The following notes
should be read in conjunction with the accompanying Schedule of Investments.
2013 Semi-Annual
Report
5
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Statement of Assets and Liabilities (Unaudited)
June 30, 2013
|
|
|
|
|
Assets:
|
|
|
|
|
Investments in securities, at value (Note 2)
|
|
$
|
218,521,583
|
|
Cash
|
|
|
5,733,376
|
|
Receivable for investments sold
|
|
|
4,772,942
|
|
Interest and dividends receivable
|
|
|
1,219,593
|
|
Prepaid expenses
|
|
|
14,114
|
|
|
|
|
|
|
Total assets
|
|
|
230,261,608
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
Payable for credit facility (Note 6)
|
|
|
53,000,000
|
|
Payable for credit facility interest
|
|
|
6,510
|
|
Payable for investments purchased
|
|
|
1,294,306
|
|
Investment advisory fee payable
|
|
|
190,531
|
|
Administration fee payable
|
|
|
28,580
|
|
Directors fee payable
|
|
|
3,950
|
|
Accrued expenses
|
|
|
92,167
|
|
|
|
|
|
|
Total liabilities
|
|
|
54,616,044
|
|
|
|
|
|
|
Net Assets
|
|
$
|
175,645,564
|
|
|
|
|
|
|
Composition of Net Assets:
|
|
|
|
|
Capital stock, at par value ($0.001 par value, 1,000,000,000 shares authorized)
|
|
$
|
7,755
|
|
Additional paid-in capital
|
|
|
145,912,560
|
|
Distributions in excess of net investment income
|
|
|
(3,331,124
|
)
|
Accumulated net realized gain on investments, written option contracts, and foreign currency and foreign currency translation
|
|
|
9,358,058
|
|
Net unrealized appreciation on investments and foreign currency translation
|
|
|
23,698,315
|
|
|
|
|
|
|
Net assets applicable to capital stock outstanding
|
|
$
|
175,645,564
|
|
|
|
|
|
|
Total investments at cost
|
|
$
|
194,811,402
|
|
|
|
|
|
|
Shares Outstanding and Net Asset Value Per Share:
|
|
|
|
|
Shares outstanding
|
|
|
7,755,240
|
|
Net asset value per share
|
|
$
|
22.65
|
|
See Notes to Financial
Statements.
6 Brookfield
Investment Management Inc.
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Statement of Operations (Unaudited)
For the Six
Months Ended June 30, 2013
|
|
|
|
|
Investment Income:
|
|
|
|
|
Interest
|
|
$
|
108,488
|
|
Dividends
|
|
|
5,114,284
|
|
Foreign withholding tax
|
|
|
(416,837
|
)
|
|
|
|
|
|
Total investment income
|
|
|
4,805,935
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
Investment advisory fees (Note 3)
|
|
|
1,159,094
|
|
Administration fees (Note 3)
|
|
|
173,864
|
|
Audit and tax services
|
|
|
34,676
|
|
Reports to stockholders
|
|
|
32,030
|
|
Custodian fees
|
|
|
26,647
|
|
Fund accounting servicing fees
|
|
|
26,226
|
|
Directors fees
|
|
|
21,033
|
|
Legal fees
|
|
|
20,693
|
|
Insurance
|
|
|
14,648
|
|
Registration fees
|
|
|
12,397
|
|
Miscellaneous
|
|
|
7,246
|
|
Transfer agent fees
|
|
|
7,147
|
|
|
|
|
|
|
Total operating expenses
|
|
|
1,535,701
|
|
Interest expense on credit facility (Note 6)
|
|
|
297,108
|
|
|
|
|
|
|
Total expenses
|
|
|
1,832,809
|
|
|
|
|
|
|
Net investment income
|
|
|
2,973,126
|
|
|
|
|
|
|
Realized and Unrealized Gain (Loss):
|
|
|
|
|
Net realized gain (loss) from:
|
|
|
|
|
Investments
|
|
|
9,173,141
|
|
Written option contracts
|
|
|
94,972
|
|
Foreign currency and foreign currency translation
|
|
|
(183,877
|
)
|
|
|
|
|
|
Net realized gain on investments, written option contracts, foreign currency and foreign currency translation
|
|
|
9,084,236
|
|
|
|
|
|
|
Net change in unrealized appreciation (depreciation) on:
|
|
|
|
|
Investments
|
|
|
3,145,285
|
|
Foreign currency translation
|
|
|
(8,252
|
)
|
|
|
|
|
|
Net change in unrealized appreciation on investments, written option contracts and foreign currency translation
|
|
|
3,137,033
|
|
|
|
|
|
|
Total realized and unrealized gain
|
|
|
12,221,269
|
|
|
|
|
|
|
Net increase in net assets resulting from operations
|
|
$
|
15,194,395
|
|
|
|
|
|
|
See Notes to Financial
Statements.
