................ $13.88
======
- ----------
For Federal tax purposes:
Aggregate cost ................................ $13,989,300
===========
Gross unrealized appreciation ................. $ 3,822,759
Gross unrealized depreciation ................. (633,170)
-----------
Net unrealized appreciation ................... $ 3,189,589
===========
- ----------
(a) Security exempt from registration under Rule 144A of the Securities Act
of 1933, as amended. These securities may be resold in transactions
exempt from registration, normally to qualified institutional buyers. At
December 31, 1999, the market value of Rule 144A securities amounted to
$1,628,703 or 9.26% of net assets.
(b) Principal amount denoted in Japanese Yen.
(c) Principal amount denoted in French Francs.
(d) Principal amount denoted in Euros.
+ Non-income producing security.
++ Represents annualized yield at date of purchase.
ACES - Adjustable Convertible Exchange Security.
% OF
MARKET MARKET
GEOGRAPHIC DIVERSIFICATION VALUE VALUE
- -------------------------- ------ ------------
North America ................. 36.1% $ 6,196,075
Europe ........................ 32.3% 5,554,538
Japan ......................... 27.1% 4,651,839
Asia/Pacific Rim .............. 2.6% 450,500
Latin America ................. 1.9% 325,937
------ ------------
100.0% $ 17,178,889
===== ============
See accompanying notes to financial statements.
11
<PAGE>
THE GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
- --------------------------------------------------------------------------------
ASSETS:
Investments, at value (Cost $13,989,300) ................. $17,178,889
Foreign currency, at value (Cost $470,544) ............... 477,306
Dividends, interest and reclaims receivable .............. 58,491
Receivable for investments sold .......................... 126,345
Receivable for Fund shares sold .......................... 117,485
Other assets ............................................. 22,240
-----------
TOTAL ASSETS ............................................. 17,980,756
-----------
LIABILITIES:
Payable for Fund shares redeemed ......................... 10,000
Payable for investment advisory fees ..................... 13,773
Payable for distribution fees ............................ 3,443
Payable to custodian ..................................... 318,345
Other accrued expenses ................................... 42,346
-----------
TOTAL LIABILITIES ........................................ 387,907
-----------
NET ASSETS applicable to 1,267,890
shares outstanding ..................................... $17,592,849
===========
NET ASSETS CONSIST OF:
Capital stock, at par value .............................. $ 1,268
Additional paid-in capital ............................... 14,395,815
Net unrealized appreciation on investments
and foreign currency transactions ...................... 3,195,766
-----------
TOTAL NET ASSETS ......................................... $17,592,849
===========
NET ASSET VALUE, offering and redemption
price per share ($17,592,849 / 1,267,890
shares outstanding; 200,000,000 shares
authorized of $0.001 par value) ........................ $13.88
======
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1999
- --------------------------------------------------------------------------------
INVESTMENT INCOME:
Dividends (net of foreign taxes of $1,263) .............. $ 14,314
----------
TOTAL INVESTMENT INCOME ................................. 14,314
----------
EXPENSES:
Investment advisory fees ................................ 94,640
Distribution fees ....................................... 23,667
Legal and audit fees .................................... 33,250
Shareholder services fees ............................... 24,028
Shareholder communications expenses ..................... 22,218
Registration fees ....................................... 17,344
Custodian fees .......................................... 10,355
Organizational expenses ................................. 1,073
Directors' fees ......................................... 171
Interest expense ........................................ 1,528
Miscellaneous expenses .................................. 2,926
----------
TOTAL EXPENSES .......................................... 231,200
----------
NET INVESTMENT LOSS ..................................... (216,886)
----------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS:
Net realized gain on investments
and foreign currency transactions ..................... 1,762,262
Net change in unrealized appreciation
on investments and foreign currency
transactions .......................................... 2,778,010
----------
NET REALIZED AND UNREALIZED GAIN ON
INVESTMENTS AND FOREIGN CURRENCY
TRANSACTIONS .......................................... 4,540,272
----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ....................................... $4,323,386
==========
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1999 DECEMBER 31, 1998
----------------- -----------------
<S> <C> <C>
OPERATIONS:
Net investment loss ................................................. $ (216,886) $ (80,913)
Net realized gain on investments and foreign currency transactions .. 1,762,262 74,754
Net change in unrealized appreciation on investments
and foreign currency transactions ................................ 2,778,010 744,636
------------ ------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ................ 4,323,386 738,477
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
In excess of net investment income .................................. (33,793) (5,156)
Net realized gain on investments .................................... (1,531,962) (53,777)
------------ ------------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS ................................. (1,565,755) (58,933)
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Net increase (decrease) in net assets from capital share transactions 7,509,096 (2,728,084)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS ............................... 10,266,727 (2,048,540)
NET ASSETS:
Beginning of period ................................................. 7,326,122 9,374,662
------------ ------------
End of period ....................................................... $ 17,592,849 $ 7,326,122
============ ============
</TABLE>
See accompanying notes to financial statements.
