UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-21432
Reaves Utility Income
Fund
(Exact name of registrant as specified in charter)
1290 Broadway, Suite 1000, Denver, Colorado 80203
(Address of principal executive offices) (Zip code)
Sareena Khwaja-Dixon, Esq.
Reaves Utility Income Fund
1290 Broadway, Suite 1000
Denver, Colorado 80203
(Name and address of agent for service)
Registrant’s telephone number, including area code:
303-623-2577
Date of fiscal year end: October 31
Date of reporting period: April 30, 2022
|
Item 1. |
Reports to
Stockholders. |
Section 19(b)
Disclosure
April 30, 2022 (Unaudited)
Reaves Utility Income Fund (the “Fund”), acting pursuant to a
Securities and Exchange Commission (“SEC”) exemptive order and with
the approval of the Fund’s Board of Trustees (the “Board”), has
adopted a plan, consistent with its investment objectives and
policies to support a level distribution of income, capital gains
and/or return of capital (the “Plan”). In accordance with the Plan,
the Fund currently distributes $0.19 per share on a monthly
basis.
The fixed amount distributed per share is subject to change at the
discretion of the Fund’s Board. Under the Plan, the Fund will
distribute all available investment income to its shareholders,
consistent with its primary investment objectives and as required
by the Internal Revenue Code of 1986, as amended (the “Code”). If
sufficient investment income is not available on a monthly basis,
the Fund will distribute long-term capital gains and/or return of
capital to shareholders in order to maintain a level distribution.
Each monthly distribution to shareholders is expected to be at the
fixed amount established by the Board, except for extraordinary
distributions and potential distribution rate increases or
decreases to enable the Fund to comply with the distribution
requirements imposed by the Code.
Shareholders should not draw any conclusions about the Fund’s
investment performance from the amount of these distributions or
from the terms of the Plan. The Fund’s total return performance on
net asset value is presented in its financial highlights table.
The Board may amend, suspend or terminate the Fund’s Plan without
prior notice if it deems such action to be in the best interest of
the Fund or its shareholders. The suspension or termination of the
Plan could have the effect of creating a trading discount (if the
Fund’s stock is trading below net asset value) or widening an
existing trading discount. The Fund is subject to risks that could
have an adverse impact on its ability to maintain level
distributions. Examples of potential risks include, but are not
limited to, economic downturns impacting the markets, increased
market volatility, companies suspending or decreasing corporate
dividend distributions and changes in the Code.
Please refer to Additional Information for a cumulative summary of
the Section 19(a) notices for the Fund’s current fiscal period.
Section 19(a) notices for the Fund, as applicable, are available on
the Reaves Utility Income Fund website
www.utilityincomefund.com.
| Reaves Utility Income
Fund |
Table of
Contents |
| Shareholder Letter |
2 |
| Statement of Investments |
6 |
| Statement of Assets and
Liabilities |
9 |
| Statement of Operations |
10 |
| Statement of Changes in Net
Assets |
11 |
| Statement of Cash Flows |
12 |
| Financial Highlights |
14 |
| Notes to Financial Statements |
17 |
| Additional Information |
26 |
| Privacy Policy |
32 |
| Semi-Annual Report | April 30, 2022 |
1 |
| Reaves Utility Income Fund |
Shareholder Letter |
April 30, 2022 (Unaudited)
To our Shareholders:
Investment Portfolio Returns: 6 months ended April 30,
2022
Total net assets of the Fund were $2.26 billion on April 30, 2022,
or $32.96 of net asset value (“NAV”) per common share. On October
31, 2021, net assets totaled $2.16 billion representing $33.09 of
net asset value per common share.
Changes in the market price of the Fund can and do differ from the
underlying changes in the net asset value per common share. As a
result, the market return to common shares can be higher or lower
than the NAV return.
The market return for shareholders in the first half of fiscal 2022
was 1.34%, as is reflected in the table below. The share price of
the Fund traded at a premium of 0.91% to the NAV at 4/30/2022
versus a premium of 2.63% at the beginning of the fiscal year.
| |
Period
Ended April 30, 2022 |
| |
Six
Months |
One
Year |
Three
Years+ |
Five
Years+ |
Ten
Years+ |
Since
Inception+** |
| Total investment return – Net Asset Value* |
3.07% |
2.54% |
5.22% |
5.90% |
9.78% |
10.50% |
| Total investment return – Market Price* |
1.34% |
2.58% |
5.39% |
5.81% |
9.11% |
10.28% |
| S&P 500 Utilities Index1 |
8.17% |
10.12% |
10.24% |
10.28% |
11.07% |
10.16% |
| Dow Jones Utility
Average2 |
11.08% |
12.58% |
11.82% |
10.89% |
11.71% |
11.27% |
|
* |
Assumes all dividends being
reinvested |
|
** |
Index data since
02/29/04 |
|
1 |
S&P 500 Utilities Index is a
capitalization-weighted index containing 29 Electric and Gas
Utility stocks (including multi-utilities and independent power
producers). Prior to July 1996, this index included
telecommunications equities. |
|
2 |
The Dow Jones Utility Average is
a price-weighted average of 15 utility stocks traded in the United
States. |
Distributions to Common Shareholders
The Fund’s annual distribution rate of $2.28 was unchanged. For the
first half of 2022 fiscal year the Fund expects total distributions
to come from earned income (dividend income) and capital gains. For
any given month, however, part of the distribution may be
temporarily classified as a return of capital given the irregular
realization of capital gains over the course of the year.
|
2 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Shareholder Letter |
April 30, 2022 (Unaudited)
Leverage Facility
The Fund ended the period with $450 million in leverage, unchanged
from October 31, the end of fiscal 2021. As a result, net leverage
was about 20% of assets on April 30, 2022. For details about the
facility please refer to Note 4 of the accompanying financial
statements.
Portfolio Discussion and Outlook
The Reaves Utility Income Fund continued to generate tax advantaged
income for investors. The Fund maintained its leverage at about 20%
of net assets, which we think is a prudent level given market
conditions. The individual companies in which the Fund invests
proved resilient during the period. Many holdings grew earnings and
increased dividends throughout the year, highlighting the
defensiveness of the business models in which the Fund invests.
In the six-month period ending April 30, the Fund generated a total
return of about 3.07%. It paid $76.8 million ($1.14 per share) in
investor distributions. We would note that the results coincide
with a near doubling in the 10-year treasury yields, from about
1.55% at the end of October 2021 to over 2.93% by the end of April
2022. Rising interest rates generally are a short-term headwind for
our investments as investors typically prioritize risk over safety
and growth over value in such environments. Over a longer-term,
rising rates tend to be less impactful, though. This is because we
typically invest in businesses that grow cash flows and dividend
payments more quickly than sector averages and faster than
inflation.
Return generation was concentrated in utilities and traditional
telecommunications, companies that typically serve as safe havens
during periods of volatility. The first calendar quarter of 2022
was punctuated with central banks raising interest rates to fight
inflation and the military invasion of Russian forces into Ukraine
which resulted in shortages of oil, gas and some agricultural
products. These two catalysts spurred widespread reduction in
investor risk appetite and greater demand for companies with less
business risk such as regulated utilities and traditional
telecommunications companies.
Fundamentally, we continue to believe that the utility industry is
uniquely well-positioned to benefit from the longer-term energy
transition away from fossil fuels, a dynamic that became more
urgent in the context of spiking commodity prices. Grid reliability
remains an important public issue as well. Between the two,
utilities have spending backlogs that are well above historic
levels and will remain there for the next decade. It is also based
on a much wider variety of projects, making it inherently lower
risk. Please note that utilities set rates on the size of their
investment balances. Thus, the higher the level of utility
investment, the higher the level of earnings and the greater the
potential for dividend growth.
The cost of power remains an issue we watch very carefully. What we
refer to as “bill pressure” will affect utilities very differently
across the industry depending on their respective sources of
generation. We expect the issue to become more prominent over the
course of the coming year and are working diligently to avoid
places where a political problem could emerge. Well-managed
utilities should be able to limit customer bill growth, certainly
to a rate less than underlying inflation.
Communications experienced mixed results. The positive contribution
of traditional telecoms partly reflected the aforementioned shift
in investor preference for lower beta securities and prioritization
of dividend income overgrowth. Offsetting that was poor performance
in our cable company investments.
| Semi-Annual Report | April 30, 2022 |
3 |
| Reaves Utility Income Fund |
Shareholder Letter |
April 30, 2022 (Unaudited)
We remain optimistic about digital connectivity growth and fifth
generation wireless networks. In the US, telecom giants are
actively constructing and improving fifth generation wireless
networks. While this is a highly competitive market, we expect
infrastructure companies like wireless towers and data centers to
be key beneficiaries of this buildout. In Canada, where competition
is less acute, we are optimistic that population and economic
growth will continue to underpin growing dividend income.
While the Fund invests primarily in utilities and
telecommunications, we also retain a small portion of the portfolio
in transportation/logistics for diversification and inflation
sensitivity. Here, returns were negatively impacted by extreme
supply chain tightness and positively impacted by strong warehouse
demand. Rail operators had a difficult winter but emerged with
better confidence that some of the more difficult network
challenges were being resolved though self-help efforts and better
labor productivity.
Sincerely,
Timothy O. Porter, Chief Investment Officer
John P. Bartlett, President
Sources of distributions to shareholders may include net
investment income, net realized short-term capital gains, net
realized long-term capital gains and return of capital. If a
distribution includes anything other than net investment income,
the Fund provides a Section 19(a) notice of the best estimate of
its distribution sources at that time. Please refer to Additional
Information for a cumulative summary of the Section 19(a) notices
for the Fund’s current period. The actual amounts and sources of
distributions for tax reporting purposes will depend upon the
Fund’s investment experience during the remainder of its fiscal
year and may be subject to changes based on tax regulations. The
estimates may not match the final tax characterization (for the
full year’s distributions) contained in the shareholder’s Form
1099-DIV. Distribution payments are not guaranteed; distribution
rates may vary.
