Semi-Annual Report
[LOGO]
THE GABELLI
GLOBAL
MULTIMEDIA
TRUST INC.
June 30, 1997
<PAGE>
[LOGO]
THE GABELLI
GLOBAL
MULTIMEDIA
TRUST INC.
Our cover icon represents the underpinnings of Gabelli. The Teton mountains in
Wyoming represent what we believe in in America -- that creativity, ingenuity,
hard work and a global uniqueness provide enduring values. They also stand out
in an increasingly complex, interconnected and inter-dependent economic world.
Investment Objective:
The Gabelli Global Multimedia Trust Inc. is a closed-end, non-diversified
management investment company whose primary objective is long-term growth of
capital, with income as a secondary objective.
This report is printed on recycled paper.
<PAGE>
[PHOTO OF MARIO GABELLI]
[LOGO]
THE GABELLI
GLOBAL
MULTIMEDIA
TRUST INC.
To Our Shareholders,
In the second quarter of 1997, equities investors concluded that inflation
was just a bad dream after all and that "Captain Greenspan" was bringing the
economy in for another soft landing. Blue chip stocks remained in the limelight,
but smaller stocks participated in the surge. The Dow Jones Industrial Average
(DJIA) gained 17.1%.
For the six months ended June 30, 1997, The Gabelli Global Multimedia
Trust Inc.'s ("Multimedia Trust") net asset value per share increased 14.7% to
$9.28 on June 30, 1997. This compares to the average 13.9% increase of the 202
Global Funds tracked by Lipper Analytical Services. For the second quarter ended
June 30, 1997, the Fund increased 12.8%. Since its inception on November 15,
1994, the Multimedia Trust's net asset value has achieved a 44.1% total return
after adjusting for the rights offering and all distributions. This equates to a
14.9% average annual return.
The Multimedia Trust's common shares ended the second quarter at $7.5625
per share on the New York Stock Exchange, up 10.0% for the quarter and an
increase of 10.0% for the year. The common shares have increased 10.2% since
inception after adjusting for all distributions and the rights offering.
What We Do
We do what is described as bottom up research: we read annual reports; we
visit the competition; we talk to customers; we go belly to belly with
management. In past reports, we have tried to articulate our investment
philosophy and methodology. The following graphic further illustrates the
interplay among the four components of our valuation approach.
[GRAPHIC OMITTED]
Our focus is on free cash flow; earnings before interest, taxes,
depreciation and amortization (EBITDA) minus the capital expenditures necessary
to grow the business. We believe free cash flow is the best barometer of a
business' value. Rising free cash flow often foreshadows net earnings
improvement. We also look at earnings per share trends. Unlike Wall Street's
ubiquitous earnings momentum players, we do not try to forecast earnings with
accounting precision and then trade stocks based on quarterly expectations and
realities. We simply try to position ourselves in front of long-term earnings
uptrends. In addition, we analyze on and off balance sheet assets and
liabilities such as plant and equipment, inventories, receivables, and legal,
environmental and health care issues. We want to know everything and anything
that will add to or detract from our private market value (PMV) estimates.
Finally, we look for a catalyst; something happening in the company's industry
or indigenous to the company itself that will surface value. In the case of the
independent telephone stocks, the catalyst is a regulatory change. In the
agricultural equipment business, it is the increasing world-wide demand for
American food and feed crops. In other instances, it may be a change in
management, sale or spin-off of a division or the development of a profitable
new business.
<PAGE>
Once we identify securities that qualify as fundamental and conceptual
bargains, we then become patient investors. This has been a proven long-term
method for preserving and enhancing wealth in the U.S. securities market. At the
margin, our new investments are focused on businesses that are well-managed and
will benefit from sustainable long-term economic dynamics. These include macro
trends, such as the globalization of the market in filmed entertainment and
telecommunications, and micro trends, such as an increased focus on productivity
enhancing goods and services.
THE PORTFOLIO OVERVIEW
Global Allocation
The chart at the right represents the Multimedia Trust's holdings by
geographic region as of June 30, 1997. The geographic allocation will change
based on current global market conditions. Countries and/or regions and
companies represented in the chart and below may or may not be included in the
Multimedia Trust's portfolio in the future.
[THE FOLLOWING TABLE WAS DEPICTED AS A PIE CHART IN THE PRINTED MATERIAL.]
HOLDINGS BY GEOGRAPHIC REGION - 6/30/97
United States 72.2%
Europe 8.3%
Latin America 8.2%
Asia/Pacific Rim 5.8%
Canada 5.5%
Equity Mix
The Multimedia Trust's investment premise falls within the context of two
main investment universes: 1) companies involved in creativity, as it relates to
the development of intellectual property rights (copyrights); and 2) companies
involved in distribution, as it relates to the delivery of these copyrights.
Additionally, this includes the broad scope of communications-related services
such as basic voice and data.
The chart at the right depicts our equity mix of the copyright/creativity
and distribution companies in our portfolio as of June 30, 1997.
[THE FOLLOWING TABLE WAS DEPICTED AS A PIE CHART IN THE PRINTED MATERIAL.]
Distribution 56.7%
Copyright/Creativity 43.3%
COMMENTARY
The Economy and the Stock Market: Having Your Cake and Eating It Too
From 1995 through the second quarter of 1997, equities investors have
enjoyed their just desserts. Modest economic growth, low inflation, and strong
corporate earnings have translated into spectacular equities returns. The "What
Me Worry" market cheerleaders are now projecting these favorable conditions
forward indefinitely in order to justify high equities valuations and to support
their fantastic predictions for the Dow and S&P. We look at the same picture and
wonder whether all the economic components that have combined to propel this
historic market advance are sustainable.
2
<PAGE>
If it is truly different this time around, the stock market tree can grow
to the sky. Stocks probably deserve to trade at 20 times earnings or higher if
the following scenario holds: the Federal Reserve and corporate managements have
really tamed the business cycle; inflation is truly dead rather than dormant;
further cost cutting and productivity gains allow American corporations to
continue to grow earnings at three to four times top line revenues; and there
are no major political or financial accidents here or abroad. In other words,
everything has to remain right for the fundamentals to raise the safety net --
we just do not have a "margin of safety".
Let's look at what's been going so right and what could go wrong. We have
to applaud Alan Greenspan's Federal Reserve and corporate managements for
reducing economic volatility. More modest but sustainable economic growth is
vastly preferable to the boom/bust business cycles of the past. The business
cycle has not disappeared, but the 3 1/2 billion new consumers in the global
market place have added extra secular growth to the global economy, perhaps
diluting the cyclical effects of economic policy most of us have lived through.
We do not believe inflation is dead, but it is certainly subdued.
Can net earnings continue to outpace top line revenue growth? Corporate
America has been on "Slim Fast" for almost a decade. Management has restructured
and technology has contributed to enormous productivity gains. How much more
efficiently can we run our businesses? Rebounding from 1994's inventory bubble,
S&P 500 earnings grew approximately 18% in 1995. These earnings rose nearly 10%
in 1996, and are projected to advance another 9% to 11% in 1997. These are
impressive numbers considering the economy has chugged along at a modest 3% to
4% annual growth rate over this same time period. Return on equity has exceeded
the expectation of even the most optimistic. Will we retreat to a more normal
relationship between top line revenue and earnings growth?
This year, equities investors have been so concerned about inflation and
the potential for higher interest rates while praying so fervently for a slower
economy, they seem to have lost sight of the fact that one of the consequences
may be corporate earnings growth below "enhanced expectations." With Europe and
the Far East gaining economic momentum, second half earnings for U.S.
multinationals should be okay, with an obvious yellow flag associated with
"currency" adjustments. But, we are likely to see disappointments domestically.
Investors' recent reaction to warnings of earnings shortfalls from a string of
leading technology companies may be duplicated in other industry groups in the
next six months.
The final piece of the puzzle is always the most difficult to
predict -- some form of political or financial accident that could spread like a
California brush fire in the increasingly interconnected global economy and
capital markets. That is the "G Factor" - only God knows.
What do we conclude from all this conjecture? If we continue to be blessed
with this highly favorable economic backdrop for equities, the stock market can
continue to advance, albeit at a much less torrid pace than we have enjoyed over
the last 2 1/2 years. Equities investors can continue to have their cake and
eat it too, but it will be served in significantly smaller portions. If there
proves to be one or more flies in the ointment, we could see a substantial
correction that lasts for more than just a few weeks. We also believe we are
entering what could be an extended phase of a market of stocks rather than a
stock market. Investors have been broadening their horizons as evidenced by the
much stronger relative performance of broader market indices. This would
indicate that individual stock fundamentals are becoming as important as sheer
market momentum in the decision making process.
3
<PAGE>
Cable Television: One Man's Junk is Bill Gates' Treasure
We have been analyzing the cable television (CATV) stocks for many years.
We've experienced the thrill of victory -- the pricing deregulation and rampant
consolidation of the industry in the mid eighties -- and over the last few
years, the agony of defeat -- re-regulation and the threat of competition from
telcos and satellite broadcasters. Through it all, we have viewed cable TV as a
good long-term investment. The business has most of the economic and financial
characteristics we favor: an identifiable franchise, high operating margins, and
strong cash flow. We are aware of the negatives: lousy service by new entrants,
high debt, the need for a second round of substantial capital investment to
technologically upgrade systems, and the prospect for increased competition.
However, we remain confident that the value of all those connections to American
homes will ultimately be recognized.
