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)
Karen
S. Gilomen, Esq.
ALPS
Fund Services, Inc.
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: November 1, 2018 - October 31, 2019
Item
1. Reports to Stockholders.
(a)
section
19(b)
disclosure
October
31, 2019 (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 $0.18 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 invest-ment 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 down-turns impacting the markets, increased market volatility, companies suspend-ing 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
|
Report
of Independent Registered Public Accounting Firm
|
6
|
Statement
of Investments
|
7
|
Statement
of Assets and Liabilities
|
11
|
Statement
of Operations
|
12
|
Statement
of Changes in Net Assets
|
13
|
Statement
of Cash Flows
|
14
|
Financial
Highlights
|
16
|
Notes
to Financial Statements
|
18
|
Additional
Information
|
26
|
Trustees
& Officers
|
30
|
Beginning
on January 1, 2021, as permitted by regulations adopted by the U.S. Securities and Exchange Commission, paper copies of the Funds’
annual and semi-annual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the
reports. Instead, the reports will be made available on the Fund’s website at www.utilityincomefund.com, and you will be
notified by mail each time a report is posted and provided with a website link to access the report.
Beginning
on January 1, 2019, you may, notwithstanding the availability of shareholder reports online, elect to receive all future shareholder
reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to
request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Fund, you can call
1-866-230-0315, from 8am to 5pm CT, to let the Fund know you wish to continue receiving paper copies of your shareholder reports.
If
you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take
any action. You may elect to receive shareholder reports and other communications from a Fund electronically anytime by contacting
your financial intermediary (such as a broker-dealer or bank) or, if you are a direct investor, by calling 1-866-230-0315.
Annual Report | October
31, 2019
|
1
|
Reaves
Utility Income Fund
|
Shareholder
Letter
|
October
31, 2019 (Unaudited)
To
our Shareholders:
2019
Investment Portfolio Returns
Total
net assets of the Fund were $1,779,985,345 at October 31, 2019, or $36.52 of net asset value (“NAV”) per common
share. One year ago, net assets totaled $1,544,961,106 representing $31.74 of net asset value per common share.
The
changes include distributions to shareholders totaling $101,291,071. 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
fiscal 2019 market return for shareholders was 29.94% as is reflected in the table to follow. The share price of the Fund traded
at a premium of 1.56% to the NAV at fiscal year-end in contrast to the 6.4% discount at the beginning of the fiscal year.
|
Year
Ended October 31, 2019
|
|
One
Year
|
Three
Years+
|
Five
Years+
|
Since
Inception+**
|
Total
investment return – Net
Asset Value*
|
22.38%
|
11.64%
|
9.33%
|
16.24%
|
Total
investment return – Market
Price*
|
29.94%
|
15.29%
|
10.94%
|
16.80%
|
S&P
500 Utilities Index1
|
23.71%
|
12.97%
|
10.98%
|
12.77%
|
Dow
Jones Utility Average2
|
22.11%
|
12.41%
|
11.49%
|
13.30%
|
|
*
|
Assumes
all dividends being reinvested
|
|
**
|
Index
data since 02/29/04
|
|
1
|
S&P
Utilities Index is a capitalization-weighted index containing 28 Electric and Gas Utility stocks (including multi-utilities and
independent power producers). Prior to July 1996, this index included telecommunications equities power producers.
|
|
2
|
The
Dow Jones Utility Average (DJUA) is a price-weighted average of the 15 utility stocks traded in the United States.
|
Distributions
to Common Shareholders
Since
the Fund’s first distribution in April 2004, distributions to shareholders have totaled over $800 million consisting of
divided income and realized capital gains with no returns of capital. The Trustees of the Fund regularly review the amount of
the monthly distribution. The monthly distribution has been increased on eleven occasions from the initial monthly amount of
$0.0967 per share to the current amount of $0.18 per share, representing a cumulative increase of 86.1%. For calendar year
2018, all distributions from the Fund were paid from net investment income including realized capital gains. We anticipate
that all distributions for the 12 months ending December 31, 2019 will also be characterized as paid from net investment
income and realized capital gains.
2
|
www.utilityincomefund.com
|
Reaves
Utility Income Fund
|
Shareholder
Letter
|
October
31, 2019 (Unaudited)
Leverage
Facility
The
$445,000,000 principal amount of the loan facility was unchanged during this fiscal year. Due to the appreciation of the
Fund, the leverage decreased from 28.8% of net assets to about 25.0% at October 31, 2019. For details about the facility
please refer to Note 4 of the accompanying financial statements.
Overview
Fiscal
year 2019 experienced a steadily declining interest rate on the 10-year U.S. Treasury. The decline from 3.15% to 1.69% produced
a favorable climate for investors focused on utilities and communications companies that produce and grow dividend income. In
contrast, high-yielding energy companies with poor earnings experienced stock price declines in spite of higher-than-market dividend
yields.
California
wildfires were once again a factor for utility investors to consider. PG&E Corp. was forced to file for bankruptcy given the
liabilities incurred from wildfires. The Fund did not own PG&E shares, but did continue to own San Diego-based Sempra Energy
which earned an exceptional total return for the year. Sempra’s service territory is much less prone to wildfires, and its
Southern California based utility assets are part of a diversified multi-state portfolio.
Earnings
and dividend growth of portfolio companies have generally met our expectations. Good earnings predictability is characteristic
of the Fund’s communications and utility holdings. Energy company valuations are challenged by weak commodity prices and
the prospect that climate-related regulation, and increasingly competitive renewable alternatives, will result in declining global
fossil-fuel demand in the foreseeable future.
Utilities
For
the third time in the last four fiscal years the S&P Utilities sector generated double-digit returns. Earnings and dividend
growth met our expectations with total returns for Fund holdings exceeding our expectations due to the meaningful expansion of
earnings multiples. We continue to look for earnings and dividend growth in 2020, but multiple expansion, comparable to fiscal
year 2019, is not likely.
Communications
The
cable, towers and telecom services investments delivered double-digit returns led by the cable companies. The sector’s weighting
remains largely unchanged. Our view is that growth in demand for broadband services will persist in the years ahead. Cable companies
are two of the Fund’s top-10 holdings. Communications services dividends will provide a material amount of the Fund’s
dividend income.
Energy
Total
returns have not kept pace with the overall portfolio. However, energy stocks provide meaningful dividend income. We expect
the Fund’s energy investments will increase their dividends in 2020. The industry faces long-term challenges from weak
commodity prices, investor and legislative emphasis on environmental stewardship and concern that the demand for fossil fuels
will experience long-term decline. The production and consumption of energy is changing; we will look to identify
beneficiaries from the change.
Annual
Report | October 31, 2019
|
3
|
Reaves
Utility Income Fund
|
Shareholder
Letter
|
October
31, 2019 (Unaudited)
Sincerely,
Ronald
J. Sorenson, Chief Investment Officer
John
P. Bartlett, Vice President, CFA
Timothy O. Porter, Vice President, CFA
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
|
October
31, 2019 (Unaudited)
Industry
Allocation as of October 31, 2019
|
*
|
Includes
Money Market Funds
|
Holdings
are subject to change
Annual
Report | October 31, 2019
|
5
|
|
Report
of Independent Registered
|
Reaves
Utility Income Fund
|
Public
Accounting Firm
|
To
the shareholders and the Board of Trustees of Reaves Utility Income Fund
Opinion
on the Financial Statements and Financial Highlights
We
have audited the accompanying statement of assets and liabilities of Reaves Utility Income Fund (the “Fund”), including
the statement of investments, as of October 31, 2019, the related statements of operations and cash flows for the year then ended,
the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each
of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights
present fairly, in all material respects, the financial position of the Fund as of October 31, 2019, and the results of its operations
and its cash flows for the year then ended, the changes in its net assets for each of the two years in the period then ended,
and the financial highlights for each of the five years in the period then ended in conformity with accounting principles generally
accepted in the United States of America.
Basis
for Opinion
These
financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to
express an opinion on the Fund’s financial statements and financial highlights based on our audits. We are a public accounting
firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent
with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities
and Exchange Commission and the PCAOB.
We
conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement,
whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control
over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial
reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial
reporting. Accordingly, we express no such opinion.
Our
audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights,
whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a
test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also
included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall
presentation of the financial statements and financial highlights. Our procedures included confirmation of securities owned as
of October 31, 2019, by correspondence with the custodian and brokers; when replies were not received from brokers, we performed
other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
DELOITTE
& TOUCHE LLP
Denver,
Colorado
December
20, 2019
We
have served as the auditor of Reaves Utility Income Fund since 2005.