2013 Semi-Annual
Report
7
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Statements of Changes in Net Assets
|
|
|
|
|
|
|
|
|
|
|
For the Six
Months Ended
June 30, 2013
(Unaudited)
|
|
|
For the Year
Ended
December 31, 2012
|
|
Increase in Net Assets Resulting from Operations:
|
|
|
|
|
|
|
|
|
Net investment income
|
|
$
|
2,973,126
|
|
|
$
|
5,026,680
|
|
Net realized gain on investments, written option contracts, foreign currency and foreign currency translation
|
|
|
9,084,236
|
|
|
|
8,994,917
|
|
Net change in unrealized appreciation on investments, written option contracts, foreign currency and foreign currency translation
|
|
|
3,137,033
|
|
|
|
6,655,206
|
|
|
|
|
|
|
|
|
|
|
Net increase in net assets resulting from operations
|
|
|
15,194,395
|
|
|
|
20,676,803
|
|
|
|
|
|
|
|
|
|
|
Distributions to Stockholders:
|
|
|
|
|
|
|
|
|
Net investment income
|
|
|
(5,430,219
|
)
|
|
|
(3,750,331
|
)
|
Net realized gains
|
|
|
|
|
|
|
(6,915,708
|
)
|
Return of capital
|
|
|
|
|
|
|
(194,399
|
)
|
|
|
|
|
|
|
|
|
|
Total distributions
|
|
|
(5,430,219
|
)
|
|
|
(10,860,438
|
)
|
|
|
|
|
|
|
|
|
|
Total increase in net assets
|
|
|
9,764,176
|
|
|
|
9,816,365
|
|
Net Assets:
|
|
|
|
|
|
|
|
|
Beginning of period
|
|
|
165,881,388
|
|
|
|
156,065,023
|
|
|
|
|
|
|
|
|
|
|
End of period
|
|
$
|
175,645,564
|
|
|
$
|
165,881,388
|
|
|
|
|
|
|
|
|
|
|
Distributions in excess of net investment income
|
|
$
|
(3,331,124
|
)
|
|
$
|
(874,031
|
)
|
|
|
|
|
|
|
|
|
|
See Notes to Financial
Statements.
8 Brookfield
Investment Management Inc.
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Statement of Cash Flows (Unaudited)
For the Six
Months Ended June 30, 2013
|
|
|
|
|
Increase (Decrease) in Cash:
|
|
|
|
|
Cash flows provided by (used for) operating activities:
|
|
|
|
|
Net increase in net assets resulting from operations
|
|
$
|
15,194,395
|
|
Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by operating activities:
|
|
|
|
|
Purchases of long-term portfolio investments
|
|
|
(54,456,547
|
)
|
Proceeds from disposition of long-term portfolio investments
|
|
|
54,131,422
|
|
Premiums received on options written
|
|
|
281,484
|
|
Decrease in prepaid expenses
|
|
|
12,569
|
|
Increase in interest and dividends receivable
|
|
|
(223,378
|
)
|
Decrease in payable for credit facility interest
|
|
|
(349
|
)
|
Increase in investment advisory fee payable
|
|
|
6,258
|
|
Increase in administration fee payable
|
|
|
939
|
|
Increase in payable to directors
|
|
|
1,033
|
|
Decrease in accrued expenses and other liabilities
|
|
|
(36,294
|
)
|
Net accretion on investments
|
|
|
633
|
|
Net change in unrealized appreciation on investments and written option contracts
|
|
|
(3,145,285
|
)
|
Net realized gain on investments and written option contracts
|
|
|
(9,268,113
|
)
|
|
|
|
|
|
Net cash provided by operating activities
|
|
|
2,498,767
|
|
|
|
|
|
|
Cash flows used for financing activities:
|
|
|
|
|
Distributions paid to stockholders
|
|
|
(5,430,219
|
)
|
|
|
|
|
|
Net cash used for financing activities
|
|
|
(5,430,219
|
)
|
|
|
|
|
|
Net decrease in cash
|
|
|
(2,931,452
|
)
|
Cash at the beginning of period
|
|
|
8,664,828
|
|
|
|
|
|
|
Cash at the end of period
|
|
$
|
5,733,376
|
|
|
|
|
|
|
Supplemental Disclosure of Cash Flow Information:
Interest payments for the period ended June 30, 2013 totaled $297,457.
See Notes to Financial Statements.