Cablevision Systems Corporation (CVC - $53.50 - ASE) best illustrates the
recent trials and tribulations of cable television operators and investors. A
great growth company in the 1980s, Cablevision built a terrific franchise in the
New York metropolitan area. They were also early to recognize the potential of
cable networks and programming by investing in American Movie Classics, Bravo,
eight regional sports networks, and 50% of MSG (Madison Square Garden, the NY
Knicks and the NY Rangers). In the process, they leveraged the company to the
hilt and were as vulnerable as anyone to potential competition from News
Corporation Limited (NWS - $19.25 - NYSE) Chairman Rupert Murdoch's plan for a
national satellite broadcast system--labeled by Wall Street as the "Death Star"
for the CATV industry. In the last year, Cablevision stock fell from the mid
$50's to a low of $25 per share.
Then, things got interesting. Murdoch's Death Star was grounded.
Recognizing cable television lines were likely to continue to be the speediest
data transmission highway into the home, Microsoft Corporation's (MSFT -
$126.375 - Nasdaq) Bill Gates invested $1 billion in Comcast Corporation (CMCSA
- - $20.9375 - Nasdaq), instantly ratcheting up the value of every cable
television link in the country. Cablevision moved quickly to further consolidate
its system by swapping 33% of its stock to Tele-Communications, Inc. (TCOMA -
$14.875 - Nasdaq) in return for an additional 820,000 subscribers in the New
York metropolitan area. It then closed on the remaining 50% of MSG from its
partner ITT Corporation (ITT - $61.0625 - NYSE). Finally, in a particularly deft
move, Cablevision sold 40% of its Rainbow cable network and programming unit to
News Corp's Fox unit for $850 million, bolstering both its network/programming
assets through a planned national sports network with its new partners and its
debt heavy balance sheet. Cablevision's stock went from deep in Wall Street's
doghouse to the penthouse almost overnight. We expect a lot more from
Cablevision.
Although a much more diversified media company, Time Warner Inc. (TWX -
$48.25 - NYSE) stock has been stuck in the mud due to its substantial cable
television operations. Chairman Gerald Levin has been pressured by Wall Street
and several large institutional and corporate shareholders to reduce the
company's exposure to the business by off-loading cable systems to US West Media
Group (UMG - $20.25 - NYSE) in return for its minority stake in Time Warner
Entertainment. Believing Levin would be forced to throw in the towel on cable,
US West Media Group held out for a higher price (more cable subscribers) than
Levin was willing to part with. Perhaps US West Media has outfoxed itself. With
the escalating value of its assets, Time Warner is now in the driver's seat in
negotiating a deal. We believe Time Warner will eventually reduce its exposure
to cable and focus more on its programming and publishing assets. When they pull
the trigger on cable, they will get a much better price.
4
<PAGE>
Let's Make a Deal
News Corp/International Family Entertainment
In the long running game show "Let's Make a Deal," host Monty Hall would
urge his contestants to deal for the fabulous prizes hidden behind door number
one, two, or three. This quarter, we've had portfolio prizes hidden behind all
three doors. Seeking a national distribution channel for its children's
programming and shut out by a Supreme Court ruling upholding "must carry"
requirements, News Corp. wooed and won International Family Entertainment, Inc.
(FAM - $34.375 - NYSE).
We believe the current "Let's Make a Deal" market may run as long as the
popular game show. There is tremendous liquidity in the financial system. With
modest top line revenue growth, minimal pricing flexibility, and limits to
further margin expansion through cost cutting and productivity gains, the
ability of many companies to grow earnings from existing operations is
restrained. The answer for many will be to grow via acquisitions. This will not
take the form of the re-conglomeratization of American business. Instead, we
will see larger companies buying smaller niche companies to complement their
existing businesses. This feeds nicely into our focus on smaller niche
franchises and we expect to be bidding a fond farewell to additional portfolio
holdings in the years ahead. We identified the "urge to consolidate" in previous
reports to you. We have announced and heralded this Third Wave of Mergers in all
of our letters to you since General Electric Company (GE - $65.375 - NYSE)
attempted a hostile takeover of Kemper in February 1994. A reduction in
long-term capital gains rates will fan the flames of an already raging fire.
The Last Shall Be First
Our investment thesis is that if you buy good businesses at the right
price, and hold them long term, you will eventually earn a satisfactory return.
Often, it takes quite awhile for the corporate values we identify to be
recognized by other investors. Generally, our patience is rewarded. This
quarter, many of our sleepers have come to life. Golden Books Family
Entertainment, Inc. (GBFE - $12.50 - NASDAQ) and Cablevision (CVC - $53.50 -
ASE) were among our top performing stocks, posting large percentage gains after
somewhat extended naps. If you factor in our holding periods, there are not many
grand slam home runs. These are singles and doubles, and in some cases, the
count is just now even. But, they are helping to produce the kind of consistent
investment progress our value discipline is designed to provide. In this age of
instant gratification, most investors are simply not willing to wait on stocks
that aren't moving. They dump and run, chasing momentum not value. This may work
well during roaring bull markets. But, over the long term and through the market
cycles, it has not proven to be a particularly effective way to generate
superior returns.
Preferred Stock -- An Investment For The Future
In the first quarter, the Board of Directors of The Gabelli Global
Multimedia Trust authorized management to consider an offering of preferred
stock. On June 4, 1997, the Trust successfully completed its offering of
cumulative preferred stock which was rated 'aaa' by Moody's Investors Service
Inc. Shareholder response has been positive and we appreciate the efforts of
Smith Barney and Gabelli & Company, Inc., the underwriters, and wish to thank
and welcome all those investors who participated.
5
<PAGE>
The Trust issued 1,250,000 Preferred Shares at $25 with an annual dividend
rate of $1.98 per share paying semi-annually starting in December 1997. The
Preferred Shares are trading on the New York Stock Exchange under the symbol GGT
Pr. We thought we would answer some questions about preferred stock.
Q: What is Preferred Stock?
Preferred stock is a form of equity investment which has certain rights
that differ from those of common stock. In our case, the preferred stock was
issued at $25 per share with a fixed dividend rate of $1.98. The Trust is
obligated to pay this dividend to the Preferred Shareholders before any
dividends are paid to the holders of common shares. Thereafter, any return
earned in excess of this dividend rate would work to benefit the Common
Shareholders.
Q: How would Preferred Shares benefit Common Shareholders?
From its inception on November 15, 1994 through June 30, 1997, the
Multimedia Trust has earned a 14.9% average annual return. The only obligation
that the Trust has to the Preferred Shareholders is to pay the stated dividend
rate. Given the current market environment, we considered this to be an ideal
opportunity to take advantage of relatively low long-term interest rates and to
earn an excess return for our Common Shareholders consistent with our
conservative investment approach. Any return earned in excess of the stated
dividend rate, which is less than the Trust's average annual return, would
directly benefit Common Shareholders; however, any shortfall from the stated
rate would impact the Common Shareholders in the opposite fashion. Therefore, by
taking advantage of the current relatively low interest rate environment and
achieving our investment objectives, the Preferred Share issuance offers what we
believe is a conservative method of adding wealth for our Common Shareholders.
As an additional benefit, since the Preferred Offering increases the
Trust's overall capital base, fixed costs of the Trust are spread over more
assets. Thus, a lower expense ratio will work to benefit Common Shareholders.
Furthermore, Common Shareholders stand to receive certain tax benefits as
a result of the Preferred Stock offering. Since taxable income is allocated to
the Preferred Shareholders before Common Shareholders, taxable distributions to
Common Shareholders are not required to the extent they would be if the
Preferred Shares were not outstanding. Common Shareholders thus avoid having to
pay taxes on that portion of taxable income that previously would have been
distributed to them. By deferring these taxable distributions and taxes
associated therewith, the net asset value of the common shares are likely to
grow at a faster rate.
Q: Why did the Trust consider Preferred Shares?
Right now, long-term interest rates are at relatively low levels. The
dividend rate that the Trust is required to pay on the Preferred Shares is
related to long-term rates. In this environment, we have a great opportunity to
create value by earning a return in excess of the Preferred's dividend rate over
the long term. Therefore, we believe this represents an opportunistic time for
the Trust to take advantage of these low rates.
Q: Will Gabelli Funds, Inc. be paid a management fee on the Preferred Capital?
With the completion of the preferred offering, the Adviser has agreed to
waive the management fee on the incremental assets if the return on the Trust
does not exceed the stated dividend rate on the Preferred Shares.
6
<PAGE>
Q: What were the offering costs involved with the Preferred Shares?
Consistent with our conservative approach, the Trust issued the Preferred
Shares in a cost efficient manner at less than $0.12 per share. Although this
offering crimped our results for the quarter -- 12.8% versus 14.3% had the
Preferred Shares not been issued -- this modest investment provides the
underpinnings for successful returns in the future.
Let's Talk Stocks
The following are stock specifics on selected holdings of the Multimedia
Trust. Favorable EBITDA (Earnings Before Interest, Taxes, Depreciation and
Amortization) prospects do not necessarily translate into higher stock prices,
but they do express a positive trend which we believe will develop over time.
BC TELECOM, Inc. (BCT - $23.46 - TSE), formerly British Columbia Telephone
Company, is the second largest telecommunications services company in Canada. A
subsidiary of GTE Corporation (GTE - $43.875 - NYSE) owns 52% of the company. We
estimate the private market value (PMV) of BCT to be $50 per share. Its basic
telephone operations provide service to more than two million telephone lines
and are growing at twice the Canadian industry average. BCT's crown jewel is a
rapidly growing cellular phone company which currently serves 463,000
subscribers. We expect BCT to take advantage of the deregulatory trend in Canada
by entering new businesses in which they are now allowed to participate.
Cablevision Systems Corporation (CVC - $53.50 - ASE), based in Woodbury, NY, is
a major cable TV operator serving 2.9 million subscribers, including managed
systems. CVC's cable systems generate average monthly subscriber revenues among
the highest in the industry. CVC is purchasing ITT's 50% stake in MSG (Madison
Square Garden) Properties for $500 million cash, plus options that bring the
transaction's value to almost $690 million. Cablevision intends to use the
proceeds from the sale of a 40% stake in Rainbow Sports to a News Corp./TCI
joint venture to pay down a significant portion of MSG's debt. With its upgraded
cable systems, CVC is well-positioned to offer telephony, high-speed data and
enhanced video services. We believe Cablevision's PMV is about $90 per share.
