UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY
Investment Company Act file number 811-07358
Duff & Phelps Utility and Corporate
Bond Trust Inc.
(Exact name of registrant as specified in charter)
200 South Wacker Drive, Suite 500, Chicago, Illinois 60606
(Address of principal executive offices) (Zip code)
Alan M. Meder | Lawrence R. Hamilton, Esq. | |
Duff & Phelps Utility and Corporate Bond Trust Inc. | Mayer Brown LLP | |
200 South Wacker Drive, Suite 500 | 71 South Wacker Drive | |
Chicago, Illinois 60606 | Chicago, Illinois 60606 |
(Name and address of agents for service)
Registrants telephone number, including area code: (800) 338-8214
Date of fiscal year end: October 31
Date of reporting period: January 31, 2017
ITEM 1. SCHEDULE OF INVESTMENTS.
See the Statement of Net Assets below.
DUFF & PHELPS UTILITY AND CORPORATE BOND TRUST INC.
STATEMENT OF NET ASSETS
January 31, 2017
(Unaudited)
Principal (000) |
Description | Value | ||||||
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|
|
|
||||
LONG-TERM INVESTMENTS - 138.8% | ||||||||
Corporate Bonds - 138.2% | ||||||||
Electric, Gas and Water - 54.3% | ||||||||
$4,000 | CMS Energy Corporation, | |||||||
5.05%, 3/15/22 (a) |
$4,386,828 | |||||||
10,000 | CalEnergy Company, Inc., | |||||||
8.48%, 9/15/28 (a)(b) |
14,472,060 | |||||||
5,000 | CenterPoint Energy Resources Corp., | |||||||
6.00%, 5/15/18 (a) |
5,232,705 | |||||||
10,713 | The Cleveland Electric Illuminating Company, | |||||||
8.875%, 11/15/18 (a)(b) |
11,977,980 | |||||||
5,000 | Commonwealth Edison Company, | |||||||
6.95%, 7/15/18 (a) |
5,346,510 | |||||||
5,000 | Consolidated Edison Company of New York Inc., | |||||||
5.85%, 4/01/18 (a) |
5,246,575 | |||||||
4,000 | The Detroit Edison Company, | |||||||
3.45%, 10/01/20 (a) |
4,159,500 | |||||||
4,000 | Dominion Resources, Inc., | |||||||
5.20%, 8/15/19 (a) |
4,297,916 | |||||||
10,000 | Entergy Texas, Inc., | |||||||
7.125%, 2/01/19 (a)(b) |
11,002,690 | |||||||
5,475 | Exelon Generation Company, LLC, | |||||||
6.20%, 10/01/17 (a) |
5,642,070 | |||||||
8,115 | Indiana Michigan Power Company, | |||||||
7.00%, 3/15/19 (a)(b) |
8,939,387 | |||||||
2,000 | Integrys Energy Group, Inc., | |||||||
4.17%, 11/01/20 |
2,105,404 | |||||||
7,000 | National Fuel Gas Company, | |||||||
6.50%, 4/15/18 (a)(b) |
7,301,133 | |||||||
4,000 | Nevada Power Company, | |||||||
7.125%, 3/15/19 |
4,434,716 | |||||||
5,000 | Oncor Electric Delivery Company, LLC, | |||||||
7.00%, 9/01/22 (a) |
6,096,615 | |||||||
10,000 | Progress Energy, Inc., | |||||||
7.05%, 3/15/19 (a)(b) |
11,030,650 | |||||||
3,000 | Public Service Electric & Gas Company, | |||||||
3.75%, 3/15/24 |
3,116,376 | |||||||
8,000 | Sempra Energy, | |||||||
6.15%, 6/15/18 (a)(b) |
8,481,768 | |||||||
7,785 | South Carolina Electric & Gas Company, | |||||||
6.50%, 11/01/18 (a)(b) |
8,416,075 | |||||||
5,000 | Southern California Edison Company, | |||||||
3.875%, 6/01/21 (a) |
5,306,440 | |||||||
4,000 | Southern Power Company, | |||||||
4.15%, 12/01/25 |
4,146,780 | |||||||
4,400 | Western Massachusetts Electric Company, | |||||||
3.50%, 9/15/21 (a) |
4,531,815 | |||||||
3,000 | Wisconsin Energy Corporation, | |||||||
3.55%, 6/15/25 (a)(b) |
3,054,672 | |||||||
|
|
|||||||
148,726,665 | ||||||||
|
|
The accompanying notes are an integral part of this financial statement.