2013 Semi-Annual
Report
9
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Financial Highlights
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months
Ended June 30,
2013
(Unaudited)
|
|
|
For the Year
Ended
December 31, 2012
|
|
|
Period from
August 26, 2011
1
through
December 31, 2011
|
|
Per Share Operating Performance:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net asset value, beginning of period
|
|
$
|
21.39
|
|
|
$
|
20.12
|
|
|
$
|
19.10
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
2
|
|
|
0.38
|
|
|
|
0.65
|
|
|
|
0.18
|
|
Net realized and unrealized gain on investment transactions
|
|
|
1.58
|
|
|
|
2.02
|
|
|
|
1.19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase in net asset value resulting from operations
|
|
|
1.96
|
|
|
|
2.67
|
|
|
|
1.37
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions from net investment income
|
|
|
(0.70
|
)
|
|
|
(0.48
|
)
|
|
|
(0.09
|
)
|
Distributions from net realized gains
|
|
|
|
|
|
|
(0.89
|
)
|
|
|
|
|
Return of capital distributions
|
|
|
|
|
|
|
(0.03
|
)
|
|
|
(0.26
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total distributions paid
|
|
|
(0.70
|
)
|
|
|
(1.40
|
)
|
|
|
(0.35
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net asset value, end of period
|
|
$
|
22.65
|
|
|
$
|
21.39
|
|
|
$
|
20.12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market price, end of period
|
|
$
|
21.48
|
|
|
$
|
20.15
|
|
|
$
|
17.61
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Investment Return
|
|
|
10.02
|
%
5
|
|
|
23.06
|
%
|
|
|
(10.16
|
)%
5
|
Ratios to Average Net Assets/Supplementary Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of period (000s)
|
|
$
|
175,646
|
|
|
$
|
165,881
|
|
|
$
|
156,065
|
|
Operating expenses
|
|
|
1.71
|
%
4
|
|
|
1.83
|
%
|
|
|
2.14
|
%
4
|
Interest expense
|
|
|
0.33
|
%
4
|
|
|
0.42
|
%
|
|
|
0.47
|
%
4
|
Total expenses
|
|
|
2.04
|
%
4
|
|
|
2.25
|
%
|
|
|
2.61
|
%
4
|
Net investment income
|
|
|
3.32
|
%
4
|
|
|
3.12
|
%
|
|
|
2.81
|
%
4
|
Portfolio turnover rate
|
|
|
25
|
%
5
|
|
|
76
|
%
|
|
|
30
|
%
5
|
|
Total investment return is computed based upon the New York Stock Exchange market price of the Funds shares and excludes the effect of broker
commissions. Distributions are assumed to be reinvested at the prices obtained under the Funds dividend reinvestment plan.
|
1
|
Commencement of operations.
|
2
|
Per share amounts presented are based on average shares outstanding throughout the period indicated.
|
3
|
Net asset value, beginning of period, reflects a deduction of $0.90 per share sales charge from the initial public offering price of $20.00 per share.
|
See Notes to Financial Statements.
10 Brookfield
Investment Management Inc.
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Notes to Financial Statements (Unaudited)
June 30, 2013
1. Organization
Brookfield Global Listed Infrastructure
Income Fund Inc. (the Fund) was organized under the laws of the State of Maryland as a Maryland corporation on June 8, 2011. The Fund is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as
a non-diversified, closed-end management investment company, which will invest primarily in publicly traded infrastructure companies.
Brookfield
Investment Management Inc. (BIM or Adviser), a wholly-owned subsidiary of Brookfield Asset Management Inc., is registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the Advisers
Act), and serves as investment adviser to the Fund.
The Funds investment objective is to provide a high level of total return, with an
emphasis on income. The investment objective of the Fund is not fundamental and may be changed without stockholder approval, upon not less than 60 days prior written notice to stockholders. No assurance can be given that the Funds investment
objective will be achieved.
2. Significant Accounting Policies
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP)
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and
decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.
Valuation of Investments:
Debt securities, including U.S. government securities, listed corporate bonds, other fixed income and asset-backed securities, and unlisted securities and private placement securities, are generally valued at the bid prices furnished by an
independent pricing service or, if not valued by an independent pricing service, using bid prices obtained from at least two active and reliable market makers in any such security. If quotes cannot be obtained from two active and reliable market
makers then the securities may be priced using a quote obtained from a single active market maker. Short-term debt securities with remaining maturities of sixty days or less are held at fair value which is equal to cost with interest accrued or
discount accrued to the date of maturity, unless such valuation, in the judgment of the Advisers Valuation Committee, does not represent market value, in which case these securities will be fair valued as determined by the Advisers
Valuation Committee.
Investments in equity securities listed or traded on any securities exchange or traded in the over-the-counter market are
valued at the trade price as of the close of business on the valuation date. Equity securities for which no sales were reported for that date are valued at fair value as determined in good faith by the Advisers Valuation Committee.
Investments in open-end registered investment companies, if any, are valued at the net asset value (NAV) as reported by those investment companies.
When price quotations for certain securities are not readily available, or if the available quotations are not believed to be reflective of market value
by the Adviser, those securities will be valued at fair value as determined in good faith by the Advisers Valuation Committee using procedures adopted by and under the supervision of the Funds Board of Directors. There can be
no assurance that the Fund could purchase or sell a portfolio security at the price used to calculate the Funds NAV.