Giddings & Lewis Inc. (GIDL - $20.875 - Nasdaq), a maker of machine tools and
assembly line equipment, agreed to be acquired by Germany's Thyssen AG in a $675
million bid that topped a rival offer. Thyssen, a diversified German steelmaker,
launched a $21 per share cash tender offer for all Giddings & Lewis' outstanding
shares. The offer topped a $19 per share bid from Harnischfeger Industries Inc.
(HPH - $42.875 - NYSE), also a machine tools maker, which Giddings rejected in
May. The acquisition would give Thyssen a manufacturing base in the U.S. while
Giddings would benefit from the larger company's global presence and common ties
to the automobile industry. The tender is subject to Thyssen receiving a
majority of Giddings & Lewis' outstanding shares in the offer, as well as
approval from U.S. and German regulators. The tender offer is expected to be
completed by the end of July.
Grupo Televisa S.A. (TV - $30.375 - NYSE) is a Mexico-based entertainment
company that dominates the Spanish speaking world through its fully integrated
mix of content and distribution. The company is an excellent vehicle for
accessing the growth in disposable income among the Spanish speaking population
on a global basis. The business mix includes film, music, cable television and
broadcasting. Grupo Televisa also has valuable holdings in PanAmSat Corporation
(SPOT - $29.00 - Nasdaq) and Univision Communications Inc. (UVN - $39.125 -
NYSE). A five-year restructuring plan - "Televisa 2000" - is designed to cut
costs by $90 million annually over the next three years and to raise Televisa's
cash flow margin by more than 25%.
7
<PAGE>
International Family Entertainment, Inc. (FAM - $34.375 - NYSE) is a
Virginia-based entertainment company with production and distribution operations
around the world. With such key assets as The Family Channel, MTM and Cable
Health Club, FAM is a leading provider of cable programming oriented toward
families. The Family Channel is performing exceptionally well, and MTM has been
re-energized. FAM has created an exceptional franchise which attracted News
Corporation Limited (NWS - $19.25 - NYSE), whose Fox Kids Worldwide Inc. unit
agreed to buy FAM for $35 a share cash in a transaction valued at $1.9 billion.
Tambrands, Inc. (TMB - $49.875 - NYSE) agreed to be acquired by Procter & Gamble
Company for $2 billion in cash and assumed debt. P&G will pay $50 a share in
cash, or $1.85 billion, and assume $150 million in debt for Tambrands. The
purchase would make P&G the largest producer of feminine hygiene products. P&G
will give Tambrands the financial resources, marketing experience and
distribution network to expand sales outside the U.S. While Tambrands has half
of the U.S. tampon market, valued at $800 million, sales are much lower in
foreign markets. P&G hopes to distribute Tampax in Latin America and Asia, which
have more than half of the world's population yet account for less than 5
percent of Tampax's volume sales. The transaction is expected to be completed
during the third quarter of 1997.
Telecomunicacoes Brasileiras SA (Telebras) (TBR - $151.75 - NYSE) is the
Brazilian government-controlled monopoly telecommunications holding company
consisting of 28 subsidiaries serving more than 14 million telephone lines and
two million cellular customers in a country with a population of 160 million.
The penetration rate is less than 9% for telephone and 1% for cellular. The
stock is attractively priced at less than six times our estimate of 1997 cash
flow. Future opportunities include the prospects of privatization, strong line
growth and improvements in efficiency. Telebras is benefiting from an improved
rate structure which allows the company to recoup inflation-related cost
increases on a more consistent basis.
Telefonica de Espana (TEF - $86.25 - NYSE) is a diversified telecommunications
service provider offering services to more than 15 million lines. The company
also services a fast growing cellular subscriber base which now exceeds two
million subscribers. We consider TEF an ideal way to invest in Latin America,
with a diversified portfolio of telecommunication operations in the region. Its
portfolio of publicly traded Latin American companies includes: Compania de
Telecomunicaciones de Chile S.A., Telefonica de Argentina S.A. and Compania
Peruana de Telefonos SA. TEF also holds interests in non-public Latin American
telecom operations in Mexico, Colombia, Puerto Rico, Uruguay and Venezuela. The
company's long-term strategy is to create a Pan-American network, leveraging the
Spanish-speaking world. TEF jump-started this effort with its decision to form a
global alliance with British Telecom/MCI's Concert plc, which is gaining
momentum in the race to become the dominant provider of one-stop shopping for
full-service, global telecommunications products.
Time Warner, Inc. (TWX - $48.25 - NYSE), having completed its acquisition of
Turner Broadcasting in the fourth quarter of 1996, is the world's largest
diversified media and publishing company. The combined companies have more than
$23 billion in revenues and over $4.5 billion in EBITDA. Together they control a
host of powerful media brands, such as CNN, Warner Brothers film, HBO, Cinemax
and Time and People magazines. Under the leadership of Chairman Gerald Levin and
Vice-Chairman Ted Turner, Time Warner is now focused on reducing its almost $13
billion in debt and simplifying its capital structure. Achievement of both goals
would be greatly aided by a successful restructuring of the Time Warner
Entertainment partnership with U.S. West Media Group (UMG - $20.25 - NYSE).
8
<PAGE>
Viacom, Inc. (VIA - $29.4375 - ASE; VIA'B - $30.00 - ASE), long a major provider
of entertainment "content", has evolved into one of the world's dominant media
companies. Following its acquisitions of Paramount Communications and
Blockbuster Entertainment, the company is now divesting non-core assets to
reduce debt and is focusing on the global expansion of its media franchises. The
company has divested its cable systems subsidiary in a transaction with
Tele-Communications, Inc. (TCOMA - $14.875 - Nasdaq) which reduced Viacom's debt
by $1.7 billion and the number of common shares outstanding by about 4%. Its
radio group, Evergreen Media, is being sold for $1.1 billion in cash. Viacom is
well-positioned in music (notably MTV) and cable networks such as Nickelodeon,
USA (50% interest) and the Sci-Fi Channel.
Shareholder Meeting - May 12, 1997
The Annual Meeting of shareholders was held on May 12, 1997 at the
Greenwich Library in Greenwich, Connecticut. At that meeting, shareholders
elected James P. Conn, Anthony R. Pustorino and Karl Otto Pohl as Directors of
the Global Multimedia Trust. A total of 5,330,786 votes, 5,307,820 votes and
5,295,560 votes were cast in favor of each Director and 317,958 votes, 340,924
votes and 353,184 votes were withheld for each Director, respectively.
At the meeting, the shareholders also selected Price Waterhouse L.L.P. as
the independent accountants for the Global Multimedia Trust for the year ending
December 31, 1997. 5,319,393 votes were cast in favor of the approval of this
proposal, 137,160 votes were cast against the proposal and 66,739 votes
abstained.
In addition, the shareholders approved the revision of the fundamental
restriction regarding senior securities. 4,010,824 votes were cast in favor of
the approval of this proposal, 1,011,769 votes were cast against the proposal
and 164,033 votes abstained. We thank you for your participation and appreciate
your continued support.
Multimedia Trust Share Repurchase
At a special meeting of the Board of Directors on July 3, 1996, the Board
authorized the repurchase of up to 500,000 shares of the Multimedia Trust's
outstanding shares. On February 26, 1997, the Board voted to increase the
authorized shares which may be repurchased to 750,000 shares. The Multimedia
Trust may from time to time purchase shares of its capital stock in the open
market when the shares are trading at a discount of 10% or more from the net
asset value of the shares. During the second quarter, the Trust repurchased
19,833 shares at an average discount of 19.7%. In total, through June 30, 1997,
419,833 shares were repurchased in the open market.
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].
9
<PAGE>
In Conclusion
The strength of the market is understandable considering today's favorable
economic/earnings/interest rate backdrop and the enormous amount of money being
poured into equities mutual funds. Although high by historical standards,
current equities valuations may be justified as long as these "best of all
possible worlds" market conditions can be sustained. If something happens to
disrupt this comfortable scenario -- our best guess is it may come in the form
of more widespread earnings disappointments as the slowing economy begins to
impact corporate profitability -- the market could run into some trouble.
We are encouraged by the broadening of this bull market and some evidence
that investors are once again focusing on fundamental value instead of just
momentum. Stock pickers across the land rejoice! Ongoing merger and acquisition
activity should continue to provide a tailwind for our portfolio.
As always, we thank you for your confidence in our investing abilities and
will work hard to preserve and enhance the assets you have entrusted to us.
Sincerely,
/s/ Mario J. Gabelli
Mario J. Gabelli, CFA
President and Chief Investment Officer
August 1, 1997
- --------------------------------------------------------------------------------
Top Ten Holdings
June 30, 1997
----------------
International Family Entertainment
Time Warner, Inc.
Tambrands, Inc.
Viacom, Inc.
Grupo Televisa S.A.
Telecomunicacoes Brasileiras SA (Telebras)
Cablevision Systems Corp.
Telefonica De Espana
Giddings & Lewis, Inc.
BC TELECOM, 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.
10
<PAGE>
The Gabelli Global Multimedia Trust Inc.