6
|
www.utilityincomefund.com
|
Reaves
Utility Income Fund
|
Statement
of Investments
|
October
31, 2019
|
|
|
SHARES
|
|
|
|
VALUE
|
|
COMMON STOCKS 121.00%
|
|
|
|
|
|
|
|
|
Airlines 1.79%
|
|
|
|
|
|
|
|
|
Delta Air Lines, Inc.(1)
|
|
|
580,000
|
|
|
$
|
31,946,400
|
|
|
|
|
|
|
|
|
|
|
Diversified Telecommunication Services 16.40%
|
|
|
|
|
|
|
|
|
AT&T, Inc.
|
|
|
613,234
|
|
|
|
23,603,377
|
|
BCE, Inc.(1)
|
|
|
1,900,000
|
|
|
|
90,155,000
|
|
TELUS Corp.
|
|
|
1,880,000
|
|
|
|
66,872,669
|
|
Verizon Communications, Inc.(1)
|
|
|
1,840,000
|
|
|
|
111,264,800
|
|
|
|
|
|
|
|
|
291,895,846
|
|
|
|
|
|
|
|
|
|
|
Electric Utilities 23.81%
|
|
|
|
|
|
|
|
|
Edison International(1)
|
|
|
860,000
|
|
|
|
54,094,000
|
|
Eversource Energy(1)
|
|
|
555,000
|
|
|
|
46,475,700
|
|
FirstEnergy Corp.
|
|
|
500,000
|
|
|
|
24,160,000
|
|
Fortis, Inc.(1)
|
|
|
1,400,000
|
|
|
|
58,192,681
|
|
NextEra Energy, Inc.(1)
|
|
|
454,000
|
|
|
|
108,206,360
|
|
Pinnacle West Capital Corp.(1)
|
|
|
350,000
|
|
|
|
32,942,000
|
|
PPL Corp.(1)
|
|
|
960,000
|
|
|
|
32,150,400
|
|
The Southern Co.
|
|
|
1,080,000
|
|
|
|
67,672,800
|
|
|
|
|
|
|
|
|
423,893,941
|
|
|
|
|
|
|
|
|
|
|
Gas Utilities 2.02%
|
|
|
|
|
|
|
|
|
Atmos Energy Corp.
|
|
|
161,500
|
|
|
|
18,165,520
|
|
South Jersey Industries, Inc.
|
|
|
361,000
|
|
|
|
11,609,760
|
|
Southwest Gas Corp.
|
|
|
70,000
|
|
|
|
6,111,000
|
|
|
|
|
|
|
|
|
35,886,280
|
|
|
|
|
|
|
|
|
|
|
Independent Power and Renewable
Electricity Producers 3.08%
|
|
|
|
|
|
|
|
|
NextEra Energy Partners LP(1)
|
|
|
1,040,000
|
|
|
|
54,808,000
|
|
|
|
|
|
|
|
|
|
|
Interactive Media & Services 0.78%
|
|
|
|
|
|
|
|
|
Alphabet, Inc., Class C(2)
|
|
|
11,000
|
|
|
|
13,861,210
|
|
|
|
|
|
|
|
|
|
|
Media 13.62%
|
|
|
|
|
|
|
|
|
Altice USA, Inc., Class A(2)
|
|
|
2,610,000
|
|
|
|
80,779,500
|
|
CBS Corp., Class B
|
|
|
100,000
|
|
|
|
3,604,000
|
|
Charter Communications, Inc., Class A(1)(2)
|
|
|
200,000
|
|
|
|
93,572,000
|
|
Comcast Corp., Class A(1)
|
|
|
1,440,000
|
|
|
|
64,540,800
|
|
|
|
|
|
|
|
|
242,496,300
|
|
|
|
|
|
|
|
|
|
|
Multi-Utilities 29.02%
|
|
|
|
|
|
|
|
|
CMS Energy Corp.(1)
|
|
|
571,000
|
|
|
|
36,498,320
|
|
Dominion Energy, Inc.(1)
|
|
|
920,000
|
|
|
|
75,946,000
|
|
Annual
Report | October 31, 2019
|
7
|
Reaves
Utility Income Fund
|
Statement
of Investments
|
October
31, 2019
|
|
SHARES
|
|
|
VALUE
|
|
Multi-Utilities (continued)
|
|
|
|
|
|
|
|
|
DTE Energy Co.(1)
|
|
|
932,000
|
|
|
$
|
118,662,240
|
|
National Grid PLC, Sponsored ADR
|
|
|
1
|
|
|
|
58
|
|
NiSource, Inc.
|
|
|
442,000
|
|
|
|
12,393,680
|
|
Public Service Enterprise Group, Inc.(1)
|
|
|
1,100,000
|
|
|
|
69,641,000
|
|
Sempra Energy(1)
|
|
|
840,000
|
|
|
|
121,388,400
|
|
WEC Energy Group, Inc.(1)
|
|
|
868,700
|
|
|
|
82,005,280
|
|
|
|
|
|
|
|
|
516,534,978
|
|
|
|
|
|
|
|
|
|
|
Oil, Gas & Consumable Fuels 16.11%
|
|
|
|
|
|
|
|
|
BP PLC
|
|
|
375,000
|
|
|
|
2,376,812
|
|
BP PLC, Sponsored ADR
|
|
|
850,000
|
|
|
|
32,223,500
|
|
EOG Resources, Inc.
|
|
|
71,000
|
|
|
|
4,921,010
|
|
Exxon Mobil Corp.
|
|
|
450,000
|
|
|
|
30,406,500
|
|
Marathon Petroleum Corp.
|
|
|
575,000
|
|
|
|
36,771,250
|
|
Occidental Petroleum Corp.
|
|
|
295,000
|
|
|
|
11,947,500
|
|
ONEOK, Inc.(1)
|
|
|
1,100,000
|
|
|
|
76,813,000
|
|
Royal Dutch Shell PLC:
|
|
|
|
|
|
|
|
|
Class A
|
|
|
200,000
|
|
|
|
5,785,049
|
|
Class A, Sponsored ADR(1)
|
|
|
1,300,000
|
|
|
|
75,361,000
|
|
TC Energy Corp.
|
|
|
200,000
|
|
|
|
10,066,000
|
|
|
|
|
|
|
|
|
286,671,621
|
|
|
|
|
|
|
|
|
|
|
Real Estate Investment Trusts (REITs) 5.85%
|
|
|
|
|
|
|
|
|
CoreSite Realty Corp.
|
|
|
40,000
|
|
|
|
4,700,000
|
|
Crown Castle International Corp.(1)
|
|
|
335,000
|
|
|
|
46,494,650
|
|
Equinix, Inc.(1)
|
|
|
85,000
|
|
|
|
48,176,300
|
|
SBA Communications Corp.
|
|
|
20,000
|
|
|
|
4,813,000
|
|
|
|
|
|
|
|
|
104,183,950
|
|
|
|
|
|
|
|
|
|
|
Road & Rail 5.19%
|
|
|
|
|
|
|
|
|
Union Pacific Corp.(1)
|
|
|
558,000
|
|
|
|
92,326,680
|
|
|
|
|
|
|
|
|
|
|
Water Utilities 2.71%
|
|
|
|
|
|
|
|
|
American Water Works Co., Inc.(1)
|
|
|
392,000
|
|
|
|
48,321,840
|
|
|
|
|
|
|
|
|
|
|
Wireless Telecommunication Services 0.62%
|
|
|
|
|
|
|
|
|
T-Mobile US, Inc.(2)
|
|
|
133,000
|
|
|
|
10,993,780
|
|
|
|
|
|
|
|
|
|
|
TOTAL COMMON STOCKS
|
|
|
|
|
|
|
|
|
(Cost $1,548,539,206)
|
|
|
|
|
|
|
2,153,820,826
|
|
8
|
www.utilityincomefund.com
|
Reaves
Utility Income Fund
|
Statement
of Investments
|
October
31, 2019
|
|
SHARES
|
|
|
VALUE
|
|
LIMITED PARTNERSHIPS 2.03%
|
|
|
|
|
|
|
|
|
Oil, Gas & Consumable Fuels 2.03%
|
|
|
|
|
|
|
|
|
Bastion Energy LLC (Anglo Dutch)(3)(4)
|
|
|
|
|
|
$
|
437,324
|
|
Enterprise Products Partners LP(1)
|
|
|
1,370,000
|
|
|
|
35,661,100
|
|
Talara Opportunities II, LP(2)(3)(4)(5)
|
|
|
|
|
|
|
–
|
|
|
|
|
|
|
|
|
36,098,424
|
|
TOTAL LIMITED PARTNERSHIPS
|
|
|
|
|
|
|
|
|
(Cost $32,192,946)
|
|
|
|
|
|
|
36,098,424
|
|
|
|
BOND RATING
MOODY/S&P
|
|
PRINCIPAL
AMOUNT
|
|
|
VALUE
|
|
CORPORATE BONDS 0.05%
|
|
|
|
|
|
|
|
|
|
|
Diversified Telecommunication
Services 0.05%
|
|
|
|
|
|
|
|
|
|
|
Frontier
Communications Corp., 7.125%, 01/15/2023
|
|
Caa3/CCC
|
|
$
|
2,000,000
|
|
|
|
907,500
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL CORPORATE BONDS
|
|
|
|
|
|
|
|
|
|
|
(Cost $1,943,951)
|
|
|
|
|
|
|
|
|
907,500
|
|
|
|
SHARES
|
|
|
VALUE
|
|
MONEY MARKET FUNDS 1.91%
|
|
|
|
|
|
|
|
|
Federated Treasury Obligations
Money Market Fund, 1.700% (7-Day Yield)
|
|
|
33,971,281
|
|
|
|
33,971,281
|
|
|
|
|
|
|
|
|
|
|
TOTAL MONEY MARKET FUNDS
|
|
|
|
|
|
|
|
|
(Cost $33,971,281)
|
|
|
|
|
|
|
33,971,281
|
|
|
|
|
|
|
|
|
|
|
TOTAL INVESTMENTS - 124.99%
|
|
|
|
|
|
|
|
|
(Cost $1,616,647,384)
|
|
|
|
|
|
$
|
2,224,798,031
|
|
|
|
|
|
|
|
|
|
|
LEVERAGE FACILITY - (25.00%)
|
|
|
|
|
|
|
(445,000,000
|
)
|
|
|
|
|
|
|
|
|
|
OTHER ASSETS IN EXCESS OF LIABILITIES - 0.01%
|
|
|
|
|
|
|
187,314
|
|
|
|
|
|
|
|
|
|
|
NET ASSETS - 100.00%
|
|
|
|
|
|
$
|
1,779,985,345
|
|
|
(1)
|
Pledged
security; a portion or all of the security is pledged as collateral for borrowings as
of October 31, 2019. (See Note 4)
|
|
(2)
|
Non-Income
Producing Security.
|
|
(3)
|
Restricted
security. Investment represents a non-public partnership interest and is not unitized.