Fair valuation
procedures may be used to value a substantial portion of the assets of the Fund. The Fund may use the fair value of a security to calculate its NAV when, for example, (1) a portfolio security is not traded in a public market or the principal
market in which the security trades is closed, (2) trading in a portfolio security is suspended and not resumed prior to the normal market close, (3) a portfolio security is not traded in significant volume for a substantial period, or
(4) the Adviser determines that the quotation or price for a portfolio security provided by a broker-dealer or an independent pricing service is inaccurate.
2013 Semi-Annual
Report
11
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Notes to Financial Statements (Unaudited)
June 30, 2013
The fair value of securities may be difficult to determine and thus judgment plays a
greater role in the valuation process. The fair valuation methodology may include or consider the following guidelines, as appropriate: (1) evaluation of all relevant factors, including but not limited to, pricing history, current market level,
supply and demand of the respective security; (2) comparison to the values and current pricing of securities that have comparable characteristics; (3) knowledge of historical market information with respect to the security; (4) other
factors relevant to the security which would include, but not be limited to, duration, yield, fundamental analytical data, the Treasury yield curve, and credit quality.
The values assigned to fair valued investments are based on available information and do not necessarily represent amounts that might ultimately be
realized, since such amounts depend on future developments inherent in long-term investments. Changes in the fair valuation of portfolio securities may be less frequent and of greater magnitude than changes in the price of portfolio securities
valued at their last sale price, by an independent pricing service, or based on market quotations. Imprecision in estimating fair value can also impact the amount of unrealized appreciation or depreciation recorded for a particular portfolio
security and differences in the assumptions used could result in a different determination of fair value, and those differences could be material.
The Board of Directors (the Board) has adopted procedures for the valuation of the Funds securities and has delegated the day to day
responsibilities for valuation determinations under these procedures to the Adviser. The Board has reviewed and approved the valuation procedures utilized by the Adviser and regularly reviews the application of the procedures to the securities in
the Fund portfolios. Securities are valued using unadjusted quoted market prices, when available, as supplied primarily by third party pricing services or dealers. If a market value or price cannot be determined for a security or a significant
event has occurred that would materially affect the value of the security, the security is fair valued by the Advisers Valuation Committee. The Valuation Committee is comprised of senior members of the Advisers management team.
The Fund has established methods of fair value measurements in accordance with GAAP. Fair value denotes the price that the Fund would receive upon
selling an investment in a timely transaction to an independent buyer in the principal or most advantageous market of the investment. A three-tier hierarchy has been established to maximize the use of observable market data and minimize the use of
unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk,
for example, the risk inherent in a particular valuation technique used to measure fair value including such a pricing model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable
inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the
reporting entitys own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The three-tier hierarchy of inputs is summarized in
the three broad levels listed below.
|
Level 1 -
|
quoted prices in active markets for identical assets or liabilities
|
|
Level 2 -
|
quoted prices in markets that are not active or other significant observable inputs (including, but not limited to: quoted prices for similar assets or
liabilities, quoted prices based on recently executed transactions, interest rates, prepayment speeds, credit risk, etc.)
|
|
Level 3 -
|
significant unobservable inputs (including the Funds own assumptions in determining the fair value of assets or liabilities)
|
The Advisers valuation policy, as previously stated, establishes parameters for the sources and types of valuation analysis, as well as, the
methodologies and inputs the Adviser uses in determining fair value, including the use of the Advisers Valuation Committee. If the Valuation Committee determines that additional techniques, sources or inputs are appropriate or necessary in a
given situation, such additional work will be undertaken.
12 Brookfield
Investment Management Inc.
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Notes to Financial Statements (Unaudited)
June 30, 2013
Significant increases or decreases in any of the unobservable inputs in isolation may result in a lower
or higher fair value measurement.
To assess the continuing appropriateness of security valuations, the Adviser (or its third party service provider
who is subject to oversight by the Adviser), regularly compares one of its prior day prices, prices on comparable securities and sale prices to the current day prices and challenges those prices that exceed certain tolerance levels with the third
party pricing service or broker source. For those securities valued by fair valuations, the Valuation Committee reviews and affirms the reasonableness of the valuations based on such methodologies and fair valuation determinations on a regular basis
after considering all relevant information that is reasonably available.
The inputs or methodology used for valuing investments are not necessarily
an indication of the risk associated with investing in those securities.
The following table summarizes the Funds investments categorized in the disclosure
hierarchy as of June 30, 2013:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Valuation Inputs
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
Common Stocks:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Australia
|
|
$
|
|
|
|
$
|
24,722,424
|
|
|
$
|
|
|
|
$
|
24,722,424
|
|
Brazil.