Portfolio of Investments -- June 30, 1997 (Unaudited)
================================================================================
Market
Shares Cost Value
------ ---- -----
COMMON STOCKS - 76.9%
COPYRIGHT/CREATIVITY COMPANIES - 33.8%
Advertising - 0.0%
200 Havas Advertising, SA.......... $ 19,126 $ 23,992
200 Publicis SA.................... 13,971 20,929
------------ ------------
33,097 44,921
------------ ------------
Cable Programmers - 10.0%
4,000 BET Holdings, Inc., Class A+... 80,800 131,000
15,000 CANAL+, Sponsored ADR.......... 431,000 584,170
20,000 Flextech plc+.................. 129,729 214,055
30,000 Gaylord Entertainment
Company, Class A............. 655,092 691,875
55,000 HSN, Inc.+..................... 1,116,283 1,718,750
220,000 International Family
Entertainment, Inc., Class B+ 5,264,504 7,562,500
112,500 Tele-Communications, Inc./
Liberty Media Group,
Class A+..................... 1,896,038 2,671,875
------------ ------------
9,573,446 13,574,225
------------ ------------
Diversified Publishers - 8.8%
10,000 American Media Inc., Class A+.. 74,500 70,000
10,000 Arnoldo Mondadori Editore
SpA.......................... 63,827 57,819
25,000 Belo (A.H.) Corporation,
Class A...................... 435,757 1,040,625
2,500 Central Newspapers, Inc.,
Class A...................... 71,479 179,063
4,000 Dow Jones & Company Inc........ 144,950 160,750
700 Filipacchi Medias.............. 87,284 148,528
30,000 Golden Books Family
Entertainment, Inc.+......... 302,154 375,000
22,000 Harcourt General, Inc.......... 1,001,725 1,047,750
12,000 Harte-Hanks
Communications Inc........... 266,900 354,000
2,000 Houghton Mifflin Company....... 81,819 133,500
60,639 Independent Newspapers Ltd.,
ORD.......................... 177,182 357,883
11,000 Knight-Ridder, Inc............. 313,659 539,688
9,000 K-III Communications Corp.+.... 90,000 108,000
20,000 Lee Enterprises, Incorporated.. 393,038 527,500
8,000 McGraw-Hill Companies, Inc..... 408,650 470,500
10,000 Media General, Inc., Class A... 284,125 400,000
36,000 Meredith Corporation........... 495,150 1,044,000
60,000 Nation Multimedia Group........ 95,837 132,797
100,000 New Straits Times Press Berhad. 319,511 586,371
100,000 Oriental Press Group ORD....... 41,864 40,981
10,000 Playboy Enterprises, Inc.,
Class A...................... 97,125 115,000
80,000 Post Publishing Company Ltd.... 219,014 112,676
30,000 Pulitzer Publishing Company.... 940,587 1,590,000
2,000 Reader's Digest Association, Inc.,
Class B...................... 45,350 55,375
35,000 Singapore Press Holdings, Ltd.. 533,526 705,043
400,000 South China Morning Post
Holdings ORD................. 273,763 392,385
300 SPIR Communication............. 23,329 23,047
20,000 Thomas Nelson Inc.............. 214,062 277,500
4,000 Times Mirror Company,
Class A...................... 76,575 221,000
50,000 Times Publishing Ltd........... 126,892 111,912
10,000 United News & Media plc,
ADR.......................... 249,375 233,750
200 Wiley (John) & Sons, Inc.,
Class A...................... 5,693 6,750
1,000 Wolters Kluwer NV.............. 90,625 121,752
------------ ------------
8,045,327 11,740,945
------------ ------------
Entertainment Production - 1.3%
22,000 All American Communications
Inc., Class B+............... 212,124 266,750
450 American Radio Systems
Corporation.................. 7,911 17,944
32,108 Ascent Entertainment Group
Inc.+........................ 294,856 292,986
4,000 Cinergi Pictures Entertainment
Inc.+........................ 13,305 5,000
2,000 DMX Inc.+...................... 4,975 3,480
13,000 EMI Group plc, Sponsored
ADR.......................... 192,709 235,625
7,000 Grammy Entertainment plc+...... 67,723 81,127
3,500 Granada Group plc.............. 35,566 46,023
10,000 GTECH Holdings Corporation+.... 169,281 322,500
1,000 Harvey Entertainment
Company+..................... 12,858 13,500
15,000 Katz Media Group Inc.+......... 149,283 98,437
1,000 Lancit Media Productions,
Ltd.+........................ 13,040 3,125
300 NRJ SA......................... 22,694 40,837
2,877 People's Choice TV
Corporation+................. 17,186 4,675
See Notes to Financial Statements
11
<PAGE>
The Gabelli Global Multimedia Trust Inc.
Portfolio of Investments (Continued) -- June 30, 1997 (Unaudited)
================================================================================
Market
Shares Cost Value
------ ---- -----
COMMON STOCKS (Continued)
COPYRIGHT/CREATIVITY COMPANIES (Continued)
Entertainment Production (Continued)
100,000 Shaw Brothers (Hong Kong)
Ltd.......................... $ 145,929 $ 112,294
20,000 Spelling Entertainment Group,
Inc.+........................ 152,993 137,500
3,250 THORN plc, ADR+................ 54,979 37,578
1,700 Tring International Group...... 3,099 453
------------ ------------
1,570,511 1,719,834
------------ ------------
Global Media and Entertainment - 11.7%
100,000 Grupo Televisa SA, GDR......... 2,254,572 3,037,500
25,000 Havas, Sponsored ADR........... 498,375 437,500
21,000 News Corporation Limited,
ADS.......................... 413,278 404,250
2,000 PolyGram NV.................... 114,825 107,625
45,000 Seagram Company Ltd............ 1,538,203 1,811,250
1,000 Sony Corporation, ADR.......... 54,114 88,000
120,000 Time Warner, Inc............... 5,217,932 5,790,000
120,000 Viacom Inc., Class A+.......... 4,015,102 3,532,500
6,000 Walt Disney Company............ 410,625 481,500
------------ ------------
14,517,026 15,690,125
------------ ------------
Hotels/Gaming - 0.5%
2,500 Churchhill Downs
Incorporated................. 102,432 100,000
1,000 Gaming Lottery Corporation..... 4,727 4,562
5,000 ITT Corporation, New+.......... 218,750 305,312
50,847 Ladbroke Group plc............. 131,440 198,892
2,500 Quintel Entertainment Inc.+.... 12,500 41,250
------------ ------------
469,849 650,016
------------ ------------
Information Publishing - 0.2%..
2,500 Berlitz International Inc.+.... 43,500 62,344
20,000 Data Broadcasting
Corporation+................. 112,256 95,000
1,000 Dun & Bradstreet Corp.......... 28,747 26,250
500 Scholastic Corporation+........ 16,500 17,500
------------ ------------
201,003 201,094
------------ ------------
Software - 1.3%
1,000 Activision Inc.+............... 6,415 14,375
100,000 Digex, Inc..................... 1,291,948 1,290,625
1,000 Electronic Arts Inc.+.......... 22,353 33,625
2,000 Excaliber Technologies
Corporation.................. 20,915 10,750
8,000 H&R Block Inc.................. 212,362 258,000
500 Intel Corporation.............. 32,500 70,906
500 Microsoft Corporation+......... 15,510 63,188
200 Netscape Communications
Corp.+....................... 2,800 6,412
100 Pixar Inc.+.................... 2,200 1,575
------------ ------------
1,607,003 1,749,456
------------ ------------
TOTAL COPYRIGHT/CREATIVITY
COMPANIES ................... 36,017,262 45,370,616
------------ ------------
DISTRIBUTION COMPANIES - 43.1%
Broadcasting - 8.2%
70,000 Ackerley Group, Inc............ 385,688 761,250
1,000 Audiofina...................... 54,505 39,788
3,000 Baton Broadcasting Inc.+....... 19,240 27,592
7,000 BHC Communications, Inc.,
Class A...................... 544,988 836,500
3,000 British Sky Broadcasting
Group, Sponsored ADR......... 72,400 134,062
18,000 CanWest Global
Communications Corp.......... 92,012 262,013
2,000 Carlton Communications plc,
Sponsored ADR................ 63,625 86,000
27,260 Chris-Craft Industries, Inc.... 1,008,422 1,315,295
2,000 Clear Channel
Communications, Inc.+........ 28,244 123,125
13,000 Cox Radio Inc., Class A+....... 240,500 333,125
500 Emmis Broadcasting
Corporation, Class A+........ 10,489 21,812
200 Europe 1 Communication+........ 44,101 41,007
750 Evergreen Media Corporation,
Class A+..................... 10,736 33,469
3,560 Fisher Companies Inc........... 260,310 462,800
5,000 General Electric Company....... 129,375 326,875
5,000 Granite Broadcasting
Corporation+................. 58,517 51,250
8,750 Gray Communications
Systems, Inc................. 172,625 196,328
40,000 Gray Communications Systems,
Inc., Class B................ 810,063 835,000
5,000 Grupo Radio Centro, SA de
CV, ADR...................... 42,938 58,750
2,000 Heritage Media Corporation,
Class A+..................... 28,675 37,750
500 Jacor Communications, Inc.+.... 6,957 19,125
700 LaGardere Groupe............... 12,878 20,332
See Notes to Financial Statements
12
<PAGE>
The Gabelli Global Multimedia Trust Inc.
Portfolio of Investments (Continued) -- June 30, 1997 (Unaudited)
================================================================================
Market
Shares Cost Value
------ ---- -----
COMMON STOCKS (Continued)
DISTRIBUTION COMPANIES (Continued)
Broadcasting (Continued)
25,000 LIN Television Corporation+.... $ 763,430 $ 1,103,125
400 Metropole TV M6 SA............. 35,208 38,115
1,100 Nippon Television
Broadcasting................. 323,764 441,844
7,500 NTN Communications Inc.+....... 43,500 33,281
42,000 Paxson Communications
Corporation, Class A+........ 379,794 551,250
976 SAGA Communications,
Incorporated, Class A+....... 9,710 18,056
2,000 Scandinavian Broadcasting
SA+.......................... 42,023 44,500
25,000 Sistem Televisyen Malaysia
Berhad....................... 36,518 51,010
50,000 Television Broadcasting Ltd.