You cannot invest directly in an index.
|
4 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Shareholder Letter |
April 30, 2022 (Unaudited)
Industry Allocation as of April 30, 2022
|
* |
Includes Money Market
Funds |
Holdings are subject to change
| Semi-Annual Report | April 30, 2022 |
5 |
| Reaves Utility Income Fund |
Statement of
Investments |
April 30, 2022 (Unaudited)
|
|
|
SHARES |
|
|
VALUE |
|
|
COMMON STOCKS 116.49%(1) |
|
|
|
|
|
|
|
|
|
Diversified Telecommunication Services 16.40% |
|
|
|
|
|
|
|
|
|
BCE, Inc. |
|
|
2,110,000 |
|
|
$ |
112,188,700 |
|
| Deutsche
Telekom AG |
|
|
4,017,447 |
|
|
|
74,465,449 |
|
| Shaw
Communications, Inc., Class B |
|
|
1,074,000 |
|
|
|
31,986,331 |
|
| TELUS
Corp. |
|
|
3,520,100 |
|
|
|
88,067,578 |
|
|
Verizon Communications, Inc. |
|
|
1,374,703 |
|
|
|
63,648,749 |
|
|
|
|
|
|
|
|
|
370,356,807 |
|
| |
|
|
|
|
|
|
|
|
|
Electric Utilities 27.61% |
|
|
|
|
|
|
|
|
| Duke
Energy Corp. |
|
|
706,000 |
|
|
|
77,772,960 |
|
| Entergy
Corp. |
|
|
850,000 |
|
|
|
101,022,500 |
|
|
Eversource Energy |
|
|
770,000 |
|
|
|
67,298,000 |
|
| Exelon
Corp. |
|
|
1,489,957 |
|
|
|
69,700,188 |
|
|
FirstEnergy Corp. |
|
|
1,000,000 |
|
|
|
43,310,000 |
|
| Fortis,
Inc. |
|
|
1,350,600 |
|
|
|
65,706,690 |
|
| NextEra
Energy, Inc. |
|
|
1,179,200 |
|
|
|
83,746,784 |
|
| PPL
Corp. |
|
|
700,000 |
|
|
|
19,817,000 |
|
|
The Southern Co. |
|
|
1,299,600 |
|
|
|
95,377,644 |
|
|
|
|
|
|
|
|
|
623,751,766 |
|
| |
|
|
|
|
|
|
|
|
|
Equity Real Estate Investment Trust (REIT) 2.80% |
|
|
|
|
|
|
|
|
| SBA
Communications Corp. |
|
|
181,700 |
|
|
|
63,069,887 |
|
| |
|
|
|
|
|
|
|
|
|
Independent Power and Renewable Electricity Producers 1.98% |
|
|
|
|
|
|
|
|
|
Constellation Energy Group, Inc. |
|
|
755,333 |
|
|
|
44,723,287 |
|
| |
|
|
|
|
|
|
|
|
| Media
5.02% |
|
|
|
|
|
|
|
|
| Charter
Communications, Inc., Class A(2) |
|
|
112,862 |
|
|
|
48,360,238 |
|
|
Comcast Corp., Class A |
|
|
1,637,900 |
|
|
|
65,122,904 |
|
|
|
|
|
|
|
|
|
113,483,142 |
|
| |
|
|
|
|
|
|
|
|
|
Multi-Utilities 36.50% |
|
|
|
|
|
|
|
|
| Alliant
Energy Corp. |
|
|
1,533,100 |
|
|
|
90,161,611 |
|
| Ameren
Corp. |
|
|
1,094,000 |
|
|
|
101,632,600 |
|
| CMS
Energy Corp. |
|
|
1,235,500 |
|
|
|
84,866,495 |
|
| DTE
Energy Co. |
|
|
719,200 |
|
|
|
94,243,968 |
|
| Enel
SpA |
|
|
7,650,000 |
|
|
|
50,181,663 |
|
|
NiSource, Inc. |
|
|
1,766,966 |
|
|
|
51,454,050 |
|
| PG&E
Corp.(2) |
|
|
4,338,300 |
|
|
|
54,879,495 |
|
| Public
Service Enterprise Group, Inc. |
|
|
1,144,000 |
|
|
|
79,691,040 |
|
| Sempra
Energy |
|
|
243,200 |
|
|
|
39,242,752 |
|
| WEC
Energy Group, Inc. |
|
|
812,100 |
|
|
|
81,250,605 |
|
|
6 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Statement of
Investments |
April 30, 2022 (Unaudited)
|
|
|
SHARES |
|
|
VALUE |
|
|
Multi-Utilities (continued) |
|
|
|
|
|
|
|
|
|
Xcel Energy, Inc. |
|
|
1,320,600 |
|
|
$ |
96,747,156 |
|
| |
|
|
|
|
|
|
824,351,435 |
|
| |
|
|
|
|
|
|
|
|
|
Oil, Gas & Consumable Fuels 0.41% |
|
|
|
|
|
|
|
|
| DT Midstream,
Inc. |
|
|
173,100 |
|
|
|
9,304,125 |
|
| |
|
|
|
|
|
|
|
|
|
Real Estate Investment Trusts (REITs) 13.19% |
|
|
|
|
|
|
|
|
| American Tower
Corp. |
|
|
220,959 |
|
|
|
53,255,538 |
|
| Crown Castle
International Corp. |
|
|
325,600 |
|
|
|
60,304,376 |
|
| Equinix, Inc. |
|
|
83,000 |
|
|
|
59,683,640 |
|
| Prologis,
Inc. |
|
|
460,100 |
|
|
|
73,749,429 |
|
| Realty
Income Corp. |
|
|
735,000 |
|
|
|
50,979,600 |
|
| |
|
|
|
|
|
|
297,972,583 |
|
| |
|
|
|
|
|
|
|
|
|
Road & Rail 8.05% |
|
|
|
|
|
|
|
|
| Canadian Pacific
Railway, Ltd. |
|
|
738,000 |
|
|
|
54,036,360 |
|
| Norfolk Southern
Corp. |
|
|
252,100 |
|
|
|
65,011,548 |
|
| Union
Pacific Corp. |
|
|
267,900 |
|
|
|
62,766,291 |
|
| |
|
|
|
|
|
|
181,814,199 |
|
| |
|
|
|
|
|
|
|
|
|
Water Utilities 4.53% |
|
|
|
|
|
|
|
|
| American States
Water Co. |
|
|
295,000 |
|
|
|
23,204,700 |
|
|
American Water Works Co., Inc. |
|
|
513,800 |
|
|
|
79,166,304 |
|
| |
|
|
|
|
|
|
102,371,004 |
|
| |
|
|
|
|
|
|
|
|
|
TOTAL COMMON STOCKS |
|
|
|
|
|
|
|
|
|
(Cost $2,220,390,841) |
|
|
|
|
|
|
2,631,198,235 |
|
| |
|
|
|
|
|
|
|
|
|
LIMITED PARTNERSHIPS 0.00% |
|
|
|
|
|
|
|
|
|
Oil, Gas & Consumable Fuels 0.00% |
|
|
|
|
|
|
|
|
| Bastion Energy LLC
(Anglo Dutch)(2)(3)(4) |
|
|
|
|
|
|
0 |
|
| |
|
|
|
|
|
|
|
|
|
TOTAL LIMITED PARTNERSHIPS |
|
|
|
|
|
|
|
|
|
(Cost $0) |
|
|
|
|
|
|
0 |
|
| |
|
|
|
|
|
|
|
|
|
MONEY MARKET FUNDS 3.77% |
|
|
|
|
|
|
|
|
| Federated Treasury
Obligations Money Market Fund, 0.154% (7-Day Yield) |
|
|
85,208,738 |
|
|
|
85,208,738 |
|
| |
|
|
|
|
|
|
|
|
|
TOTAL MONEY MARKET FUNDS |
|
|
|
|
|
|
|
|
|
(Cost $85,208,738) |
|
|
|
|
|
|
85,208,738 |
|
| Semi-Annual Report | April 30, 2022 |
7 |
| Reaves Utility Income Fund |
Statement of
Investments |
April 30, 2022 (Unaudited)
|
|
|
SHARES |
|
|
VALUE |
|
|
Oil, Gas & Consumable Fuels (continued) |
|
|
|
|
|
|
|
|
|
TOTAL INVESTMENTS - 120.26% |
|
|
|
|
|
|
|
|
|
(Cost $2,305,599,579) |
|
|
|
|
|
$ |
2,716,406,973 |
|
| |
|
|
|
|
|
|
|
|
|
LEVERAGE FACILITY - (19.92%) |
|
|
|
|
|
|
(450,000,000 |
) |
| |
|
|
|
|
|
|
|
|
|
LIABILITIES IN EXCESS OF OTHER ASSETS - (0.34%) |
|
|
|
|
|
|
(7,693,267 |
) |
|
|
|
|
|
|
|
|
|
|
|
NET ASSETS - 100.00% |
|
|
|
|
|
$ |
2,258,713,706 |
|
|
(1) |
All securities are available as
collateral for leverage provided by State Street Bank and Trust as
of April 30, 2022. (See Note 5) |
|
(2) |
Non-Income Producing
Security. |
|
(3) |
Restricted security. Investment
represents a non-public partnership interest and is not unitized.