|
|
|
18,935,871
|
|
|
|
|
|
|
|
|
|
|
|
18,935,871
|
|
Canada
|
|
|
23,727,960
|
|
|
|
|
|
|
|
|
|
|
|
23,727,960
|
|
France
|
|
|
|
|
|
|
13,026,143
|
|
|
|
|
|
|
|
13,026,143
|
|
Hong Kong
|
|
|
|
|
|
|
12,654,932
|
|
|
|
|
|
|
|
12,654,932
|
|
Italy
|
|
|
|
|
|
|
12,562,608
|
|
|
|
|
|
|
|
12,562,608
|
|
Mexico
|
|
|
1,376,217
|
|
|
|
|
|
|
|
|
|
|
|
1,376,217
|
|
Portugal
|
|
|
|
|
|
|
4,869,013
|
|
|
|
|
|
|
|
4,869,013
|
|
Spain
|
|
|
|
|
|
|
8,143,959
|
|
|
|
|
|
|
|
8,143,959
|
|
United Kingdom
|
|
|
8,783,850
|
|
|
|
5,108,892
|
|
|
|
|
|
|
|
13,892,742
|
|
United States
|
|
|
81,821,050
|
|
|
|
|
|
|
|
|
|
|
|
81,821,050
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Common Stocks
|
|
|
134,644,948
|
|
|
|
81,087,971
|
|
|
|
|
|
|
|
215,732,919
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate Bonds
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Australia
|
|
|
|
|
|
|
2,788,664
|
|
|
|
|
|
|
|
2,788,664
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
134,644,948
|
|
|
$
|
83,876,635
|
|
|
$
|
|
|
|
$
|
218,521,583
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For further information regarding security characteristics, see the Schedule of Investments.
The fair value of the Funds credit facility, which qualifies as a financial instrument under Financial Accounting Standards Board
(FASB) Accounting Standards Codification (ASC) 820 Disclosures about Fair Values of Financial Instruments, approximates the carrying amounts presented in the Statement of Assets and Liabilities. As of
June 30, 2013, this financial instrument is categorized as a Level 2 within the disclosure hierarchy.
During the six months ended
June 30, 2013, the Fund did not invest in any Level 3 securities. There was a transfer from Level 1 to Level 2 of $4,869,013. The transfer was due to the securities being fair valued as a result of market movements following the close of local
trading. The basis for recognizing and valuing transfers is as of the end of the period in which transfers occur.
Investment Transactions and
Investment Income:
Securities transactions are recorded on the trade date. Realized gains and losses from securities transactions are calculated on the identified cost basis. Interest income is recorded on the accrual basis. Dividend income is
recorded on the ex-dividend date.
2013 Semi-Annual
Report
13
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Notes to Financial Statements (Unaudited)
June 30, 2013
Foreign Currency Transactions:
Securities and other assets and liabilities denominated in
foreign currencies are translated into U.S. dollar amounts at the date of valuation. Purchases and sales of securities and income and expense items denominated in foreign currencies are translated into U.S. dollar amounts on the respective dates of
such transactions. The Fund isolates the portion of realized gains or losses resulting from changes in foreign exchange rates on securities from the fluctuations arising from changes in market prices of securities held. Reported net realized foreign
exchange gains or losses arise from sales of securities, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the amounts of dividends, interest and foreign withholding taxes
recorded on the Funds books and the U.S. dollar equivalent of the amounts actually received or paid.
Taxes:
The Fund intends to
continue to meet the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no federal income or excise
tax provision is required. The Fund may incur an excise tax to the extent it has not distributed all of its taxable income on a calendar year basis.
GAAP provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. An
evaluation of tax positions taken in the course of preparing the Funds tax returns to determine whether the tax positions are more-likely-than-not of being sustained by the taxing authority is required. Tax benefits of positions
not deemed to meet the more-likely-than-not threshold would be booked as a tax expense in the current year and recognized as: a liability for unrecognized tax benefits; a reduction of an income tax refund receivable; a reduction of a deferred tax
asset; an increase in deferred tax liability; or a combination thereof. As of June 30, 2013, the Fund has determined that there are no uncertain tax positions or tax liabilities required to be accrued.
The Fund has reviewed all taxable years that are open for examination (i.
e.
, not barred by the applicable statute of limitations) by taxing
authorities of all major jurisdictions, including the Internal Revenue Service. As of June 30, 2013, open taxable years consisted of the taxable period August 26, 2011 (commencement of operations) to December 31, 2011 and the taxable
year ended December 31, 2012. No examination of the Funds tax returns is currently in progress.
Expenses:
Expenses directly
attributable to the Fund are charged directly to the Fund, while expenses which are attributable to the Fund and other investment companies advised by the Adviser are allocated among the respective investment companies, including the Fund, based
upon relative net assets.
Dividends and Distributions:
The Fund declares and pays dividends monthly from net investment income.
Distributions of realized capital gains in excess of capital loss carryfowards are distributed at least annually. Dividends and distributions are recorded on the ex-dividend date. All common shares have equal dividend and other distribution rights.
A notice disclosing the source(s) of a distribution will be provided if payment is made from any source other than net investment income. Any such
notice would be provided only for informational purposes in order to comply with the requirements of Section 19(a) of the 1940 Act and not for tax reporting purposes. The tax composition of the Funds distributions for each calendar year
is reported on IRS Form 1099-DIV.