1
DUFF & PHELPS UTILITY AND CORPORATE BOND TRUST INC.
STATEMENT OF NET ASSETS (Continued)
January 31, 2017
(Unaudited)
Principal (000) |
Description | Value |
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Financial - 35.3% | ||||||||
$5,000 | American Express Company, | |||||||
6.15%, 8/28/17 (a) |
$5,134,010 | |||||||
3,000 | AvalonBay Communities, Inc., | |||||||
3.95%, 1/15/21 (a) |
3,147,597 | |||||||
3,000 | Bank of America Corporation, | |||||||
5.00%, 5/13/21 |
3,257,424 | |||||||
3,000 | Citigroup Inc., | |||||||
4.50%, 1/14/22 (a) |
3,195,990 | |||||||
4,000 | Digital Realty Trust, L.P., | |||||||
5.25%, 3/15/21 |
4,340,632 | |||||||
4,000 | Duke Realty Limited Partnership, | |||||||
3.875%, 10/15/22 (a) |
4,189,944 | |||||||
3,000 | ERP Operating Limited Partnership, | |||||||
4.75%, 7/15/20 |
3,222,558 | |||||||
2,000 | Fifth Third Bancorp, | |||||||
3.50%, 3/15/22 |
2,055,264 | |||||||
5,000 | General Electric Capital Corporation, | |||||||
4.375%, 9/16/20 (a) |
5,388,025 | |||||||
4,000 | The Goldman Sachs Group, Inc., | |||||||
5.25%, 7/27/21 (a) |
4,390,928 | |||||||
5,000 | JPMorgan Chase & Co., | |||||||
6.00%, 1/15/18 |
5,206,775 | |||||||
4,000 | KeyCorp., | |||||||
5.10%, 3/24/21 (a) |
4,376,896 | |||||||
4,000 | Kimco Realty Corporation, | |||||||
3.20%, 5/01/21 (a) |
4,071,724 | |||||||
2,250 | Liberty Property Limited Partnership, | |||||||
4.125%, 6/15/22 |
2,360,178 | |||||||
5,000 | National City Corporation, | |||||||
6.875%, 5/15/19 (a) |
5,526,015 | |||||||
3,000 | Prologis, L.P., | |||||||
6.875%, 3/15/20 |
3,373,227 | |||||||
6,000 | Realty Income Corporation, | |||||||
6.75%, 8/15/19 (a)(b) |
6,703,560 | |||||||
4,000 | Regency Centers, L.P., | |||||||
4.80%, 4/15/21 (a) |
4,312,756 | |||||||
4,000 | Simon Property Group, L.P., | |||||||
4.375%, 3/01/21 (a) |
4,291,804 | |||||||
3,000 | UDR, Inc., | |||||||
4.625%, 1/10/22 |
3,207,114 | |||||||
4,000 | Ventas Realty, Limited Partnership and Ventas Capital Corporation, | |||||||
4.25%, 3/01/22 |
4,234,320 | |||||||
6,000 | Wachovia Bank NA, | |||||||
6.00%, 11/15/17 (a) |
6,205,734 | |||||||
4,000 | Welltower, Inc., | |||||||
6.125%, 4/15/20 (a) |
4,446,060 | |||||||
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|||||||
96,638,535 | ||||||||
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The accompanying notes are an integral part of this financial statement.
2
DUFF & PHELPS UTILITY AND CORPORATE BOND TRUST INC.
