-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FikHDQAK95umyEMcl/u4MP1bS97wAP2bJ5z4L4ky0oqbMfurfFRwRWTtHGa/9Mlb XwzzbD7CktFj/mbsMeK1BQ== 0000891092-03-001934.txt : 20030804 0000891092-03-001934.hdr.sgml : 20030804 20030804110516 ACCESSION NUMBER: 0000891092-03-001934 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20030630 FILED AS OF DATE: 20030804 EFFECTIVENESS DATE: 20030804 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CENTRAL SECURITIES CORP CENTRAL INDEX KEY: 0000018748 IRS NUMBER: 131875970 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-00179 FILM NUMBER: 03819465 BUSINESS ADDRESS: STREET 1: 375 PARK AVE CITY: NEW YORK STATE: NY ZIP: 10152 BUSINESS PHONE: 2126883011 MAIL ADDRESS: STREET 1: 375 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10152 FORMER COMPANY: FORMER CONFORMED NAME: TRANS CENTRAL SECURITIES CORP DATE OF NAME CHANGE: 19700722 FORMER COMPANY: FORMER CONFORMED NAME: BUERGER LADET & RADINSKY INC DATE OF NAME CHANGE: 19671026 N-CSR 1 e15160n_csr.txt SEMI-ANNUAL REPORT 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 811-179 Name of registrant as specified in charter: Central Securities Corporation Address of principal executive offices: 375 Park Avenue Suite 3404 New York, New York 10152 Name and address of agent for service: Central Securities Corporation, Wilmot H. Kidd, President 375 Park Avenue Suite 3404 New York, New York 10152 Registrant's telephone number, including area code: 212-688-3011 Date of fiscal year end: December 31, 2003 Date of reporting period: January 1, 2003 - June 30, 2003 Item 1. Reports to Stockholders. ================================================================================ CENTRAL SECURITIES CORPORATION ---------- SEMI-ANNUAL REPORT JUNE 30, 2003 ================================================================================ CENTRAL SECURITIES CORPORATION (Organized on October 1, 1929 as an investment company, registered as such with the Securities and Exchange Commission under the provisions of the Investment Company Act of 1940.) TEN YEAR HISTORICAL DATA
Per Share of Common Stock ------------------------------------ Total Convertible Net Net Net realized Unrealized net Preference asset investment Divi- Distribu- investment appreciation Year assets Stock(A) value income(B) dends(C) tions(C) gain of investments - ---- ------ ----------- ----- ---------- -------- --------- ------------ -------------- 1992 $165,599,864 $10,019,000 $14.33 $ 70,586,429 1993 218,868,360 9,960,900 17.90 $ .14 $ .18 $ 1.42 $16,407,909 111,304,454 1994 226,639,144 9,687,575 17.60 .23 .22 1.39 16,339,601 109,278,788 1995 292,547,559 9,488,350 21.74 .31 .33 1.60 20,112,563 162,016,798 1996 356,685,785 9,102,050 25.64 .27 .28 1.37 18,154,136 214,721,981 1997 434,423,053 9,040,850 29.97 .24 .34 2.08 30,133,125 273,760,444 1998 476,463,575 8,986,125 31.43 .29 .29 1.65 22,908,091 301,750,135 1999 590,655,679 -- 35.05 .26 .26 2.34 43,205,449 394,282,360 2000 596,289,086 -- 32.94 .32 .32 4.03 65,921,671 363,263,634 2001 539,839,060 -- 28.54 .18 .22 1.58* 13,662,612 304,887,640 2002 361,942,568 -- 18.72 .14 .14 1.11 22,869,274 119,501,484 6 mos. to June 30, 421,972,928 -- 22.06 .07 .01 .11 15,999,401 168,084,528 2003**
- ---------- A - At liquidation preference. B - Excluding gains or losses realized on sale of investments and the dividend requirement on the Convertible Preference Stock which was redeemed on August 1, 1999. C - Computed on the basis of the Corporation's status as a "regulated investment company" for Federal income tax purposes. Dividends are from undistributed net investment income. Distributions are from long-term investment gains. * Includes a non-taxable return of capital of $.55. ** Unaudited. The Common Stock is listed on the American Stock Exchange. On June 30, 2003 the market quotations were as follows: Common Stock.................................. $18.85 low, $18.99 high and $18.92 last sale [ 2 ] To the Stockholders of CENTRAL SECURITIES CORPORATION: Financial statements for the six months ended June 30, 2003 reviewed by our independent accountants and other pertinent information are submitted herewith. Comparative net assets are as follows: June 30, 2003 December 31, (Unaudited) 2002 ----------- ------------ Net assets ................................... $421,972,928 $ 361,942,568 Net assets per share of Common Stock ......... 