The Herzfeld Caribbean Basin Fund, Inc. Pays Distribution
The Herzfeld Caribbean Basin Fund (NASDAQ: CUBA) has announced a distribution of $0.2325 per share paid on January 13, 2025, under its Managed Distribution Policy. The distribution represents a 15% annual rate based on the Fund's June 30, 2024 net asset value.
The Board recently modified the Policy to maintain the 15% annual distribution rate but with flexible distribution periods (quarterly, semi-annual, or annual) to accommodate year-end regulatory capital gains distributions. The current distribution consists entirely of return of capital. The Fund reports a -4.50% average annual return over the past 5 years, with a current annualized distribution rate of 15.15% of NAV. The Fund's cumulative total return for the fiscal year through December 31, 2024, stands at 6.53%.
Il Fondo Herzfeld Caribbean Basin (NASDAQ: CUBA) ha annunciato una distribuzione di $0.2325 per azione da pagare il 13 gennaio 2025, nell'ambito della sua Politica di Distribuzione Gestita. La distribuzione rappresenta un tasso annuale del 15% basato sul valore netto degli attivi del Fondo al 30 giugno 2024.
Il Consiglio ha recentemente modificato la Politica per mantenere il tasso di distribuzione annuale del 15%, ma con periodi di distribuzione flessibili (trimestrali, semestrali o annuali) per adeguarsi alle distribuzioni di guadagni di capitale regolamentari di fine anno. L'attuale distribuzione è completamente costituita da rimborso di capitale. Il Fondo segnala un ritorno medio annuale del -4,50% negli ultimi 5 anni, con un attuale tasso di distribuzione annualizzato del 15,15% del NAV. Il rendimento totale cumulativo del Fondo per l'anno fiscale fino al 31 dicembre 2024 è pari al 6,53%.
El Fondo Herzfeld Caribbean Basin (NASDAQ: CUBA) ha anunciado una distribución de $0.2325 por acción que se pagará el 13 de enero de 2025, bajo su Política de Distribución Administrada. La distribución representa un tasa anual del 15% basada en el valor neto de los activos del Fondo al 30 de junio de 2024.
La Junta ha modificado recientemente la Política para mantener la tasa de distribución anual del 15%, pero con períodos de distribución flexibles (trimestrales, semestrales o anuales) para adaptarse a las distribuciones de ganancias de capital reglamentarias de fin de año. La distribución actual consiste enteramente en un retorno de capital. El Fondo informa un retorno promedio anual del -4.50% en los últimos 5 años, con una tasa de distribución anualizada actual del 15.15% del NAV. El retorno total acumulado del Fondo para el año fiscal hasta el 31 de diciembre de 2024 es del 6.53%.
헤르츠펠드 카리브 분지 펀드 (NASDAQ: CUBA)는 관리 분배 정책에 따라 주당 $0.2325의 분배를 2025년 1월 13일에 지급한다고 발표했습니다. 이 분배는 2024년 6월 30일 기준 펀드의 순자산 가치를 바탕으로 한 연 15%의 비율을 나타냅니다.
이사회는 최근 연 15%의 분배 비율을 유지하되, 연말 규제 자본 이득 분배를 수용하기 위해 유연한 분배 기간(분기별, 반기별 또는 연간)으로 정책을 수정했습니다. 현재의 분배는 전적으로 자본 환급으로 구성되어 있습니다. 펀드는 지난 5년 간 -4.50%의 평균 연간 수익률을 보고하며, 현재 연간화된 분배 비율은 순자산 기준으로 15.15%입니다. 2024년 12월 31일까지의 회계연도 동안 펀드의 누적 총 수익률은 6.53%입니다.
Le Fonds Herzfeld Caribbean Basin (NASDAQ: CUBA) a annoncé une distribution de 0,2325 $ par action prévue le 13 janvier 2025, dans le cadre de sa Politique de Distribution Gérée. La distribution représente un taux annuel de 15% basé sur la valeur nette des actifs du Fonds au 30 juin 2024.
Le Conseil a récemment modifié la Politique pour maintenir le taux de distribution annuel de 15%, mais avec des périodes de distribution flexibles (trimestrielles, semestrielles ou annuelles) pour s'adapter aux distributions réglementaires de gains en capital de fin d'année. La distribution actuelle consiste entièrement en un remboursement de capital. Le Fonds rapporte un rendement moyen annuel de -4,50% au cours des 5 dernières années, avec un taux de distribution annualisé actuel de 15,15% de la NAV. Le rendement total cumulé du Fonds pour l'exercice fiscal se terminant le 31 décembre 2024 atteint 6,53%.
Der Herzfeld Caribbean Basin Fund (NASDAQ: CUBA) hat eine Ausschüttung von 0,2325 $ pro Aktie bekannt gegeben, die am 13. Januar 2025 im Rahmen seiner verwalteten Ausschüttungspolitik gezahlt wird. Die Ausschüttung entspricht einem jährlichen Satz von 15%, basierend auf dem Nettovermögen des Fonds zum 30. Juni 2024.