Dividends from net investment income and distributions from realized gains from investment transactions have been
determined in accordance with Federal income tax regulations and may differ from net investment income and realized gains recorded by the Fund for financial reporting purposes. These differences which could be temporary or permanent in nature may
result in reclassification of distributions; however, net investment income, net realized gains and losses and net assets are not affected.
Cash
Flow Information:
The Fund invests in securities and distributes dividends and distributions which are paid in cash or are reinvested at the discretion of shareholders. These activities are reported in the Statement of Changes in Net Assets.
Additional information on cash receipts and cash payments is presented in the Statement
14 Brookfield
Investment Management Inc.
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Notes to Financial Statements (Unaudited)
June 30, 2013
of Cash Flows. Cash, as used in the Statement of Cash Flows, is the amount reported as Cash in the Statement of Assets and Liabilities, and does not include short-term investments.
3. Investment Advisory Agreement and Transactions with Related Parties
The Fund has entered into an investment advisory agreement (the Advisory Agreement) with the Adviser under which the Adviser is responsible
for the management of the Funds portfolio and provides the necessary personnel, facilities, equipment and certain other services necessary to the operation of the Fund. The Advisory Agreement provides that the Fund shall pay the Adviser a fee,
computed daily and payable monthly, at an annual rate of 1.00% of the Funds average daily net assets (plus the amount of borrowing for investment purposes) (Managed Assets). Pursuant to the Advisory Agreement, the Adviser may
delegate any or all of its responsibilities to one or more investment sub-advisers, which may be affiliates of the Adviser, subject to the approval of the Board of Directors and stockholders of the Fund. For the six months ended June 30, 2013,
the Adviser earned $1,159,094 in investment advisory fees from the Fund.
The Fund has entered into an Administration Agreement with the Adviser.
The Adviser entered into a sub-administration agreement with U.S. Bancorp Fund Services, LLC (the Sub-Administrator). The Adviser and Sub-Administrator perform administrative services necessary for the operation of the Fund, including
maintaining certain books and records of the Fund and preparing reports and other documents required by federal, state, and other applicable laws and regulations, and providing the Fund with administrative office facilities. For these services, the
Fund shall pay to the Adviser a monthly fee at an annual rate of 0.15% of the Funds average daily Managed Assets. The Adviser is responsible for any fees due to the Sub-Administrator.
For the six months ended June 30, 2013, the Adviser earned $173,864 in administration fees.
Certain officers and/or directors of the Funds are officers and/or directors of the Adviser.
4. Purchases and Sales of Investments
For the six months
ended June 30, 2013, purchases and sales of investments, excluding short-term securities, the credit facility and U.S. Government securities were $55,750,853 and $58,904,364, respectively.
5. Option Contracts
The Fund may purchase or sell
(
i.e.,
write) options on securities, securities indices and foreign currencies which are listed on a national securities exchange or traded in the over-the-counter market to hedge the value of the Funds portfolio or, as a means of
achieving additional return.
A call option is a contract that gives the holder of the option the right to buy from the writer of the option, in
return for a premium, the security or currency underlying the option at a specified exercise price at any time during the term of the option. The writer of the call option has the obligation, upon exercise of the option, to deliver the underlying
security or currency upon payment of the exercise price during the option period.
A put option is a contract that gives the holder of the option
the right, in return for a premium, to sell to the seller of the put option the underlying security at a specified price. The seller of the put option has the obligation to buy the underlying security upon exercise at the exercise price.
A call option is covered if the Fund owns the underlying instrument covered by the call or has an absolute and immediate right to acquire
that instrument without additional cash consideration (or for additional cash consideration held in a segregated account by its custodian) upon conversion or exchange of other instruments held in its portfolio. A call option is also covered if the
Fund holds a call option on the same instrument as the call option written where the exercise price of the call option held is (i) equal to or less than the exercise price of the call option written or (ii) greater than the exercise price
of the call option written if the difference is maintained by the Fund in cash, U.S. government securities or other high-grade short-term obligations in a segregated account
2013 Semi-Annual
Report
15
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Notes to Financial Statements (Unaudited)
June 30, 2013
with its custodian. A call option is uncovered if the underlying security covered by the call is not held by the Fund. A put option is covered if the Fund maintains cash
or other liquid securities with a value equal to the exercise price in a segregated account with its custodian, or else holds a put option on the same instrument as the put option written where the exercise price of the put option held is equal to
or greater than the exercise price of the put option written.
If the Fund has written an option, it may terminate its obligation by effecting a
closing purchase transaction. This is accomplished by purchasing an option of the same series as the option previously written. However, once the Fund has been assigned an exercise notice, the Fund will be unable to effect a closing purchase
transaction. Similarly, if the Fund is the holder of an option it may liquidate its position by effecting a closing sale transaction. This is accomplished by selling an option of the same series as the option previously purchased. There can be no
assurance that either a closing purchase or sale transaction can be effected when the Fund so desires.