(See Note 5)
|
Annual
Report | October 31, 2019
|
9
|
Reaves
Utility Income Fund
|
Statement
of Investments
|
October
31, 2019
|
(4)
|
Security
fair valued by management, pursuant to procedures approved by the Board of Trustees,
using significant unobservable inputs. (See Note 1)
|
|
(5)
|
Underlying
investment filed for bankruptcy in May 2019. Received notice of dissolution in November
2019.
|
Common
Abbreviations:
ADR
- American Depositary Receipt
Co.
- Company
Corp.
- Corporation
Inc.
- Incorporated
LLC
- Limited Liability Company
LP
- Limited Partnership
PLC
- Public Limited Company
See
Notes to Financial Statements.
10
|
www.utilityincomefund.com
|
Reaves
Utility Income Fund
|
Statement
of Assets and Liabilities
|
October
31, 2019
ASSETS:
|
|
|
|
Investments, at value (Cost $1,616,647,384)
|
|
$
|
2,224,798,031
|
|
Foreign currency, at value (Cost $96,804)
|
|
|
96,804
|
|
Dividends receivable
|
|
|
2,600,492
|
|
Interest receivable
|
|
|
88,648
|
|
Receivable for investments sold
|
|
|
403,090
|
|
Other assets
|
|
|
771
|
|
Total Assets
|
|
|
2,227,987,836
|
|
|
|
|
|
|
LIABILITIES:
|
|
|
|
|
Loan payable
|
|
|
445,000,000
|
|
Interest payable on loan outstanding
|
|
|
387,604
|
|
Payable for investments purchased
|
|
|
748,485
|
|
Accrued investment advisory fees
|
|
|
1,089,568
|
|
Accrued administration fees
|
|
|
502,149
|
|
Accrued trustees' fees
|
|
|
40,860
|
|
Accrued chief compliance officer fees
|
|
|
3,250
|
|
Other payables and accrued expenses
|
|
|
230,575
|
|
Total Liabilities
|
|
|
448,002,491
|
|
Net Assets Applicable to Common Shareholders
|
|
$
|
1,779,985,345
|
|
|
|
|
|
|
COMPOSITION OF NET ASSETS ATTRIBUTABLE TO COMMON SHARES:
|
|
|
|
|
Paid-in capital
|
|
$
|
1,139,967,949
|
|
Total distributable earnings
|
|
|
640,017,396
|
|
Net Assets Applicable to Common Shareholders
|
|
$
|
1,779,985,345
|
|
|
|
|
|
|
Shares of common stock outstanding of no par value, unlimited shares authorized
|
|
|
48,736,871
|
|
Net asset value per common share
|
|
$
|
36.52
|
|
See
Notes to Financial Statements.
Annual
Report | October 31, 2019
|
11
|
Reaves
Utility Income Fund
|
Statement
of Operations
|
For
the Year Ended October 31, 2019
INVESTMENT INCOME:
|
|
|
|
Dividends (Net of foreign withholding taxes of $2,089,315)
|
|
$
|
65,745,287
|
|
Interest on investment securities
|
|
|
153,790
|
|
Total Investment Income
|
|
|
65,899,077
|
|
|
|
|
|
|
EXPENSES:
|
|
|
|
|
Interest on loan
|
|
|
14,703,356
|
|
Investment advisory fees
|
|
|
12,109,922
|
|
Administration fees
|
|
|
5,581,068
|
|
Chief compliance officer fees
|
|
|
39,000
|
|
Trustees' fees
|
|
|
179,449
|
|
State tax
|
|
|
1,137,768
|
|
Miscellaneous fees
|
|
|
278,396
|
|
Total Expenses
|
|
|
34,028,959
|
|
|
|
|
|
|
Net Investment Income
|
|
|
31,870,118
|
|
|
|
|
|
|
Net realized gain/(loss) on:
|
|
|
|
|
Investment securities
|
|
|
73,218,951
|
|
Foreign currency transactions
|
|
|
(63,947
|
)
|
Change in unrealized appreciation/(depreciation) of:
|
|
|
|
|
Investment securities
|
|
|
229,026,410
|
|
Translation of assets and liabilities denominated in foreign currencies
|
|
|
(132
|
)
|
Net gain on investments and foreign currency transactions
|
|
|
302,181,282
|
|
|
|
|
|
|
Net Increase in Net Assets Attributable to Common Shares from Operations
|
|
$
|
334,051,400
|
|
See
Notes to Financial Statements.
12
|
www.utilityincomefund.com
|
Reaves
Utility Income Fund
|
Statement
of Changes in Net Assets
|
|
|
For the
Year Ended
October 31, 2019
|
|
|
For the
Year Ended
October 31, 2018
|
|
COMMON SHAREHOLDER OPERATIONS:
|
|
|
|
|
|
|
|
|
Net investment income
|
|
$
|
31,870,118
|
|
|
$
|
40,898,540
|
|
Net realized gain
|
|
|
73,155,004
|
|
|
|
54,172,551
|
|
Change in unrealized appreciation/(depreciation)
|
|
|
229,026,278
|
|
|
|
(66,012,058
|
)
|
Net increase in net assets attributable to common shares from operations
|
|
|
334,051,400
|
|
|
|
29,059,033
|
|
|
|
|
|
|
|
|
|
|
DISTRIBUTIONS TO COMMON SHAREHOLDERS:
|
|
|
|
|
|
|
|
|
Total amount of distributions
|
|
|
(101,291,071
|
)
|
|
|
(96,853,302
|
)
|
Net decrease in net assets from distributions to common shareholders
|
|
|
(101,291,071
|
)
|
|
|
(96,853,302
|
)
|
|
|
|
|
|
|
|
|
|
CAPITAL SHARE TRANSACTIONS:
|
|
|
|
|
|
|
|
|
Proceeds from common shares issued to shareholders from reinvestment of dividends
|
|
|
2,263,910
|
|
|
|
–
|
|
Offering cost(1)
|
|
|
–
|
|
|
|
(109,237
|
)
|
Net increase/(decrease) from capital share transactions
|
|
|
2,263,910
|
|
|
|
(109,237
|
)
|
|
|
|
|
|
|
|
|
|
Net Increase/(Decrease) in Net Assets Attributable to Common Shares
|
|
|
235,024,239
|
|
|
|
(67,903,506
|
)
|
|
|
|
|
|
|
|
|
|
NET ASSETS ATTRIBUTABLE TO COMMON SHAREHOLDERS:
|
|
|
|
|
|
|
|
|
Beginning of year
|
|
$
|
1,544,961,106
|
|
|
$
|
1,612,864,612
|
|
End of year
|
|
$
|
1,779,985,345
|
|
|
$
|
1,544,961,106
|
|
|
(1)
|
Additional
offering cost associated with rights offering which expired on October 4, 2017.
|
See
Notes to Financial Statements.