22.06 18.72 Shares of Common Stock outstanding ....... 19,124,984 19,337,284 Comparative operating results are as follows: Six months ended June 30, ---------------------------- 2003 2002 (Unaudited) (Unaudited) ----------- ----------- Net investment income ........................ $ 1,325,898 $ 1,724,727 Per share of Common Stock ................ .07* .09* Net realized gain on sale of investments ..... 15,999,401 24,051,213 Increase (decrease) in net unrealized appreciation of investments ................ 48,583,044 (110,396,802) Increase (decrease) in net assets resulting from operations .................. 65,908,343 (84,620,862) - ---------- * Per-share data are based on the average number of Common shares outstanding. A dividend of $.12 per share was paid on June 20, 2003 to holders of Common Stock. Stockholders will be sent a notice concerning the taxability of all 2003 distributions in January 2004. During the first six months of 2003 the Corporation repurchased 212,300 shares of its Common Stock at an average price per share of $16.84. These shares were purchased on the American Stock Exchange. The Corporation may from time to time purchase Common Stock in such amounts and at such prices as the Board of Directors may deem advisable in the best interests of stockholders. Stockholders' inquiries are welcome. CENTRAL SECURITIES CORPORATION WILMOT H. KIDD, President 375 Park Avenue New York, NY 10152 July 23, 2003 [ 3 ] TEN LARGEST INVESTMENTS June 30, 2003 (Unaudited) % of Year First Cost Value Net Assets Acquired ---- ----- ---------- ---------- (millions) The Plymouth Rock Company, Inc. ....... $ 2.2 $51.9 12.3% 1982 American Management Systems, Inc. ..... 22.2 23.2 5.5 1984 Intel Corporation ..................... .5 21.9 5.2 1986 Capital One Financial Corporation ..... 2.2 21.6 5.1 1994 Analog Devices, Inc. .................. .6 17.4 4.1 1987 Brady Corporation ..................... 2.4 17.3 4.1 1984 The Bank of New York Company, Inc. .... 4.1 16.1 3.8 1993 Murphy Oil Corporation ................ 3.1 15.8 3.7 1974 SunGard Data Systems Inc. ............. 6.7 15.3 3.6 1999 Unisys Corporation .................... 12.6 14.1 3.3 1999 PRINCIPAL PORTFOLIO CHANGES April 1 to June 30, 2003 (Unaudited) (Common Stock unless specified otherwise) Number of Shares ---------------------------------------- Held June 30, Purchased Sold 2003 --------- ---- -------- Affymetrix, Inc...................... 100,000 100,000 Analog Devices, Inc.................. 50,000 500,000 Apple Computer Inc................... 100,000 100,000 Arch Capital Group Ltd............... 90,000 110,000 ArvinMeritor, Inc.................... 60,000 640,000 The Bank of New York Company, Inc.... 40,000 560,000 Capital One Financial Corp........... 60,000 440,000 CarMax, Inc.......................... 10,000 100,000* Concord EFS, Inc..................... 100,000 -- Dover Corporation.................... 170,000 170,000 Duke Energy Corp..................... 20,000 130,000 Flextronics International Ltd........ 50,000 1,300,000 HSBC Holdings Plc Ltd................ 53,500 -- Impath Inc........................... 70,000 490,000 Ingram Micro Inc. Class A............ 180,000 180,000 Intel Corporation.................... 60,000 1,050,000 Laboratory Corporation of America Holdings, Inc. ............ 110,000 110,000 Rohm and Haas Company................ 50,000 250,000 Roper Industries, Inc................ 64,700 84,700* Schering-Plough Corp................. 100,000 400,000 - ---------- * Includes shares considered "Other Investments" at March 31, 2003. [ 4 ] STATEMENT OF ASSETS AND LIABILITIES June 30, 2003 (Unaudited) ASSETS: Investments: General portfolio securities at market value (cost $205,090,957) (Note 1) .................................. $ 321,735,620 Securities of affiliated companies (cost $3,462,486) (Notes 1, 5 and 6) ...... 