UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO
HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY
Investment Company Act File Number: 811-05379
| Name of Fund: | Royce Focus Trust, Inc. | |
| Fund Address: | 745 Fifth Avenue | |
| New York, NY 10151 |
Name and address of agent for service:
John E. Denneen, Esq.
Royce & Associates, LLC
745 Fifth Avenue
New
York, NY 10151
Registrant’s telephone number, including area code: (212) 508-4500
Date of fiscal year end: 12/31/2012
Date of reporting period: 3/31/2012
Item 1 - Schedule of Investments
| SCHEDULE OF INVESTMENTS | ||||||||
| ROYCE FOCUS TRUST | ||||||||
| MARCH 31, 2012 (UNAUDITED) | ||||||||
| SHARES | VALUE | |||||||
| COMMON STOCKS – 101.0% | ||||||||
| Consumer Discretionary – 6.9% | ||||||||
| Automobiles - 1.5% | ||||||||
Thor Industries |
75,000 | $ | 2,367,000 | |||||
| Specialty Retail - 5.4% | ||||||||
Buckle (The) |
120,000 | 5,748,000 | ||||||
GameStop Corporation Cl. A |
150,000 | 3,276,000 | ||||||
| 9,024,000 | ||||||||
| Total | 11,391,000 | |||||||
| Consumer Staples – 4.6% | ||||||||
| Food Products - 3.6% | ||||||||
Cal-Maine Foods |
50,000 | 1,913,000 | ||||||
Industrias Bachoco ADR |
90,000 | 1,895,400 | ||||||
Sanderson Farms |
40,000 | 2,121,200 | ||||||
| 5,929,600 | ||||||||
| Personal Products - 1.0% | ||||||||
Nu Skin Enterprises Cl. A |
30,000 | 1,737,300 | ||||||
| Total | 7,666,900 | |||||||
| Energy – 12.6% | ||||||||
| Energy Equipment & Services - 9.8% | ||||||||
| 100,000 | 1,779,000 | |||||||
Ensco ADR |
65,000 | 3,440,450 | ||||||
Helmerich & Payne |
50,000 | 2,697,500 | ||||||
Pason Systems |
180,000 | 2,533,661 | ||||||
Trican Well Service |
250,000 | 3,671,863 | ||||||
Unit Corporation 2 |
50,000 | 2,138,000 | ||||||
| 16,260,474 | ||||||||
| Oil, Gas & Consumable Fuels - 2.8% | ||||||||
Exxon Mobil |
55,000 | 4,770,150 | ||||||
| Total | 21,030,624 | |||||||
| Financials – 19.6% | ||||||||
| Capital Markets - 13.5% | ||||||||
Affiliated Managers Group 2 |
20,000 | 2,236,200 | ||||||
Ashmore Group |
600,000 | 3,526,900 | ||||||
Franklin Resources |
45,000 | 5,581,350 | ||||||
INTL FCStone 2 |
65,000 | 1,371,500 | ||||||
Knight Capital Group Cl. A 2 |
100,000 | 1,287,000 | ||||||
Partners Group Holding |
12,000 | 2,340,977 | ||||||
Sprott |
500,000 | 3,107,925 | ||||||
Value Partners Group |
4,900,000 | 2,965,662 | ||||||
| 22,417,514 | ||||||||
| Insurance - 3.7% | ||||||||
Berkshire Hathaway Cl. B 2 |
75,000 | 6,086,250 | ||||||
| Real Estate Management & Development - 2.4% | ||||||||
Kennedy-Wilson Holdings |
300,000 | 4,050,000 | ||||||
| Total | 32,553,764 | |||||||
| Health Care – 1.4% | ||||||||
| Biotechnology - 1.4% | ||||||||
Myriad Genetics 2 |
100,000 | 2,366,000 | ||||||
| Total | 2,366,000 | |||||||
| Industrials – 6.2% | ||||||||
| Construction & Engineering - 1.3% | ||||||||
Jacobs Engineering Group 2 |
50,000 | 2,218,500 | ||||||
| Electrical Equipment - 0.7% | ||||||||
GrafTech International 2 |
100,000 | 1,194,000 | ||||||
| Machinery - 2.9% | ||||||||
Lincoln Electric Holdings |
50,000 | 2,266,000 | ||||||
Semperit AG Holding |
60,000 | 2,571,907 | ||||||
| 4,837,907 | ||||||||
| Road & Rail - 1.3% | ||||||||