(See Note 6) |
|
(4) |
Level 3 Asset fair valued by
management, pursuant to procedures approved by the Board of
Trustees, using significant unobservable inputs. (See Note
1) |
Common Abbreviations:
Co. - Company
Corp. - Corporation
Inc. - Incorporated
LLC - Limited Liability Company
Ltd. - Limited
See Notes to Financial Statements.
|
8 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Statement of Assets and
Liabilities |
April 30, 2022 (Unaudited)
|
ASSETS: |
|
|
|
|
|
Investments,
at value (Cost $2,305,599,579) |
|
$ |
2,716,406,973 |
|
|
Foreign
currency, at value (Cost $70,418) |
|
|
70,174 |
|
|
Dividends
receivable |
|
|
2,198,259 |
|
|
Interest
receivable |
|
|
11,488 |
|
|
Receivable
for shares sold |
|
|
117,396 |
|
|
Receivable
for investments sold |
|
|
197 |
|
|
Other
assets (Note 4) |
|
|
177,297 |
|
|
Total
Assets |
|
|
2,718,981,784 |
|
| |
|
|
|
|
|
LIABILITIES: |
|
|
|
|
|
Loan
payable |
|
|
450,000,000 |
|
|
Payable
for investments purchased |
|
|
7,448,270 |
|
|
Accrued
investment advisory fees |
|
|
1,322,783 |
|
|
Accrued
administration fees |
|
|
1,219,188 |
|
|
Accrued
trustees' fees |
|
|
48,269 |
|
|
Accrued
chief compliance officer fees |
|
|
7,018 |
|
|
Other
payables and accrued expenses |
|
|
222,550 |
|
|
Total
Liabilities |
|
|
460,268,078 |
|
|
Net
Assets Applicable to Common Shareholders |
|
$ |
2,258,713,706 |
|
| |
|
|
|
|
|
COMPOSITION
OF NET ASSETS ATTRIBUTABLE TO COMMON SHARES: |
|
|
|
|
|
Paid-in
capital |
|
$ |
1,795,737,899 |
|
|
Total
distributable earnings |
|
|
462,975,807 |
|
|
Net
Assets Applicable to Common Shareholders |
|
$ |
2,258,713,706 |
|
| |
|
|
|
|
|
Shares
of common stock outstanding of no par value, unlimited shares
authorized |
|
|
68,525,646 |
|
|
Net
asset value per common share |
|
$ |
32.96 |
|
See Notes to Financial Statements.
| Semi-Annual Report | April 30, 2022 |
9 |
| Reaves Utility Income Fund |
Statement of
Operations |
For the Six Months Ended April 30, 2022 (Unaudited)
|
INVESTMENT INCOME: |
|
|
|
|
Dividends (Net of foreign withholding taxes of $1,253,645) |
|
$ |
37,935,008 |
|
|
Total Investment Income |
|
|
37,935,008 |
|
| |
|
|
|
|
|
EXPENSES: |
|
|
|
|
| Interest
on loan |
|
|
2,048,670 |
|
|
Investment advisory fees |
|
|
7,673,180 |
|
|
Administration fees |
|
|
3,534,279 |
|
| Chief
compliance officer fees |
|
|
20,018 |
|
|
Trustees' fees |
|
|
143,689 |
|
|
Miscellaneous fees |
|
|
185,797 |
|
|
Total Expenses |
|
|
13,605,633 |
|
| |
|
|
|
|
|
Net Investment Income |
|
|
24,329,375 |
|
| |
|
|
|
|
| Net
realized gain/(loss) on: |
|
|
|
|
|
Investment securities |
|
|
99,270,380 |
|
| Foreign
currency transactions |
|
|
(42,203 |
) |
| Change
in unrealized appreciation/(depreciation) of: |
|
|
|
|
|
Investment securities |
|
|
(56,024,648 |
) |
|
Translation of assets and liabilities denominated in foreign
currencies |
|
|
(6,226 |
) |
|
Net gain on investments and foreign currency transactions |
|
|
43,197,303 |
|
| |
|
|
|
|
|
Net Increase in Net Assets Attributable to Common Shares from
Operations |
|
$ |
67,526,678 |
|
See Notes to Financial Statements.
|
10 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Statement of Changes in
Net Assets |
|
|
|
For the Six
Months Ended
April 30, 2022
(Unaudited) |
|
|
For the
Year Ended
October 31, 2021 |
|
|
COMMON SHAREHOLDER OPERATIONS: |
|
|
|
|
|
|
|
|
|
Net investment income |
|
$ |
24,329,375 |
|
|
$ |
33,417,443 |
|
| Net
realized gain |
|
|
99,228,177 |
|
|
|
86,819,284 |
|
|
Change in unrealized appreciation/(depreciation) |
|
|
(56,030,874 |
) |
|
|
129,586,653 |
|
|
Net increase in net assets attributable to common shares from
operations |
|
|
67,526,678 |
|
|
|
249,823,380 |
|
| |
|
|
|
|
|
|
|
|
|
DISTRIBUTIONS TO COMMON SHAREHOLDERS: |
|
|
|
|
|
|
|
|
|
Total amount of distributions |
|
|
(76,768,162 |
) |
|
|
(129,509,500 |
) |
|
Net decrease in net assets from distributions to common
shareholders |
|
|
(76,768,162 |
) |
|
|
(129,509,500 |
) |
| |
|
|
|
|
|
|
|
|
| CAPITAL
SHARE TRANSACTIONS: |
|
|
|
|
|
|
|
|
| Proceeds
from common shares issued to shareholders from reinvestment of
dividends |
|
|
2,348,510 |
|
|
|
4,575,025 |
|
|
Proceeds from sales of shares, net of offering costs (See Note
4) |
|
|
107,554,077 |
|
|
|
373,409,491 |
|
|
Net increase from capital share transactions |
|
|
109,902,587 |
|
|
|
377,984,516 |
|
| |
|
|
|
|
|
|
|
|
|
Net Increase in Net Assets Attributable to Common Shares |
|
|
100,661,103 |
|
|
|
498,298,396 |
|
| |
|
|
|
|
|
|
|
|
|
NET ASSETS ATTRIBUTABLE TO COMMON SHAREHOLDERS: |
|
|
|
|
|
|
|
|
|
Beginning of period |
|
$ |
2,158,052,603 |
|
|
$ |
1,659,754,207 |
|
|
End of period |
|
$ |
2,258,713,706 |
|
|
$ |
2,158,052,603 |
|
See Notes to Financial Statements.
| Semi-Annual Report | April 30, 2022 |
11 |
| Reaves Utility Income Fund |
Statement of Cash
Flows |
For the Six Months Ended April 30, 2022 (Unaudited)
| CASH FLOWS FROM OPERATING
ACTIVITIES: |
|
|
|
|
Net increase in net assets from operations |
|
$ |
67,526,678 |
|
|
Adjustments to reconcile net increase in net assets from operations
to net cash used in operating activities: |
|
|
|
|
| Purchase
of investment securities |
|
|
(563,900,383 |
) |
| Proceeds
from disposition of investment securities |
|
|
562,481,873 |
|
| Net
purchases of short-term investment securities |
|
|
(62,193,240 |
) |
| Net
realized (gain)/loss on: |
|
|
|
|
|
Investment securities |
|
|
(99,270,380 |
) |
| Net
change in unrealized (appreciation)/depreciation on: |
|
|
|
|
| Investments |
|
|
56,024,648 |
|
|
(Increase)/Decrease in assets: |
|
|
|
|
|
Dividends receivable |
|
|
344,394 |
|
| Interest
receivable |
|
|
(11,222 |
) |
| Other
assets |
|
|
(177,297 |
) |
|
Increase/(Decrease) in liabilities: |
|
|
|
|
| Interest
payable on loan outstanding |
|
|
(131,830 |
) |
| Accrued
investment advisory fees |
|
|
72,051 |
|
| Accrued
administration fees |
|
|
72,303 |
|
| Accrued
trustees' fees |
|
|
(30,811 |
) |
| Accrued
chief compliance officer fees |
|
|
518 |
|
| Accrued
expenses for offering costs (See Note 4) |
|
|
(138,621 |
) |
|
Other payables and accrued expenses |
|
|
18,280 |
|
|
Net Cash Used in Operating Activities |
|
|
(39,313,039 |
) |
| |
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
| Proceeds
from sales of shares, net of offering costs |
|
|
112,440,755.88 |
|
|
Cash distributions paid on Common Shares |
|
|
(74,419,652 |
) |
|
Net Cash Provided by Financing Activities |
|
|
38,021,104 |
|
|
Effect of exchange rates on cash |
|
|
(244 |
) |
| |
|
|
|
|
|
Net Decrease in cash |
|
|
(1,292,179 |
) |
|
Cash and foreign cash, beginning of year |
|
$ |
1,362,353 |
|
|
Cash and foreign cash, end of year |
|
$ |
70,174 |
|
| |
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: |
|
|
|
|
| Cash
paid during the period for interest from bank borrowing |
|
$ |
2,180,500 |
|
| Non-cash
financing activities not included herein consist of reinvestment of
distributions of: |
|
|
2,348,510 |
|
See Notes to Financial Statements.
|
12 |
www.utilityincomefund.com |
Page Intentionally Left Blank
Reaves Utility Income Fund
| PER
COMMON SHARE OPERATING PERFORMANCE: |
| Net asset value per
share, beginning of year |
| INCOME/LOSS FROM INVESTMENT OPERATIONS: |
| Net investment
income(1) |
|
Net realized and unrealized gain/(loss) |
| Total income/(loss)
from investment operations |
| |
| DISTRIBUTIONS TO COMMON SHAREHOLDERS: |
| From net investment income |
|
From net realized gains |
| Total distributions
to common shareholders |
| Change due to rights
offering |
| Common share offering
costs charged to paid-in capital |
| Total distributions
and offerings |
| |
| Net asset value
per common share, end of period |
| Market price per
common share, end of period |
| |
| Total Investment Return - Net Asset
Value(4) |
| Total Investment Return - Market
Price(4) |
| |
| RATIOS AND SUPPLEMENTAL DATA |
| Net assets attributable to common shares, end of period
(000s) |
| Ratio of expenses to average net assets attributable to common
shares |
| |
| Ratio of expenses excluding interest expense to average net
assets attributable to common shares |
| |
| Ratio of net investment income to average net assets
attributable to common shares |
| Portfolio turnover rate |
| |
| BORROWINGS AT END OF PERIOD |
| Aggregate amount outstanding (000s) |
| Asset coverage per $1,000(7) |
See Notes to Financial Statements.