ORD.......................... 187,673 224,589
2,000 Television Francaise 1......... 206,188 178,663
40,000 Tokyo Broadcasting System...... 655,630 820,817
10,000 United Television, Inc......... 763,979 990,000
25,000 Westinghouse Electric Corp..... 372,789 578,125
------------ ------------
7,917,494 11,096,623
------------ ------------
Business Services - 0.5%
20,000 Prime Service, Inc............. 634,350 638,750
------------ ------------
Cable - 4.5%
46,700 Cablevision Systems
Corporation, Class A+........ 1,802,899 2,498,450
5,000 Century Communications
Corporation, Class A+........ 21,875 26,875
8,000 Comcast Corporation,
Class A...................... 123,000 167,500
1,000 Comcast Corporation,
Class A Special.............. 15,612 21,375
3,000 Comcast U.K. Cable Partners
Limited, Class A+............ 43,612 36,000
4,000 General Cable plc, ADR+........ 58,500 54,000
3,000 NTL Incorporated+.............. 62,325 74,625
1,000 Mercom, Inc.................... 7,000 7,000
2,000 Rogers Communications, Inc.,
Class B+..................... 12,683 12,375
6,000 Telewest Communications plc,
Sponsored ADR+............... 128,807 93,750
80,000 Tele-Communications, Inc.,
Class A+..................... 1,171,774 1,190,000
50,000 Tele-Communications
International, Inc., Class A+ 795,563 771,875
100,000 United International Holdings,
Inc., Class A+............... 1,395,845 1,037,500
5,000 Videotron Groupe............... 42,106 39,831
100 Wireless One Inc.+............. 1,329 256
------------ ------------
5,682,930 6,031,412
------------ ------------
Consumer Products - 4.1%
30,000 Mafco Conslidated Group,
Inc.......................... 999,000 1,005,000
89,000 Tambrands, Inc................. 4,427,825 4,438,875
------------ ------------
5,426,825 5,443,875
------------ ------------
Consumer Services - 1.0%
3,000 Department 56, Inc.+........... 62,108 66,563
78,000 Ticketmaster Group Inc.+....... 1,117,722 1,296,750
------------ ------------
1,179,830 1,363,313
------------ ------------
Entertainment Distribution - 1.8%
120,000 Cineplex Odeon
Corporation+................. 165,000 217,500
22,000 GC Companies, Inc.+............ 609,163 1,012,000
19,500 Shaw Communications, Inc.,
Class B, conv................ 122,708 143,336
50,000 US WEST Media Group+........... 908,819 1,012,500
------------ ------------
1,805,690 2,385,336
------------ ------------
Equipment - 2.4%
6,000 General Instrument
Corporation+................. 159,589 150,000
112,900 Giddings & Lewis, Inc.......... 2,349,572 2,356,787
7,000 Lucent Technologies, Inc....... 189,000 504,437
1,000 Northern Telecom Limited....... 34,956 91,000
1,000 Philips Electronics N.V.,
New York..................... 38,425 71,875
3,000 Scientific-Atlanta, Inc........ 50,804 65,625
------------ ------------
2,822,346 3,239,724
------------ ------------
Information Services - 0.1%
2,000 Cognizant Corporation.......... 58,759 81,000
------------ ------------
International Telephone - 9.6%
80,000 BC TELECOM Inc................. 1,435,326 1,877,105
30,000 BCE Inc........................ 536,250 840,000
5,000 BHI Corporation................ 78,755 110,000
28,000 Cable & Wireless plc,
Sponsored ADR................ 564,900 782,250
See Notes to Financial Statements
13
<PAGE>
The Gabelli Global Multimedia Trust Inc.
Portfolio of Investments (Continued) -- June 30, 1997 (Unaudited)
================================================================================
Market
Shares Cost Value
------ ---- -----
COMMON STOCKS (Continued)
DISTRIBUTION COMPANIES (Continued)
International Telephone (Continued)
35,000 Compania de
Telecomunicaciones de
Chile SA, Sponsored ADR....... $ 635,219 $1,155,000
500 CPT Telefonica del Peru,
ADR.......................... 10,250 13,094
200,000 CPT Telefonica del Peru,
Class B...................... 414,925 525,047
2,000 Deutsche Telekom AG,
ADR+......................... 37,780 48,250
2,000 Esprit Telecom Group plc,
ADR+......................... 10,330 16,000
6,000 GST Telecommunications,
Inc.+........................ 38,425 60,750
20 Japan Telecom Co., Ltd......... 393,221 384,212
10 Nippon Telegraph &
Telephone Corp............... 81,575 96,053
1,000 PT Telekomunikasi Indonesia.... 20,185 32,500
3,000 Quebec-Telephone............... 44,083 53,445
1,800 Telecom Argentina Stet-France
Telecom SA, Sponsored ADR.... 69,082 94,500
2,000 Telecom Corporation of New
Zealand Ltd., ADR............ 62,150 81,500
150,000 Telecom Italia SpA............. 246,360 449,541
20,000 Telecomunicacoes Brasileiras
SA (Telebras), Sponsored
ADR........................... 613,296 3,035,000
3,000 Telefonica de Argentina SA,
Sponsored ADR................ 64,387 103,875
28,000 Telefonica de Espana,
Sponsored ADR................ 1,201,190 2,415,000
14,000 Telefonos De Mexico SA,
Class L, ADR................. 458,967 668,500
------------ ------------
7,016,656 12,841,622
------------ ------------
Retail - 0.2%
25,000 Bruno's Inc.................... 282,813 287,500
------------ ------------
Satellite - 0.9%
100 Asia Satellite
Telecommunications Holdings
Ltd., Sponsored ADR+.......... 2,583 3,013
7,000 EchoStar Communications
Corporation, Class A+........ 162,972 109,375
6,000 General Motors Corporation,
Class H...................... 237,950 346,500
2,000 Globalstar
Telecommunications+.......... 13,663 61,250
7,000 Orion Network Systems, Inc.+... 68,005 77,000
1,100 PT Indonesia Satellite, ADR.... 36,492 32,931
70,000 TCI Satellite Entertainment
Inc., Class A +.............. 650,173 551,250
10,000 U.S. Satellite Broadcasting
Co.+......................... 196,675 82,500
------------ ------------
1,368,513 1,263,819
------------ ------------
Telecommunications - 1.1%
2,000 Bruncor Inc.................... 34,068 43,307
40,000 Frontier Corporation........... 741,488 797,500
1,000 Hellenic Telecommunication
Organization SA (OTE)........ 16,553 23,489
6,000 Metromedia International
Group Inc.+.................. 65,350 76,125
2,000 MIDCOM Communications
Inc.+........................ 20,909 10,625
3,000 NewTel Enterprises Limited..... 45,184 59,203
3,000 Philippine Long Distance
Telephone Company............ 184,252 192,750
13,500 Tel-Save Holdings, Inc.+....... 62,645 205,875
------------ ------------
1,170,449 1,408,874
------------ ------------
Telecommunications - Long Distance - 0.9%
13,000 AT&T Corp...................... 449,846 455,812
50 DDI Corp....................... 401,727 369,368
7,000 Sprint Corporation............. 168,313 368,375
------------ ------------
1,019,886 1,193,555
------------ ------------
US Regional Operators - 1.5%...
1,000 Cincinnati Bell Inc............ 14,629 31,500
38,000 C-TEC Corporation, Class B+.... 1,055,720 1,306,250
13,000 GTE Corporation................ 443,025 570,375
731 SBC Communications, Inc........ 26,800 45,232
800 Teleport Communications
Group Inc., Class A+......... 12,800 27,300
1,000 US WEST Communications
Group........................ 24,802 37,687
------------ ------------
1,577,776 2,018,344
------------ ------------
Wireless Communications - 6.3%
65,000 Aerial Communications Inc.+... 460,585 552,500
10,000 AirTouch Communications
Inc.+........................ 269,250 273,750
See Notes to Financial Statements
14
<PAGE>
The Gabelli Global Multimedia Trust Inc.