54,902,351 Short-term investments (cost $45,276,211) ... 45,276,211 $421,914,182 ------------- Cash, receivables and other assets: Cash and dividends receivable ............... 137,450 Office equipment, net ....................... 24,104 Other assets ................................ 38,720 200,274 ------------- ------------ Total Assets .............................. 422,114,456 LIABILITIES: Accrued expenses and reserves ................. 141,528 ------------- Total Liabilities ......................... 141,528 ------------ NET ASSETS ...................................... $421,972,928 ============ NET ASSETS are represented by: Common Stock $1 par value: authorized 30,000,000 shares; issued 19,347,284 (Note 2) .................................... $ 19,347,284 Surplus: Paid-in ..................................... $ 221,065,405 Undistributed net gain on sales of investments ............................... 15,999,970 Undistributed net investment income ......... 1,221,276 238,286,651 ------------- Net unrealized appreciation of investments .... 168,084,528 Treasury stock, at cost (222,300 shares of Common Stock) (Note 2) ...................... (3,745,535) ------------ NET ASSETS ...................................... $421,972,928 ============ NET ASSET VALUE PER COMMON SHARE (19,124,984 shares outstanding) ............... $22.06 ====== See accompanying notes to financial statements and independent accountants' review report. [ 5 ] STATEMENT OF OPERATIONS For the six months ended June 30, 2003 (Unaudited) INVESTMENT INCOME Income: Dividends (net of foreign withholding taxes of $3,395) ............................ $ 2,035,635 Interest ...................................... 290,042 $ 2,325,677 ----------- Expenses: Administration and operations ................. 270,237 Investment research ........................... 240,458 Rent and utilities ............................ 85,599 Franchise and miscellaneous taxes ............. 72,239 Listing, software and sundry fees ............. 55,817 Insurance ..................................... 53,464 Directors' fees ............................... 51,000 Legal, auditing and tax fees .................. 34,388 Publications .................................. 25,593 Stationery, supplies, printing and postage ................................. 24,918 Transfer agent and registrar fees and expenses ................................ 17,805 Travel and telephone .......................... 13,013 Custodian fees ................................ 11,727 Employees' retirement plans ................... 7,600 Miscellaneous ................................. 35,921 999,779 ----------- ----------- Net investment income ........................... 1,325,898 NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS Net realized gain from security transactions .................................. 15,999,401 Net increase in unrealized appreciation of investments ................................ 48,583,044 ----------- Net gain on investments ....................... 64,582,445 ----------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ............................... $65,908,343 =========== See accompanying notes to financial statements and independent accountants' review report. [ 6 ] STATEMENTS OF CHANGES IN NET ASSETS For the six months ended June 30, 2003 and the year ended December 31, 2002 Six months ended June 30, Year ended 2003 December 31, (Unaudited) 2002 ------------- ------------- FROM OPERATIONS: Net investment income ........................ $ 1,325,898 $ 2,592,249 Net realized gain on investments ............. 15,999,401 22,869,274 Net increase (decrease) in unrealized appreciation of investments .............. 48,583,044 (185,386,156) ------------- ------------- Increase (decrease) in net assets resulting from operations ................ 65,908,343 (159,924,633) ------------- ------------- DISTRIBUTIONS TO STOCKHOLDERS FROM: Net investment income ........................ (129,008) (2,571,208) Net realized gain from investment transactions ............................... (2,173,790) (20,694,915) ------------- ------------- Decrease in net assets from distributions .. (2,302,798) (23,266,123) ------------- ------------- FROM CAPITAL SHARE TRANSACTIONS: (Note 2) Distribution to stockholders reinvested in Common Stock ............................ -- 12,119,838 Cost of shares of Common Stock repurchased ... (3,575,185) (6,825,574) ------------- ------------- Increase (decrease) in net assets from capital share transactions ............... (3,575,185) 5,294,264 ------------- ------------- Total increase (decrease) in net assets .. 60,030,360 (177,896,492) NET ASSETS: Beginning of period .......................... 361,942,568 539,839,060 ------------- ------------- End of period (including undistributed net investment income of $1,221,276 and $24,386, respectively) .............................. $ 421,972,928 $ 361,942,568 ============= ============= See accompanying notes to financial statements and independent accountants' review report. [ 7 ] STATEMENT OF INVESTMENTS June 30, 2003 (Unaudited) PORTFOLIO SECURITIES (89.3%) STOCKS (COMMON UNLESS SPECIFIED OTHERWISE) Prin. Amt. or Shares Value - ---------- ----- Banking and Finance 9.7% 560,000 The Bank of New York Company, Inc............ $ 16,100,000 440,000 Capital One Financial Corporation............ 21,639,200 100,000 FleetBoston Financial Corporation............. 2,971,000 ------------ 40,710,200 ------------ Chemicals 3.3% 1,372,400 PolyOne Corporation(a)........................ 6,107,180 250,000 Rohm and Haas Company......................... 7,757,500 ------------ 13,864,680 ------------ Communications 1.6% 1,000,000 Cincinnati Bell Inc.(a)(d).................... 6,700,000 ------------ Computer Software & Services 18.9% 280,000 Accenture Ltd.(a)............................. 5,065,200 1,620,000 American Management Systems, Inc.(a)......... 23,182,200 880,000 Convergys Corporation(a)...................... 14,080,000 200,000 Peerless Systems Corporation(a)............... 506,000 590,000 SunGard Data Systems Inc.(a).................. 15,286,900 900,000 The TriZetto Group, Inc.(a)................... 5,391,000 1,150,000 Unisys Corporation(a)......................... 14,122,000 500,000 Wind River Systems, Inc.(a)................... 1,905,000 ------------ 79,538,300 ------------ Electronics 14.9% 500,000 Analog Devices, Inc.(a)....................... 17,410,000 100,000 Apple Computer Inc.(a)........................ 1,906,000 1,300,000 Flextronics International Ltd.(a)............. 13,559,000 180,000 Ingram Micro Inc. Class A..................... 1,980,000 1,050,000 Intel Corporation............................. 21,850,500 330,000 Motorola, Inc................................. 3,111,900 800,000 Solectron Corporation(a)...................... 2,992,000 ------------ 62,809,400 ------------ Energy 8.1% 130,000 Duke Energy Corporation....................... 2,593,500 160,000 EnCana Corporation............................ 6,139,200 220,000 Kerr-McGee Corporation........................ 9,856,000 300,000 Murphy Oil Corporation........................ 15,780,000 ------------ 34,368,700 ------------ [ 8 ] Prin. Amt. or Shares Value - ---------- ----- Health Care 6.3% 100,000 Affymetrix, Inc.(a)........................... $ 1,971,000 490,000 Impath Inc.(a)................................ 6,913,900 110,000 Laboratory Corporation of America Holdings(a) 3,316,500 100,000 Merck & Co. Inc............................... 6,055,000 400,000 Schering-Plough Corporation................... 7,440,000 150,000 Vical Incorporated(a)......................... 678,000 ------------ 26,374,400 ------------ Insurance 16.0% 100,000 American International Group, Inc............. 5,518,000 110,000 Arch Capital Group Ltd.(a).................... 3,814,800 50,000 Everest Re Group Ltd.......................... 3,825,000 50,000 Marsh & McLennan Companies, Inc.............. 2,553,500 70,000 The Plymouth Rock Company, Inc. Class A(b)(c) 51,940,000 ------------ 67,651,300 ------------ Manufacturing 9.1% 640,000 ArvinMeritor, Inc............................. 12,915,200 520,000 Brady Corporation Class A..................... 17,342,000 170,000 Dover Corporation............................. 