|
14 |
www.utilityincomefund.com |
Financial Highlights
For the Six
Months
Ended 4/30/22
(Unaudited) |
|
|
For the
Year Ended
10/31/21 |
|
|
For the
Year Ended
10/31/20 |
|
|
For the
Year Ended
10/31/19 |
|
|
For the
Year Ended
10/31/18 |
|
|
For the
Year Ended
10/31/17 |
|
|
$ |
33.09 |
|
|
$ |
30.77 |
|
|
$ |
36.52 |
|
|
$ |
31.74 |
|
|
$ |
33.14 |
|
|
$ |
32.53 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
0.36 |
|
|
|
0.57 |
|
|
|
0.65 |
|
|
|
0.65 |
|
|
|
0.84 |
|
|
|
1.00 |
|
|
|
0.65 |
|
|
|
3.95 |
|
|
|
(4.24 |
) |
|
|
6.21 |
|
|
|
(0.25 |
) |
|
|
3.87 |
|
|
|
1.01 |
|
|
|
4.52 |
|
|
|
(3.59 |
) |
|
|
6.86 |
|
|
|
0.59 |
|
|
|
4.87 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
(1.14 |
) |
|
|
(0.57 |
) |
|
|
(0.85 |
) |
|
|
(0.64 |
) |
|
|
(0.83 |
) |
|
|
(1.04 |
) |
|
|
– |
|
|
|
(1.63 |
) |
|
|
(1.31 |
) |
|
|
(1.44 |
) |
|
|
(1.16 |
) |
|
|
(1.80 |
) |
|
|
(1.14 |
) |
|
|
(2.20 |
) |
|
|
(2.16 |
) |
|
|
(2.08 |
) |
|
|
(1.99 |
) |
|
|
(2.84 |
) |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
(0.00 |
)(2) |
|
|
(1.42 |
)(3) |
|
|
N/A |
|
|
|
0.00 |
(2) |
|
|
0.00 |
(2) |
|
|
N/A |
|
|
|
N/A |
|
|
|
N/A |
|
|
|
(1.14 |
) |
|
|
(2.20 |
) |
|
|
(2.16 |
) |
|
|
(2.08 |
) |
|
|
(1.99 |
) |
|
|
(4.26 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
32.96 |
|
|
$ |
33.09 |
|
|
$ |
30.77 |
|
|
$ |
36.52 |
|
|
$ |
31.74 |
|
|
$ |
33.14 |
|
|
$ |
33.26 |
|
|
$ |
33.96 |
|
|
$ |
31.45 |
|
|
$ |
37.09 |
|
|
$ |
30.36 |
|
|
$ |
31.02 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
3.07 |
%(5) |
|
|
14.92 |
% |
|
|
(9.89 |
)% |
|
|
22.38 |
% |
|
|
2.39 |
% |
|
|
11.04 |
% |
| |
1.34 |
%(5) |
|
|
15.39 |
% |
|
|
(9.32 |
)% |
|
|
29.94 |
% |
|
|
4.63 |
% |
|
|
12.70 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| $ |
2,258,714 |
|
|
$ |
2,158,053 |
|
|
$ |
1,659,754 |
|
|
$ |
1,779,985 |
|
|
$ |
1,544,961 |
|
|
$ |
1,612,865 |
|
| |
1.22 |
%(6) |
|
|
1.23 |
% |
|
|
1.50 |
% |
|
|
2.06 |
% |
|
|
1.90 |
% |
|
|
1.66 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
1.04 |
%(6) |
|
|
1.05 |
% |
|
|
1.09 |
% |
|
|
1.17 |
% |
|
|
1.10 |
% |
|
|
1.09 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
2.18 |
%(6) |
|
|
1.70 |
% |
|
|
2.00 |
% |
|
|
1.93 |
% |
|
|
2.62 |
% |
|
|
2.97 |
% |
| |
21 |
%(5) |
|
|
20 |
% |
|
|
38 |
% |
|
|
22 |
% |
|
|
24 |
% |
|
|
15 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| $ |
450,000 |
|
|
$ |
450,000 |
|
|
$ |
345,000 |
|
|
$ |
445,000 |
|
|
$ |
445,000 |
|
|
$ |
320,000 |
|
| $ |
6,019 |
|
|
$ |
5,796 |
|
|
$ |
5,811 |
|
|
$ |
5,000 |
|
|
$ |
4,472 |
|
|
$ |
6,040 |
|
See Notes to Financial Statements.
| Semi-Annual Report | April 30, 2022 |
15 |
| Reaves Utility Income Fund |
Financial Highlights |
|
(1) |
Calculated using average common
shares outstanding. |
|
(3) |
Effect of rights offerings for
common shares at a price below market price. |
|
(4) |
Total investment return is
calculated assuming a purchase of a common share at the opening on
the first day and a sale at closing on the last day of each period
reported. Total investment return excludes any sales charges.
Dividends and distributions, if any, are assumed for purposes of
this calculation to be reinvested at prices obtained under the
Fund’s dividend reinvestment plan. |
|
(5) |
Calculated by subtracting the
Fund's total liabilities (excluding the principal amount of
Leverage Facility) from the Fund's total assets and dividing by the
principal amount of the Leverage Facility and then multiplying by
$1,000. |
See Notes to Financial Statements.
|
16 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Notes to Financial
Statements |
April 30, 2022 (Unaudited)
1. SIGNIFICANT ACCOUNTING AND OPERATING POLICIES
Reaves Utility Income Fund (the “Fund”) is registered under the
Investment Company Act of 1940, as amended (the “1940 Act”), as a
closed-end management investment company. The Fund was organized
under the laws of the state of Delaware by an Agreement and
Declaration of Trust dated September 15, 2003. The Fund’s
investment objective is to provide a high level of after-tax income
and total return consisting primarily of tax-advantaged dividend
income and capital appreciation. The Fund is a diversified
investment company for purpose of the 1940 Act. The Agreement and
Declaration of Trust provides that the Trustees may authorize
separate classes of shares of beneficial interest. The Fund’s
common shares are listed on the NYSE American LLC (the “Exchange”)
and trade under the ticker symbol “UTG”.
The following is a summary of significant accounting policies
followed by the Fund in the preparation of its financial
statements. The preparation of financial statements is in
accordance with generally accepted accounting principles in the
United States of America (“U.S. GAAP”), which 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 Fund is considered an investment
company under U.S. GAAP and follows the accounting and reporting
guidance applicable to investment companies in the Financial
Accounting Standards Board Accounting Standards Codification Topic
946.
Investment Valuation: The net asset value per common share
(“NAV”) of the Fund is determined no less frequently than daily, on
each day that the Exchange is open for trading, as of the close of
regular trading on the Exchange (normally 4:00 p.m. New York time).
The NAV is determined by dividing the value of the Fund’s total
assets less its liabilities by the number of shares
outstanding.
The Board of Trustees (the “Board”) has established the following
procedures for valuation of the Fund’s asset values under normal
market conditions. For domestic equity securities, foreign equity
securities and funds that are traded on an exchange, the market
price is usually the closing sale or official closing price on that
exchange. In the case of a domestic and foreign equity security not
traded on an exchange, or if such closing prices are not otherwise
available, the mean of the closing bid and ask price will be used.
The fair value for debt obligations is generally the evaluated mean
price supplied by the Fund’s primary and/or secondary independent
third-party pricing service, approved by the Board. An evaluated
mean is considered to be a daily fair valuation price which may use
a matrix, formula or other objective method that takes into
consideration various factors, including, but not limited to:
structured product markets, fixed income markets, interest rate
movements, new issue information, trading, cash flows, yields,
spreads, credit quality and other pertinent information as
determined by the pricing services evaluators and methodologists.
If the Fund’s primary and/or secondary independent third-party
pricing services are unable to supply a price, or if the price
supplied is deemed to be unreliable, the market price may be
determined using quotations received from one or more
broker-dealers that make a market in the security. Investments in
non-exchange traded funds are fair valued at their respective net
asset values.
Securities, for which market quotations or valuations are not
available, are valued at fair value in good faith by or at the
direction of the Board. When applicable, fair value of an
investment is determined by the Fund’s Fair Valuation Committee as
a designee of the Board. In fair valuing the Fund’s investments,
consideration is given to several factors, which may include, among
others, the following: the fundamental business data relating to
the issuer, borrower or counterparty; an evaluation of the forces
which influence the market in which the investments are purchased
and sold; the type, size and cost of the investment; the
information as to any transactions in or offers for the investment;
the price and extent of public trading in similar securities (or
equity securities) of the issuer, or comparable companies; the
coupon payments, yield data/cash flow data; the quality, value and
saleability of collateral, if any, securing the investment; the
business prospects of the issuer, borrower or counterparty, as
applicable, including any ability to obtain money or resources from
a parent or affiliate and an assessment of the issuer’s, borrower’s
or counterparty’s management; the prospects for the industry of the
issuer, borrower or counterparty, as applicable, and multiples (of
earnings and/or cash flow) being paid for similar businesses in
that industry; one or more non-affiliated independent broker quotes
for the sale price of the portfolio security; and other relevant
factors.
| Semi-Annual Report | April 30, 2022 |
17 |
| Reaves Utility Income Fund |
Notes to Financial
Statements |
April 30, 2022 (Unaudited)
The Fund discloses the classification of its fair value
measurements following a three-tier hierarchy based on the inputs
used to measure fair value. Inputs refer broadly to the assumptions
that market participants would use in pricing the asset or
liability, including assumptions about risk. Inputs may be
observable or unobservable. Observable inputs reflect the
assumptions market participants would use in pricing the asset or
liability that are developed based on market data obtained from
sources independent of the reporting entity. Unobservable inputs
reflect the reporting entity’s own assumptions about the
assumptions market participants would use in pricing the asset or
liability that are developed based on the best information
available.