Portfolio of Investments (Continued) -- June 30, 1997 (Unaudited)
================================================================================
Market
Shares Cost Value
------ ---- -----
COMMON STOCKS (Continued)
DISTRIBUTION COMPANIES (Continued)
International Telephone (Continued)
10,000 American Paging Inc.+.......... $ 49,863 $ 15,000
5,000 BCE Mobile Communications
Inc.+........................ 163,511 155,339
3,551 Cable & Wireless
Communications plc, ADR...... 78,630 95,433
1,000 CAI Wireless Systems, Inc.+.... 1,125 1,063
50,000 Centennial Cellular Corp.,
Class A +.................... 815,274 793,750
25,000 Century Telephone Enterprises,
Inc.......................... 774,250 842,187
35,000 COMSAT Corporation............. 656,055 833,437
6,000 CoreComm Inc.+................. 180,308 103,500
35,000 Iridium World
Communications Ltd........... 700,000 634,375
5,000 Loral Space &
Communications Ltd.+......... 69,750 75,000
10,000 NEXTEL Communications,
Inc., Class A+............... 108,882 189,375
6,000 Omnipoint Corporation+......... 56,130 99,750
20,000 Palmer Wireless Inc.,
Class A+..................... 251,800 337,500
2,000 Pittencrieff Communications,
Inc.+........................ 8,500 11,000
3,000 Price Communications
Corporation.................. 25,775 26,250
1,000 Qualcomm, Inc.+................ 41,625 50,875
24,000 Rogers Cantel Mobile
Communications, Inc.,
Class B+...................... 544,806 454,500
2,000 Rural Cellular Corp.,
Class A+..................... 20,250 20,625
350,000 Telecom Italia Mobile SpA...... 433,162 1,133,420
25,000 Telephone and Data
Systems, Inc................. 1,055,963 948,437
5,000 360(degrees)Communications
Company+..................... 81,100 85,625
18,000 Total Access
Communications plc........... 113,625 83,520
11,000 U.S. Cellular Corporation+..... 340,863 325,875
20,000 WinStar Communications
Inc.+........................ 263,360 267,500
------------ ------------
7,564,442 8,409,586
------------ ------------
TOTAL DISTRIBUTION
COMPANIES............................... 45,528,759 57,703,333
------------ ------------
TOTAL COMMON STOCKS....................... 81,546,021 103,073,949
------------ ------------
PREFERRED STOCKS - 1.6%
Broadcasting - 0.2%
4,500 Granite Broadcasting
Corporation, Preference
Shares........................ 290,857 231,750
------------ ------------
Cable - 0.0%
2,000 Cablevision Systems
Corporation, Series 1, 8.500%,
Conv. Pfd..................... 50,000 54,250
------------ ------------
Entertainment - 0.1%
4,000 AMC Entertainment, Inc.,
1.75, Conv. Pfd.............. 105,738 127,000
------------ ------------
Global Media and Entertainment - 0.7%
60,000 News Corporation Limited,
Sponsored ADR Preference
Shares........................ 957,512 937,500
------------ ------------
Wireless Communications - 0.6%
13,000 AirTouch Communications Inc.,
Series B, 6.000%, Pfd........ 350,933 370,500
8,000 AirTouch Communications Inc.,
Series C, 4.250%, Pfd........ 355,438 384,000
------------ ------------
706,371 754,500
------------ ------------
TOTAL PREFERRED STOCKS.................... 2,110,478 2,105,000
------------ ------------
COMMON STOCK WARRANTS
AND RIGHTS - 0.0%
1,000 Hellenic Telecommunication
Organization SA (OTE),
Rights, expire 7/23/97....... 0 117
10,000 Oriental Press Group, Warrants,
expire 10/02/1998+........... 0 555
------------ ------------
TOTAL COMMON STOCK
WARRANTS AND RIGHTS..................... 0 672
------------ ------------
See Notes to Financial Statements
15
<PAGE>
The Gabelli Global Multimedia Trust Inc.
Portfolio of Investments (Continued) -- June 30, 1997 (Unaudited)
================================================================================
Principal Market
Amount Cost Value
------ ---- -----
CORPORATE BONDS - 1.8%
Cable - 1.6%
$1,500,000 HSN, Inc., Conv. Sub. Deb.,
5.875% due 03/01/2016,
144A (b)...................... 1,500,000 1,867,500
300,000 Tele-Communications
International, Inc., Conv.
Sub. Deb., 4.500%
due 02/15/2006................ 302,208 243,750
------------ ------------
1,802,208 2,111,250
------------ ------------
Entertainment Production - 0.1%
100,000 Viacom Inc., Sub. Deb.,
8.000% due 07/07/2006........ 86,678 97,750
------------ ------------
Equipment - 0.1%
100,000 Trans-Lux Corporation, Conv.
Deb., 7.500% due
12/01/2006.................... 100,000 110,500
------------ ------------
Software - 0.0%
50,000 BBN Corp., Conv. Sub. Deb.,
6.000% due 4/1/2012.......... 49,258 48,437
------------ ------------
TOTAL CORPORATE
BONDS................................... 2,038,144 2,367,937
------------ ------------
U.S. TREASURY BILLS - 17.6%
23,778,000 4.42% to 4.89%+ + due
07/10/1997 - 07/24/1997...... 23,704,968 23,704,968
------------ ------------
TOTAL
INVESTMENTS............... 97.9% $109,399,611(a)131,252,526
============
OTHER ASSETS AND
LIABILITIES (NET)......... 2.1 2,768,765
----- ------------
NET ASSETS ................ 100.0% $134,021,291
===== ============
- ----------
(a) Aggregate cost for Federal tax purposes was $109,412,025. Net unrealized
appreciation for Federal tax purposes was $21,840,501 (gross unrealized
appreciation was $24,154,956 and gross unrealized depreciation was
$2,314,455)
(b) Security exempt from registration under Rule 144A of the Securities Act of
1933, as amended. The security may be resold in transactions exempt from
registration, normally to qualified institutional buyers. The market value
of his security at June 30, 1997 was $1,867,500, representing 1.39% of
total net assets.
+ Non-income producing security
++ Represents annualized yield at date of purchase.
ADR- American Depositary Receipt
ADS- American Depositary Share
GDR- Global Depositary Receipt
ORD- Ordinary Share
See Notes to Financial Statements.
16
<PAGE>
The Gabelli Multimedia Trust Inc.
Statement of Assets and Liabilities
June 30, 1997 (Unaudited)
================================================================================
Assets:
Investments at value (Cost $109,399,611) .................. $131,252,526
Cash and foreign currency (Cost $66,330) .................. 40,484
Dividends and interest receivable ......................... 165,164
Unamortized organization costs ............................ 166,070
Receivable for investments sold ........................... 3,096,537
Prepaid expenses .......................................... 25,634
------------
Total assets ............................................ 134,746,415
------------
Liabilities:
Payable for investments purchased ......................... 60,986
Payable for offering costs (Preferred Shares) ............. 429,625
Payable for investment advisory fee ....................... 84,300
Accrued directors' fees ................................... 6,250
Payable for shareholders services fees .................... 101,899
Accrued expenses and other payables ....................... 42,064
------------
Total liabilities ....................................... 725,124
------------
Net assets .............................................. $134,021,291
------------
Net Assets Consist of:
Preferred Stock ($25 per share,
1,250,000 shares outstanding)
redemption value ....................................... $ 31,250,000
Common Stock at par value ................................. 11,057
Additional paid-in capital ................................ 78,152,951
Undistributed net investment income ....................... 149,230
Accumulated net realized gain
on investments sold .................................... 2,604,777
Net unrealized appreciation of
investments and foreign currency ........................... 21,853,276
------------
Total Net Assets ........................................ $134,021,291
============
Net Asset Value per Common Share
($102,585,666/11,056,715 common
shares outstanding; 200,000,000 shares
authorized of $0.001 par value) .............................. $ 9.28
============
Statement of Operations
For the Six Months Ended June 30, 1997 (Unaudited)
================================================================================
Investment Income:
Interest income ........................................... $ 501,773
Dividend income (net of foreign withholding
taxes of $24,756) ....................................... 484,644
------------
Total Investment Income ................................. 986,417
------------
Expenses:
Investment advisory fee ................................... 470,240
Shareholder communications expense ........................ 146,087
Shareholder services fees ................................. 88,945
Amortization of organization costs ........................ 35,000
Payroll ................................................... 29,547
Legal and audit fees ...................................... 27,869
Directors' fees ........................................... 22,852
Other ..................................................... 19,300
------------
Total expenses .......................................... 839,840
------------
Net Investment income ........................................ 146,577
------------
Net Realized and Unrealized Gain
on Investments
Net realized gain on securities sold ...................... 2,658,312
------------
Net unrealized appreciation
of securities and foreign currency
Beginning of period ................................... 10,271,498
End of period ......................................... 21,853,276
------------
Change in net unrealized appreciation of
securities and foreign currency ......................... 11,581,778
------------
Net realized and unrealized gain
on investments ............................................. 14,240,090
------------
Net increase in net assets resulting from
operations ................................................ $ 14,386,667
============
Statement of Changes in Net Assets
================================================================================
<TABLE>
<CAPTION>
Six Months
Ended 6/30/97 Year Ended
(Unaudited) 12/31/96
----------- --------
<S> <C> <C>
Net Investment Income ............................................ $ 146,577 $ 121,861
Net realized gain on investments ................................. 2,658,312 4,082,549
Net change in unrealized appreciation of investments ............. 11,581,778 3,148,676
------------- ------------
Net increase in net assets resulting from operations ............. 14,386,667 7,353,086
Distributions to common stock shareholders:
Dividends paid from net investment income ...................... -- (121,844)
Distributions paid from net realized capital gains ............. -- (4,082,549)
Distributions paid in excess of net realized gain on investments -- (31,812)
Net decrease in net assets from common stock transactions ........ (1,663,320) (1,234,828)
Net proceeds from issuance of preferred stock .................... 29,836,000 --
------------- ------------
Net increase in net assets ....................................... 42,559,347 1,882,053
Net Assets:
Beginning of period .............................................. 91,461,944 89,579,891
------------- ------------
End of period (including undistributed net investment income of
$149,230 and $2,653, respectively) ............................. $ 134,021,291 $ 91,461,944
============= ============
</TABLE>
See Notes to Financial Statements.
17
<PAGE>
The Gabelli Global Multimedia Trust Inc.
Notes to Financial Statements (Unaudited)
================================================================================
1. Significant Accounting Policies. The Gabelli Global Multimedia Trust Inc.
("Multimedia Trust") is a closed-end, non-diversified management investment
company organized as a Maryland corporation and registered under the Investment
Company Act of 1940, as amended (the "1940 Act"), whose primary objective is
long-term growth of capital with income as a secondary objective. The Multimedia
Trust had no operations prior to November 15, 1994, other than the sale of
10,000 shares of common stock for $100,000 to The Gabelli Equity Trust Inc. (the
"Equity Trust"). On November 15, 1994, the Equity Trust contributed $64,382,764
in exchange for 8,587,702 shares of the Multimedia Trust and immediately
thereafter distributed to its shareholders all the shares it held of the
Multimedia Trust. Investment operations commenced on November 15, 1994. 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 Multimedia Trust in the
preparation of its financial statements.