12
<PAGE>
THE GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. ORGANIZATION. The Gabelli Global Convertible Securities Fund (the "Fund"), a
series of Gabelli Global Series Funds, Inc. (the "Corporation"), was organized
on July 16, 1993 as a Maryland corporation. The Fund is a non-diversified,
open-end management investment company registered under the Investment Company
Act of 1940, as amended (the "1940 Act"), and one of four separately managed
portfolios (collectively, the "Portfolios") of the Corporation. The Fund's
primary objective is to obtain a high rate of total return. The Fund commenced
investment operations on February 3, 1994.
2. SIGNIFICANT ACCOUNTING POLICIES. 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 as of the close of business on
the day the securities are being valued (if there were no sales that day, the
security is valued at the average of the closing bid and asked prices or, if
there were no asked prices quoted on that day, then the security is valued at
the closing bid price on that day, except for open short positions, which are
valued at the last asked price). All other portfolio securities for which
over-the-counter market quotations are readily available are valued at the
latest average of the bid and asked prices. Portfolio securities traded on more
than one national securities exchange or market are valued according to the
broadest and most representative market, as determined by Gabelli Funds, LLC
(the "Adviser"). Securities and assets for which market quotations are not
readily available are valued at their fair value as determined in good faith
under procedures established by and under the general supervision of the Board
of 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. Debt instruments
having a maturity greater than 60 days are valued at the highest bid price
obtained from a dealer maintaining an active market in those securities. 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
primary government securities dealers recognized by the Federal Reserve Board
with member banks of the Federal Reserve System or with other brokers or dealers
that meet credit guidelines established by the 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.
13
<PAGE>
THE GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
OPTIONS. The Fund may purchase or write call or put options on securities or
indices. As a writer of put options, the Fund receives a premium at the outset
and then bears the risk of unfavorable changes in the price of the financial
instrument underlying the option. The Fund would incur a loss if the price of
the underlying financial instrument decreases between the date the option is
written and the date on which the option is terminated. The Fund would realize a
gain, to the extent of the premium, if the price of the financial instrument
increases between those dates.
As a purchaser of put options, the Fund pays a premium for the right to sell to
the seller of the put option the underlying security at a specified price. The
seller of the put has the obligation to purchase the underlying security upon
exercise at the exercise price. If the price of the underlying security
declines, the Fund would realize a gain upon sale or exercise. If the price of
the underlying security increases, the Fund would realize a loss upon sale or at
expiration date, but only to the extent of the premium paid. For the year ended
December 31, 1999 the Fund did not write options.
FUTURES CONTRACTS. The Fund may engage in futures contracts for the purpose of
hedging against changes in the value of its portfolio securities and in the
value of securities it intends to purchase. Upon entering into a futures
contract, the Fund is required to deposit with the broker an amount of cash or
cash equivalents equal to a certain percentage of the contract amount. This is
known as the "initial margin". Subsequent payments ("variation margin") are made
or received by the Fund each day, depending on the daily fluctuation of the
value of the contract. The daily changes in the contract are included in
unrealized gains or losses. The Fund recognizes a realized gain or loss when the
contract is closed. At December 31, 1999, there were no open futures contracts.
There are several risks in connection with the use of futures contracts as a
hedging device. The change in value of futures contracts primarily corresponds
with the value of their underlying instruments, which may not correlate with the
change in value of the hedged investments. In addition, there is the risk that
the Fund may not be able to enter into a closing transaction because of an
illiquid secondary market.