Various inputs are used in determining the value of the Fund’s
investments as of the end of the reporting period. When inputs used
fall into different levels of the fair value hierarchy, the level
in the hierarchy within which the fair value measurement falls is
determined based on the lowest level input that is significant to
the fair value measurement in its entirety. The designated input
levels are not necessarily an indication of the risk or liquidity
associated with these investments. These inputs are categorized in
the following hierarchy under applicable financial accounting
standards:
| Level
1 – |
Unadjusted
quoted prices in active markets for identical investments,
unrestricted assets or liabilities that the Fund has the ability to
access at the measurement date; |
| Level
2 – |
Quoted
prices which are not active, quoted prices for similar assets or
liabilities in active markets or inputs other than quoted prices
that are observable (either directly or indirectly) for
substantially the full term of the asset or liability;
and |
| Level
3 – |
Significant
unobservable prices or inputs (including the Fund’s own assumptions
in determining the fair value of investments) where there is little
or no market activity for the asset or liability at the measurement
date. |
|
18 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Notes to Financial
Statements |
April 30, 2022 (Unaudited)
The following is a summary of the Fund’s investments in the fair
value hierarchy as of April 30, 2022:
| |
|
Valuation Inputs |
|
|
|
|
|
|
Investments in Securities at Value* |
|
Level 1 |
|
|
Level 2 |
|
|
Level 3 |
|
|
Total |
|
| Common Stocks |
|
$ |
2,631,198,235 |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
2,631,198,235 |
|
| Limited Partnerships |
|
|
– |
|
|
|
– |
|
|
|
– |
|
|
|
– |
|
| Money
Market Funds |
|
|
85,208,738 |
|
|
|
– |
|
|
|
– |
|
|
|
85,208,738 |
|
| Total |
|
$ |
2,716,406,973 |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
2,716,406,973 |
|
| * |
See Statement of Investments for
industry classifications. |
The following is a reconciliation of assets in which significant
unobservable inputs (Level 3) were used in determining fair
value:
|
Asset Type |
|
Balance as of
October 31,
2021 |
|
|
Realized
Gain/(Loss) |
|
|
Change in
Unrealized
Appreciation/
Depreciation |
|
|
Purchases |
|
|
Sales
Proceeds |
|
|
Transfer in
and/or (out)
of Level 3 |
|
|
Balance as of
April 30, 2022 |
|
|
Net change
in unrealized
appreciation/
(depreciation)
included in the
Statements of
Operations
attributable
to Level 3
investments held at
April 30, 2022 |
|
|
Limited Partnerships |
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
Total |
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
|
$ |
– |
|
Foreign Currency Translation: The books and records of the
Fund are maintained in U.S. dollars. Investment valuations and
other assets and liabilities initially expressed in foreign
currencies are converted each business day the Exchange is open
into U.S. dollars based upon current exchange rates. Prevailing
foreign exchange rates may generally be obtained at the close of
the Exchange (normally, 4:00 p.m. New York time). The portion of
realized and unrealized gains or losses on investments due to
fluctuations in foreign currency exchange rates is not separately
disclosed and is included in realized and unrealized gains or
losses on investments, when applicable. As of and during the six
months ended April 30, 2022, the Fund had no outstanding forward
foreign currency contracts.
Distributions to Shareholders: The Fund intends to make a
level distribution each month to common shareholders after payment
of interest on any outstanding borrowings. The level dividend rate
may be modified by the Board of Trustees from time to time. Any net
capital gains earned by the Fund are distributed at least annually.
Distributions to shareholders are recorded by the Fund on the
ex-dividend date.
Income Taxes: The Fund’s policy is to comply with the
provisions of the Code applicable to regulated investment companies
and to distribute all of its taxable income and gains to its
shareholders. See Note 3.
Investment Transactions: Investment security transactions
are accounted for as of trade date. Dividend income is recorded on
the ex-dividend date, or as soon as information is available to the
Fund. Interest income, which includes amortization of premium and
accretion of discount, is accrued as earned. Realized gains and
losses from investment transactions are determined using the
first-in first-out basis for both financial reporting and income
tax purposes.
| Semi-Annual Report | April 30, 2022 |
19 |
| Reaves Utility Income Fund |
Notes to Financial
Statements |
April 30, 2022 (Unaudited)
2. RISKS
The Fund may have elements of risk, including the risk of loss of
equity. There is no assurance that the investment process will
consistently lead to successful results. An investment concentrated
in sectors and industries may involve greater risk and volatility
than a more broadly diversified investment.
Concentration Risk. The Fund invests a significant portion
of its total assets in securities of utility companies, which may
include companies in the electric, gas, water, and
telecommunications sectors, as well as other companies engaged in
other infrastructure operations. This may make the Fund
particularly susceptible to adverse economic, political or
regulatory occurrences affecting those sectors. As concentration of
the Fund’s investments in a sector increases, so does the potential
for fluctuation in the net asset value of common shares.
Risk of Foreign Securities. The Fund may directly purchase
securities of foreign issuers. Investing in securities of foreign
issuers involves special risks not typically associated with
investing in securities of U.S. issuers. The risks include possible
revaluation of currencies, the inability to repatriate foreign
currency, less complete financial information about companies and
possible future adverse political and economic developments.
Moreover, securities of many foreign issuers and their markets may
be less liquid and their prices more volatile than those of
securities of comparable U.S. issuers.
Market Disruption and Geopolitical Risk. The value of
investment in the Fund is based on the values of the Fund’s
investments, which may change due to economic and other events that
affect markets generally, as well as those that affect particular
regions, countries, industries, companies or governments. These
movements, sometimes called volatility, may be greater or less
depending on the types of securities the Fund owns and the markets
in which the securities trade. The increasing interconnectivity
between global economies and financial markets increases the
likelihood that events or conditions in one region or financial
market may adversely impact issuers in a different country, region
or financial market. Securities in the Fund’s portfolio may
underperform due to inflation (or expectations for inflation),
interest rates, global demand for particular products or resources,
natural disasters, pandemics, epidemics, terrorism, regulatory
events and governmental or quasi-governmental actions. The
occurrence of global events similar to those in recent years, such
as terrorist attacks around the world, natural disasters, social
and political discord or debt crises and downgrades, among others,
may result in market volatility and may have long term effects on
both the U.S. and global financial markets. The occurrence of such
events may be sudden and unexpected, and it is difficult to predict
when similar events affecting the U.S. or global financial markets
may occur, the effects that such events may have and the duration
of those effects. Any such event(s) could have a significant
adverse impact on the value, liquidity and risk profile of the
Fund’s portfolio, as well as its ability to sell securities to meet
redemptions. There is a risk that you may lose money by investing
in the Fund.
Social, political, economic and other conditions and events, such
as natural disasters, health emergencies (e.g., epidemics and
pandemics), terrorism, conflicts and social unrest, may occur and
could significantly impact issuers, industries, governments and
other systems, including the financial markets. As global systems,
economies and financial markets are increasingly interconnected,
events that once had only local impact are now more likely to have
regional or even global effects. Events that occur in one country,
region or financial market will, more frequently, adversely impact
issuers in other countries, regions or markets. These impacts can
be exacerbated by failures of governments and societies to
adequately respond to an emerging event or threat. These types of
events quickly and significantly impact markets in the U.S. and
across the globe leading to extreme market volatility and
disruption. The extent and nature of the impact on supply chains or
economies and markets from these events is unknown, particularly if
a health emergency or other similar event, persists for an extended
period of time. Such events could impact the Adviser’s investment
advisory activities and services of other service providers, which
in turn could adversely affect the Fund’s investments and other
operations. The value of the Fund’s investments may decrease as a
result of such events, particularly if these events adversely
impact the operations and effectiveness of the Adviser or key
service providers or if these events disrupt systems and processes
necessary or beneficial to the investment advisory, other
activities on behalf the Fund.
|
20 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Notes to Financial
Statements |
April 30, 2022 (Unaudited)
COVID-19 Risk. The outbreak of the novel coronavirus that
causes the respiratory disease COVID-19, (the “Coronavirus”)
outbreak, began in late 2019. The Coronavirus subsequently spread
globally in early 2020. The impact of the outbreak has evolved
during the Fund’s fiscal year and continues to change. The virus
has impacted the U.S and countries throughout the world, resulting
in travel restrictions, quarantines, and significant portions of
the population working from home, temporary or permanent layoffs,
and adverse economic impacts on many industries. There have been
fluctuations of consumer demand in certain sectors, disruptions in
supply chains and economic output, and other adverse economic
impacts of the Coronavirus. Further developments could result in
additional disruptions and uncertainty and could generally have
significant impacts on economies and financial markets and could
impact the value and performance of the Fund.
3. INCOME TAXES AND TAX BASIS INFORMATION
The Fund complies with the requirements under Subchapter M of the
Code applicable to regulated investment companies and intends to
distribute substantially all of its net taxable income and net
capital gains, if any, each year. The Fund is not subject to income
taxes to the extent such distributions are made.
As of and during the six months ended April 30, 2022, the Fund did
not have a liability for any unrecognized tax benefits in the
accompanying financial statements. The Fund files U.S. federal,
state, and local tax returns as required. The Fund’s tax returns
are subject to examination by the relevant tax authorities until
expiration of the applicable statute of limitations, which is
generally three years after the filing of the tax return but which
can be extended to six years in certain circumstances. Tax returns
for open years have incorporated no uncertain tax positions that
require a provision for income taxes.