Annual
Report | October 31, 2019
|
13
|
Reaves
Utility Income Fund
|
Statement
of Cash Flows
|
For
the Year Ended October 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
Net increase in net assets from operations
|
|
$
|
334,051,400
|
|
Adjustments to reconcile net increase in net assets from operations to net cash provided by operating activities:
|
|
|
|
|
Purchase of investment securities
|
|
|
(461,155,193
|
)
|
Proceeds from disposition of investment securities
|
|
|
547,908,984
|
|
Net purchases of short-term investment securities
|
|
|
(19,888,983
|
)
|
Premium amortization
|
|
|
(13,804
|
)
|
Net realized (gain)/loss on:
|
|
|
|
|
Investment securities
|
|
|
(73,218,951
|
)
|
Net change in unrealized (appreciation)/depreciation on:
|
|
|
|
|
Investments
|
|
|
(229,026,410
|
)
|
(Increase)/Decrease in assets:
|
|
|
|
|
Dividends receivable
|
|
|
190,834
|
|
Interest receivable
|
|
|
(45,642
|
)
|
Other assets
|
|
|
69,389
|
|
Increase/(Decrease) in liabilities:
|
|
|
|
|
Interest payable on loan outstanding
|
|
|
(100,652
|
)
|
Accrued investment advisory fees
|
|
|
103,419
|
|
Accrued administration fees
|
|
|
47,663
|
|
Accrued trustees' fees
|
|
|
(3,361
|
)
|
Accrued chief compliance officer fees
|
|
|
(3,250
|
)
|
Other payables and accrued expenses
|
|
|
168,425
|
|
Net Cash Provided by Operating Activities
|
|
|
99,083,868
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
Cash distributions paid on Common Shares
|
|
|
(99,027,161
|
)
|
Net Cash Used in Financing Activities
|
|
|
(99,027,161
|
)
|
|
|
|
|
|
Net Increase in cash
|
|
|
56,707
|
|
Foreign currency, beginning of year
|
|
$
|
40,097
|
|
Foreign currency, end of year
|
|
$
|
96,804
|
|
|
|
|
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
|
|
|
|
Cash paid during the period for interest from bank borrowing
|
|
$
|
14,804,008
|
|
Non-cash financing activities not included herein consist of reinvestment of distributions of:
|
|
|
2,263,910
|
|
See
Notes to Financial Statements.
14
|
www.utilityincomefund.com
|
Page
Intentionally Left Blank
Reaves
Utility Income Fund
PER
COMMON SHARE OPERATING PERFORMANCE:
|
Net
asset value per share, beginning of period
|
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
|
Total
distributions and rights offering
|
|
Net
asset value per common share, end of year
|
Market
price per common share, end of year
|
|
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 year (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(5)
|
|
(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
|
For
the
Year Ended
10/31/19
|
|
For
the
Year Ended
10/31/18
|
|
For
the
Year Ended
10/31/17
|
|
For
the
Year Ended
10/31/16
|
|
For
the
Year Ended
10/31/15
|
$
|
31.74
|
|
|
$
|
33.14
|
|
|
$
|
32.53
|
|
|
$
|
30.29
|
|
|
$
|
32.71
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.65
|
|
|
|
0.84
|
|
|
|
1.00
|
|
|
|
0.84
|
|
|
|
0.84
|
|
|
6.21
|
|
|
|
(0.25
|
)
|
|
|
3.87
|
|
|
|
3.89
|
|
|
|
(1.47
|
)
|
|
6.86
|
|
|
|
0.59
|
|
|
|
4.87
|
|
|
|
4.73
|
|
|
|
(0.63
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(0.64
|
)
|
|
|
(0.83
|
)
|
|
|
(1.04
|
)
|
|
|
(0.99
|
)
|
|
|
(0.89
|
)
|
|
(1.44
|
)
|
|
|
(1.16
|
)
|
|
|
(1.80
|
)
|
|
|
(0.83
|
)
|
|
|
(0.90
|
)
|
|
(2.08
|
)
|
|
|
(1.99
|
)
|
|
|
(2.84
|
)
|
|
|
(1.82
|
)
|
|
|
(1.79
|
)
|
|
–
|
|
|
|
(0.00
|
)(2)
|
|
|
(1.42
|
)(3)
|
|
|
(0.67
|
)(3)
|
|
|
–
|
|
|
(2.08
|
)
|
|
|
(1.99
|
)
|
|
|
(4.26
|
)
|
|
|
(2.49
|
)
|
|
|
(1.79
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
36.52
|
|
|
$
|
31.74
|
|
|
$
|
33.14
|
|
|
$
|
32.53
|
|
|
$
|
30.29
|
|
$
|
37.09
|
|
|
$
|
30.36
|
|
|
$
|
31.02
|
|
|
$
|
30.00
|
|
|
$
|
29.67
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22.38
|
%
|
|
|
2.39
|
%
|
|
|
11.04
|
%
|
|
|
14.31
|
%
|
|
|
(1.78
|
)%
|
|
29.94
|
%
|
|
|
4.63
|
%
|
|
|
12.70
|
%
|
|
|
7.62
|
%
|
|
|
1.91
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,779,985
|
|
|
$
|
1,544,961
|
|
|
$
|
1,612,865
|
|
|
$
|
1,116,576
|
|
|
$
|
878,952
|
|
|
2.06
|
%
|
|
|
1.90
|
%
|
|
|
1.66
|
%
|
|
|
1.59
|
%
|
|
|
1.62
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.17
|
%
|
|
|
1.10
|
%
|
|
|
1.09
|
%
|
|
|
1.14
|
%
|
|
|
1.15
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1.93
|
%
|
|
|
2.62
|
%
|
|
|
2.97
|
%
|
|
|
2.66
|
%
|
|
|
2.67
|
%
|
|
22
|
%
|
|
|
24
|
%
|
|
|
15
|
%
|
|
|
34
|
%
|
|
|
32
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
445,000
|
|
|
$
|
445,000
|
|
|
$
|
320,000
|
|
|
$
|
320,000
|
|
|
$
|
320,000
|
|
$
|
5,000
|
|
|
$
|
4,472
|
|
|
$
|
6,040
|
|
|
$
|
4,489
|
|
|
$
|
3,747
|
|
Annual
Report | October 31, 2019
|
17
|
Reaves Utility
Income Fund
|
Notes
to Financial Statements
|
October
31, 2019
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
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.
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.
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.
18
|
www.utilityincomefund.com
|
Reaves Utility
Income Fund
|
Notes
to Financial Statements
|
October
31, 2019
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.
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, unrestricted assets or liabilities that the Fund has 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
|
Annual Report
| October 31, 2019
|
19
|
Reaves Utility
Income Fund
|
Notes
to Financial Statements
|
October
31, 2019
|
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.
|
The
following is a summary of the Fund’s investments in the fair value hierarchy as of October 31, 2019:
|
|
Valuation Inputs
|
|
|
|
|
|
Investments in Securities at Value*
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
Common Stocks
|
|
$
|
2,153,820,826
|
|
|
$
|
–
|
|
|
$
|
–
|
|
|
$
|
2,153,820,826
|
|
Limited Partnerships
|
|
|
35,661,100
|
|
|
|
–
|
|
|
|
437,324
|
|
|
|
36,098,424
|
|
Corporate Bonds
|
|
|
–
|
|
|
|
907,500
|
|
|
|
–
|
|
|
|
907,500
|
|
Money Market Funds
|
|
|
33,971,281
|
|
|
|
–
|
|
|
|
–
|
|
|
|
33,971,281
|
|
Total
|
|
$
|
2,223,453,207
|
|
|
$
|
907,500
|
|
|
$
|
437,324
|
|
|
$
|
2,224,798,031
|
|
|
*
|
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:
Investments
in
Securities
at
Value
|
Balance
as of
October
31,
2018
|
Realized
Gain/(Loss)
|
Change
in
Unrealized
Appreciation/
Depreciation
|
Purchases
|
Sales
Proceeds
|
Transfer
in
and/or
(out)
of
Level 3
|
Balance
as of
October
31,
2019
|
Net
change
in
unrealized
appreciation/
(depreciation)
included
in the
Statements
of
Operations
attributable
to
Level 3
investments
held at
October
31, 2019
|
Limited Partnerships
|
$5,845,732
|
$–
|
$(5,408,408)
|
$–
|
$–
|
$–
|
$437,324
|
$(5,408,408)
|
Total
|
$5,845,732
|
$–
|
$(5,408,408)
|
$–
|
$–
|
$–
|
$437,324
|
$(5,408,408)
|
The
table below provides additional information about the Level 3 fair value measurements as of October 31, 2019:
Investment Type
|
Value
as of 10/31/19
|
Valuation
Technique*
|
Unobservable
Input**
|
Amount
|
|
|
|
Discount
Rate
|
12.5%
|
|
|
|
Decline
Rate
|
25%
|
Limited Partnership
|
$437,324
|
Discounted
Cash Flow
|
Discount
for Lack of Marketability
|
15%
|
Total
|
$437,324
|
|
|
|
|
*
|
The
fair valuation procedures used to value the Level 3 investments are in accordance with the Fund's Board-approved fair valuation
policies.
|
20
|
www.utilityincomefund.com
|
Reaves Utility Income Fund
|
Notes
to Financial Statements
|
October
31, 2019
|
**
|
A
change in the unobservable input may result in a significant change to the value of the investment as of October 31, 2019 as follows:
|
Unobservable Input
|
Impact
to Value if
Input
Increases
|
Impact
to Value if
Input
Decreases
|
Discount Rate
|
Decrease
|
Increase
|
Decline Rate
|
Decrease
|
Increase
|
Discount for Lack
of Marketability
|
Decrease
|
Increase
|
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.
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 year ended October 31, 2019, 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 2.
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.
Annual Report | October 31,
2019
|
21
|
Reaves Utility Income Fund
|
Notes
to Financial Statements
|
October
31, 2019
2.
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 year ended October 31, 2019, 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.