5,093,200 84,700 Roper Industries, Inc......................... 3,150,840 ------------ 38,501,240 ------------ Retail Trade 0.7% 100,000 CarMax, Inc.(a)............................... 3,015,000 ------------ Transportation 0.7% 533,757 Transport Corporation of America, Inc. Class B(a)(b)............................... 2,962,351 ------------ Miscellaneous 0.0% Grumman Hill Investments, L.P.(a)(c)......... 142,400 ------------ Total Portfolio Securities (cost $208,553,443)...................... 376,637,971 ------------ [ 9 ] Prin. Amt. or Shares Value - ---------- ----- SHORT-TERM INVESTMENTS 10.7% Commercial Paper 4.4% $ 7,509,000 John Deere Credit Corp. 0.901% due 7/30/03................................. $ 7,503,556 11,058,000 Prudential Funding Corp. 1.081% due 7/2/03.................................. 11,057,668 ------------ 18,561,224 ------------ U.S. Treasury Bills 6.3% 26,724,000 U.S. Treasury Bills 0.710%- 0.913% due 7/10/03-7/24/03......................... 26,714,987 ------------ Total Short-Term Investments (cost $45,276,211)..................... 45,276,211 ------------ Total Investments (cost $253,829,654)(100.0%)............ 421,914,182 Cash, receivables and other assets less liabilities (0.0%)................. 58,746 ------------ Net Assets (100%)......................... $421,972,928 ============ - ---------- (a) Non-dividend paying. (b) Affiliate as defined in the Investment Company Act of 1940. (c) Valued at estimated fair value. (d) Formerly known as Broadwing Inc. See accompanying notes to financial statements and independent accountants' review report. [ 10 ] NOTES TO FINANCIAL STATEMENTS -- (unaudited) 1. Significant Accounting Policies -- The Corporation is registered under the Investment Company Act of 1940, as amended, as a non-diversified, closed-end management investment company. The following is a summary of the significant accounting policies consistently followed by the Corporation in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America. Security Valuation -- Securities are valued at the last sale price or, if unavailable, at the closing bid price. Corporate discount notes are valued at amortized cost, which approximates market value. Securities for which no ready market exists, including The Plymouth Rock Company, Inc. Class A Common Stock, are valued at estimated fair value by the Board of Directors. Federal Income Taxes -- It is the Corporation's policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income to its stockholders. Therefore, no Federal income taxes have been accrued. Use of Estimates -- The preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported. Actual results could differ from those estimates. Other -- Security transactions are accounted for on the date the securities are purchased or sold, and cost of securities sold is determined by specific identification. Dividend income and distributions to stockholders are recorded on the ex-dividend date. 2. Common Stock -- The Corporation repurchased 212,300 shares of its Common Stock in the first six months of 2003 at an average price of $16.84 per share, representing an average discount from net asset value of 14.1%. It may from time to time purchase Common Stock in such amounts and at such prices as the Board of Directors may deem advisable in the best interests of the stockholders. Purchases will only be made at less than net asset value per share, thereby increasing the net asset value of shares held by the remaining stockholders. Shares so acquired may be held as treasury stock, available for optional stock distributions, or may be retired. 3. Investment Transactions -- The aggregate cost of securities purchased and the aggregate proceeds of securities sold during the six months ended June 30, 2003 (excluding short-term investments), were $32,932,279 and $33,493,271, respectively. As of June 30, 2003, based on cost for Federal income tax purposes, the aggregate gross unrealized appreciation and depreciation for all securities were $191,247,467 and $23,162,939, respectively. 