Net investment income (loss) and net realized gain (loss) may
differ for financial statement and tax purposes. The character of
distributions made during the year from net investment income or
net realized gains may differ from its ultimate characterization
for federal income tax purposes. Also, due to the timing of
dividend distributions, the fiscal year in which amounts are
distributed may differ from the fiscal year in which the income or
realized gain was recorded by the Fund.
| Semi-Annual Report | April 30, 2022 |
21 |
| Reaves Utility Income Fund |
Notes to Financial
Statements |
April 30, 2022 (Unaudited)
The amounts and characteristics of tax basis distributions and
composition of distributable earnings/(accumulated losses) are
finalized at fiscal year-end and are not available for the six
months ended April 30, 2022.
The tax character of the distributions paid by the Fund were as
follows:
| |
|
For the
Year Ended
October 31, 2021 |
|
| Distributions paid from: |
|
|
|
|
|
Ordinary Income |
|
$ |
49,217,155 |
|
|
Long-Term Capital Gain |
|
|
80,292,345 |
|
|
Total |
|
$ |
129,509,500 |
|
As of April 30, 2022, net unrealized appreciation/depreciation of
investments based on federal tax cost were as follows:
| Gross appreciation (excess
of value over tax cost) |
|
$ |
476,091,127 |
|
| Gross
depreciation (excess of tax cost over value) |
|
|
(66,041,040 |
) |
| Net
unrealized appreciation |
|
|
410,050,087 |
|
| Cost
of investments for income tax purposes |
|
$ |
2,306,356,886 |
|
4. CAPITAL TRANSACTIONS
Common Shares: There are an unlimited number of no par value
common shares of beneficial interest authorized.
The Fund has a registration statement on file with the SEC (the
“Shelf Registration Statement”), pursuant to which the Fund may
offer common shares, from time to time, in one or more offerings,
up to a maximum aggregate offering price of $600,000,000 on terms
to be determined at the time of the offering.
On November 4, 2019, as allowed by the Shelf Registration
Statement, the Fund entered into a distribution agreement with ALPS
Distributors, Inc. (“ADI”), an affiliate of ALPS, pursuant to which
the Fund could offer and sell up to 5,500,000 of the Fund’s Common
Shares, from time to time through ADI. On October 6, 2020, the Fund
and ADI amended the agreement, pursuant to which the Fund may offer
and sell up to 6,147,291 of the Fund’s Common Shares, representing
647,291 shares from the original agreement, plus an additional
5,500,000 shares, for a total of 11,000,000 shares. On June 21,
2021, the Fund and ADI amended the Distribution Agreement, pursuant
to which the Fund may offer and sell up to 17,000,000 of the Fund’s
Common Shares, representing 11,000,000 shares from the current
agreement, plus an additional 6,000,000 shares. During the six
months ended April 30, 2022, 3,243,399 common shares were sold
totaling $107,613,921, net of offering costs of $138,621. Under the
agreement, ADI was paid $217,846 for the shares sold.
|
22 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Notes to Financial
Statements |
April 30, 2022 (Unaudited)
Transactions in common shares were as follows:
| |
|
For the
Six Months Ended
April 30, 2022 |
|
|
For the
Year Ended
October 31, 2021 |
|
| Common Shares outstanding
- beginning of period |
|
|
65,211,164 |
|
|
|
53,936,356 |
|
| Common Shares issued from sale of
shares |
|
|
3,243,399 |
|
|
|
11,135,737 |
|
| Common
Shares issued as reinvestment of dividends |
|
|
71,083 |
|
|
|
139,071 |
|
|
Common Shares outstanding - end of period |
|
|
68,525,646 |
|
|
|
65,211,164 |
|
5. BORROWINGS
On December 8, 2016, the Fund entered into a Credit Agreement with
Pershing LLC. Under the terms of the Amended Credit Agreement, the
Fund is allowed to borrow up to $455,000,000. Interest is charged
at a rate of the one month LIBOR (“London Interbank Offered Rate”)
plus 0.80%. Effective June 20, 2021, the interest rate charged
under the Amended Credit Agreement changed from LIBOR plus 0.80% to
OBFR (Overnight Bank Funding Rate) plus 0.80%. Borrowings under the
Credit Agreement are secured by assets of the Fund that are held by
the Fund’s custodian in a separate account (the “pledged
collateral”). Borrowing commenced under the terms of the Credit
Agreement on December 13, 2016.
On April 27, 2022, the Fund entered into a Credit Agreement with
State Street Bank and Trust Company. Under the terms of the Credit
Agreement, the Fund is allowed to borrow up to $650,000,000.
Interest is charged at a rate of the one month SOFR (“Secured
Overnight Financing Rate”) plus 0.65%. Borrowings under the Credit
Agreement are secured by all or a portion of assets of the Fund
that are held by the Fund’s custodian in a separate account (the
“pledged collateral”). Borrowing commenced under the terms of the
Credit Agreement on April 27, 2022. The Credit Agreement with State
Street Bank and Trust Company replaced the credit facility
previously in place with Pershing LLC.
For the six months ended April 30, 2022, the average amount
borrowed under the Credit Agreement was $394,602,740, at an average
rate of 0.90%. As of April 30, 2022, the amount of outstanding
borrowings was $450,000,000, the interest rate was 0.87% and the
fair value of pledged collateral was $1,483,127,355.
6. RESTRICTED SECURITIES
As of April 30, 2022, investments in securities included issues
that are considered restricted. Restricted securities are often
purchased in private placement transactions, are not registered
under the Securities Act of 1933, may have contractual restrictions
on resale, and may be valued under methods approved by the Board of
Trustees as reflecting fair value.
Restricted securities as of April 30, 2022 were as follows:
|
Description |
|
Acquisition Date |
|
Cost |
|
|
Value |
|
|
Market Value
as Percentage
of Net Assets |
|
|
Bastion Energy LLC (Anglo Dutch) |
|
7/30/2015 |
|
$ |
– |
|
|
$ |
– |
|
|
|
0.00 |
% |
|
TOTAL |
|
|
|
$ |
– |
|
|
$ |
– |
|
|
|
0.00 |
% |
| Semi-Annual Report | April 30, 2022 |
23 |
| Reaves Utility Income Fund |
Notes to Financial
Statements |
April 30, 2022 (Unaudited)
7. PORTFOLIO SECURITIES
Purchases and sales of investment securities, other than short-term
securities, for the six months ended April 30, 2022, aggregated
$565,889,935 and $562,422,801, respectively.
8. MANAGEMENT FEES, ADMINISTRATION FEES AND OTHER TRANSACTIONS WITH
AFFILIATES
Reaves Asset Management (“Reaves”) serves as the Fund’s investment
adviser pursuant to an Investment Advisory and Management Agreement
(the “Advisory Agreement”) with the Fund. As compensation for its
services to the Fund, Reaves receives an annual investment advisory
fee of 0.575% based on the Fund’s average daily total assets,
computed daily and payable monthly. Effective May 11, 2021, the
advisory fee schedule will be as follows: 0.575% annually on assets
up to $2.5 billion and 0.525% annual on assets over $2.5
billion.
ALPS Fund Services, Inc. (“ALPS”) serves as the Fund’s
administrator pursuant to an Administration, Bookkeeping and
Pricing Services Agreement (the “Administration Agreement”) with
the Fund. As compensation for its services to the Fund, ALPS
receives an annual administration fee based on the Fund’s average
daily total assets, computed daily and payable monthly. ALPS will
pay all expenses in connection with the performance of its services
under the Administration Agreement, with the exception of advisory
fees, trustees’ fees, portfolio transaction expenses, litigation
expenses, tax, cost of preferred shares, expenses of conducting
repurchase offers for the purpose of repurchasing fund shares, the
printing and distribution cost incurred to comply with the terms of
the Fund’s 19(b) exemptive relief granted on July 14, 2011, certain
expenses related to regulatory filings and extraordinary
expenses.
For the six months ended April 30, 2022, Trustees who are not
affiliated with the Adviser received compensation of $172,085 from
the Fund which is shown in the Statement of Operations, $48,269 of
which was payable as of April 30, 2022.
Pursuant to the Chief Compliance Officer Services Agreement, the
Fund has agreed to pay ALPS for providing Chief Compliance Officer
services to the Fund an annual fee payable in monthly
installments.
Both Reaves and ALPS are considered affiliates of the Fund as
defined under the 1940 Act.
9. INDEMNIFICATIONS
In the normal course of business, the Fund enters into contracts
that contain a variety of representations which provide general
indemnifications. The Fund’s maximum exposure under these
arrangements is unknown as this would involve future claims that
may be made against the Fund that have not yet occurred.
|
24 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Notes to Financial Statements |
April 30, 2022 (Unaudited)
10. SUBSEQUENT EVENT
The Fund has entered into a distribution agreement, dated November
14, 2019, with the Distributor, as amended by Amendment No. 1
thereto, dated October 6, 2020, Amendment No. 2 thereto, dated June
21, 2021 and Amendment No. 3 thereto, dated November 22, 2021
(collectively, the “Distribution Agreement”) relating to the Fund’s
common shares of beneficial interest, no par value (the “Common
Shares”). In accordance with the terms of the Distribution
Agreement, the Fund may offer and sell up to 23,000,000 of the
Fund’s Common Shares, from time to time through the Distributor for
the offer and sale of the Common Shares.
| Semi-Annual Report | April 30, 2022 |
25 |
| Reaves Utility Income Fund |
Additional
Information |
April 30, 2022 (Unaudited)
DIVIDEND REINVESTMENT PLAN
Unless the registered owner of Common Shares elects to receive cash
by contacting DST Systems, Inc. (the “Plan Administrator”), all
dividends declared on Common Shares will be automatically
reinvested by the Plan Administrator for shareholders in the Fund’s
Dividend Reinvestment Plan (the “Plan”), in additional Common
Shares. Shareholders who elect not to participate in the Plan will
receive all dividends and other distributions in cash paid by check
mailed directly to the shareholder of record (or, if the Common
Shares are held in street or other nominee name, then to such
nominee) by the Plan Administrator as dividend disbursing agent.
