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SOURCE CAPITAL /DE/ — Interim / Quarterly Report 2009
Nov 25, 2009
33116_rns_2009-11-25_c8414a78-e8a7-4b8d-981b-fd8b7b9bffca.zip
Interim / Quarterly Report
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N-Q 1 a09-29494_2nq.htm N-Q
*UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549*
*FORM N-Q*
*QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY*
| Investment
Company Act file number | |
| --- | --- |
| Source
Capital, Inc. | |
| (Exact name of registrant as specified in charter) | |
| 11400 West Olympic Boulevard, Suite 1200, Los Angeles, California | 90064 |
| (Address of principal executive offices) | (Zip code) |
| J. Richard Atwood, Treasurer, Source Capital, Inc., 11400 West Olympic Boulevard, Suite 1200, Los Angeles, California 90064 | |
| (Name and address of agent for service) | |
| Registrants
telephone number, including area code: | (310)
473-0225 |
| Date of
fiscal year end: | December 31 |
| Date of
reporting period: | September
30, 2009 |
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ITEM 1. Schedule of Investments.
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Source Capital, Inc.
Portfolio of Investments
September 30, 2009 (unaudited)
| Shares or | ||
|---|---|---|
| Principal | ||
| COMMON STOCKS | Amount | Value |
| BUSINESS SERVICES & SUPPLIES 24.3% | ||
| Brady | ||
| Corporation (Class A) | 431,500 | $ 12,392,680 |
| Charles | ||
| River Laboratories International, Inc.* | 460,035 | 17,012,094 |
| CLARCOR, Inc. | 320,000 | 10,035,200 |
| Copart, Inc.* | 303,800 | 10,089,198 |
| Life | ||
| Technologies Corporation* | 535,000 | 24,904,250 |
| Manpower | ||
| Inc. | 300,000 | 17,013,000 |
| ScanSource, Inc . * | 803,363 | 22,751,240 |
| $ 114,197,662 | ||
| PRODUCER DURABLE GOODS 17.9% | ||
| Actuant | ||
| Corporation (Class A) | 400,000 | $ 6,424,000 |
| Franklin | ||
| Electric Co., Inc. | 285,900 | 8,196,753 |
| Graco | ||
| Inc. | 501,300 | 13,971,231 |
| HNI | ||
| Corporation | 627,933 | 14,819,219 |
| IDEX | ||
| Corporation | 540,900 | 15,118,155 |
| WABCO | ||
| Holdings Inc. | 625,000 | 13,125,000 |
| Zebra | ||
| Technologies Corporation (Class A)* | 486,900 | 12,625,317 |
| $ 84,279,675 | ||
| RETAILING 13.5% | ||
| CarMax, Inc.* | 1,017,412 | $ 21,263,911 |
| OReilly | ||
| Automotive, Inc.* | 600,000 | 21,684,000 |
| Signet | ||
| Jewelers Limited | 773,200 | 20,358,356 |
| $ 63,306,267 | ||
| ENERGY 9.7% | ||
| FMC | ||
| Technologies, Inc.* | 195,000 | $ 10,186,800 |
| Helix | ||
| Energy Solutions Group, Inc.* | 660,900 | 9,900,282 |
| Noble | ||
| Corporation | 670,000 | 25,433,200 |
| $ 45,520,282 | ||
| HEALTH CARE 8.8% | ||
| Bio-Rad | ||
| Laboratories, Inc. (Class A)* | 187,200 | $ 17,199,936 |
| Lincare | ||
| Holdings Inc.* | 480,000 | 15,000,000 |
| Varian | ||
| Medical Systems, Inc.* | 53,200 | 2,241,316 |
| VCA | ||
| Antech, Inc.* | 250,000 | 6,722,500 |
| $ 41,163,752 | ||
| TRANSPORTATION 6.7% | ||
| Heartland | ||
| Express, Inc. | 1,046,000 | $ 15,062,400 |
| Knight | ||
| Transportation, Inc. | 963,000 | 16,159,140 |
| $ 31,221,540 | ||
| TECHNOLOGY 4.2% | ||
| Maxim | ||
| Integrated Products, Inc. | 392,000 | $ 7,110,880 |
| Microchip | ||
| Technology Incorporated | 474,951 | 12,586,201 |
| $ 19,697,081 | ||
| ENTERTAINMENT 3.5% | ||
| Carnival | ||
| Corporation (Class A)* | 499,900 | $ 16,636,672 |
| FINANCIAL 2.3% | ||
| Brown & | ||
| Brown, Inc. | 557,300 | $ 10,677,868 |
| TOTAL COMMON STOCKS 90.9% (Cost $337,866,995) | $ 426,700,799 | |
| PREFERRED STOCKS | ||
| REAL ESTATE INVESTMENT TRUST | ||
| CBL & | ||
| Associates Properties, Inc. | 100,000 | $ 1,950,000 |
| ProLogis | ||
| (Series G) | 120,000 | 2,364,000 |
| TOTAL PREFERRED STOCKS 0.9% (Cost $5,726,454) | $ 4,314,000 |
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| CONVERTIBLE BONDS AND DEBENTURES — Diodes, Inc.
2.25% 2026 | $ 2,000,000 | $ 1,907,500 | |
| --- | --- | --- | --- |
| Transocean, Inc.