FORWARD FOREIGN EXCHANGE CONTRACTS. The Fund may engage in forward foreign
exchange contracts for hedging a specific transaction with respect to either the
currency in which the transaction is denominated or another currency as deemed
appropriate by the Adviser. Forward foreign exchange contracts are valued at the
forward rate and are marked-to-market daily. The change in market value is
included in unrealized appreciation/depreciation on investments and foreign
currency transactions. When the contract is closed, the Fund records a realized
gain or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
The use of forward foreign exchange contracts does not eliminate fluctuations in
the underlying prices of the Fund's portfolio securities, but it does establish
a rate of exchange that can be achieved in the future. Although forward foreign
exchange contracts limit the risk of loss due to a decline in the value of the
hedged currency, they also limit any potential gain/(loss) 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.
FOREIGN CURRENCY TRANSLATION. The books and records of the Fund are maintained
in United States (U.S.) dollars. Foreign currencies, investments and other
assets and liabilities are translated into U.S. dollars at the exchange rates
prevailing at the end of the period, and purchases and sales of investment
securities, income and expenses are translated at the exchange rate prevailing
on the respective dates of such transactions. Unrealized gains and losses, which
result from changes in foreign exchange rates and/or changes in market
14
<PAGE>
THE GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
prices of securities, have been included in unrealized appreciation/depreciation
on investments and foreign currency transactions. Net realized foreign currency
gains and losses resulting from changes in exchange rates include foreign
currency gains and losses between trade date and settlement date on investment
securities transactions, foreign currency transactions and the difference
between the amounts of interest and dividends recorded on the books of the Fund
and the amounts actually received. The portion of foreign currency gains and
losses related to fluctuation in exchange rates between the initial trade date
and subsequent sale trade date is included in realized gain/(loss) on
investments.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME. Securities transactions are
accounted for on the trade date with realized gain or loss on investments
determined by using the identified cost method. Interest income (including
amortization of premium and accretion of discount) is recorded as earned.
Dividend income is 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.
For the year ended December 31, 1999, reclassifications were made to increase
distributions in excess of net investment income for $231,067 and decrease
accumulated undistributed net realized gain on investments and foreign currency
transactions for $222,485 with an offsetting adjustment to additional paid-in
capital.
EXPENSES. Certain administrative expenses are common to, and allocated among,
the Portfolios. Such allocations are made on the basis of each Portfolio's
average net assets or other criteria directly affecting the expenses as
determined by the Adviser.
PROVISION FOR INCOME TAXES. The Fund intends to continue to qualify as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended. As a result, a Federal income tax provision is not 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.
3. INVESTMENT ADVISORY AGREEMENT. The Fund has entered into an investment
advisory agreement (the "Advisory Agreement") with the Adviser which provides
that the Fund will pay the Adviser a fee, computed daily and paid monthly, at
the annual rate of 1.00% of the value of the Fund's average daily net assets. In
accordance with the Advisory Agreement, the Adviser 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.
15
<PAGE>
THE GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
- --------------------------------------------------------------------------------
4. DISTRIBUTION PLAN. The Fund's Board of Directors has adopted a distribution
plan (the "Plan") pursuant to Rule 12b-1 under the 1940 Act. For the year ended
December 31, 1999 the Fund incurred distribution costs payable to Gabelli &
Company, Inc., an affiliate of the Adviser, of $23,667, or 0.25% of average
daily net assets, the annual limitation under the Plan. Such payments are
accrued daily and paid monthly.
5. ORGANIZATIONAL EXPENSES. The organizational expenses of the Fund are being
amortized on a straight-line basis over a period of 60 months.
6. PORTFOLIO SECURITIES. Purchases and sales of securities for the year ended
December 31, 1999, other than short term securities, aggregated $20,121,513 and
$14,381,043, respectively.
7. TRANSACTIONS WITH AFFILIATES. During the year ended December 31, 1999, the
Fund paid brokerage commissions of $203 to Gabelli & Company, Inc. and its
affiliates.