4. Operating Expenses -- The aggregate remuneration paid during the six months ended June 30, 2003 to officers and directors amounted to $529,500, of which $51,000 was paid as fees to directors who were not officers. Benefits to employees are provided through a profit sharing retirement plan. Contributions to the plan are made at the discretion of the Board of Directors, and each participant's benefits vest after three years. No contributions were made to the plan for the six months ended June 30, 2003. [ 11 ] NOTES TO FINANCIAL STATEMENTS -- continued (unaudited) 5. Affiliates-- The Plymouth Rock Company, Inc. and Transport Corporation of America, Inc. are affiliates as defined in the Investment Company Act of 1940. The Corporation received dividends of $461,300 from affiliates during the six months ended June 30, 2003. Unrealized appreciation related to affiliates increased by $10,286,942 for the six months ended June 30, 2003 to $51,439,865. 6. Restricted Securities -- The Corporation from time to time invests in securities the resale of which is restricted. On June 30, 2003 such investments had an aggregate value of $52,082,400, which was equal to 12.3% of the Corporation's net assets. Investments in restricted securities at June 30, 2003, including acquisition dates and cost, were:
Company Shares Security Date Purchased Cost - ---------------------------------- ---------- ------------------- -------------- ---------- Grumman Hill Investments, L.P. Limited Partnership 9/11/85 $ 18,162 Interest The Plymouth Rock 70,000 Class A Common 12/15/82 1,500,000 Company, Inc. Stock 6/9/84 699,986
The Corporation does not have the right to demand registration of the restricted securities. Unrealized appreciation related to restricted securities increased by $9,907,885 for the six months ended June 30, 2003 to $49,864,252. [ 12 ] FINANCIAL HIGHLIGHTS
Six Mos. Ended June 30, 2003 (Unaudited) 2002 2001 2000 1999 1998 ------------- ----------- ----------- ----------- ----------- ----------- Per Share Operating Performance Net asset value, beginning of period ............ $ 18.72 $ 28.54 $ 32.94 $ 35.05 $ 31.43 $ 29.97 Net investment income* .......................... .07 .14 .18 .32 .30 .34 Net realized and unrealized gain (loss) on securities ................................. 3.39 (8.71) (2.78) 1.92 5.96 3.11 ----------- ----------- ----------- ----------- ----------- ----------- Total from investment operations .............................. 3.46 (8.57) (2.60) 2.24 6.26 3.45 Less: Dividends from net investment income** To Preference Stockholders .................. -- -- -- -- .04 .05 To Common Stockholders ...................... .01 .14 .22 .32 .26 .29 Distributions from capital gains** To Common Stockholders ...................... .11 1.11 1.03 4.03 2.34 1.65 Return of Capital** To Common Stockholders ...................... -- -- .55 -- -- -- ----------- ----------- ----------- ----------- ----------- ----------- Total distributions ....................... .12 1.25 1.80 4.35 2.64 1.99 ----------- ----------- ----------- ----------- ----------- ----------- Net asset value, end of period .................. $ 22.06 $ 18.72 $ 28.54 $ 32.94 $ 35.05 $ 31.43 =========== =========== =========== =========== =========== =========== Per share market value, end of period ................................. $ 18.92 $ 16.28 $ 25.31 $ 28.25 $ 27.25 $ 24.38 Total investment return, market(%) ..................................... 15.66+ (31.23) (2.42) 17.75 22.96 (11.57) Total investment return, NAV(%) ................. 18.48+ (29.43) (6.54) 7.02 31.79 13.75 Ratios/Supplemental Data: Net assets, end of period(000) .................. $ 421,973 $ 361,943 $ 539,839 $ 596,289 $ 590,656 $ 476,464 Ratio of expenses to average net assets for Common(%) .......................... .53++ .50 .45 .38 .45 .51 Ratio of net investment income to average net assets for Common(%) ..................................... .58++ .57 .60 .83 .89 1.09 Portfolio turnover rate(%) ...................... 10.11+ 19.50 10.32 13.54 12.06 6.21