STATEMENT OF NET ASSETS (Continued)
January 31, 2017
(Unaudited)
Principal (000) |
Description | Value |
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Oil & Gas Storage, Transportation and Production - 23.2% | ||||||||
$4,000 | Conoco Inc., | |||||||
6.95%, 4/15/29 (a) |
$5,098,448 | |||||||
8,000 | EQT Corporation, | |||||||
8.125%, 6/01/19 (a)(b) |
9,004,704 | |||||||
5,000 | Enterprise Products Operating LLC, | |||||||
6.50%, 1/31/19 (a) |
5,444,475 | |||||||
5,000 | Kinder Morgan Energy Partners, L.P., | |||||||
7.75%, 3/15/32 (a) |
6,268,410 | |||||||
3,500 | Magellan Midstream Energy Partners, L.P., | |||||||
6.40%, 7/15/18 |
3,729,019 | |||||||
5,000 | Magellan Midstream Energy Partners, L.P., | |||||||
6.55%, 7/15/19 (a) |
5,523,555 | |||||||
4,000 | ONEOK Partners, L.P., | |||||||
4.90%, 3/15/25 |
4,306,160 | |||||||
4,000 | Plains All American Pipeline, L.P., | |||||||
5.00%, 2/01/21 |
4,308,120 | |||||||
7,000 | Spectra Energy Capital LLC, | |||||||
6.20%, 4/15/18 (a)(b) |
7,329,889 | |||||||
10,000 | Trans-Canada PipeLines Limited, | |||||||
9.875%, 1/01/21 (Canada) (a) |
12,627,150 | |||||||
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63,639,930 | ||||||||
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Industrial - 22.7% | ||||||||
4,000 | Amgen Inc., | |||||||
4.10%, 6/15/21 (a) |
4,248,060 | |||||||
4,000 | CSX Corporation, | |||||||
4.25%, 6/01/21 (a) |
4,265,460 | |||||||
3,000 | CVS Health Corporation, | |||||||
4.125%, 5/15/21 |
3,170,520 | |||||||
4,000 | Caterpillar Inc., | |||||||
3.90%, 5/27/21 (a) |
4,239,180 | |||||||
6,000 | The Dow Chemical Company, | |||||||
9.00%, 4/01/21 |
7,388,658 | |||||||
4,000 | Ford Motor Company, | |||||||
4.346%, 12/08/26 |
4,019,272 | |||||||
5,000 | Sun Company, Inc., | |||||||
9.00%, 11/01/24 |
6,080,240 | |||||||
5,275 | Tele-Communications, Inc., | |||||||
10.125%, 4/15/22 (a)(b) |
6,875,213 | |||||||
3,200 | Tele-Communications, Inc., | |||||||
9.875%, 6/15/22 (a) |
4,130,611 | |||||||
5,000 | Time Warner, Inc., | |||||||
9.15%, 2/01/23 (a)(b) |
6,468,665 | |||||||
5,000 | Wal-Mart Stores, Inc., | |||||||
6.75%, 10/15/23 |
6,214,260 | |||||||
5,000 | Xerox Corporation, | |||||||
6.35%, 5/15/18 |
5,248,765 | |||||||
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|||||||
62,348,904 | ||||||||
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The accompanying notes are an integral part of this financial statement.
3
DUFF & PHELPS UTILITY AND CORPORATE BOND TRUST INC.
STATEMENT OF NET ASSETS (Continued)
January 31, 2017
(Unaudited)
Principal (000) |
Description | Value |
||||||
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Telecommunications - 2.7% | ||||||||
$3,000 | AT&T Inc., | |||||||
4.60%, 2/15/21 |
$3,186,594 | |||||||
4,000 | Verizon Communications Inc., | |||||||
3.45%, 3/15/21 (a) |
4,106,036 | |||||||
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7,292,630 | ||||||||
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Total Corporate Bonds |
||||||||
(Cost $388,502,724) |
378,646,664 | |||||||
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Shares | ||||||||
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Non-Convertible Preferred Stock - 0.5% | ||||||||
Financial - 0.5% | ||||||||
50,000 | Vornado Realty Trust, Series I, | |||||||
6.625% |
1,271,500 | |||||||
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Total Non-Convertible Preferred Stock |
||||||||
(Cost $1,175,000) |
1,271,500 | |||||||
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Principal (000) |
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U.S. Government and Agency Mortgage-Backed Securities - 0.1% | ||||||||
Federal National Mortgage Association, | ||||||||
Pass-Through Certificates, | ||||||||
$62 | 8.00%, 10/01/30 |
72,682 | ||||||
231 | 7.00%, 12/01/31 |
264,778 | ||||||
Government National Mortgage Association, | ||||||||
Pass-Through Certificates, | ||||||||
5 | 7.00%, 3/15/26 |
4,858 | ||||||
31 | 8.00%, 11/15/30 |
32,862 | ||||||
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Total U.S. Government and Agency Mortgage-Backed Securities |
||||||||
(Cost $338,153) |
375,180 | |||||||
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TOTAL INVESTMENTS - 138.8% |
||||||||
(Cost $390,015,877) |
$380,293,344 | |||||||
|
|
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Secured borrowings - (45.6)% |
(125,000,000 | ) | ||||||
Other assets less other liabilities - 6.8% |
18,689,015 | |||||||
|
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|||||||
NET ASSETS APPLICABLE TO COMMON STOCK - 100.0% |
$273,982,359 | |||||||
|
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(a) | All or a portion of this security has been pledged as collateral for borrowings and made available for loan. |
(b) | All or a portion of this security has been loaned. |
The percentage shown for each investment category is the total value of that category as a percentage of the net assets applicable to common stock of the Fund.