The tax character of the distributions paid
by the Fund were as follows:
|
|
For the
Year Ended
October 31, 2019
|
|
|
For the
Year Ended
October 31, 2018
|
|
Distributions paid from:
|
|
|
|
|
|
|
|
|
Ordinary Income
|
|
$
|
31,216,062
|
|
|
$
|
40,326,896
|
|
Long-Term Capital Gain
|
|
|
70,075,009
|
|
|
|
56,526,406
|
|
Total
|
|
$
|
101,291,071
|
|
|
$
|
96,853,302
|
|
As
of October 31, 2019, the components of distributable earnings on a tax basis were as follows:
Accumulated Capital Gain
|
|
$
|
16,793,651
|
|
Unrealized Appreciation
|
|
|
632,444,731
|
|
Other Cumulative Effect of Timing Differences
|
|
|
(9,220,986
|
)
|
Total
|
|
$
|
640,017,396
|
|
The
tax components of distributable earnings are determined in accordance with income tax regulations which may differ from composition
of net assets reported under U.S. GAAP. Accordingly, for the year ended October 31, 2019, certain differences were reclassified.
The Fund increased total distributable earnings by $1,193 and decreased paid-in capital by $1,193.
22
|
www.utilityincomefund.com
|
Reaves Utility Income Fund
|
Notes
to Financial Statements
|
October
31, 2019
The
tax basis components of capital differ from the amounts reflected in the Statement of Assets and Liabilities due to temporary
book/tax differences primarily arising from wash sales and the tax treatment of investments in partnerships.
As
of October 31, 2019, net unrealized appreciation/depreciation of investments based on federal tax cost were as follows:
Gross appreciation (excess of value over tax cost)
|
|
$
|
668,724,037
|
|
Gross depreciation (excess of tax cost over value)
|
|
|
(36,278,062
|
)
|
Net depreciation of foreign currency
|
|
|
(1,244
|
)
|
Net unrealized appreciation
|
|
|
632,444,731
|
|
Cost of investments for income tax purposes
|
|
$
|
1,592,352,056
|
|
3.
CAPITAL TRANSACTIONS
Common
Shares: There are an unlimited number of no par value common shares of beneficial interest authorized.
Transactions
in common shares were as follows:
|
|
For the
Year Ended
October 31, 2019
|
|
|
For the
Year Ended
October 31, 2018
|
|
Common Stock outstanding - beginning of period
|
|
|
48,670,001
|
|
|
|
48,670,001
|
|
Common Stock issued as reinvestment of dividends
|
|
|
66,870
|
|
|
|
–
|
|
Common Stock outstanding - end of period
|
|
|
48,736,871
|
|
|
|
48,670,001
|
|
4.
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%. Prior to June 20, 2019 the interest rate was one month LIBOR plus 1.00%. 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.
For
the year ended October 31, 2019, the average amount borrowed under the Credit Agreement was $445,000,000, at an average rate of
3.26%. As of October 31, 2019, the amount of outstanding borrowings was $445,000,000, the interest rate was 2.58% and the amount
of pledged collateral was $784,526,800.
Annual Report | October 31,
2019
|
23
|
Reaves Utility Income Fund
|
Notes
to Financial Statements
|
October
31, 2019
5.
RESTRICTED SECURITIES
As
of October 31, 2019, 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 October 31, 2019 were as follows:
Description
|
|
Acquisition Date(s)
|
|
|
Cost
|
|
|
Value
|
|
|
Value as
Percentage
of Net Assets
|
|
Bastion Energy LLC (Anglo Dutch)
|
|
7/30/2015
|
|
|
$
|
–
|
|
|
$
|
437,324
|
|
|
|
0.02
|
%
|
Talara Opportunities II, LP
|
|
8/30/2013 - 7/24/2015
|
|
|
|
4,051,936
|
|
|
|
–
|
|
|
|
0.00
|
%
|
TOTAL
|
|
|
|
|
$
|
4,051,936
|
|
|
$
|
437,324
|
|
|
|
0.02
|
%
|
6.
PORTFOLIO SECURITIES
Purchases
and sales of investment securities, other than short-term securities, for the year ended October 31, 2019, aggregated $448,693,855
and $499,715,962, respectively.
7.
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.
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.
24
|
www.utilityincomefund.com
|
Reaves Utility Income Fund
|
Notes
to Financial Statements
|
October
31, 2019
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.
8.
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.
Annual Report | October 31,
2019
|
25
|
Reaves Utility Income Fund
|
Additional
Information
|
October
31, 2019 (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
|
October
31, 2019 (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.
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 http://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 http://www.sec.gov.
Annual Report | October 31,
2019
|
27
|
Reaves Utility Income Fund
|
Additional
Information
|
October
31, 2019 (Unaudited)
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 http://www.sec.gov.
Information on the Fund’s Forms N-PORT is available without a charge, upon request, by contacting the Fund at 1-800-644-5571
and on the website at http://www.utilityincomefund.com.
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 shares of its common stock in the open market.
TAX
INFORMATION (UNAUDITED)
The
Fund designates the following for federal income tax purposes for distributions made during the calendar year ended December 31,
2018 qualified dividend income (“QDI”) and as qualifying for the corporate dividends received deduction (“DRD”).
|
QDI
|
DRD
|
Reaves Utility Income Fund
|
100%
|
100%
|
In
early 2019, if applicable, shareholders of record received this information for the distribution paid to them by the Fund during
the calendar year 2018 via Form 1099. The Fund will notify shareholders in early 2020 of amounts paid to them by the Fund, if
any, during the calendar year 2019.
Pursuant
to Section 852(b)(3) of the Internal Revenue Code, the Fund designated $70,075,009 as long-term capital gain distribution for
the year ended October 31, 2019.
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.
28
|
www.utilityincomefund.com
|
Reaves Utility Income Fund
|
Additional
Information
|
October
31, 2019 (Unaudited)
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 October 31, 2019
|
% Breakdown of the
Total Cumulative Distributions
for the year ended October 31, 2019
|
|
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
|
$0.80991
|
$1.27009
|
$0.0000
|
$2.08000
|
38.94%
|
61.06%
|
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.
Annual Report | October 31,
2019
|
29
|
Reaves Utility
Income Fund
|
Trustees
& Officers
|
October
31, 2019 (Unaudited)
The
following table includes information regarding the Fund’s trustees and officers, and their principal occupations and other
affiliations during the past five years. The address for all trustees is 1290 Broadway, Suite 1000, Denver, CO 80203. The “independent
trustees” consist of those trustees who are not “interested persons” of the Fund, as that term is defined under
the 1940 Act.
Name,
Position(s)
Held with
the Fund,
Address1,
and Year
of Birth
|
Term of
Office and
Length of
Time Served2
|
Principal Occupation(s)
During Past Five Years
|
Number of
Portfolios
in Fund
Complex
Overseen
by Trustee
|
Other Directorships
Held by Trustee
or Nominee4
|
Independent Trustees
|
E. Wayne
Nordberg
Trustee
1938
|
Since 2012*
|
Mr. Nordberg is currently the Chairman and Chief
Investment Officer of Hollow Brook Wealth Management, LLC, a private investment management firm. Mr. Nordberg was formerly
a Senior Director at Ingalls & Snyder LLC, a privately owned registered investment advisor.
|
1
|
Mr. Nordberg is a Director of Annaly Capital
Management, Inc., a real estate investment trust and PetroQuest Energy, Inc., an oil and gas exploration company.
|
Larry W.
Papasan
Trustee
1940
|
Since Inception*
|
Mr. Papasan is currently a Director/Trustee
of Mimedx Inc., Bionova, Inc., and Cogenix Inc., each a medical services company, and Triumph Bankshares, Inc., a financial
institution.
|
1
|
Mr. Papasan is a Director/Trustee of Mimedx
Inc.; Bionova, Inc.; Cogenix Inc.; and Triumph Bankshares
|
30
|
www.utilityincomefund.com
|
Reaves Utility Income Fund
|
Trustees & Officers
|
October
31, 2019 (Unaudited)
Name,
Position(s)
Held
with
the
Fund,
Address1,
and
Year
of
Birth
|
Term
of
Office
and
Length
of
Time
Served2
|
Principal
Occupation(s)
During
Past Five Years
|
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Trustee
|
Other
Directorships
Held
by Trustee
or
Nominee4
|
Independent
Trustees
|
Mary
K.
Anstine
Trustee
1940
|
Since
Inception***
|
Ms. Anstine
is also a Trustee of A.V. Hunter Trust and Director of Colorado Uplift Board. Ms. Anstine was formerly a Director of the Trust
Bank of Colorado (later purchased and now known as Northern Trust Bank), HealthONE, and Denver Area Council of the Boy Scouts
of America, and a member of the American Bankers Association Trust Executive Committee.
|
1
|
Ms. Anstine
is a Trustee of ALPS ETF Trust (16 funds); Financial Investors Trust (32 funds); ALPS Variable Investment Trust (7 funds);
and Segall Bryant & Hamill Trust (14 funds).
|
Michael
F.