1.5% 2037 | 2,000,000 | 1,942,500 | |
| TOTAL CONVERTIBLE BONDS AND DEBENTURES 0.8% (Cost
$2,770,000) | | $ 3,850,000 | |
| NON-CONVERTIBLE BONDS AND DEBENTURES | | | |
| CORPORATE 4.6% | | | |
| Brown
Shoe Company, Inc. 8.75% 2012 | $ 3,000,000 | $ 2,940,000 | |
| Central
Garden & Pet Company 9.125% 2013 | 3,000,000 | 3,018,750 | |
| Deluxe
Corporation 5% 2012 | 2,000,000 | 1,823,440 | |
| Helix
Energy Solutions Group, Inc. 9.5% 2016 | 2,000,000 | 2,002,880 | |
| Invacare
Corporation 9.75% 2015 | 3,000,000 | 3,180,000 | |
| Nova
Chemicals Corporation 6.5% 2012 | 1,970,000 | 1,942,499 | |
| PolyOne
Corporation 6.58% 2011 | 1,500,000 | 1,478,505 | |
| Rock-Tenn
Co. 9.25% 2016 | 2,000,000 | 2,145,000 | |
| Titan
International, Inc. 8% 2012 | 3,000,000 | 2,902,500 | |
| | | $ 21,433,574 | |
| U.S. GOVERNMENT AGENCY 0.0% | | | |
| Government
National Mortgage Association (Mobile Home) 9.75% 2010 | $ 42,399 | $ 43,730 | |
| TOTAL NON-CONVERTIBLE BONDS AND DEBENTURES
4.6% (Cost $21,299,678) | | $ 21,477,304 | |
| TOTAL INVESTMENT SECURITIES 97.2% (Cost $367,663,127) | | $ 456,342,103 | |
| SHORT-TERM INVESTMENTS 2.8% (Cost $13,311,867) | | | |
| Toyota
Motor Credit Corporation 0.1% 10/1/09 | $ 5,312,000 | $ 5,312,000 | |
| Chevron
Funding Corporation 0.12% 10/6/09 | 8,000,000 | 7,999,867 | |
| | | $ 13,311,867 | |
| TOTAL INVESTMENTS 100.0% (Cost $380,974,994) Note 2 | | $ 469,653,970 | |
| Other
assets and liabilities, net 0.0% | | (75,935 | ) |
| TOTAL NET ASSETS 100.0% | | $ 469,578,035 | |
*Non-income producing security
*NOTE 1 Disclosure of Fair Value Measurements*
The Company classifies its assets based on three valuation methodologies. Level 1 investment securities are valued based on quoted market prices in active markets for identical assets. Level 2 investment securities are valued based on significant observable market inputs, such as quoted prices for similar assets and quoted prices in inactive markets or other market observable inputs. Level 3 investment securities are valued using significant unobservable inputs that reflect the Funds determination of assumptions that market participants might reasonably use in valuing the assets. The valuation levels are not necessarily an indication of the risk associated with investing in those securities. The following table presents the valuation levels of the Funds investments as of September 30, 2009:
| Investments | Level 1 | Level 2 | Level 3 | Total |
|---|---|---|---|---|
| Common | ||||
| Stocks | ||||
| Business | ||||
| Services & Supplies | $ 114,197,662 | | | $ 114,197,662 |
| Producer | ||||
| Durable Goods | 84,279,675 | | | 84,279,675 |
| Retailing | 63,306,267 | | | 63,306,267 |
| Energy | 45,520,282 | | | 45,520,282 |
| Health | ||||
| Care | 41,163,752 | | | 41,163,752 |
| Transportation | 31,221,540 | | | 31,221,540 |
| Technology | 19,697,081 | | | 19,697,081 |
| Entertainment | 16,636,672 | | | 16,636,672 |
| Financial | 10,677,868 | | | 10,677,868 |
| Preferred | ||||
| Stocks | 4,314,000 | | | 4,314,000 |
| Convertible | ||||
| Bonds & Debentures | | $ 3,850,000 | | 3,850,000 |
| Non-Convertible | ||||
| Bonds & Debentures | | 21,477,304 | | 21,477,304 |
| Short-Term | ||||
| Investments | | 13,311,867 | | 13,311,867 |
| Total | ||||
| Investments | $ 431,014,799 | $ 38,639,171 | | $ 469,653,970 |
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*NOTE 2 Federal Income Tax*
The aggregate cost of investment securities was $368,168,705 for Federal income tax purposes. Net unrealized appreciation consists of:
| Gross
unrealized appreciation: | $ | |
| --- | --- | --- |
| Gross
unrealized depreciation: | (20,859,230 | ) |
| Net
unrealized appreciation: | $ 88,173,398 | |
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ITEM 2. CONTROLS AND PROCEDURES.
(a) The principal executive officer and principal financial officer of the registrant have concluded that the registrants disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) are effective based on their evaluation of the disclosure controls and procedures as of a date within 90 days of the filing date of this report.
(b) There have been no significant changes in the registrants internal controls over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the registrants last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrants internal controls over financial reporting.
ITEM 3. EXHIBITS.
(a) Separate certification for the registrants principal executive officer and principal financial officer, as required by Rule 30a-2(a) under the Investment Company Act of 1940. Attached hereto.
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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.
| SOURCE
CAPITAL, INC. | |
| --- | --- |
| By: | /s/
ERIC S. ENDE |
| | Eric
S. Ende, President |
| | (Principal
Executive Officer) |
| Date: November 25,
2009 | |
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.
| SOURCE
CAPITAL, INC. | |
| --- | --- |
| By: | /s/
ERIC S. ENDE |
| | Eric
S. Ende, President |
| | (Principal
Executive Officer) |
| Date: November 25,
2009 | |
| By: | /s/
J. RICHARD ATWOOD |
| | J.
Richard Atwood, Treasurer |
| | (Principal
Financial Officer) |
| Date: November 25,
2009 | |
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