- ---------- * Per-share data are based on the average number of Common Shares outstanding during the period. ** Computed on the basis of the Corporation's status as a "regulated investment company" for Federal income tax purposes. + Not annualized. ++ Annualized, not necessarily indicative of full year ratio. See accompanying notes to financial statements and independent accountants' review report. [ 13 ] - -------------------------------------------------------------------------------- INDEPENDENT ACCOUNTANTS' REVIEW REPORT TO THE BOARD OF DIRECTORS AND STOCKHOLDERS OF CENTRAL SECURITIES CORPORATION We have reviewed the accompanying statement of assets and liabilities, including the statement of investments, of Central Securities Corporation as of June 30, 2003, and the related statements of operations, changes in net assets and financial highlights for the six-month period ended June 30, 2003. These financial statements are the responsibility of the management of Central Securities Corporation. We have conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States of America. We have previously audited, in accordance with auditing standards generally accepted in the United States of America, the statement of changes in net assets for the year ended December 31, 2002, and financial highlights for each of the five years in the period ended December 31, 2002, and in our report dated January 29, 2003 we expressed an unqualified opinion on those statements. KPMG LLP New York, NY July 23, 2003 - -------------------------------------------------------------------------------- ANNUAL MEETING OF STOCKHOLDERS -- (unaudited) The annual meeting of stockholders of the Corporation was held on March 12, 2003. At the meeting all of the directors of the Corporation were reelected by the following vote of the holders of the Common Stock: Donald G. Calder, 18,115,246 shares in favor, 138,200 shares withheld; Jay R. Inglis, 18,103,684 shares in favor, 149,762 shares withheld; Dudley D. Johnson, 18,115,589 shares in favor, 137,857 shares withheld; Wilmot H. Kidd, 17,871,283 shares in favor, 382,163 shares withheld; and C. Carter Walker, Jr., 18,114,354 shares in favor, 139,092 shares withheld. In addition, the selection of KPMG LLP as independent auditors of the Corporation for the year 2003 was ratified by the following vote of the holders of the Common Stock: 18,159,452 shares in favor, 45,646 shares against, 48,241 shares abstaining. [ 14 ] BOARD OF DIRECTORS DONALD G. CALDER DUDLEY D. JOHNSON President President G. L. Ohrstrom & Co., Inc. Young & Franklin Inc. New York, NY Liverpool, NY JAY R. INGLIS WILMOT H. KIDD Executive Vice President President National Marine Underwriters, Inc. New York, NY C. CARTER WALKER, JR. Washington, CT OFFICERS WILMOT H. KIDD, President CHARLES N. EDGERTON, Vice President and Treasurer MARLENE A. KRUMHOLZ, Secretary OFFICE 375 Park Avenue, New York, NY 10152 212-688-3011 866-593-2507 (toll free) www.centralsecurities.com CUSTODIAN UMB Bank, N. A. P.O. Box 419226, Kansas City, MO 64141-6226 TRANSFER AGENT AND REGISTRAR EquiServe Trust Company P.O. Box 43069, Providence, RI 02940-3069 781-575-2724 www.equiserve.com INDEPENDENT AUDITORS KPMG LLP 757 Third Avenue, New York, NY 10017 [ 15 ] Item 2. Code of Ethics. N/A. Item is only applicable for annual reports for periods ending on or after July 15, 2003. Item 3. Audit Committee Financial Experts. N/A. Item is only applicable for annual reports for periods ending on or after July 15, 2003. Item 4. Principal Accountant Fees and Services. N/A. Item is only applicable for annual reports for periods ending on or after December 15, 2003. Item 5. Audit Committee of Listed Registrants. N/A. Item is only applicable for annual reports for periods ending on or after January 15, 2004. Item 6. [Reserved] Item 7. Disclose Proxy Voting Policies and Procedures for Closed-End Management Companies. N/A. Item is only applicable for annual reports for periods ending on or after July 15, 