Holland
Trustee
1944
|
Since
Inception***
|
Mr. Holland
is Chairman of Holland & Company, an investment management company.
|
1
|
Mr. Holland
is a Director/Trustee of Blackstone Real Estate Income Fund (1 fund); Blackstone Real Estate Income Fund II (1 fund); Blackstone
Real Estate Income Master Fund (1 fund); Holland Series Funds, Inc. (1 fund); State Street Master Funds (5 funds); and China
Fund, Inc. (1 fund).
|
Jeremy
W.
Deems
Chairman
and Trustee
1976
|
Trustee
Since 2008**
Chairman
Since 2017
|
Mr. Deems is the Co-Founder, Chief Financial
Officer of Green Alpha Advisors, LLC, a registered investment adviser, and Co-Portfolio Manager of the Shelton Green Alpha
Fund. Prior to joining Green Alpha Advisors, Mr. Deems was Chief Financial Officer and Treasurer of Forward Management, LLC,
ReFlow Management, Co., LLC, ReFlow Fund, LLC, a private investment fund, and Sutton Place Management, LLC, an administrative
services company from 2004 to 2007.
|
1
|
Mr. Deems is a Trustee of ALPS ETF Trust (16
funds); Financial Investors Trust (32 funds); Clough Funds Trust (1); and ALPS Variable Investment Trust (7 funds).
|
Annual Report | October 31,
2019
|
31
|
Reaves Utility Income Fund
|
Trustees & Officers
|
October
31, 2019 (Unaudited)
Name,
Position(s)
Held with
the Fund,
Address1,
and Year
of Birth
|
Term of
Office and
Length of
Time Served2
|
Principal Occupation(s)
During Past Five Years
|
Number of
Portfolios
in Fund
Complex
Overseen
by Trustee
|
Other Directorships
Held by Trustee
or Nominee4
|
Interested Trustee
|
Jeremy O.
May3
Trustee 1970
|
Trustee Since
2009**
President
2010-2019
Chairman
2009-2017
|
Mr. May joined ALPS in 1995 and served as the
President of the Fund, President of ALPS Fund Services, Inc., ALPS Portfolio Solutions Distributors and ALPS Distributors,
Inc. and Executive Vice President of ALPS Holdings Inc. and ALPS Advisors, Inc. until June 2019. Mr. May is also a director
of the University of Colorado Foundation and the A.V. Hunter Trust.
|
1
|
Mr. May is Trustee of ALPS Series Trust (9 funds).
|
32
|
www.utilityincomefund.com
|
Reaves Utility Income Fund
|
Trustees & Officers
|
October
31, 2019 (Unaudited)
Name,
Position(s)
Held
with the Fund,
Address1,
and
Year
of Birth
|
Term of
Office and
Length of
Time Served2
|
Principal Occupation(s)
During Past Five Years
|
Other Directorships
Held by Trustee
or Nominee4
|
Officers
|
Bradley J. Swenson
President 1972
|
President Since 2019
|
Mr. Swenson joined ALPS Fund Services,
Inc. (“ALPS”) in 2004 and has served as its President since June 2019. He also served as the Chief Operating Officer
of ALPS (2015- 2019). Mr. Swenson previously served as Chief Compliance Officer to ALPS, its affiliated entities, and to certain
ETF, closed-end and open-end investment companies (2004-2015).
|
N/A
|
Karen S. Gilomen
Secretary 1970
|
Since 2016
|
Ms. Gilomen joined ALPS in August
2016 as Vice President and Senior Counsel. Prior to joining ALPS, Ms. Gilomen served as Vice President – General Counsel
and Chief Compliance Officer at Monticello Associates, Inc. from 2010 to 2016. Ms. Gilomen also serves as Secretary of Financial
Investors Trust and ALPS Variable Investment Trust and Assistant Secretary of the WesMark Funds.
|
N/A
|
Annual Report | October 31,
2019
|
33
|
Reaves Utility Income Fund
|
Trustees & Officers
|
October
31, 2019 (Unaudited)
Name,
Position(s)
Held
with the Fund,
Address1,
and
Year
of Birth
|
Term of
Office and
Length of
Time Served2
|
Principal Occupation(s)
During Past Five Years
|
Other Directorships
Held by Trustee
or Nominee4
|
Officers (continued)
|
Jill A. Kerschen
Treasurer 1975
|
Treasurer Since 2014
Assistant Treasurer 2013-2014
|
Ms. Kerschen joined ALPS in July 2013 and is
currently Vice President and Fund Controller at ALPS. Ms. Kerschen also serves as Treasurer of Clough Funds Trust, Clough
Global Dividend and Income Fund, Clough Global Equity Fund, Clough Global Opportunities Fund, RiverNorth Opportunities Fund,
Inc., Principal Real Estate Income Fund and ALPS Variable Investment Trust.
|
N/A
|
Ted W. Uhl
Chief Compliance Officer 1974
|
Chief Compliance Officer Since 2015
|
Mr. Uhl joined ALPS Fund Services in October
2006, and is currently Deputy Compliance Officer of ALPS. Mr. Uhl is also CCO of the Boulder Growth & Income Fund, Inc.,
Centre Funds, Elevation ETF Trust, Financial Investors Trust, Index Funds, Reality Shares ETF Trust, Axonic Alternative Income
Fund and XAI Octagon Credit Opportunities Alternative Registered Trust.
|
N/A
|
|
(1)
|
Address:
1290 Broadway, Suite 1000, Denver, Colorado 80203.
|
|
(2)
|
The
Fund commenced operations on February 24, 2004. The Fund’s Board of Trustees is divided into three classes, each class serves
for a term of three years. Each year the term of office of one class expires and the successors elected to such class serve for
a term of three years.
|
|
*
|
Term
expires at the Fund’s 2021 Annual Meeting of Shareholders.
|
|
**
|
Term
expires at the Fund’s 2022 Annual Meeting of Shareholders.
|
|
***
|
Term
expires at the Fund’s 2020 Annual Meeting of Shareholders.
|
|
(3)
|
Mr.
May is considered to be an “interested person” (as defined in the Investment Company Act of 1940, as amended (the
“1940 Act”)) because of his prior affiliation with ALPS, which acts as the Fund’s administrator.
|
|
(4)
|
The
numbers enclosed in the parentheticals represent the number of funds overseen in each respective directorship held by the Trustee.
|
The
Statement of Additional Information includes additional information about the Fund’s Trustees and is available, without
a charge, upon request, by contacting the Fund at 1-800-644-5571.
34
|
www.utilityincomefund.com
|
Intentionally
Left Blank
Item
2. Code of Ethics.
|
(a)
|
As
of the end of the period covered by this report, the registrant has adopted a code of
ethics that applies to the registrant's principal executive officer, principal financial
officer, principal accounting officer or controller, or persons performing similar functions,
regardless of whether these individuals are employed by the registrant or a third party.
|
|
(b)
|
For
purposes of this item, “code of ethics” means written standards that are
reasonably designed to deter wrongdoing and to promote:
|
|
(1)
|
Honest
and ethical conduct, including the ethical handling of actual or apparent conflicts of
interest between personal and professional relationships;
|
|
(2)
|
Full,
fair, accurate, timely, and understandable disclosure in reports and documents that a
registrant files with, or submits to, the Commission and in other public communications
made by the registrant;
|
|
(3)
|
Compliance
with applicable governmental laws, rules, and regulations;
|
|
(4)
|
The
prompt internal reporting of violations of the code to an appropriate person or persons
identified in the code; and
|
|
(5)
|
Accountability
for adherence to the code.
|
|
(c)
|
During
the period covered by this report, there were no amendments to the provisions of the
code of ethics adopted in Item 2(a) of this report.
|
|
(d)
|
During
the period covered by this report, the registrant had not granted any express or implicit
waivers from the provisions of the code of ethics adopted in Item 2(a) of this report.
|
|
(f)
|
The
registrant’s Code of Ethics is attached as an Exhibit hereto.
|
Item
3. Audit Committee Financial Expert.
The
Board of Trustees of the registrant has determined that the registrant has at least one audit committee financial expert serving
on its audit committee. The Board of Trustees has designated Jeremy W. Deems and Michael F. Holland as the Registrant’s
“audit committee financial expert(s).” Mr. Deems and Mr. Holland are each “independent” as defined in
paragraph (a)(2) of Item 3 to Form N-CSR.
