-----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, KH6NV5RPj/6GGQmMN4GGWMPSihjUn1vMbyF3Z+Noo+bH0Cm8wKe5TloUKDhlvhqw dsx+SmDLyivDWQG00f7d7w== 0000950117-96-001479.txt : 19961121 0000950117-96-001479.hdr.sgml : 19961121 ACCESSION NUMBER: 0000950117-96-001479 CONFORMED SUBMISSION TYPE: N-30B-2 PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960930 FILED AS OF DATE: 19961119 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ROYCE VALUE TRUST INC CENTRAL INDEX KEY: 0000804116 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 133356097 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30B-2 SEC ACT: 1940 Act SEC FILE NUMBER: 001-09313 FILM NUMBER: 96668845 BUSINESS ADDRESS: STREET 1: 1414 AVE OF THE AMERICAS 9TH FL CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2123557311 MAIL ADDRESS: STREET 1: 1414 AVENUE OF THE AMERICAS CITY: NEW YORK STATE: NY ZIP: 10019 N-30B-2 1 ROYCE VALUE TRUST THIRD QUARTER REPORT Royce Value Trust 3rd QUARTER REPORT September 30, 1996 Dear Stockholder: After declining 15.5% from May 22 through July 24, small-cap stocks, as measured by the Russell 2000*, staged a comeback, rallying 12.3% through quarter end. However, unlike the large-cap oriented S&P 500* which made new highs near the end of the third quarter, the Russell 2000 failed to reach the peak established in the second quarter and now trails the large-cap index on a year-to-date performance basis. For the quarter, the S&P 500 was up 3.1% versus a 0.3% gain for the Russell 2000; year-to-date the S&P 500 is up 13.6% and the Russell 2000 is up 10.7%. The S&P Small-Cap 600*, the Fund's relative performance benchmark, had a strong quarterly showing, up 3.2%, and is now ahead of both the Russell 2000 and the S&P 500 with a 14.8% year-to-date gain. ROYCE VALUE TRUST ('RVT') MATCHED THE RUSSELL 2000 FOR THE THIRD QUARTER POSTING A 0.4% NAV RETURN, AND YEAR-TO-DATE THROUGH SEPTEMBER 30, THE FUND WAS UP 7.2% ON AN NAV BASIS. Contributing to the Fund's third quarter performance were nice gains in office furniture manufacturer, Kimball International, home furnishings manufacturer and retailer, Ethan Allen Interiors, and film manufacturer and processor, Seattle Filmworks. Average annual NAV total returns for the Fund for the 1-year, 5-year and since inception (11/26/86) periods were 8.1%, 14.8% and 12.1%, respectively. NOVEMBER WILL MARK RVT'S 10-YEAR ANNIVERSARY. The Fund began with approximately $100 million in net assets and, through appreciation, rights offerings and the issuance of preferred stock, net assets now exceed $425 million. The Fund remains one of the few domestic, closed-end small-cap offerings and one of only three, domestic closed-end equity funds with a fulcrum (performance-based) management fee instead of a traditional fixed fee structure. During the quarter, RVT completed a successful offering of 2.4 million shares of Cumulative Preferred Stock. The 8% cumulative preferred, which was sold at $25.00 per share, resulted in $58 million of net, new capital for the Fund and no dilution for stockholders. As your investment advisor, we are excited about the investment opportunities that the new capital will afford us. If you would like any information on the preferred stock, please contact the Fund's office at (800) 221-4268 for a prospectus. We appreciate your continued support of the Fund and look forward to another ten years together. Sincerely, CHARLES M. ROYCE Jack E. Fockler, Jr. Charles M. Royce W. Whitney George President Vice Presidents October 15, 1996 * The Russell 2000, S&P 500, and S&P Small-Cap 600 are unmanaged indices and include the reinvestment of dividends. PORTFOLIO SUMMARY The following information is provided as a 'bird's eye' view of the RVT portfolio at September 30, 1996. - ---------------------------------------------------------- WEIGHTED AVERAGES
Market Capitalization (Total Portfolio) $363 Million Median Market Capitalization (Total Portfolio) $265 Million P/E Ratio (100 Largest Positions) 13.6x P/B Ratio (100 Largest Positions) 1.6x Portfolio Yield (100 Largest Positions) 2.0%
- ---------------------------------------------------------- TOP TWENTY POSITIONS
Market Value ---------- 1. Ash Grove Cement Company Cl. B............ $4,399,147 2. The Standard Register Company............. 4,290,163 3. Kimball International, Inc. Cl. B......... 4,160,600 4. Marshall Industries....................... 4,097,000 5. Comdisco, Inc. ........................... 4,009,294 6. Stanhome, Inc. ........................... 3,952,988 7. Ethan Allen Interiors Inc. ............... 3,871,950 8. Zenith National Insurance Corp. .......... 3,793,200 9. Wesco Financial Corporation............... 3,741,000 10. Florida Rock Industries, Inc. ............ 3,646,913 11. Family Dollar Stores, Inc. ............... 3,612,263 12. Vallen Corporation........................ 3,488,258 13. Richardson Electronics, Ltd. ............. 3,485,800 14. Pennsylvania Manufacturers Corporation Cl. A......................................... 3,431,750 15. Lilly Industries, Inc. Cl. A.............. 3,382,905 16. Haemonetics Corporation................... 3,382,500 17. MacDermid, Incorporated................... 3,354,001 18. Velcro Industries N.V. ................... 3,348,150 19. Farmer Bros. Co. ......................... 3,322,000 20. Arnold Industries, Inc. .................. 3,317,706
FUND HIGHLIGHTS
September 30, 1996 ------------------ Net Asset Value Per Share.......................... $ 14.53 Market Price Per Share............................. $ 12.625
- -------------------------------------------------------------------------------- TOTAL RETURN PERFORMANCE