8. LINE OF CREDIT. The Fund has access to an unsecured line of credit up to
$25,000,000 from the custodian for temporary borrowing purposes. Borrowings
under this arrangement bear interest at 0.75% above the Federal Funds rate on
outstanding balances. There were $340,000 of borrowings outstanding at December
31, 1999.
The average daily amount of borrowings outstanding within the year ended
December 31, 1999 was $369,857, with a related weighted average interest rate of
6.09%. The maximum amount borrowed at any time during the year ended December
31, 1999 was $1,060,000.
9. CAPITAL STOCK TRANSACTIONS. Transactions in shares of capital stock were as
follows:
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
DECEMBER 31, 1999 DECEMBER 31, 1998
---------------------------- ----------------------------
SHARES AMOUNT SHARES AMOUNT
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Shares sold ................................ 939,175 $ 12,219,522 81,274 $ 801,016
Shares issued upon reinvestment of dividends 110,965 1,520,095 5,590 55,681
Shares redeemed ............................ (506,169) (6,230,521) (361,093) (3,584,781)
------------ ------------ ------------ ------------
Net increase (decrease) .............. 543,971 $ 7,509,096 (274,229) $ (2,728,084)
============ ============ ============ ============
</TABLE>
10. NEW SHARE CLASSES. On December 7, 1998, the Board of Directors of the Fund
approved a Rule 18f-3 Multi-Class Plan relating to the creation of three
additional classes of shares of the Fund - Class A Shares, Class B Shares and
Class C Shares (the "New Share Classes"). The existing class of shares was
redesignated as Class AAA Shares. In addition, the Board has also approved an
Amended and Restated Distribution Agreement, Rule 12b-1 plans for each of the
New Share Classes and an Amended and Restated Plan of Distribution for the
existing class of shares (Class AAA Shares) to be effective upon the
commencement of the offering of the New Share Classes. On July 22, 1999,
shareholder approval permitting the Fund to offer additional classes of shares
was attained. The New Share Classes are currently not being offered to the
public.
16
<PAGE>
THE GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
Selected data for a share of capital stock outstanding throughout each period:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------------------------------
1999 1998 1997 1996 1995
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
OPERATING PERFORMANCE:
Net asset value, beginning of period .......... $ 10.12 $ 9.39 $ 10.18 $ 10.79 $ 9.93
------- ------- ------- ------- -------
Net investment income (loss) .................. (0.18) (0.12) 0.11 0.43 0.39
Net realized and unrealized gain
on investments ............................. 5.33 0.93 0.17 0.16 0.86
------- ------- ------- ------- -------
Total from investment operations .............. 5.15 0.81 0.28 0.59 1.25
------- ------- ------- ------- -------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income ......................... -- -- (0.14) (0.43) (0.39)
In excess of net investment income ............ (0.03) (0.01) -- -- --
Net realized gain on investments .............. (1.36) (0.07) (0.90) (0.77) --
In excess of net realized gains
on investments ............................. -- -- (0.03) -- --
------- ------- ------- ------- -------
Total distributions ........................... (1.39) (0.08) (1.07) (1.20) (0.39)
------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD ................ $ 13.88 $ 10.12 $ 9.39 $ 10.18 $ 10.79
======= ======= ======= ======= =======
Total return+ ................................. 51.1% 8.6% 2.8% 5.5% 12.6%
======= ======= ======= ======= =======
RATIOS TO AVERAGE NET ASSETS AND SUPPLEMENTAL DATA:
Net assets, end of period (in 000's) .......... $17,593 $ 7,326 $ 9,375 $13,527 $15,742
Ratio of net investment income (loss)
to average net assets ...................... (2.29)% (1.00)% 1.17% 2.00% 2.90%
Ratio of operating expenses
to average net assets (a) .................. 2.44% 2.63% 2.48% 2.35% 2.41%
Portfolio turnover rate ....................... 151% 89% 100% 126% 152%
</TABLE>
- ----------
+ Total return represents aggregate total return of a hypothetical $1,000
investment at the beginning of the period and sold at the end of the
period including reinvestment of dividends.
(a) The Fund incurred interest expense during the years ended December 31,
1999 and 1997. If interest expense had not been incurred, the ratios of
operating expenses to average net assets would have been 2.42% and 2.46%,
respectively. In addition, the ratio for the year ended December 31, 1997
does not include a reduction of expenses for custodian fee credits.