2003. Item 8. [Reserved] Item 9. Controls and Procedures. (a) The Principal Executive Officer and Principal Financial Officer of Central Securities Corporation (the "Corporation") have concluded that the Corporation's Disclosure Controls and Procedures (as defined in Rule 30a-2(c) under the Investment Company Act of 1940) are effective based on their evaluation of the Disclosure Controls and Procedures as of a date within 90 days of the filing date of this report. (b) There have been no significant changes in the Corporation's internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Item 10. Exhibits. (a) Any code of ethics, or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy the Item 2 requirements through filing of an exhibit. Not applicable. (b) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2 under the Act. Attached hereto. 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. Central Securities Corporation By: /s/ Wilmot H. Kidd ---------------------------- Wilmot H. Kidd President August 4, 2003 - -------------- Date 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. Central Securities Corporation By: /s/ Charles N. Edgerton ---------------------------- Charles N. Edgerton Treasurer August 4, 2003 - -------------- Date EX-99.302CERT 3 e15160ex99.txt CERTIFICATION Exhibit 99.302 CERT Certification pursuant to Section 302 of the Sarbanes-Oxley Act I, Wilmot H. Kidd, certify that: 1. I have reviewed this report on Form N-CSR of Central Securities Corporation; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in rule 30a-2(c) under the Investment Company Act) for the registrant and have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this report (the "Evaluation Date"); and c) presented in this report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize, and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: July 23, 2003 /s/ Wilmot H. Kidd ------------- ------------------ Wilmot H. Kidd President EX-99.906 4 e15160ex99-906.txt CERTIFICATION Exhibit 99.906 CERT Certification pursuant to Section 302 of the Sarbanes-Oxley Act I, Charles N. Edgerton, certify that: 1. I have reviewed this report on Form N-CSR of Central Securities Corporation; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in rule 30a-2(c) under the Investment Company Act) for the registrant and have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this report (the "Evaluation Date"); and c) presented in this report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize, and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 6. The registrant's other certifying officers and I have indicated in this report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. Date: July 23, 2003 /s/ Charles N. Edgerton ------------- ----------------------- Charles N. Edgerton Treasurer Certification Pursuant to Section 906 of the Sarbanes-Oxley Act I, Wilmot H. Kidd, President of Central Securities Corporation (the "Corporation"), certify that: 1. The Corporation's periodic report on Form N-CSR for the period ended June 30, 2003 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation. July 23, 2003 /s/ Wilmot H. Kidd - ------------- ------------------ Date Wilmot H. Kidd President - -------------------------------------------------------------------------------- Certification Pursuant to Section 906 of the Sarbanes-Oxley Act I, Charles N. Edgerton, Treasurer of Central Securities Corporation (the "Corporation"), certify that: 1. The Corporation's periodic report on Form N-CSR for the period ended June 30, 2003 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Corporation. July 23, 2003 /s/ Charles N. Edgerton - ------------- ----------------------- Date Charles N. Edgerton Treasurer - -------------------------------------------------------------------------------- A signed original of this written statement required by Section 906 has been provided to the Corporation and will be retained by the Corporation and furnished to the Securities and Exchange Commission or its staff upon request. -----END PRIVACY-ENHANCED MESSAGE-----