Item
4. Principal Accountant Fees and Services.
|
(a)
|
Audit
Fees: For the registrant’s last two fiscal years ended October 31, 2018 and
October 31, 2019, the aggregate fees billed for professional services rendered by the
principal accountant for the audit of the registrant’s annual financial statements
or services that are normally provided by the accountant in connection with statutory
and regulatory filings or engagements were $39,500 and $39,500, respectively.
|
|
(b)
|
Audit-Related
Fees: For the registrant’s last two fiscal years ended October 31, 2018 and
October 31, 2019, the aggregate fees billed for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit of the
registrant’s financial statements and not otherwise reported under paragraph (a)
of Item 4 of this report were $0 and $0, respectively.
|
|
(c)
|
Tax
Fees: For the registrant’s last two fiscal years ended October 31, 2018 and
October 31, 2019, the aggregate fees billed for professional services rendered by the
principal accountant for tax compliance, tax advice and tax planning, which were comprised
of the preparation of excise filings and income tax returns for the registrant, were
$13,700 and $7,400, respectively.
|
|
(d)
|
All
Other Fees: For the registrant’s last two fiscal years ended October 31, 2018
and October 31, 2019, the aggregate fees billed for products and services, provided by
the principal accountant, other than the services reported in paragraphs (a) through
(c) of Item 4 of this report, were $0 and $7,500, respectively.
|
(e)
|
(1)
|
The
audit committee’s pre-approval policies and procedures require that all services
to be performed by the registrant’s principal accountant must be pre-approved by
the registrant’s audit committee.
|
|
(2)
|
No
services described in paragraphs (b) through (d) of Item 4 of this report were approved
by the registrant’s audit committee pursuant to paragraph (c)(7)(i)(C) of Rule
2-01 of Regulation S-X.
|
|
(f)
|
Not
applicable to the registrant.
|
|
(g)
|
Not
applicable to the registrant.
|
|
(h)
|
Not
applicable to the registrant
|
Item
5. Audit Committee of Listed Registrants.
|
(a)
|
The
registrant has a separately designated standing audit committee established in accordance
with Section 3(a)(58)(A) of the Exchange Act and is comprised of the following members:
|
Mary
K. Anstine
Jeremy
W. Deems (designated audit committee financial expert)
Michael
F. Holland (designated audit committee financial expert)
E.
Wayne Nordberg
Larry
W. Papasan
|
(b)
|
Not
applicable to registrant.
|
Item
6. Investments.
|
(a)
|
The
schedule of investments is included as part of the Reports to Stockholders filed under
Item 1 of this report.
|
|
(b)
|
Not
applicable to the registrant.
|
Item
7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Reaves
Utility Income Fund
Proxy
Voting Policies and Procedures
The
act of managing assets of clients may include the voting of proxies related to such managed assets. Where the power to vote in
person or by proxy has been delegated, directly or indirectly, to the investment adviser, the investment adviser has the fiduciary
responsibility for (a) voting in a manner that is in the best interests of the client, and (b) properly dealing with potential
conflicts of interest arising from proxy proposals being voted upon.
The
policies and procedures of W. H. Reaves & Company, Inc. (“WHR”) ("the Adviser") for voting proxies received
for accounts managed by the Adviser are set forth below and are applicable if:
|
●
|
The
underlying advisory agreement entered into with the client expressly provides that the
Adviser shall be responsible to vote proxies received in connection with the client’s
account; or
|
|
●
|
The
underlying advisory agreement entered into with the client is silent as to whether or not the Adviser shall be responsible to
vote proxies received in connection with the client’s account and the Adviser has discretionary authority over investment
decisions for the client’s account; or
|
|
●
|
In
case of an employee benefit plan, the client (or any plan trustee or other fiduciary) has not reserved the power to vote
proxies in either the underlying advisory agreement entered into with the client or in the client’s plan documents.
|
These
Proxy Voting Policies and Procedures are designed to ensure that proxies are voted in an appropriate manner and should complement
the Adviser’s investment policies and procedures regarding its general responsibility to monitor the performance and/or
corporate events of companies which are issuers of securities held in managed accounts or the Fund. Any questions about these
policies and procedures should be directed to the Fund CCO.
In
the absence of specific voting guidelines from a client, WHR will vote proxies in a manner that is in the best interest of the
client, which may result in different voting results for proxies for the same issuer. The Adviser shall consider only those factors
that relate to the client's investment or dictated by the client’s written instructions, including how its vote will economically
impact and affect the value of the client's investment (keeping in mind that, after conducting an appropriate cost-benefit analysis,
not voting at all on a presented proposal may be in the best interest of the client). WHR believes that voting proxies in accordance
with the following policies is in the best interests of its clients.
|
A.
|
Specific
Voting Policies
|
|
●
|
The
Adviser will generally vote for the election of directors (where no corporate governance
issues are implicated).
|
|
●
|
The
Adviser will generally vote for the selection of independent auditors.
|
|
●
|
The
Adviser will generally vote for increases in or reclassification of common stock.
|
|
●
|
The
Adviser will generally vote for management recommendations adding or amending indemnification
provisions in charter or by-laws.
|
|
●
|
The
Adviser will generally vote for changes in the board of directors.
|
|
●
|
The
Adviser will generally vote for outside director compensation.
|
|
●
|
The
Adviser will generally vote for proposals that maintain or strengthen the shared interests
of shareholders and management
|
|
●
|
The
Adviser will generally vote for proposals that increase shareholder value
|
|
●
|
The
Adviser will generally vote for proposals that will maintain or increase shareholder
influence over the issuer's board of directors and management
|
|
●
|
The
Adviser will generally vote for proposals that maintain or increase the rights of shareholders
|
|
2.
|
Non-Routine
and Conflict of Interest Items:
|
|
●
|
The
Adviser will generally vote for management proposals for merger or reorganization if
the transaction appears to offer fair value.
|
|
●
|
The
Adviser will generally vote against shareholder resolutions that consider only non-financial
impacts of mergers
|
|
●
|
The
Adviser will generally vote against anti-greenmail provisions.
|
If
the proxy includes a Routine Item that implicates corporate governance changes, a Non-Routine Item where no specific policy applies
or a Conflict of Interest Item where no specific policy applies, then the Adviser may engage an independent third party to determine
how the proxies should be voted.
In
voting on each and every issue, the Adviser and its employees shall vote in a prudent and timely fashion and only after a careful
evaluation of the issue(s) presented on the ballot.
In
exercising its voting discretion, the Adviser and its employees shall avoid any direct or indirect conflict of interest raised
by such voting decision. The Adviser will provide adequate disclosure to the client if any substantive aspect or foreseeable result
of the subject matter to be voted upon raises an actual or potential conflict of interest to the Adviser or:
|
●
|
any
affiliate of the Adviser. For purposes of these Proxy Voting Policies and Procedures,
an affiliate means:
|
|
(i)
|
any
person directly, or indirectly through one or more intermediaries, controlling, controlled
by or under common control with the Adviser;
|
|
(ii)
|
any
officer, director, principal, partner, employer, or direct or indirect beneficial owner
of any 10% or greater equity or voting interest of the Adviser; or
|
|
(iii)
|
any
other person for which a person described in clause (ii) acts in any such capacity;
|
|
●
|
any
issuer of a security for which the Adviser (or any affiliate of the Adviser) acts as
a sponsor, advisor, manager, custodian, distributor, underwriter, broker, or other similar
capacity; or
|
|
●
|
any
person with whom the Adviser (or any affiliate of the Adviser) has an existing, material
contract or business relationship that was not entered into in the ordinary course of
the Adviser’s (or its affiliate’s) business.
|
After
informing the client of any potential conflict of interest, the Adviser will take other appropriate action as required under these
Proxy Voting Policies and Procedures, as provided below.
The
Adviser shall keep certain records required by applicable law in connection with its proxy voting activities for clients and shall
provide proxy-voting information to clients upon their written or oral request.
|
3.
|
PROXY
VOTING PROCEDURES
|
|
A.
|
The
Account Representative or the Portfolio Manager the “Responsible Party”)
shall be designated by the Adviser to make discretionary investment decisions for the
client's account will be responsible for voting the proxies related to that account.
The Responsible Party should assume that he or she has the power to vote all proxies
related to the client’s account if any one of the three circumstances set forth
in Section 1 above regarding proxy voting powers is applicable.
|
|
B.
|
All
proxies and ballots received by WHR will be forwarded to the Responsible Party and then
logged in upon receipt in the “Receipt of Proxy Voting Material” log.
|
|
C.
|
Prior
to voting, the Responsible Party will verify whether his or her voting power is subject
to any limitations or guidelines issued by the client (or in the case of an employee
benefit plan, the plan's trustee or other fiduciaries).
|
|
D.
|
Prior
to voting, the Responsible Party will verify whether an actual or potential conflict
of interest with the Adviser or any Interested Person exists in connection with the subject
proposal(s) to be voted upon. The determination regarding the presence or absence of
any actual or potential conflict of interest shall be adequately documented by the Responsible
Party (i.e., comparing the apparent parties affected by the proxy proposal being voted
upon against the Adviser’s internal list of Interested Persons and, for any matches
found, describing the process taken to determine the anticipated magnitude and possible
probability of any conflict of interest being present), which shall be reviewed and signed
off on by the Responsible Party’s direct supervisor (and if none, by the board
of trustees or a committee of the board of trustees of the Adviser).
|
|
E.
|
If
an actual or potential conflict is found to exist, written notification of the conflict
(the “Conflict Notice”) shall be given to the client or the client’s
designee (or in the case of an employee benefit plan, the plan's trustee or other fiduciary)
in sufficient detail and with sufficient time to reasonably inform the client (or in
the case of an employee benefit plan, the plan's trustee or other fiduciary) of the actual
or potential conflict involved.
|
Specifically,
the Conflict Notice should describe:
|
●
|
the
proposal to be voted upon;
|
|
●
|
the
actual or potential conflict of interest involved;
|
|
●
|
the
Adviser’s vote recommendation (with a summary of material factors supporting the
recommended vote); and
|
|
●
|
if
applicable, the relationship between the Adviser and any Interested Person.