Including such credits, the ratio would have been 2.47%.
See accompanying notes to financial statements.
17
<PAGE>
THE GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
REPORT OF GRANT THORNTON LLP, INDEPENDENT AUDITORS
- --------------------------------------------------------------------------------
Shareholders and Board of Directors of
The Gabelli Global Convertible Securities Fund
We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of The Gabelli Global Convertible Securities Fund
(one of the series constituting Gabelli Global Series Funds, Inc.) as of
December 31, 1999, the related statement of operations for the year then ended,
the statements of changes in net assets for each of the two years in the period
then ended and financial highlights for each of the periods presented. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the
audits to obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of December 31, 1999 by correspondence with the custodian. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of The
Gabelli Global Convertible Securities Fund of Gabelli Global Series Funds, Inc.
at December 31, 1999, and the results of its operations, the changes in its net
assets and the financial highlights for the respective stated periods, in
conformity with accounting principles generally accepted in the United States.
/s/ Signature
Grant Thornton LLP
New York, New York
February 11, 2000
- --------------------------------------------------------------------------------
1999 TAX NOTICE TO SHAREHOLDERS (Unaudited)
For the fiscal year ended December 31, 1999, the Fund paid to shareholders, on
December 27, 1999, an ordinary income dividend (comprised of net investment
income and short term capital gains) totaling $1.16 per share and long term
capital gains totaling $0.23 per share. For the fiscal year ended December 31,
1999, none of the ordinary income dividend qualifies for the dividend received
deduction available to corporations.
U.S. GOVERNMENT INCOME:
The percentage of the ordinary income dividend paid by the Fund during fiscal
year 1999 which was derived from U.S. Treasury securities was 0.44%. Such income
is exempt from state and local tax in all states. However, many states,
including New York and California, allow a tax exemption for a portion of the
income earned only if a mutual fund has invested at least 50% of its assets at
the end of each quarter of the Fund's fiscal year in U.S. Government securities.
The Gabelli Global Convertible Securities Fund did not meet this strict
requirement in 1999. Due to the diversity in state and local tax law, it is
recommended that you consult your personal tax advisor as to the applicability
of the information provided to your specific situation.
- --------------------------------------------------------------------------------
18
<PAGE>
- --------------------------------------------------------------------------------
GABELLI FAMILY OF FUNDS
- --------------------------------------------------------------------------------
GABELLI ASSET FUND--------------------------------------------------------------
Seeks to invest primarily in a diversified portfolio of common stocks selling at
significant discounts to their private market value. The Fund's primary
objective is growth of capital. (NO-LOAD)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI GROWTH FUND-------------------------------------------------------------
Seeks to invest primarily in large cap stocks believed to have favorable, yet
undervalued, prospects for earnings growth. The Fund's primary objective is
capital appreciation. (NO-LOAD)
PORTFOLIO MANAGER: HOWARD F. WARD, CFA
GABELLI WESTWOOD EQUITY FUND----------------------------------------------------
Seeks to invest primarily in the common stock of seasoned companies believed to
have proven records and above average historical earnings growth. The Fund's
primary objective is capital appreciation. (NO-LOAD)
PORTFOLIO MANAGER: SUSAN M. BYRNE
GABELLI SMALL CAP GROWTH FUND---------------------------------------------------
Seeks to invest primarily in common stock of smaller companies (market
capitalizations less than $500 million) believed to have rapid revenue and
earnings growth potential. The Fund's primary objective is capital appreciation.
(NO-LOAD)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI BLUE CHIP VALUE FUND----------------------------------------------------
Seeks long-term growth of capital through investment primarily in the common
stocks of well-established, high quality companies that have market
capitalizations of greater than $5 billion. (NO-LOAD)
PORTFOLIO MANAGER: BARBARA MARCIN, CFA
GABELLI WESTWOOD SMALLCAP EQUITY FUND-------------------------------------------
Seeks to invest primarily in smaller capitalization equity securities - market
caps of $1 billion or less. The Fund's primary objective is long-term capital
appreciation. (NO-LOAD)
PORTFOLIO MANAGER: LYNDA CALKIN, CFA
GABELLI WESTWOOD INTERMEDIATE BOND FUND-----------------------------------------
Seeks to invest in a diversified portfolio of bonds with various maturities. The
Fund's primary objective is total return. (NO-LOAD)
PORTFOLIO MANAGER: PATRICIA FRAZE
GABELLI EQUITY INCOME FUND------------------------------------------------------
Seeks to invest primarily in equity securities with above market average yields.