Security Valuation. Portfolio securities which are traded on a stock
exchange or NASDAQ National Market System are valued at the last sale price as
of the close of regular trading on the day the securities are being valued, or
lacking any sales, at the mean between closing bid and asked prices. If no asked
prices are quoted on such day, then the security is valued at the closing bid
price on such day. If no bid or asked prices are quoted on that day, then the
security is valued by such method as the Board of Directors shall determine in
good faith to reflect its fair market value. Other over-the-counter securities
are valued at the mean of the current bid and asked prices as reported by
NASDAQ, or, in the case of securities not quoted by NASDAQ, the National
Quotation Bureau or other comparable sources as the Board of Directors deems
appropriate to reflect their fair value. If no asked prices are quoted on such
day, then the security is valued at the closing bid price on that day. Portfolio
securities which are traded on more than one national exchange or market are
valued according to the broadest and most representative market, as determined
by Gabelli Funds, Inc. (the "Adviser"). Securities traded primarily on foreign
exchanges are valued at the closing price on such foreign exchange immediately
prior to the close of the New York Stock Exchange. Securities and assets for
which market quotations are not readily available are valued at fair market
value as determined in good faith by or under the direction of the Board of
Directors of the Multimedia Trust. Short-term investments that mature in 60 days
or fewer are valued at amortized cost, unless the Board of Directors determines
that such valuation does not constitute fair value. Short-term instruments
having a greater maturity are valued at the highest bid price obtained from a
dealer maintaining an active market in those securities or on the basis of
prices obtained from a pricing service approved as reliable by the Board of
Directors.
Futures Contracts. The Multimedia Trust 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. Such
investments will only be made if they are economically appropriate to the
reduction of risks involved in the management of the Multimedia Trust's
investments. Upon entering into a futures contract, the Multimedia Trust 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
Multimedia Trust each day, depending on the daily fluctuation of the value of
the contract. The daily changes in the contract are recorded as unrealized gains
or losses. The Multimedia Trust recognizes a realized gain or loss when the
contract is closed. The net unrealized appreciation/depreciation is shown in the
financial statements.
18
<PAGE>
The Gabelli Global Multimedia Trust Inc.
Notes to Financial Statements (Unaudited) (Continued)
================================================================================
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 the
Multimedia Trust may not be able to enter into a closing transaction because of
an illiquid secondary market.
Short Sales. The Multimedia Trust may make short sales both to obtain
capital gains from anticipated declines in securities and as a form of hedging
to offset potential declines in positions in the same or similar securities. A
short sale is a transaction in which the Multimedia Trust sells securities it
may or may not own in anticipation of a decline in the market price of the
securities. To complete a short sale, the Multimedia Trust must arrange through
a broker to borrow the securities to be delivered to the buyer. The proceeds
received by the Multimedia Trust from the short sale are retained by the broker
until the Multimedia Trust replaces the borrowed securities. In borrowing the
securities to be delivered to the buyer, the Multimedia Trust becomes obligated
to replace the securities borrowed at their market price at the time of
replacement, whatever that price may be. The Multimedia Trust must pay any
dividends or interest payable on securities while those securities are in short
position.
Possible losses from short sales differ from losses that could be incurred from
a purchase of a security, because losses from short sales may be unlimited,
whereas losses from purchases can equal only the total amount invested.
Foreign Currency. The books and records of the Multimedia Trust 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 on the respective dates of such
transactions. Unrealized gains and losses not relating to securities which
result from changes in foreign currency exchange rates have been included in
unrealized appreciation/depreciation of foreign currency and other assets and
liabilities. Unrealized gains and losses of securities, which result from
changes in foreign exchange rates as well as changes in market prices of
securities, have been included in unrealized appreciation/depreciation of
investment securities. 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 Multimedia Trust 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) from investment securities sold.
Securities Transactions and Investment Income. Securities transactions are
accounted for as of the trade date with realized gain or loss on investments
determined using specific identification as the cost method. Interest income
(including amortization of premium and accretion of discount) is recorded as
earned. Dividend income is recorded on the ex-dividend date.
Dividends and Distributions to Shareholders. 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 Multimedia Trust, temporary differences and differing
characterization of distributions made by the Multimedia Trust.
19
<PAGE>
The Gabelli Global Multimedia Trust Inc.
Notes to Financial Statements (Unaudited) (Continued)
================================================================================
Provision for Income Taxes. The Multimedia Trust has qualified and intends
to continue to qualify as a regulated investment company under Subchapter M of
the Internal Revenue Code of 1986, as amended. As a result, a Federal income tax
provision is not required.
Deferred Organization Expenses. A total of $350,000 was incurred in
connection with the organization of the Multimedia Trust. These costs have been
deferred and are being amortized on a straight-line basis over a period of 60
months from the date the Multimedia Trust commenced investment operations.
2.Agreements and Transactions with Affiliates. The Multimedia Trust has entered
into an investment advisory agreement (the "Advisory Agreement") with the
Adviser which provides that the Multimedia Trust will pay the Adviser on the
first business day of each month a fee for the previous month at the annual rate
of 1.00% of the Multimedia Trust's average weekly net assets. In accordance with
the Advisory Agreement, the Adviser manages the Multimedia Trust's portfolio,
makes investment decisions for the Multimedia Trust, places orders to purchase
and sell securities of the Multimedia Trust and oversees the administration of
all aspects of the Multimedia Trust's business and affairs. The Adviser has
agreed to waive the management fee on the incremental assets attributable to the
cumulative preferred stock if the total return of the Trust does not exceed the
stated dividend rate on the preferred shares plus the associated advisory fees
in a given year. For the six months ended June 30, 1997, the unearned advisory
fee was $22,260.
During the six months ended June 30, 1997, Gabelli & Company, Inc. ("Gabelli &
Company") and its affiliates received $17,796 in brokerage commissions as a
result of executing agency transactions in portfolio securities on behalf of the
Multimedia Trust.
3. Portfolio Securities. Cost of purchases and proceeds from sales of
securities, other than short-term securities, aggregated $38,291,644 and
$23,298,550, respectively, for the six months ended June 30, 1997.
4. Capital. The Board of Directors of the Multimedia Trust has authorized the
repurchase of up to 750,000 shares of the Trust's outstanding common stock. For
the six months ended June 30, 1997, the Multimedia Trust repurchased 239,833
shares of its common stock in the open market at a cost of $1,663,320 and an
average discount of approximately 18.03% from its net asset value. All shares
repurchased have been retired.
Common stock transactions were as follows:
<TABLE>
<CAPTION>
Six Months Ended Year Ended
June 30, 1997 December 31, 1996
---------------------- --------------------
Shares Amount Shares Amount
------ ------ ------ ------
<S> <C> <C> <C> <C>
Shares repurchased by the Multimedia Trust .. (239,833) $(1,663,320) (180,000) $(1,234,828)
-------- ----------- -------- -----------
Net Decrease ................................ (239,833) $(1,663,320) (180,000) $(1,234,828)
-------- ----------- -------- -----------
</TABLE>
The Multimedia Trust's Articles of Incorporation authorize the issuance of up to
2,000,000 shares of $0.001 par value preferred stock. On June 4, 1997, the
Multimedia Trust received proceeds of $31,250,000 (before offering costs and
underwriting discounts of $1,414,000) from the public offering of 1,250,000
shares of Cumulative Preferred Stock. The Cumulative Preferred Stock is senior
to the Common Stock and results in the financial leveraging of the Common Stock.
Such leveraging tends to magnify both the risks and opportunities to Common
Shareholders. Dividends on shares of Cumulative Preferred Stock are cumulative.
The Multimedia Trust is required to meet certain asset coverage tests with
respect to the Cumulative Preferred Stock. If the Multimedia Trust fails to meet
these requirements and does not correct such failure, the
20
<PAGE>
The Gabelli Global Multimedia Trust Inc.
Notes to Financial Statements (Unaudited) (Continued)
================================================================================
Multimedia Trust may be required to redeem, in part or in full, Cumulative
Preferred Stock at a redemption price of $25.00 per share plus an amount equal
to the accumulated and unpaid dividends on such shares in order to meet these
requirements. Additionally, failure to meet the foregoing asset requirements
could restrict the Multimedia Trust's ability to pay dividends to Common
Shareholders and could lead to sales of portfolio securities at inopportune
times. At June 30, 1997, 1,250,000 shares of the Cumulative Preferred Stock were
outstanding with dividends payable at the fixed rate of $1.98 per share, which
amounted to $185,625. The income received on the Multimedia Trust's assets may
vary in a manner unrelated to the fixed rate, which could have either a
beneficial or detrimental impact on net investment income and gains available to
Common Shareholders.
5. Industry Concentration.
Because the Multimedia Trust primarily invests in common stocks and other
securities of foreign and domestic companies in the telecommunications, media,
publishing and entertainment industries, its portfolio may be subject to greater
risk and market fluctuations than a portfolio of securities representing a broad
range of investments.
21
<PAGE>
The Gabelli Global Multimedia Trust Inc.