NAV Market Value Total Total S&P S&P Small- Russell Return(a) Return(b) 500`D' Cap 600`D' 2000`D' ------------- ------------- ------- ----------- -------- 3 months ended 9/30/96.................................... 0.4% 2.0% 3.1% 3.2% 0.3% 9 months ended 9/30/96.................................... 7.2 6.3 13.6 14.8 10.7 Annual Returns (ended December 31) 1995...................................................... 22.6 20.5 37.5 30.0 28.4 1994...................................................... 1.1 - 5.6 1.3 - 4.8 - 1.8 1993...................................................... 17.9 14.8 10.0 18.8 18.9 1992...................................................... 19.9 26.8 7.7 21.0 18.4 1991...................................................... 39.5 35.3 30.5 48.5 46.1 Average Annual Total Returns (ended September 30, 1996) 1-Year.................................................... 8.1 4.4 20.4 15.3 13.1 3-Year.................................................... 11.4 7.2 17.4 13.1 12.8 5-Year.................................................... 14.8 14.4 15.2 17.0 15.8 Since Inception*.......................................... 12.1 9.5 14.2 10.3 11.7
(a) Reflects the NAV experience of a continuous shareholder who reinvested all distributions and fully participated in primary rights offerings. (b) Reflects the market value experience of a continuous shareholder who reinvested all distributions and fully participated in primary rights offerings. * Inception date -- 11/26/86 'D' The indices are unmanaged and include the reinvestment of dividends. Source: Frank Russell Co. - -------------------------------------------------------------------------------- STATEMENT OF CHANGES IN NET ASSETS (UNAUDITED)
Nine Months Ended Three Months Ended September 30, September 30, 1996 1996 ------------------ ----------------- INVESTMENT OPERATIONS: Net investment income................................................. $ 1,149,346 $ 2,753,173 Net realized gain on investments...................................... 4,127,458 23,361,594 Net change in unrealized appreciation on investments.................. (1,649,774) 2,970,116 ------------------ ----------------- Net increase in net assets resulting from investment operations..... 3,627,030 29,084,883 DIVIDENDS AND DISTRIBUTIONS: Preferred stock dividend accrued but not yet declared................. (512,850) (512,850) CAPITAL STOCK TRANSACTIONS: Net proceeds from issuance of preferred stock......................... 57,740,000 57,740,000 ------------------ ----------------- NET INCREASE IN NET ASSETS.............................................. 60,854,180 86,312,033 NET ASSETS: Beginning of period................................................... 364,428,204 338,970,351 ------------------ ----------------- End of period......................................................... $425,282,384 $425,282,384 ------------------ ----------------- ------------------ -----------------
- -------------------------------------------------------------------------------- PORTFOLIO COMPOSITION
September 30, 1996 % of (unaudited) Total Investments ------------------ ----------------- Common Stocks.......................................................... $401,379,651 86.3% Bonds and Preferred Stock.............................................. 7,009,893 1.5 Repurchase Agreement................................................... 57,000,000 12.2 ------------------ ------ TOTAL INVESTMENTS.................................................... $465,389,544 100.0% ------------------ ------ ------------------ ------
- -------------------------------------------------------------------------------- The results presented in this report represent past performance and should not be considered representative of the 'total return' from an investment in the Fund today. They are provided only to give an historical perspective of the Fund. The investment return and net asset and market values of Fund shares will fluctuate, so that the shares may be worth more or less than their original cost when sold. ROYCE VALUE TRUST PHILOSOPHY RVT concentrates on buying the securities of small capitalization companies. RVT uses a strict fundamental value approach which emphasizes the understanding of balance sheets, cash flows and internal rates of return. RVT concentrates on understanding the private worth or value of a business. RVT attempts to reduce the risks associated with small company ownership. Market risk is lowered by using non-mainstream securities and company risk by favoring excess cash flow and low-leverage firms. Valuation risk is lowered by using strict pricing standards and portfolio risk by achieving wide diversification. The source of performance is the consistent use of strict value disciplines applied to less well-known securities. The Fund will apply these principles from year-to-year and attempt to avoid the opportunistic and fashionable investment styles of the moment. We believe that our method, emphasizing patience and value, comes the closest to an all-weather strategy for delivering consistent, above average long-term returns. NOTE: The Board of Directors has given the Fund's management the discretionary authority to cause the Fund to repurchase up to 300,000 shares of its common stock in open market and other transactions through December 31, 1996. Such repurchases would be effected at a price per share which is less than the then current net asset value, but not in excess of the then prevailing market price. The Board of Directors of the Fund is authorized to offer stockholders an opportunity to subscribe for additional shares of common stock of the Fund through rights offerings at a price per share that may be less than the then current net asset value of the Fund's common stock. The timing and terms of any such offerings are left to the Board's discretion. Royce Value Trust, Inc. 1414 Avenue of the Americas New York, N.Y. 10019 800-221-4268 STATEMENT OF DIFFERENCES The dagger symbol shall be expressed as 'D'. -----END PRIVACY-ENHANCED MESSAGE-----