The Fund pays quarterly dividends and seeks a high level of total return with an
emphasis on income. (NO-LOAD)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI WESTWOOD BALANCED FUND--------------------------------------------------
Seeks to invest in a balanced and diversified portfolio of stocks and bonds. The
Fund's primary objective is both capital appreciation and current income.
(NO-LOAD)
PORTFOLIO MANAGERS: SUSAN M. BYRNE & PATRICIA FRAZE
GABELLI WESTWOOD MIGHTY MITES[SERVICE MARK] FUND--------------------------------
Seeks to invest in micro-cap companies that have market capitalizations of $300
million or less. The Fund's primary objective is long-term capital appreciation.
(NO-LOAD)
TEAM MANAGED: MARIO J. GABELLI, CFA,
MARC J. GABELLI, LAURA K. LINEHAN AND
WALTER K. WALSH
GABELLI VALUE FUND--------------------------------------------------------------
Seeks to invest in securities of companies believed to be undervalued. The
Fund's primary objective is long-term capital appreciation. MAX. SALES CHARGE:
5 1/2%
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI UTILITIES FUND----------------------------------------------------------
Seeks to provide a high level of total return through a combination of capital
appreciation and current income. (NO-LOAD)
PORTFOLIO MANAGER: TIMOTHY O'BRIEN, CFA
GABELLI ABC FUND----------------------------------------------------------------
Seeks to invest in securities with attractive opportunities for appreciation or
investment income. The Fund's primary objective is total return in various
market conditions without excessive risk of capital loss. (NO-LOAD)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI MATHERS FUND------------------------------------------------------------
Seeks long-term capital appreciation in various market conditions without
excessive risk of capital loss. (NO-LOAD)
PORTFOLIO MANAGER: HENRY VAN DER EB, CFA
GABELLI U.S. TREASURY MONEY MARKET FUND-----------------------------------------
Seeks to invest exclusively in short-term U.S. Treasury securities. The Fund's
primary objective is to provide high current income consistent with the
preservation of principal and liquidity. (NO-LOAD)
PORTFOLIO MANAGER: JUDITH A. RANERI
GABELLI CASH MANAGEMENT SHARES OF
THE TREASURER'S FUND------------------------------------------------------------
Three money market portfolios designed to generate superior returns without
compromising portfolio safety. U.S. Treasury Money Market seeks to invest in
U.S. Treasury bills, notes and bonds. Tax Exempt Money Market seeks to invest in
municipal securities. Domestic Prime Money Market seeks to invest in prime
quality, domestic money market instruments. (NO-LOAD)
PORTFOLIO MANAGER: JUDITH A. RANERI
AN INVESTMENT IN THE ABOVE MONEY MARKET FUNDS IS NEITHER INSURED NOR GUARANTEED
BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY GOVERNMENT AGENCY. ALTHOUGH
THE FUNDS SEEK TO PRESERVE THE VALUE OF YOUR INVESTMENT AT $1.00 PER SHARE, IT
IS POSSIBLE TO LOSE MONEY BY INVESTING IN THE FUNDS.
GLOBAL SERIES
GABELLI GLOBAL TELECOMMUNICATIONS FUND
Seeks to invest in telecommunications companies throughout the world -
targeting undervalued companies with strong earnings and cash flow dynamics.