|
The
Conflict Notice will either request the client’s consent to the Adviser’s vote recommendation or may request the client
to vote the proxy directly or through another designee of the client. The Conflict Notice and consent thereto may be sent or received,
as the case may be, by mail, fax, electronic transmission or any other reliable form of communication that may be recalled, retrieved,
produced, or printed in accordance with the recordkeeping policies and procedures of the Adviser. If the client (or in the case
of an employee benefit plan, the plan's trustee or other fiduciary) is unreachable or has not affirmatively responded before the
response deadline for the matter being voted upon, the Adviser may:
|
●
|
engage
a non-Interested Party to independently review the Adviser’s vote recommendation if the vote recommendation would fall in
favor of the Adviser’s interest (or the interest of an Interested Person) to confirm that the Adviser’s vote recommendation
is in the best interest of the client under the circumstances;
|
|
●
|
cast
its vote as recommended if the vote recommendation would fall against the Adviser’s
interest (or the interest of an Interested Person) and such vote recommendation is in
the best interest of the client under the circumstances; or
|
|
●
|
abstain
from voting if such action is determined by the Adviser to be in the best interest of
the client under the circumstances.
|
|
F.
|
The
Responsible Party will promptly vote proxies received in a manner consistent with the
Proxy Voting Policies and Procedures stated above and guidelines (if any) issued by client
(or in the case of an employee benefit plan, the plan's trustee or other fiduciaries
if such guidelines are consistent with ERISA).
|
|
G.
|
In
accordance with SEC Rule 204-2(c)(2), as amended, the Responsible Party shall retain
in the respective client’s file, the following:
|
|
●
|
A
copy of the proxy statement received (unless retained by a third party for the benefit
of the Adviser or the proxy statement is available from the SEC’s Electronic
Data Gathering, Analysis, and Retrieval (EDGAR) system);
|
|
●
|
A
record of the vote cast (unless this record is retained by a third party for the benefit of the Adviser and the third party
is able to promptly provide the Adviser with a copy of the voting record upon its request);
|
|
●
|
A
record memorializing the basis for the vote cast;
|
|
●
|
A
copy of any document created by the Adviser or its employees that was material in making
the decision on how to vote the subject proxy; and,
|
|
●
|
A
copy of any Conflict Notice, conflict consent or any other written communication (including emails or other electronic communications)
to or from the client (or in the case of an employee benefit plan, the plan's trustee or other fiduciaries) regarding the subject
proxy vote cast by, or the vote recommendation of, the Adviser.
|
The
above copies and records shall be retained in the client’s file for a period not less than five (5) years (or in the case
of an employee benefit plan, no less than six (6) years), which shall be maintained at the appropriate office of the Adviser.
|
H.
|
Periodically,
but no less than annually, the Adviser will:
|
|
1.
|
Verify
that all annual proxies for the securities held in the client’s account have been
received;
|
|
2.
|
Verify
that each proxy received has been voted in a manner consistent with the Proxy Voting
Policies and Procedures and the guidelines (if any) issued by the client (or in the case
of an employee benefit plan, the plan's trustee or other fiduciaries);
|
|
3.
|
Review
the files to verify that records of the voting of the proxies have been properly maintained;
|
|
4.
|
Prepare
a written report for each client regarding compliance with the Proxy Voting Policies
and Procedures; and
|
|
5.
|
Maintain
an internal list of Interested Persons.
|
Proxies
and Class Action Lawsuits
WHR
will be required to take action and render advice with respect to voting of proxies solicited by or with respect to the issuers
of securities in which assets of the Account may be invested from time to time. However, WHR will not take any action or
render any advice with respect to any securities held in the Account, which are named in or subject to class action lawsuits.
WHR may, only at the client’s request, offer clients advice regarding corporate actions
Item
8. Portfolio Managers of Closed-End Management Investment Companies.
(a)(1)
registrant’s Portfolio Managers as of December 31, 2019 are:
Name
|
Title
|
Length
of Service
|
Business
Experience 5 Years
|
John
P. Bartlett
|
Portfolio
Manager
|
Since
April 2017
|
PM,
Reaves Asset Management 1995-present
|
Timothy
O. Porter
|
Portfolio
Manager
|
Since
December 2018
|
PM,
Reaves Asset Management 2004-present
|
(a)(2)
Other accounts managed by the registrant’s Portfolio Managers as of October 31, 2019 (unless otherwise indicated):
PM
Name
|
Registered
Investment
Companies, Total
Assets
|
Other
Pooled
Investments
Vehicles, Total
Assets
|
Other
Accounts,
Total Assets
|
John
P. Bartlett
|
$536,078,102
2
account
|
0
|
0
|
Timothy
O. Porter
|
$44,811,288
1
account
|
0
|
$247,801,503
589
accounts
|
Other
Accounts Managed by Portfolio Managers. There may be certain inherent conflicts of interest that arise in connection with
the portfolio managers’ management of the registrant’s investments and the investments of any other accounts they
manage. Such conflicts could include aggregation of orders for all accounts managed by a particular portfolio manager, the allocation
of purchases across all such accounts, the allocation of IPOs and any soft dollar arrangements that the registrant’s investment
adviser may have in place that could benefit the registrant and/or such other accounts. The investment adviser has adopted policies
and procedures designed to address any such conflicts of interest to ensure that all management time, resources and investment
opportunities are allocated equitably.
None
of the accounts disclosed pursuant to Item 8(a)(2) of Form N-CSR have an advisory fee based on the performance of an account.
(a)(3)
Portfolio Manager compensation as of October 31, 2019:
Compensation
of Portfolio Managers. Compensation paid by Reaves Assets Management, Inc. (the “Adviser”) to the portfolio managers
is designed to be competitive and attractive, and primarily consists of a fixed base salary, based on market factors and each
person’s level of responsibility, and a bonus. The amount of the bonus is based on the overall after-tax profitability of
the Adviser, each fiscal-year, and the contribution of each portfolio manager to the Adviser’s overall performance.
Individual
compensation is designed to reward the overall contribution of portfolio managers to the performance of the Adviser. To date,
the Adviser has not linked bonuses to the performance of any particular portfolio. Compensation levels are set by senior management
following a review of overall performance. From time to time, the Adviser has engaged industry consultants to ensure that compensation
remains competitive and to identify and plan for new and emerging compensation trends. Equity holders within the Adviser, including
the portfolio managers, receive only a modest return on their capital investment, usually a mid-single digit percentage of their
share of the Adviser’s book value. The Adviser believes this practice is consistent with industry standards and that it
allows the Adviser to maximize the incentive compensation pool. This pool is critical in the Adviser’s ability to continue
to attract and retain professionals of the highest quality while simultaneously growing the intrinsic value of the Adviser. The
Adviser has no deferred compensation, stock option or other equity programs. Given the portfolio manager compensation policy described
above and the fact that the Adviser has no performance-based advisory relationships, the Adviser does not believe that any material
compensation conflicts exist.
(a)(4)
Dollar range of securities owned by the registrant’s Portfolio Managers as of October 31, 2019 (unless otherwise indicated):
Portfolio
Manager
|
Dollar
Range of Equity Securities Held in Registrant 1
|
John
P. Bartlett
|
$100,001
- $500,000
|
Timothy
O. Porter*
|
$50,001-$100,000
|
|
1
|
“Beneficial
Ownership” is determined in accordance with Section 16a-1(a)(2) of the Securities Exchange Act of 1934, as amended.
|
Item
9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not
applicable to registrant.
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 1940 Act), 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.
None.
Item
13. Exhibits.
(a)
|
(1)
|
The
Code of Ethics that applies to the registrant’s principal executive officer, principal
financial officer, principal accounting officer or controller or persons performing similar
functions is attached hereto as Exhibit 13(a)(1).
|
|
(2)
|
The
certifications required by Rule 30a-2(a) of the Investment Company Act of 1940, as amended,
and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto as Ex-99.Cert.
|
(b)
|
|
A
certification for the Registrant’s Principal Executive Officer and Principal Financial
Officer, as required by Rule 30a-2(b) of the Investment Company Act of 1940, as amended,
and Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto as Ex-99.906Cert.
|
(c)
|
|
Pursuant
to the Securities and Exchange Commission’s Order granting relief from Section
19(b) of the Investment Company Act of 1940 dated August 10, 2009, the form of 19(a)
Notices to Beneficial Owners are attached hereto as Exhibit 13(c).
|
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/
Bradley J. Swenson
|
|
|
Bradley J. Swenson
|
|
|
President (Principal Executive Officer)
|
|
|
|
|
Date:
|
January 6, 2020
|
|
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/
Bradley J. Swenson
|
|
|
Bradley J. Swenson
|
|
|
President (Principal Executive Officer)
|
|
|
|
|
Date:
|
January 6, 2020
|
|
By:
|
/s/
Jill A. Kerschen
|
|
|
Jill A. Kerschen
|
|
|
Treasurer (Principal Financial Officer)
|
|
|
|
|
Date:
|
January 6, 2020
|
|
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