You may elect not to participate in the Plan and to receive all
dividends in cash by contacting the Plan Administrator, as dividend
disbursing agent, at the address set forth below. Participation in
the Plan is completely voluntary and may be terminated or resumed
at any time without penalty by notice if received and processed by
the Plan Administrator prior to the dividend record date;
otherwise, such termination or resumption will be effective with
respect to any subsequently declared dividend or other
distribution. Some brokers may automatically elect to receive cash
on your behalf and may re-invest that cash in additional Common
Shares for you. If you wish for all dividends declared on your
Common Shares to be automatically reinvested pursuant to the Plan,
please contact your broker.
The Plan Administrator will open an account for each Common
Shareholder under the Plan in the same name in which such Common
Shareholder’s Common Shares are registered. Whenever the Fund
declares a dividend or other distribution (together, a “Dividend”)
payable in cash, non-participants in the Plan will receive cash and
participants in the Plan will receive the equivalent in Common
Shares. The Common Shares will be acquired by the Plan
Administrator for the participants’ accounts, depending upon the
circumstances described below, either (i) through receipt of
additional unissued but authorized Common Shares from the Fund
(“Newly Issued Common Shares”) or (ii) by purchase of outstanding
Common Shares on the open market (“Open-Market Purchases”) on the
NYSE American LLC or elsewhere. If, on the payment date for any
Dividend, the closing market price plus estimated brokerage
commissions per Common Share is equal to or greater than the net
asset value per Common Share, the Plan Administrator will invest
the Dividend amount in Newly Issued Common Shares on behalf of the
participants. The number of Newly Issued Common Shares to be
credited to each participant’s account will be determined by
dividing the dollar amount of the Dividend by the net asset value
per Common Share on the payment date; provided that, if the net
asset value is less than or equal to 95% of the closing market
value on the payment date, the dollar amount of the Dividend will
be divided by 95% of the closing market price per Common Share on
the payment date. If, on the payment date for any Dividend, the net
asset value per Common Share is greater than the closing market
value plus estimated brokerage commissions, the Plan Administrator
will invest the Dividend amount in Common Shares acquired on behalf
of the participants in Open-Market Purchases. In the event of a
market discount on the payment date for any Dividend, the Plan
Administrator will have until the last business day before the next
date on which the Common Shares trade on an “ex-dividend” basis or
30 days after the payment date for such Dividend, whichever is
sooner (the “Last Purchase Date”), to invest the Dividend amount in
Common Shares acquired in Open-Market Purchases. It is contemplated
that the Fund will pay monthly income Dividends. Therefore, the
period during which Open-Market Purchases can be made will exist
only from the payment date of each Dividend through the date before
the next “ex-dividend” date which typically will be approximately
ten days. If, before the Plan Administrator has completed its
Open-Market Purchases, the market price per Common Share exceeds
the net asset value per Common Share, the average per Common Share
purchase price paid by the Plan Administrator may exceed the net
asset value of the Common Shares, resulting in the acquisition of
fewer Common Shares than if the Dividend had been paid in Newly
Issued Common Shares on the Dividend payment date. Because of the
foregoing difficulty with respect to Open-Market Purchases, the
Plan provides that if the Plan Administrator is unable to invest
the full Dividend amount in Open-Market Purchases during the
purchase period or if the market discount shifts to a market
premium during the purchase period, the Plan Administrator may
cease making Open-Market Purchases and may invest the uninvested
portion of the Dividend amount in Newly Issued Common Shares at the
net asset value per Common Share at the close of business on the
Last Purchase Date, provided that, if the net asset value is less
than or equal to 95% of the then current market price per Common
Share, the dollar amount of the Dividend will be divided by 95% of
the market price on the payment date.
|
26 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Additional
Information |
April 30, 2022 (Unaudited)
The Plan Administrator maintains all shareholders’ accounts in the
Plan and furnishes written confirmation of all transactions in the
accounts, including information needed by shareholders for tax
records. Common Shares in the account of each Plan participant will
be held by the Plan Administrator on behalf of the Plan
participant, and each shareholder proxy will include those shares
purchased or received pursuant to the Plan. The Plan Administrator
will forward all proxy solicitation materials to participants and
vote proxies for shares held under the Plan in accordance with the
instructions of the participants.
In the case of Common Shareholders such as banks, brokers or
nominees which hold shares for others who are the beneficial
owners, the Plan Administrator will administer the Plan on the
basis of the number of Common Shares certified from time to time by
the record shareholder’s name and held for the account of
beneficial owners who participate in the Plan.
There will be no brokerage charges with respect to Common Shares
issued directly by the Fund. However, each participant will pay a
pro rata share of brokerage commissions incurred in connection with
Open-Market Purchases. The automatic reinvestment of Dividends will
not relieve participants of any federal, state or local income tax
that may be payable (or required to be withheld) on such Dividends.
Participants that request a sale of Common Shares through the Plan
Administrator are subject to brokerage commissions.
The Fund reserves the right to amend or terminate the Plan. There
is no direct service charge to participants with regard to
purchases in the Plan; however, the Fund reserves the right to
amend the Plan to include a service charge payable by the
participants.
All correspondence or questions concerning the Plan should be
directed to the Plan Administrator, DST Systems, Inc., 333 West
11th Street, 5th Floor, Kansas City, Missouri
64105.
APPROVAL OF INVESTMENT ADVISORY AGREEMENT
At the March 11, 2022 meeting of the Board of the Fund (the
“Meeting”), the Board, including those Trustees who are not
“interested Trustees” of the Fund, as that term is defined in the
1940 Act (the “Independent Trustees”), approved W.H. Reaves &
Co. Inc. (the “Adviser” or “Reaves”) to serve as the Fund’s
investment adviser and approved the investment advisory agreement
between Reaves and the Fund (the “Advisory Agreement”), upon the
terms and conditions set forth therein, for an additional one-year
term. In connection with considering the approval of the Advisory
Agreement, the Independent Trustees met in executive session with
independent counsel, who provided assistance and advice.
| Semi-Annual Report | April 30, 2022 |
27 |
| Reaves Utility Income Fund |
Additional
Information |
April 30, 2022 (Unaudited)
Although not meant to be all-inclusive, the following discussion
summarizes the factors considered and conclusions reached by the
Trustees in the executive session and at the Meeting in determining
to approve the Advisory Agreement.
Nature, extent, and quality of services. The Trustees
considered the nature, extent, and quality of the services provided
to the Fund by the Adviser. In evaluating the quality of the
Adviser’s services, the Trustees noted the various complexities
involved in the operations of the Fund, such as the use of
leverage, and an increasingly complex environment. The Trustees
also considered the Fund’s investment performance and took into
account its evaluation of the quality of the Adviser’s compliance
program. The Trustees also considered the qualifications,
experience, and capability of the Adviser’s management team and
other personnel and the extent of care with which the Adviser
performs its duties and obligations. The Trustees also considered
information from the Adviser regarding the overall financial
strength of the Adviser and considered the resources and staffing
in place with respect to the services provided to the Fund. In
light of the foregoing, the Trustees concluded that it was
generally satisfied with the nature, extent, and quality of the
services provided to the Fund by the Adviser.
Performance of the Fund and the Adviser. The Trustees
reviewed the Fund’s investment performance over time and compared
that performance to other funds in its peer group. In making its
comparisons, the Trustees utilized a report from an independent
provider of investment company data (the “Data Provider”). As
reported by the Data Provider, the Fund’s net total return
(annualized) ranked 9th, 7th, 4th, 5th, 5th, and 3rd for the 1-,
2-, 3-, 4-, 5- and 10-year periods ended December 31, 2021,
respectively, among the performance universe consisting of the Fund
and all leveraged closed-end utility funds, regardless of asset
size. The Trustees noted that the Fund underperformed the Lipper
Closed-End Sector Equity Fund Index for all periods.
Costs of services and profits realized. The Trustees
considered the reasonableness of the compensation paid to the
Adviser, in both absolute and comparative terms, and also the
profits realized by the Adviser from its relationship with the
Fund. To facilitate this analysis, the Trustees retained the Data
Provider to furnish a report comparing the Fund’s management fee
(defined as the sum of the advisory fee and administration fee) and
other expenses to the similar expenses of other comparable funds
selected by the Data Provider (the “the Data Provider expense
group”). The Trustees reviewed, among other things, information
provided by the Data Provider comparing the Fund’s contractual
management fee rate (at common asset levels) and actual management
fee rate (reflecting fee waivers, if any) as a percentage of total
assets and as a percentage of assets attributable to common stock
to other funds in its Data Provider expense group. Based on the
data provided on management fee rates, the Trustees noted that: (i)
the Fund’s contractual management fee rate was equal to the median
of its Data Provider expense group; and (ii) the actual management
fee rate was lower than the median of its Data Provider expense
group both on the basis of assets attributable to common shares and
on a total asset basis.
The Adviser also furnished the Trustees with copies of its
financial statements and other information regarding its expenses
in providing services to the Fund. In reviewing those financial
statements and other materials, the Trustees examined the
profitability to the Adviser.
|
28 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Additional
Information |
April 30, 2022 (Unaudited)
Economies of scale. The Trustees noted that there were no
fee breakpoints in the Advisory Agreement and that any increases in
the Fund’s assets are primarily attributable to market
appreciation, dividend reinvestments, rights offerings, and the ATM
program.