The accompanying notes are an integral part of this financial statement.
4
DUFF & PHELPS UTILITY AND CORPORATE BOND TRUST INC.
STATEMENT OF NET ASSETS (Continued)
January 31, 2017
(Unaudited)
Note 1. Investment Valuation
The Funds investments are carried at fair value which is defined as the price that the Fund would receive upon selling an investment in a timely transaction to an independent buyer in the principal or most advantageous market of the investment. The three-tier hierarchy of inputs established to classify fair value measurements for disclosure purposes is summarized in the three broad levels listed below:
Level 1 quoted prices in active markets for identical securities.
Level 2 other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.).
Level 3 significant unobservable inputs (including the Funds own assumptions in determining fair value of investments).
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in these securities. For more information about the Funds policy regarding valuation of investments and other significant accounting policies, please refer to the Funds most recent financial statements contained in its annual report. The following is a summary of the inputs used to value each of the Funds investments at January 31, 2017:
Level 1 | Level 2 | |||||||
Corporate bonds |
| $ | 378,646,664 | |||||
Non-convertible preferred stock |
$ | 1,271,500 | | |||||
U.S. Government and Agency mortgage-backed securities |
| 375,180 | ||||||
|
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Total |
$ | 1,271,500 | $ | 379,021,844 | ||||
|
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|
There were no Level 3 priced securities held and there were no transfers between Level 1 and Level 2 related to securities held at January 31, 2017.
Note 2. Federal Tax Cost
At October 31, 2016, the Funds most recent fiscal tax year-end, the federal tax cost of investments and aggregate gross unrealized appreciation (depreciation) were as follows:
Federal Tax Cost |
Unrealized Appreciation |
Unrealized Depreciation |
Net Unrealized Depreciation | |||
$396,672,500 |
$10,437,880 | $(16,831,936) | $(6,394,056) |
The difference between the book basis and tax basis of unrealized appreciation (depreciation) and cost of investments is primarily attributable to the difference between book and tax amortization methods for premiums and discounts on fixed income securities.
Other information regarding the Fund is available on the Funds website at www.ducfund.com or the Securities and Exchange Commissions website at www.sec.gov.
5
ITEM 2. CONTROLS AND PROCEDURES.
(a) The registrants principal executive officer and principal financial officer have concluded that the registrants disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the 1940 Act)) are effective, based on an evaluation of those controls and procedures made as of a date within 90 days of the filing date of this report as required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) under the Securities Exchange Act of 1934.
(b) There has been no change in the registrants internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the registrants last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting.
ITEM 3. EXHIBITS.
Exhibit 99.CERT Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002.
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.
(Registrant) | DUFF & PHELPS UTILITY AND CORPORATE BOND TRUST INC. | |
By (Signature and Title) | /s/ NATHAN I. PARTAIN | |
| ||
Nathan I. Partain | ||
President and Chief Executive Officer | ||
(Principal Executive Officer) | ||
Date |
March 17, 2017 |
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 (Signature and Title) | /s/ NATHAN I. PARTAIN | |
| ||
Nathan I. Partain | ||
President and Chief Executive Officer | ||
(Principal Executive Officer) | ||
Date |
March 17, 2017 | |
By (Signature and Title) |
/s/ ALAN M. MEDER | |
| ||
Alan M. Meder | ||
Treasurer and Assistant Secretary | ||
(Principal Financial and Accounting Officer) | ||
Date |
March 17, 2017 |