The Fund will realize a profit from a
closing transaction if the price of the transaction is less than the premium received from writing the option, or is more than the premium paid to purchase the option; the Fund will realize a loss from a closing transaction if the price of the
transaction is more than the premium received from writing the option, or is less than the premium paid to purchase the option. Since call option prices generally reflect increases in the price of the underlying security, any loss resulting from the
repurchase of a call option may also be wholly or partially offset by unrealized appreciation of the underlying security. Other principal factors affecting the market value of a put or a call option include supply and demand, interest rates, the
current market price and price volatility of the underlying security and the time remaining until the expiration date of the option. Gains and losses on investments in options depend, in part, on the ability of the Adviser to correctly predict the
effect of these factors. The use of options cannot serve as a complete hedge since the price movement of securities underlying the options will not necessarily follow the price movements of the portfolio securities subject to the hedge.
The premium amount and the number of written option contracts during the six months ended June 30, 2013 were as follows:
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
|
Premium
|
|
|
|
Contracts
|
|
|
Amount
|
|
Outstanding at December 31, 2012
|
|
|
|
|
|
$
|
|
|
Options written
|
|
|
4,500
|
|
|
|
281,484
|
|
Options expired
|
|
|
(2,556
|
)
|
|
|
(94,972
|
)
|
Options exercised
|
|
|
(1,944
|
)
|
|
|
(186,512
|
)
|
|
|
|
|
|
|
|
|
|
Outstanding at June 30, 2013
|
|
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
As of June 30, 2013, there were no options outstanding.
The average notional value of written options during the six months ended June 30, 2013 was $3,392,800.
6. Borrowings
Credit facility:
The Fund established a
line of credit with BNP Paribas for investment purposes subject to the limitations of the 1940 Act for borrowings by registered investment companies. The Fund pays interest in the amount of 0.70% plus the 3-month London Interbank Offered Rate on the
amount outstanding and 0.70% on the line of credit that is unused. For the six months ended June 30, 2013, the average interest rate paid on the line of credit was 0.95% of the total line of credit amount available to the Fund.
|
|
|
|
|
Total line of credit amount available
|
|
$
|
63,000,000
|
|
Line of credit outstanding at June 30, 2013
|
|
|
53,000,000
|
|
Line of credit amount unused at June 30, 2013
|
|
|
10,000,000
|
|
Average balance outstanding during the period
|
|
|
53,000,000
|
|
Interest expense incurred on line of credit during the period
|
|
|
297,108
|
|
16 Brookfield
Investment Management Inc.
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Notes to Financial Statements (Unaudited)
June 30, 2013
7. Capital Stock
The Funds authorized stock consists of 1,000,000,000 shares of stock, par value $0.001 per share. The Funds Board of Directors is authorized
to classify and reclassify any unissued shares of capital stock into other classes or series of stock and authorize the issuance of shares of stock without obtaining stockholder approval. The Board of Directors, without any action by the
stockholders, may amend the charter from time to time to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that the Fund has authority to issue.
The common shares have no preemptive, conversion, exchange or redemption rights. All shares of the Funds common stock have equal voting, dividend,
distribution and liquidation rights. The common shares are fully paid and non-assessable. Common stockholders are entitled to one vote per share and all voting rights for the election of directors are non-cumulative.
8. Federal Income Tax Information
Income and capital gain
distributions are determined in accordance with federal income tax regulations, which may differ from GAAP.
The tax character of distributions for
the six months ended June 30, 2013 is expected to be from ordinary income but will be determined at the end of the Funds current year.
The tax character
of distributions paid for the year ended December 31, 2012 was as follows:
|
|
|
|
|
Ordinary income (including short-term capital gains)
|
|
$
|
10,440,212
|
|
Long-term capital gains
|
|
|
225,827
|
|
Return of capital
|
|
|
194,399
|
|
|
|
|
|
|
Total distributions
|
|
$
|
10,860,438
|
|
|
|
|
|
|
At December 31, 2012, the Funds most recently completed tax year-end, the components of distributable
earnings on a tax basis were as follows:
|
|
|
|
|
Other accumulated losses
|
|
$
|
(874,031
|
)
|
Tax basis unrealized appreciation
|
|
|
20,835,104
|
|
|
|
|
|
|
Total tax basis accumulated gains
|
|
$
|
19,961,073
|
|
|
|
|
|
|
As of December 31, 2012, the Fund had no capital loss carryforwards.
Federal Income Tax Basis:
The federal income tax basis of the Funds investments at June 30, 2013 was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Investments
|
|
|
Gross Unrealized Appreciation
|
|
|
Gross Unrealized Depreciation
|
|
|
Net Unrealized Appreciation
|
|
$
|
194,811,402
|
|
|
$
|
31,636,529
|
|
|
$
|
(7,926,348
|
)
|
|
$
|
23,710,181
|
|
Capital Account Reclassifications:
Because federal income tax regulations differ in certain respects from GAAP,
income and capital gain distributions, if any, determined in accordance with tax regulations may differ from net investment income and realized gains recognized for financial reporting purposes. These differences are primarily due to differing
treatments for wash sales and return of capital. Permanent book and tax differences, if any, relating to stockholder distributions will result in reclassifications to paid-in-capital or to undistributed capital gains. These reclassifications have no
effect on net assets or net asset value per share.