Der Vorstand hat die Politik kürzlich geändert, um den jährlichen Ausschüttungssatz von 15% beizubehalten, jedoch mit flexiblen Ausschüttungszeiträumen (quartalsweise, halbjährlich oder jährlich), um den gesetzlichen Gewinnausschüttungen zum Jahresende gerecht zu werden. Die aktuelle Ausschüttung besteht vollständig aus Rückzahlung von Kapital. Der Fonds weist eine durchschnittliche jährliche Rendite von -4,50% über die letzten 5 Jahre aus, mit einem aktuellen annualisierten Ausschüttungssatz von 15,15% des NAV. Die kumulierte Gesamtrendite des Fonds für das Geschäftsjahr bis zum 31. Dezember 2024 beträgt 6,53%.
- Maintained high distribution rate of 15% annually
- 6.53% cumulative total return for fiscal year through December 31, 2024
- -4.50% average annual return over 5-year period
- 100% of current distribution consists of return of capital, not from investment income or capital gains
- Return of capital distributions decrease Fund's total assets and may increase expense ratio
Insights
The Herzfeld Caribbean Basin Fund's latest distribution of
The fund's modification of its distribution policy to allow flexible timing while maintaining the
For retail investors, it's important to understand that while the distribution may seem attractive, it's entirely composed of return of capital, which effectively reduces their cost basis and could have significant tax implications. The fund's performance metrics and distribution structure suggest a concerning trend that requires careful consideration from a long-term investment perspective.
MIAMI BEACH, Fla., Jan. 13, 2025 (GLOBE NEWSWIRE) -- The Herzfeld Caribbean Basin Fund, Inc. (NASDAQ: CUBA) (the “Fund”) today announced that the Fund has made the following distribution pursuant to the Fund’s Managed Distribution Policy (the “Policy”):
| Declaration Date | Ex-Date | Record Date | Payment Date | Per Share | |
| 12/20/2024 | 12/31/2024 | 12/31/2024 | 01/13/2025 | $ | 0.2325 |
The distribution for stockholders has been paid in all cash.
The primary purpose of the Policy is to provide stockholders with a constant, but not guaranteed, fixed minimum rate of distribution (currently set at the annual rate of
The Fund cannot predict what effect, if any, the Policy will have on the market price of its shares or whether such market price will reflect a greater or lesser discount to net asset value as compared to prior to the adoption of the Policy
Under the Policy, the Fund will distribute all available investment income to its stockholders, consistent with its investment objective and as required by the Internal Revenue Code of 1986, as amended (the “Code”). The amount distributed per share is subject to change at the discretion of the Board. If sufficient investment income is not available on a quarterly basis, the Fund will distribute long-term capital gains and/or return capital to its stockholders in order to maintain its managed distribution level. The Fund is currently not relying on any exemptive relief from Section 19(b) of the Investment Company Act of 1940, as amended (the “1940 Act”). The Fund may make additional distributions from time to time, including additional capital gain distributions at the end of the taxable year, if required to meet requirements imposed by the Code and/or the 1940 Act. Please note that for shareholders enrolled in the Fund’s Dividend Distribution Reinvestment Plan, the distribution will be reinvested in additional shares of the Fund as described in the Policy.
The Fund expects that distributions under the Policy will exceed investment income and available capital gains and thus expects that distributions under the Policy will likely include returns of capital for the foreseeable future. A return of capital may occur, for example, when some or all of a stockholder’s investment is paid back to the stockholder. A return of capital distribution does not necessarily reflect the Fund’s investment performance and should not be confused with ‘yield’ or ‘income.’ Furthermore, a return of capital distribution is not a guarantee of future distributions or yield.’ Any such returns of capital will decrease the Fund’s total assets and, therefore, could have the effect of increasing the Fund’s expense ratio. In addition, in order to maintain the level of distributions called for under its Policy, the Fund may have to sell portfolio securities at a less than opportune time.
The following table sets forth the estimated amounts of the current distribution and the cumulative distributions declared this fiscal year to date from the following sources: net investment income, net realized capital gains and return of capital. All amounts are expressed per common share.
| Current Distribution | % Breakdown of the Current Distribution | Total Cumulative Distributions for the Fiscal Year to Date | % Breakdown of the Total Cumulative Distributions for the Fiscal Year to Date | |||
| Net Investment Income | $ | 0.00 | $ | 0.00 | ||
| Net Realized Short-Term Capital Gains | $ | 0.00 | $ | 0.00 | ||
| Net Realized Long-Term Capital Gains | $ | 0.00 | $ | 0.00 | ||
| Return of Capital | $ | 0.2325 | $ | 0.2325 | ||
| Total (per common share) | $ | 0.2325 | $ | 0.2325 | ||
| Average annual total return (in relation to NAV) for the 5-year period ending on December 31, 2024 | - |
| Annualized current distribution rate expressed as a percentage of NAV as of December 31, 2024 | |
| Cumulative total return (in relation to NAV) for the fiscal year through December 31, 2024 | |
| Cumulative fiscal year distributions as a percentage of NAV as of December 31, 2024 |
No conclusions should be drawn about the Fund’s investment performance from the amount of the Fund’s distributions or from the terms of the Policy.