Financial Highlights
================================================================================
Per share amounts for a Multimedia Trust common share outstanding throughout the
period
<TABLE>
<CAPTION>
Six
Months
Ended
June 30, Year Ended December 31,
1997 ---------------------------------------
(Unaudited) 1996 1995 1994
----------- ---- ---- ----
<S> <C> <C> <C> <C>
Operating Performance
Net asset value, beginning of period ................. $ 8.10 $ 7.81 $ 7.51 $ 7.50
--------- --------- --------- ---------
Net investment income .............................. 0.01 0.01 0.08 0.03
Net realized and unrealized gain on investments ..... 1.30 0.63 0.98 0.03
--------- --------- --------- ---------
Total from investment operations ................ 1.31 0.64 1.06 0.06
--------- --------- --------- ---------
Increase/(decrease)in net asset value from
share transactions ............................... -- 0.02 (0.46) --
Offering expenses charged to capital surplus ......... (0.13) -- (0.05) --
Distributions to shareholders from:
Net investment income .............................. -- (0.01) (0.08) (0.03)
Net realized gains ................................. -- (0.36) (0.17) --
Distributions in excess of net investment income
and/or net realized gains ........................ -- (0.00)(a) (0.00)(a) (0.01)
Paid-in capital .................................... -- -- -- (0.01)
--------- --------- --------- ---------
Total distributions ............................. -- (0.37) (0.25) (0.05)
--------- --------- --------- ---------
Net asset value, end of period ....................... $ 9.28 $ 8.10 $ 7.81 $ 7.51
--------- --------- --------- ---------
Market value, end of period .......................... $ 7.563 $ 6.875 $ 6.760 $ 7.375
--------- --------- --------- ---------
Net Asset Value Total Return** ....................... 14.7% 9.4% 14.1% 0.8%
--------- --------- --------- ---------
Total Investment Return*** ........................... 10.0% 7.4% 0.4% (7.9)
--------- --------- --------- ---------
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's) ................. $ 134,021 $ 91,462 $ 89,580 $ 64,606
Ratio of net investment income to average net assets 0.30%+(c) 0.13% 1.24% 3.15%
Ratio of operating expenses to average net assets .. 1.71%+(c) 1.87% 2.04% 1.74%
Portfolio turnover rate ............................ 28.2% 32.1% 86.0% 0.0%
Average commission rate (per share of security)(b) $ 0.0395 $ 0.0367 N/A N/A
</TABLE>
- ----------
* The Multimedia Trust commenced operations on November 15, 1994.
** Based on net asset value per share, adjusted for reinvestments of all
distributions and rights offering in 1995.
*** Based on market value per share, adjusted for reinvestments of all
distributions and rights offering in 1995.
+ Annualized
(a) Amount represents less than $0.005 per share.
(b) Average commission rate (per share of security)as required by amended SEC
disclosure requirements effective for fiscal year beginning after
September 1, 1995.
(c) The ratios of net investment income and operating expenses to average net
assets without the management fee reduction were 0.25% and 1.75%,
respectively, for the six months ended June 30, 1997 (annualized).
22
<PAGE>
AUTOMATIC DIVIDEND REINVESTMENT
AND VOLUNTARY CASH PURCHASE PLAN
Enrollment in the Plan
It is the policy of The Gabelli Global Multimedia Trust Inc. ("Multimedia
Trust") to automatically reinvest dividends. As a "registered" shareholder you
automatically become a participant in the Multimedia Trust's Automatic Dividend
Reinvestment Plan (the "Plan"). The Plan authorizes the Multimedia Trust to
issue shares to participants upon an income dividend or a capital gains
distribution regardless of whether the shares are trading at a discount or a
premium to net asset value. All distributions to shareholders whose shares are
registered in their own names will be automatically reinvested pursuant to the
Plan in additional shares of the Multimedia Trust. Plan participants may send
their stock certificates to State Street Bank and Trust Company to be held in
their dividend reinvestment account. Registered shareholders wishing to receive
their distribution in cash must submit this request in writing to:
The Gabelli Global Multimedia Trust Inc.
c/o State Street Bank and Trust Company
P.O. Box 8200
Boston, MA 02266-8200
Shareholders requesting this cash election must include the shareholder's
name and address as they appear on the share certificate. Shareholders with
additional questions regarding the Plan may contact State Street Bank and Trust
Company at 1 (800) 336-6983.
Shareholders wishing to liquidate reinvested shares held at State Street
Bank and Trust Company must do so in writing or by telephone. Please submit your
request to the above mentioned address or telephone number. Include in your
request your name, address and account number. The cost to liquidate shares is
$2.50 per transaction as well as the brokerage commission incurred. Brokerage
charges are expected to be less than the usual brokerage charge for such
transactions.
If your shares are held in the name of a broker, bank or nominee, you
should contact such institution. If such institution is not participating in the
Plan, your account will be credited with a cash dividend. In order to
participate in the Plan through such institution, it may be necessary for you to
have your shares taken out of "street name" and re-registered in your own name.
Once registered in your own name your dividends will be automatically
reinvested. Certain brokers participate in the Plan. Shareholders holding shares
in "street name" at such participating institutions will have dividends
automatically reinvested. Shareholders wishing a cash dividend at such
institution must contact their broker to make this change.
The number of shares of Common Stock distributed to participants in the
Plan in lieu of cash dividends is determined in the following manner. Under the
Plan, whenever the market price of the Multimedia Trust's Common Stock is equal
to or exceeds net asset value at the time shares are valued for purposes of
determining the number of shares equivalent to the cash dividends or capital
gains distribution, participants are issued shares of Common Stock valued at the
greater of (i) the net asset value as most recently determined or (ii) 95% of
the then current market price of the Multimedia Trust's Common Stock. The
valuation date is the dividend or distribution payment date or, if that date is
not a New York Stock Exchange trading day, the next trading day. If the net
asset
23
<PAGE>
value of the Common Stock at the time of valuation exceeds the market price of
the Common Stock, participants will receive shares from the Multimedia Trust
valued at market price. If the Multimedia Trust should declare a dividend or
capital gains distribution payable only in cash, State Street will buy Common
Stock in the open market, or on the New York Stock Exchange or elsewhere, for
the participants' accounts, except that State Street will endeavor to terminate
purchases in the open market and cause the Multimedia Trust to issue shares at
net asset value if, following the commencement of such purchases, the market
value of the Common Stock exceeds the then current net asset value.
The automatic reinvestment of dividends and capital gains distributions
will not relieve participants of any income tax which may be payable on such
distributions. A participant in the Plan will be treated for Federal income tax
purposes as having received, on a dividend payment date, a dividend or
distribution in an amount equal to the cash the participant could have received
instead of shares.
The Multimedia Trust reserves the right to amend or terminate the Plan as
applied to any voluntary cash payments made and any dividend or distribution
paid subsequent to written notice of the change sent to the members of the Plan
at least 90 days before the record date for such dividend or distribution. The
Plan also may be amended or terminated by State Street on at least 90 days'
written notice to participants in the Plan.
Voluntary Cash Purchase Plan
The Voluntary Cash Purchase Plan is yet another vehicle for our
shareholders to increase their investment in the Multimedia Trust. In order to
participate in the Voluntary Cash Purchase Plan, shareholders must have their
shares registered in their own name and participate in the Dividend Reinvestment
Plan.
Participants in the Voluntary Cash Purchase Plan have the option of making
additional cash payments to State Street Bank and Trust Company for investments
in the Multimedia Trust's shares at the then current market price. Shareholders
may send an amount from $250 to $10,000. State Street Bank and Trust Company
will use these funds to purchase shares in the open market on or about the 15th
of each month. State Street Bank and Trust Company will charge each shareholder
who participates $0.75, plus a pro rata share of the brokerage commissions.
Brokerage charges for such purchases are expected to be less than the usual
brokerage charge for such transactions. It is suggested that any voluntary cash
payments be sent to State Street Bank and Trust Company, P.O. Box 8200, Boston,
MA 02266-8200 such that State Street receives such payments approximately 10
days before the 15th of the month. Funds not received at least five days before
the investment date shall be held for investment in the following month. A
payment may be withdrawn without charge if notice is received by State Street
Bank and Trust Company at least 48 hours before such payment is to be invested.
For more information regarding the Dividend Reinvestment Plan and
Voluntary Cash Purchase Plan, brochures are available by calling (914) 921-5070
or by writing directly to the Multimedia Trust.
24
<PAGE>
DIRECTORS AND OFFICERS
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
One Corporate Center, Rye, NY 10580-1434
Directors
Mario J. Gabelli, CFA
Chairman
Dr. Thomas E. Bratter
President, John Dewey Academy
Bill Callaghan
President, Bill Callaghan Associates
Felix J. Christiana
Former Senior Vice President
Dollar Dry Dock Savings Bank
James P. Conn
Managing Director/Chief Investment Officer,
Financial Security Assurance Holdings Ltd.
Karl Otto Pohl
Former President, Deutsche Bundesbank
Anthony R. Pustorino
Certified Public Accountant
Professor, Pace University
Salvatore J. Zizza
Chairman & Chief Executive Officer,
The Lehigh Group, Inc.
Officers
Mario J. Gabelli, CFA
President & Chief Investment Officer
Bruce N. Alpert
Vice President & Treasurer
Peter W. Latartara
Assistant Vice President
James E. McKee
Secretary
Investment Advisor
Gabelli Funds, Inc.
One Corporate Center
Rye, New York 10580-1434
Custodian
State Street Bank and Trust Company
Counsel
Willkie Farr & Gallagher
Transfer Agent and Registrar
State Street Bank and Trust Company
Stock Exchange Listing
NYSE-Symbol: GGT
Shares Outstanding 11,056,715
The Net Asset Value appears in the Publicly Traded Funds column, under the
heading "General Equity Funds," in Saturday's The New York Times and
"Specialized Equity Funds" in Monday's The Wall Street Journal. It is also
listed in Barron's Mutual Funds/Closed End Funds section under the heading
"Specialized Equity Funds".
The Net Asset Value may be obtained each day by calling (914) 921-5071.
- --------------------------------------------------------------------------------
For general information about the Gabelli Funds, call 1-800-GABELLI
(1-800-422-3554), fax us at 914-921-5118, visit Gabelli Funds' Internet homepage
at: http://www.gabelli.com or e-mail us at: [email protected]
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940, as amended, that the Multimedia Trust may from time to time
purchase shares of its capital stock in the open market when the Multimedia
Trust shares are trading at a discount of 10% or more from the net asset value
of the shares.
- --------------------------------------------------------------------------------
<PAGE>
THE GABELLI GLOBAL MULTIMEDIA TRUST INC. ----------------
One Corporate Center FIRST CLASS MAIL
Rye, NY 10580-1434 U.S. POSTAGE
Internet: http:/ /www.gabelli.com PAID
e-mail: [email protected]* RYE, NY
PERMIT No. 109
----------------
Semi-Annual Report
June 30, 1997
06/97