The Fund's primary objective is capital appreciation. (NO-LOAD)
TEAM MANAGED: MARIO J. GABELLI, CFA,
MARC J. GABELLI AND IVAN ARTEAGA, CFA
GABELLI GLOBAL CONVERTIBLE SECURITIES FUND
Seeks to invest principally in bonds and preferred stocks which are
convertible into common stock of foreign and domestic companies. The Fund's
primary objective is total return through a combination of current income and
capital appreciation. (NO-LOAD)
PORTFOLIO MANAGER: HART WOODSON
GABELLI GLOBAL GROWTH FUND
Seeks capital appreciation through a disciplined investment program focusing
on the globalization and interactivity of the world's marketplace. The Fund
invests in companies at the forefront of accelerated growth. The Fund's
primary objective is capital appreciation. (NO-LOAD)
PORTFOLIO MANAGER: MARC J. GABELLI
GABELLI GLOBAL OPPORTUNITY FUND
Seeks to invest in common stock of companies which have rapid growth in
revenues and earnings and potential for above average capital appreciation or
are undervalued. The Fund's primary objective is capital appreciation.
(NO-LOAD)
PORTFOLIO MANAGERS: MARC J. GABELLI
AND CAESAR BRYAN
GABELLI GOLD FUND---------------------------------------------------------------
Seeks to invest in a global portfolio of equity securities of gold mining and
related companies. The Fund's objective is long-term capital appreciation.
Investment in gold stocks is considered speculative and is affected by a variety
of world-wide economic, financial and political factors. (NO-LOAD)
PORTFOLIO MANAGER: CAESAR BRYAN
GABELLI INTERNATIONAL GROWTH FUND-----------------------------------------------
Seeks to invest in the equity securities of foreign issuers with long-term
capital appreciation potential. The Fund offers investors global
diversification. (NO-LOAD)
PORTFOLIO MANAGER: CAESAR BRYAN
THE SIX FUNDS ABOVE INVEST IN FOREIGN SECURITIES WHICH INVOLVES RISKS NOT
ORDINARILY ASSOCIATED WITH INVESTMENTS IN DOMESTIC ISSUES, INCLUDING CURRENCY
FLUCTUATION, ECONOMIC AND POLITICAL RISKS. THE FUNDS LISTED ABOVE ARE
DISTRIBUTED BY GABELLI & COMPANY, INC.
- --------------------------------------------------------------------------------
TO RECEIVE A PROSPECTUS, CALL 1-800-GABELLI (422-3554). THE
PROSPECTUS GIVES A MORE COMPLETE DESCRIPTION OF THE FUND,
INCLUDING FEES AND EXPENSES. READ THE PROSPECTUS CAREFULLY
BEFORE YOU INVEST OR SEND MONEY.
VISIT OUR WEBSITE AT:
WWW.GABELLI.COM
OR, CALL:
1-800-GABELLI
1-800-422-3554 [BULLET] 914-921-5100 [BULLET]
FAX: 914-921-5118 [BULLET] [email protected]
ONE CORPORATE CENTER, RYE, NEW YORK 10580
<PAGE>
Gabelli Global Series Funds, Inc.
THE GABELLI GLOBAL CONVERTIBLE SECURITIES 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 ASSET MANAGEMENT INC.
Felix J. Christiana Werner J. Roeder, MD
FORMER SENIOR VICE PRESIDENT MEDICAL DIRECTOR
DOLLAR DRY DOCK SAVINGS BANK LAWRENCE HOSPITAL
Anthony J. Colavita Anthonie C. van Ekris
ATTORNEY-AT-LAW MEDICAL DIRECTOR
ANTHONY J. COLAVITA, P.C. BALMAC INTERNATIONAL, INC.
John D. Gabelli
SENIOR VICE PRESIDENT
GABELLI & COMPANY, INC.
OFFICERS AND PORTFOLIO MANAGERS
Mario J. Gabelli, CFA A. Hartswell Woodson, III
PRESIDENT AND CHIEF VICE PRESIDENT AND
INVESTMENT OFFICER PORTFOLIO MANAGER
Bruce N. Alpert James E. McKee
VICE PRESIDENT AND SECRETARY
TREASURER
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 Convertible Securities Fund. It is not authorized for
distribution to prospective investors unless preceded or accompanied by an
effective prospectus.
- --------------------------------------------------------------------------------
GAB441Q499SR
[PHOTO OMITTED]
THE
GABELLI
GLOBAL
CONVERTIBLE
SECURITIES
FUND
ANNUAL REPORT
DECEMBER 31, 1999