Patriot Transportation Holding 2 |
90,000 | 2,096,100 | ||||||
| Total | 10,346,507 | |||||||
| Information Technology – 19.9% | ||||||||
| Computers & Peripherals - 8.5% | ||||||||
Apple 2 |
7,500 | 4,496,025 | ||||||
SanDisk Corporation 2 |
70,000 | 3,471,300 | ||||||
Western Digital 2 |
150,000 | 6,208,500 | ||||||
| 14,175,825 | ||||||||
| Semiconductors & Semiconductor Equipment - 7.5% | ||||||||
Analog Devices |
142,000 | 5,736,800 | ||||||
MKS Instruments |
130,000 | 3,838,900 | ||||||
| 100,000 | 2,860,000 | |||||||
| 12,435,700 | ||||||||
| Software - 3.9% | ||||||||
Microsoft Corporation |
200,000 | 6,450,000 | ||||||
| Total | 33,061,525 | |||||||
| Materials – 29.8% | ||||||||
| Chemicals - 7.5% | ||||||||
LSB Industries 2 |
100,000 | 3,892,000 | ||||||
Mosaic Company (The) |
85,000 | 4,699,650 | ||||||
Westlake Chemical |
60,000 | 3,887,400 | ||||||
| 12,479,050 | ||||||||
| Metals & Mining - 22.3% | ||||||||
Alamos Gold |
120,000 | 2,202,817 | ||||||
Allied Nevada Gold 2 |
135,000 | 4,391,550 | ||||||
Centamin 2 |
1,200,000 | 1,335,406 | ||||||
Endeavour Mining 2 |
450,000 | 1,006,065 | ||||||
Fresnillo |
70,000 | 1,789,202 | ||||||
Globe Specialty Metals |
200,000 | 2,974,000 | ||||||
Major Drilling Group International |
180,000 | 2,986,616 | ||||||
Newmont Mining |
75,000 | 3,845,250 | ||||||
Nucor Corporation |
50,000 | 2,147,500 | ||||||
Pan American Silver |
118,500 | 2,614,110 | ||||||
Pretium Resources 2 |
120,000 | 1,714,800 | ||||||
Reliance Steel & Aluminum |
70,000 | 3,953,600 | ||||||
Schnitzer Steel Industries Cl. A |
75,000 | 2,992,125 | ||||||
Seabridge Gold 2 |
160,000 | 3,214,400 | ||||||
| 37,167,441 | ||||||||
| Total | 49,646,491 | |||||||
| TOTAL COMMON STOCKS | ||||||||
(Cost $138,207,296) |
168,062,811 | |||||||
| REPURCHASE AGREEMENT – 13.8% | ||||||||
| Fixed Income Clearing Corporation, | ||||||||
0.01% dated 3/30/12, due 4/2/12, |
||||||||
maturity value $23,018,019 (collateralized |
||||||||
by obligations of various U.S. Government |
||||||||
Agencies, 0.18% due 11/23/12, valued at |
||||||||
$23,480,000) |
||||||||
(Cost $23,018,000) |
23,018,000 | |||||||
| COLLATERAL RECEIVED FOR SECURITIES | ||||||||
LOANED – 1.5% |
||||||||
| Money Market Funds | ||||||||
Federated Government Obligations Fund |
||||||||
(7 day yield-0.0098%) |
||||||||
(Cost $2,534,815) |
2,534,815 | |||||||
| TOTAL INVESTMENTS – 116.3% | ||||||||
(Cost $163,760,111) |
193,615,626 | |||||||
| LIABILITIES LESS CASH | ||||||||
AND OTHER ASSETS – (1.3)% |
(2,124,177 | ) | ||||||
| PREFERRED STOCK – (15.0)% | (25,000,000 | ) | ||||||
| NET ASSETS APPLICABLE TO COMMON | ||||||||
STOCKHOLDERS – 100.0% |
$ | 166,491,449 | ||||||
| 1 | All or a portion of these securities were on loan at March 31, 2012. Total market value of loaned securities at March 31, 2012, was $2,498,801. |
| 2 | Non-income producing. |
TAX INFORMATION: The cost of total investments for Federal income tax purposes was $163,760,111. At March 31, 2012, net unrealized appreciation for all securities was $29,855,515, consisting of aggregate gross unrealized appreciation of $36,282,568 and aggregate gross unrealized depreciation of $6,427,053.