Comparison with other advisory contracts. The Trustees also
received comparative information from the Adviser with respect to
its standard fee schedule for investment advisory clients other
than the Fund. The Trustees noted that, among all accounts managed
by the Adviser, the Fund’s advisory fee rate is comparable to the
Adviser’s standard fee schedule. However, the Trustees noted that
the services provided by the Adviser to the Fund are more extensive
and demanding than the services provided by the Adviser to its
non-investment company, institutional accounts and to those
investment company accounts for which the Adviser serves only in a
sub-advisory capacity. Furthermore, the Trustees considered, based
on the Adviser’s representation, that many of the Adviser’s other
clients would not be considered “like accounts” of the Fund because
these accounts are not of similar size and do not have the same
investment objectives as, or possess other characteristics similar
to, the Fund.
Indirect benefits. The Trustees considered indirect benefits
to the Adviser from its relationship to the Fund, including
increased visibility among its institutional asset manager peer
group and “sell side” research obtained from broker-dealers that
execute trades for the Fund.
Based upon its evaluation of all material factors, including the
foregoing, and assisted by the advice of independent legal counsel,
the Trustees concluded that the level of fees paid to the Adviser
was fair and reasonable in light of the usual and customary charges
for such services, and that the continued retention of the Adviser
as investment adviser to the Fund was in the best interests of the
Fund and its shareholders.
FUND PROXY VOTING POLICIES & PROCEDURES
A description of the policies and procedures that the Fund uses to
determine how to vote proxies relating to portfolio securities is
available without charge upon request by calling toll-free
1-800-644-5571, or on the Fund’s website at
https://www.utilityincomefund.com. Information regarding how the
Fund voted proxies relating to portfolio securities during the most
recent 12-month period ended June 30 is also available without
charge upon request by calling toll-free 1-800-644-5571, or on the
SEC’s website at https://www.sec.gov.
PORTFOLIO HOLDINGS
The Fund files its complete schedule of portfolio holdings with the
Commission for the first and third quarters of each fiscal year on
Form N-PORT. Copies of the Fund’s Forms N-PORT are available on the
Commission’s website at https://www.sec.gov. Quarterly Holdings
statements as of the first and third quarter of each fiscal year,
and information on the Fund’s Forms N-PORT, are available on the
Fund’s website at https://www.utilityincomefund.com, and are
available without a charge, upon request, by contacting the Fund at
1-800-644-5571.
NOTICE
Notice is hereby given in accordance with Section 23(c) of the
Investment Company Act of 1940 that the Fund may purchase at market
prices from time to time common shares in the open market.
| Semi-Annual Report | April 30, 2022 |
29 |
| Reaves Utility Income Fund |
Additional
Information |
April 30, 2022 (Unaudited)
SECTION 19(A) NOTICES
The following table sets forth the estimated amount of the sources
of distribution for purposes of Section 19 of the Investment
Company Act of 1940, as amended, and the related rules adopted
there under. The Fund estimates the following percentages, of the
total distribution amount per share, attributable to (i) current
and prior fiscal year net investment income, (ii) net realized
short-term capital gain, (iii) net realized long-term capital gain
and (iv) return of capital or other capital source as a percentage
of the total distribution amount. These percentages are disclosed
for the fiscal year-to-date cumulative distribution amount per
share for the Fund.
The amounts and sources of distributions reported in these 19(a)
notices are only estimates and not for tax reporting purposes. The
actual amounts and sources of the amounts for tax reporting
purposes will depend upon the Fund’s investment experience during
the remainder of its fiscal year and may be subject to changes
based on tax regulations. Shareholders will receive a Form 1099-DIV
for the calendar year that will tell you how to report these
distributions for federal income tax purposes.
| |
|
Total
Cumulative Distributions
for the year ended April 30, 2022 |
|
% Breakdown of
the
Total Cumulative Distributions
for the year ended April 30, 2022 |
| |
|
Net
Investment
Income |
|
Net
Realized
Capital
Gains |
|
|
Return
of Capital |
|
|
Total
Per
Common
Share |
|
|
Net
Investment
Income |
|
Net
Realized
Capital
Gains |
|
|
Return
of Capital |
|
|
Total
Per
Common
Share |
|
|
Reaves Utility Income Fund |
|
$ |
0.34508 |
|
$ |
0.79492 |
|
|
$ |
0.00000 |
|
|
$ |
1.14000 |
|
|
30.27% |
|
|
69.73 |
% |
|
|
0.00 |
% |
|
|
100.00 |
% |
The Fund’s dividend policy is to distribute all or a portion of its
net investment income to its shareholders on a monthly basis. In
order to provide shareholders with a more stable level of dividend
distributions, the Fund may at times pay out less than the entire
amount of net investment income earned in any particular month and
may at times in any particular month pay out such accumulated but
undistributed income in addition to net investment income earned in
that month. As a result, the dividends paid by the Fund for any
particular month may be more or less than the amount of net
investment income earned by the Fund during such month. The Fund’s
current accumulated but undistributed net investment income, if
any, is disclosed in the Statement of Assets and Liabilities, which
comprises part of the financial information included in this
report.
|
30 |
www.utilityincomefund.com |
| Reaves Utility Income Fund |
Additional
Information |
April 30, 2022 (Unaudited)
ANNUAL MEETING OF SHAREHOLDERS
On April 5, 2022, the Annual Meeting of Shareholders of the Fund
was held to elect one Trustee. On February 1, 2022, the record date
for the meeting, the Fund had 67,727,944 outstanding common shares.
The votes cast at the meeting were as follows:
Proposal 1 – Proposal to elect one Trustee:
Election of Jeremy W. Deems as Trustee of the Fund:
| |
Shares Voted |
% Voted |
| Affirmative |
47,734,271.304 |
97.553% |
| Withheld |
1,197,532.000 |
2.447% |
| TOTAL |
48,931,803.304 |
100.000% |
| Semi-Annual Report | April 30, 2022 |
31 |
| Reaves Utility Income Fund |
Privacy Policy |
April 30, 2022 (Unaudited)
The Fund is committed to ensuring your financial privacy. This
notice is being sent to comply with privacy regulations of the
Securities and Exchange Commission. The Fund has in effect the
following policy with respect to nonpublic personal information
about its customers:
|
● |
Only such information received from
you, through application forms or otherwise, and information about
your Fund transactions will be collected. |
|
● |
None of such information about you
(or former customers) will be disclosed to anyone, except as
permitted by law (which includes disclosure to employees necessary
to service your account). |
|
● |
Policies and procedures (including
physical, electronic and procedural safeguards) are in place that
are designed to protect the confidentiality of such
information. |
For more information about the Fund’s privacy policies call
(800) 644-5571 (toll-free).
|
32 |
www.utilityincomefund.com |
Not applicable to this report.
|
Item 3. |
Audit Committee Financial
Expert. |
Not applicable to this report.
|
Item 4. |
Principal Accountant Fees and
Services. |
Not applicable to this report.
|
Item 5. |
Audit Committee of Listed Registrants. |
Not applicable to this report.
|
(a) |
The schedule of investments is included as part of the Reports
to Stockholders filed under Item 1(a) of this report. |
|
(b) |
Not applicable to the
registrant. |
|
Item 7. |
Disclosure of Proxy Voting
Policies and Procedures for Closed-End Management Investment
Companies. |
Not applicable.
|
Item 8. |
Portfolio Managers of Closed-End
Management Investment Companies. |
|
(a) |
Not applicable to this report. |
|
Item 9. |
Purchases of Equity Securities
by Closed-End Management Investment Company and Affiliated
Purchasers. |
None.
|
Item 10. |
Submission of Matters to a Vote
of Security Holders. |
No material changes to the procedures by which the shareholders may
recommend nominees to the registrant’s Board of Trustees have been
implemented after the registrant last provided disclosure in
response to the requirements of Item 407(c)(2)(iv) of Regulation
S-K (17 CFR 229.407) (as required by Item 22(b)(15) of Schedule 14A
(17 CFR 240.14a-101)), or this Item.
|
Item 11. |
Controls and
Procedures. |
(a) Based on an
evaluation of the registrant’s disclosure controls and procedures
(as defined in Rule 30a-3(c) under the Investment Company Act of
1940, as amended), the registrant’s principal executive officer and
principal financial officer have concluded that the registrant’s
disclosure controls and procedures are effective as of a date
within 90 days of the filing date of this report.
(b) There were no
significant changes in the registrant’s internal control over
financial reporting that occurred during the period covered by this
report that have materially affected, or are reasonably likely to
materially affect, the registrant’s internal control over financial
reporting.
Item 12. Disclosure of Securities Lending Activities for
Closed-End Management Investment Companies.
Item 13. Exhibits.
|
(a)(1) |
Not applicable to semi-annual
report. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934
and the Investment Company Act of 1940, the registrant has duly
caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
REAVES UTILITY INCOME FUND
| By: |
/s/ Joseph (Jay) Rhame III |
|
| |
Joseph (Jay) Rhame
III |
|
| |
President (Principal Executive
Officer) |
|
| |
|
|
| Date: |
July 8, 2022 |
|
Pursuant to the requirements of the Securities Exchange Act of 1934
and the Investment Company Act of 1940, this report has been signed
below by the following persons on behalf of the registrant and in
the capacities and on the dates indicated.
| By: |
/s/ Joseph (Jay) Rhame III |
|
| |
Joseph (Jay) Rhame
III |
|
| |
President (Principal Executive
Officer) |
|
| |
|
|
| Date: |
July 8, 2022 |
|
| By: |
/s/ Jennell Panella |
|
| |
Jennell Panella |
|
| |
Treasurer (Principal Financial
Officer) |
|
| |
|
|
| Date: |
July 8, 2022 |
|
Reaves Utility Income (AMEX:UTG)
Graphique Historique de l'Action
De Jan 2023 à Fév 2023
Reaves Utility Income (AMEX:UTG)
Graphique Historique de l'Action
De Fév 2022 à Fév 2023