The amount distributed per share is subject to change at the discretion of the Board. The Policy is subject to ongoing review by the Board to determine whether it should be continued, modified or terminated. The Board may amend the terms of the Policy, suspend the Policy, or terminate the Policy at any time without prior notice to the Fund’s stockholders if it deems such actions to be in the best interest of the Fund or its stockholders. The amendment or termination of the Policy could have an adverse effect on the market price of the Fund's shares. On May 9, 2024, the Board approved certain modifications to the Policy and extended the Policy through June 30, 2025.
With each distribution that does not consist solely of net investment income, the Fund will issue a notice to stockholders and an accompanying press release that will provide detailed information regarding the amount and composition of the distribution and other related information. The amounts and sources of distributions reported in the notice to stockholders are only estimates and are not being provided 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 its full fiscal year and may be subject to changes based on tax regulations. The Fund will send stockholders a Form 1099-DIV for the respective calendar year that will tell them how to report these distributions for federal income tax purposes. Stockholders should consult their tax advisor for proper tax treatment of the Fund’s distributions.
About Thomas J. Herzfeld Advisors, Inc.
Thomas J. Herzfeld Advisors, Inc., founded in 1984, is an SEC registered investment advisor, specializing in investment analysis and account management in closed-end funds. The Firm also specializes in investment in the Caribbean Basin. The HERZFELD/CUBA division of Thomas J. Herzfeld Advisors, Inc. serves as the investment advisor to The Herzfeld Caribbean Basin Fund, Inc. a publicly traded closed-end fund (NASDAQ: CUBA).
More information about the advisor can be found at www.herzfeld.com.
Past performance is no guarantee of future performance. An investment in the Fund is subject to certain risks, including market risk. In general, shares of closed-end funds often trade at a discount from their net asset value and at the time of sale may be trading on the exchange at a price which is more or less than the original purchase price or the net asset value. An investor should carefully consider the Fund’s investment objective, risks, charges and expenses. Please read the Fund’s disclosure documents before investing.
Forward-Looking Statements
This press release, and other statements that TJHA or the Fund may make, may contain forward looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to the Fund’s or TJHA’s future financial or business performance, strategies or expectations. Forward-looking statements are typically identified by words or phrases such as “trend,” “potential,” “opportunity,” “pipeline,” “believe,” “comfortable,” “expect,” “anticipate,” “current,” “intention,” “estimate,” “position,” “assume,” “outlook,” “continue,” “remain,” “maintain,” “sustain,” “seek,” “achieve,” and similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could,” “may” or similar expressions. TJHA and the Fund caution that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made, and TJHA and the Fund assume no duty to and do not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance. With respect to the Fund, the following factors, among others, could cause actual events to differ materially from forward-looking statements or historical performance: (1) changes and volatility in political, economic or industry conditions, particularly with respect to Cuba and other Caribbean Basin countries, the interest rate environment, foreign exchange rates or financial and capital markets, which could result in changes in demand for the Fund or in the Fund’s net asset value; (2) the relative and absolute investment performance of the Fund and its investments; (3) the impact of increased competition; (4) the unfavorable resolution of any legal proceedings; (5) the extent and timing of any distributions or share repurchases; (6) the impact, extent and timing of technological changes; (7) the impact of legislative and regulatory actions and reforms, including the Dodd-Frank Wall Street Reform and Consumer Protection Act, and regulatory, supervisory or enforcement actions of government agencies relating to the Fund or TJHA, as applicable; (8) terrorist activities, international hostilities and natural disasters, which may adversely affect the general economy, domestic and local financial and capital markets, specific industries or TJHA or the Fund; (9) TJHA’s and the Fund’s ability to attract and retain highly talented professionals; (10) the impact of TJHA electing to provide support to its products from time to time; (11) the impact of problems at other financial institutions or the failure or negative performance of products at other financial institutions; and (12) the effects of an epidemic, pandemic or public health emergency, including without limitation, COVID-19. Annual and Semi-Annual Reports and other regulatory filings of the Fund with the SEC are accessible on the SEC’s website at www.sec.gov and on TJHA’s website at www.herzfeld.com/cuba, and may discuss these or other factors that affect the Fund. The information contained on TJHA’s website is not a part of this press release.
Contact:
Tom Morgan
Chief Compliance Officer
Thomas J. Herzfeld Advisors, Inc.
1-305-777-1660
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