2013 Semi-Annual
Report
17
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Notes to Financial Statements (Unaudited)
June 30, 2013
At December 31, 2012, the Funds most recently completed tax year-end, the Funds
components of net assets were increased or (decreased) by the amounts shown in the table below.
|
|
|
|
|
|
|
|
|
|
|
Additional Paid-In Capital
|
|
|
Distributions in excess of Net Investment Income
|
|
|
Accumulated Net Realized Gain
|
|
$
|
225,760
|
|
|
$
|
(1,925,671
|
)
|
|
$
|
1,699,911
|
|
9. Indemnification
Under the
Funds organizational documents, its officers and directors are indemnified against certain liabilities arising out of the performance of their duties to the Fund. In addition, in the normal course of business, the Fund enters into contracts
with its vendors and others that provide for indemnification. The Funds maximum exposure under these arrangements is unknown, since this would involve the resolution of certain claims, as well as future claims that may be made, against the
Fund. Thus, an estimate of the financial impact, if any, of these arrangements cannot be made at this time. However, based on experience, the Fund expects the risk of loss due to these warranties and indemnities to be unlikely.
10. Recently Adopted Accounting Pronouncements
In December
2011, the FASB issued new guidance that requires an entity to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. In
January 2013, FASB issued additional clarification to specify that the guidance applies only to derivatives, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions that are either offset
in accordance with specific criteria of the Codification or subject to a master netting arrangement or similar agreement. This guidance is effective for annual periods beginning on or after January 1, 2013. The adoption of this guidance did not
have a material impact on the financial statements.
11. Exclusion from Definition of Commodity Pool Operator
Pursuant to amendments by the Commodity Futures Trading Commission to Rule 4.5 under the Commodity Exchange Act (CEA), the Adviser has filed
a notice of exemption from registering as a commodity pool operator with respect to the Fund. The Fund and the Adviser are therefore not subject to registration or regulation as a pool operator under the CEA. Effective December 31,
2012, in order to claim the Rule 4.5 exemption, the Fund is limited in its ability to invest in commodity futures, options, swaps (including securities futures, broad-based stock index futures and financial futures contracts). The Fund will limit
its transactions in such instruments (excluding transactions entered into for bona fide hedging purposes, as defined under the Commodity Futures Trading Commission regulations) such that either: (i) the aggregate initial margin and
premiums required to establish its futures, options on futures and swaps do not exceed 5% of the liquidation value of the Funds portfolio, after taking into account unrealized profits and losses on such positions; or (ii) the aggregate
net notional value of its futures, options on futures and swaps does not exceed 100% of the liquidation value of the Funds portfolio, after taking into account unrealized profits and losses on such positions. The Fund and the Adviser do not
believe that complying with the amended rule will limit the Funds ability to use commodity, futures, options and swaps to the extent that it has used them in the past. These limitations, however, may have an impact on the ability of the
Adviser to manage the Fund in the future and on the Funds performance.
12. Subsequent Events
GAAP requires recognition in the financial statements of the effects of all subsequent events that provide additional evidence about conditions that
existed at the date of the Statement of Assets and Liabilities. For non-recognized subsequent events that must be disclosed to keep the financial statements from being misleading, the Fund is required to disclose the nature of the event as well as
an estimate of its financial effect, or a statement that such an estimate cannot be made.
18 Brookfield
Investment Management Inc.
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.
Notes to Financial Statements (Unaudited)
June 30, 2013
On August 9, 2013, the Fund filed an initial Registration Statement under the Securities Act of
1933 and the Investment Company Act of 1940 on Form N-2, in connection with a proposed rights offering. The Board has not approved the terms of the proposed rights offering, only the initial filing of the Registration Statement. If the terms of the
proposed rights offering are approved by the Board, the Fund will issue a press release announcing such terms.
Dividends:
The Funds Board of Directors
declared the following monthly dividends:
|
|
|
|
|
|
|
|
|
|
|
Dividend Per Share
|
|
|
Record Date
|
|
|
Payable Date
|
|
$
|
0.1167
|
|
|
|
July 18, 2013
|
|
|
|
July 26, 2013
|
|
$
|
0.1167
|
|
|
|
August 15, 2013
|
|
|
|
August 30, 2013
|
|
Management has evaluated subsequent events in the preparation of the Funds financial statements and has determined
that other than the items listed herein, there are no events that require recognition or disclosure in the financial statements.
2013 Semi-Annual
Report
19
BROOKFIELD GLOBAL LISTED INFRASTRUCTURE INCOME FUND INC.