Valuation of Investments:
Investment transactions are
accounted for on the trade date. Securities are valued as of the close of trading on the New York Stock Exchange (NYSE)
(generally 4:00 p.m. Eastern time) on the valuation date. Securities that trade on an exchange, and securities traded
on Nasdaq’s Electronic Bulletin Board, are valued at their last reported sales price or Nasdaq official closing price
taken from the primary market in which each security trades or, if no sale is reported for such day, at their bid
price. Other over-the-counter securities for which market quotations are readily available are valued at their highest
bid price, except in the case of some bonds and other fixed income securities which may be valued by reference to other
securities with comparable ratings, interest rates and maturities, using established independent pricing services. The
Fund values its non-U.S. dollar denominated securities in U.S. dollars daily at the prevailing foreign currency
exchange rates as quoted by a major bank. Securities for which market quotations are not readily available are valued
at their fair value under procedures approved by the Fund’s Board of Directors. In addition, if, between the time
trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that are
significant and may make the closing price unreliable, the Fund may fair value the security. The Fund uses an
independent pricing service to provide fair value estimates for relevant non-U.S. equity securities on days when the
U.S. market volatility exceeds a certain threshold. This pricing service uses proprietary correlations it has developed
between the movement of prices of non-U.S. equity securities and indices of U.S.-traded securities, futures contracts
and other indications to estimate the fair value of relevant non-U.S. securities. When fair value pricing is employed,
the prices of securities used by the Fund may differ from quoted or published prices for the same security. Investments
in money market funds are valued at net asset value per share.
| Various inputs are used in determining the value of the Fund’s investments, as noted above. These inputs are summarized in the three broad levels below: | |||
| Level 1 | – | quoted prices in active markets for identical securities. | |
| Level 2 | – | other significant observable inputs
(including quoted prices for similar securities, foreign securities that may be fair valued and
repurchase agreements). The table below includes all Level 2 securities. Any Level 2 securities with
values based on quoted prices for similar securities would be noted in the Schedule of Investments. |
|
| Level 3 | – | significant unobservable inputs
(including the Fund’s own assumptions in determining the fair value of investments). |
|
The inputs or methodology used for valuing securities are not necessarily
an indication of the risk associated with investing in those securities. |
|||
The following is a summary of the inputs used to value the Fund’s investments
as of March 31, 2012. For a detailed breakout of common stocks by sector classification,
please refer to the Schedule of Investments. |
|||
| Level 1 | Level 2 | Level 3 | Total | |||||||||
Common Stocks |
$168,062,811 | $ | – | – | $168,062,811 | |||||||
Cash Equivalents |
2,534,815 | 23,018,000 | – | 25,552,815 | ||||||||
Repurchase Agreements:
The Fund may enter into repurchase agreements with institutions that the Fund’s investment adviser has determined are
creditworthy. The Fund restricts repurchase agreements to maturities of no more than seven days. Securities pledged as
collateral for repurchase agreements, which are held until maturity of the repurchase agreements, are marked-to-market
daily and maintained at a value at least equal to the principal amount of the repurchase agreement (including accrued
interest). Repurchase agreements could involve certain risks in the event of default or insolvency of the
counter-party, including possible delays or restrictions upon the ability of the Fund to dispose of its underlying
securities.
Securities Lending:
The Fund loans securities through a lending agent to qualified institutional investors for the purpose of realizing
additional income. Collateral for the Fund on all securities loaned is accepted in cash and cash equivalents and
invested temporarily by the custodian. The collateral maintained is at least 100% of the current market value of the
loaned securities. The market value of the loaned securities is determined at the close of business of the Fund and any
additional required collateral is delivered to the Fund on the next business day. The Fund retains the risk of any loss
on the securities on loan as well as incurring the potential loss on investments purchased with cash collateral
received for securities lending. The Fund’s securities lending income consists of the income earned on investing cash
collateral, plus any premium payments received for lending certain securities, less any rebates paid to borrowers and
lending agent fees associated with the loan. The lending agent is not affiliated with Royce.
Other information regarding the Fund is available in the Fund’s most recent Report to Stockholders. This information is available through The Royce Funds (www.roycefunds.com) and on the Securities and Exchange Commission’s website (www.sec.gov).
Item 2 - Controls and Procedures
(a) The Registrant’s principal executive and principal financial officers have concluded, based on their evaluation of the Registrant’s disclosure controls and procedures as of a date within 90 days of the filing date of this report (as required by Rule 30a-3(b) under the Investment Company Act of 1940 (the “Act”)), that the Registrant’s disclosure controls and procedures (as defined by Rule 30a-3(c) under the Act) are reasonably designed to ensure that information required to be disclosed by the Registrant on Form N-Q is recorded, processed, summarized and reported within the required time periods and that information required to be disclosed by the Registrant in the reports that it files or submits on Form N-Q is accumulated and communicated to the Registrant’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.
(b) There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) during the Registrant’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the internal control over financial reporting.
Item 3 - Exhibits
Certifications pursuant to Rule 30a-2(a) under the Act are attached hereto.
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.
Royce Focus Trust, Inc.
By:
/s/ Charles M. Royce
Charles M. Royce
President, Royce Focus Trust, Inc.
Date: May 29,
2012
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/ Charles M. Royce
Charles M. Royce
President, Royce Focus Trust, Inc.
Date: May 29,
2012
By:
/s/ John D. Diederich
John D. Diederich
Treasurer, Royce Focus Trust, Inc.
Date: May 29,
2012