Gabelli Utility Trust Continues Monthly Distributions, Declares Distributions of $0.05 Per Share

Rhea-AI Summary

The Gabelli Utility Trust (NYSE:GUT) has announced the continuation of its monthly cash distribution policy. The Board of Trustees has declared $0.05 per share distributions for October, November, and December 2024. The Fund has consistently paid monthly distributions since October 1999.

Key points:

• The Board is evaluating strategic opportunities in the current market environment
• The Fund's shares are trading at a premium to net asset value, which may not be sustainable
• Distributions may include long-term capital gains and qualified dividend income
• Approximately 8% of 2024 distributions are from net investment income, while 92% are deemed return of capital

The Fund's distribution policy is subject to modification, and shareholders should consider tax implications and consult financial advisors for personalized advice.

Positive

• Consistent monthly distributions of $0.05 per share
• Board evaluating strategic opportunities in current market environment
• Shares trading at a premium to net asset value

Negative

• Premium to net asset value may not be sustainable
• 92% of 2024 distributions deemed return of capital, potentially reducing shareholder cost basis
• 3.8% Medicare surcharge on 'net investment income' for certain U.S. shareholders

News Market Reaction – GUT

-1.63%

1 alert

-1.63% News Effect

On the day this news was published, GUT declined 1.63%, reflecting a mild negative market reaction.

Data tracked by StockTitan Argus on the day of publication.

RYE, N.Y., Aug. 23, 2024 (GLOBE NEWSWIRE) -- The Board of Trustees of The Gabelli Utility Trust (NYSE:GUT) (the “Fund”) approved the continuation of its policy of paying fixed monthly cash distributions. The Board of Trustees declared cash distributions of $0.05 per share for each of October, November, and December 2024.

Distribution Month	Record Date	Payable Date	Distribution Per Share
October	October 17, 2024	October 24, 2024	$0.05
November	November 14, 2024	November 21, 2024	$0.05
December	December 13, 2024	December 20, 2024	$0.05

Additionally, the Board of Directors continues to evaluate potential strategic opportunities for the Fund in what we believe to be an attractive environment to invest in the broader equity markets.

Each quarter, the Board of Trustees reviews the amount of any potential distribution from the income, realized capital gain, or capital available. The Board of Trustees will continue to monitor the Fund’s distribution level, taking into consideration the Fund’s net asset value and the financial market environment. If necessary, the Fund will pay an adjusting distribution in December which includes any additional income and net realized capital gains in excess of the monthly distributions for that year to satisfy the minimum distribution requirements of the Internal Revenue Code for regulated investment companies. The Fund’s distribution policy is subject to modification by the Board of Trustees at any time, and there can be no guarantee that the policy will continue. The distribution rate should not be considered the dividend yield or total return on an investment in the Fund. The Gabelli Utility Trust has paid a distribution to shareholders every month since October 1999.

The Fund’s shares are currently trading at a premium to net asset value. The Board of Trustees believes that the premium at which the Fund shares trade relative to net asset value is not likely to be sustainable. Shareholders participating in the Fund’s dividend reinvestment plan should note that at the current market price, the reinvestment of distributions occurs at a premium to net asset value.

All or part of the distribution may be treated as long-term capital gain or qualified dividend income (or a combination of both) for individuals, each subject to the maximum federal income tax rate for long term capital gains, which is currently 20% in taxable accounts for individuals (or less depending on an individual’s tax bracket). In addition, certain U.S. shareholders who are individuals, estates or trusts and whose income exceeds certain thresholds will be required to pay a 3.8% Medicare surcharge on their "net investment income", which includes dividends received from the Fund and capital gains from the sale or other disposition of shares of the Fund.

If the Fund does not generate sufficient earnings (dividends and interest income, less expenses, and realized net capital gain) equal to or in excess of the aggregate distributions paid by the Fund in a given year, then the amount distributed in excess of the Fund’s earnings would be deemed a return of capital. Since this would be considered a return of a portion of a shareholder’s original investment, it is generally not taxable and would be treated as a reduction in the shareholder’s cost basis.

Long-term capital gains, qualified dividend income, investment company taxable income, and return of capital, if any, will be allocated on a pro-rata basis to all distributions to common shareholders for the year. Based on the accounting records of the Fund currently available, each of the distributions paid to common shareholders in 2024 would include approximately 8% from net investment income and 92% would be deemed a return of capital on a book basis. This does not represent information for tax reporting purposes. The estimated components of each distribution are updated and provided to shareholders of record in a notice accompanying the distribution and are available on our website (www.gabelli.com). The final determination of the sources of all distributions in 2024 will be made after year end and can vary from the monthly estimates. Shareholders should not draw any conclusions about the Fund’s investment performance from the amount of the current distribution. All individual shareholders with taxable accounts will receive written notification regarding the components and tax treatment for all 2024 distributions in early 2025 via Form 1099-DIV.

Investors should carefully consider the investment objectives, risks, charges, and expenses of the Fund before investing. For more information regarding the Fund’s distribution policy and other information about the Fund, call:

David Schachter
(914) 921-5057

About The Gabelli Utility Trust
The Gabelli Utility Trust is a diversified, closed-end management investment company with $296 million in total net assets whose primary investment objective is to seek long-term growth of capital and income by investing primarily in utility companies involved in the generation and distribution of electricity, gas, and water. The Fund is managed by Gabelli Funds, LLC, a subsidiary of GAMCO Investors, Inc. (OTCQX: GAMI).

NYSE – GUT
CUSIP – 36240A101

Investor Relations Contact:
David Schachter
(914} 921-5057
dschachter@gabelli.com

FAQ

What is the monthly distribution amount for Gabelli Utility Trust (GUT) in Q4 2024?

The Gabelli Utility Trust (GUT) has declared a monthly cash distribution of $0.05 per share for each month in Q4 2024: October, November, and December.

How long has Gabelli Utility Trust (GUT) been paying monthly distributions?

The Gabelli Utility Trust (GUT) has been paying monthly distributions to shareholders consistently since October 1999.

What percentage of Gabelli Utility Trust's (GUT) 2024 distributions are considered return of capital?

Based on current accounting records, approximately 92% of Gabelli Utility Trust's (GUT) 2024 distributions are deemed return of capital on a book basis.

Are Gabelli Utility Trust (GUT) shares currently trading at a premium or discount to NAV?

Gabelli Utility Trust (GUT) shares are currently trading at a premium to net asset value, though the Board of Trustees believes this premium may not be sustainable.