Virtus Total Return Fund Inc. Discloses Sources of Distribution – Section 19(a) Notice
Virtus Total Return Fund Inc. (NYSE: ZTR) has announced its monthly distribution of $0.05 per share, payable on January 30, 2025. The Fund operates under a Managed Distribution Plan, aiming to maintain consistent distribution levels. For January 2025, 100% of the distribution ($0.050) comes from Return of Capital, while the Fiscal Year-to-Date distribution shows 14.9% ($0.015) from Net Investment Income and 85.1% ($0.085) from Return of Capital.
The Fund's performance metrics reveal a 5-year Average Annual Total Return on NAV of 2.93%, an Annualized Current Distribution Rate of 9.27%, and a Fiscal YTD Cumulative Total Return on NAV of -6.79%. The Fiscal YTD Cumulative Distribution Rate stands at 0.77%. Shareholders are advised that distributions may constitute a return of capital rather than reflecting investment performance.
Virtus Total Return Fund Inc. (NYSE: ZTR) ha annunciato la sua distribuzione mensile di $0.05 per azione, che sarà pagata il 30 gennaio 2025. Il Fondo opera secondo un Piano di Distribuzione Gestita, con l'obiettivo di mantenere livelli di distribuzione coerenti. Per gennaio 2025, il 100% della distribuzione ($0.050) proviene dal Ritorno di Capitale, mentre la distribuzione cumulativa dall'inizio dell'anno fiscale mostra il 14,9% ($0.015) da Reddito da Investimento Netto e l'85,1% ($0.085) da Ritorno di Capitale.
I parametri di performance del Fondo rivelano un Rendimento Totale Annuale Medio su NAV di 5 anni del 2,93%, un tasso di distribuzione annualizzato corrente del 9,27%, e un rendimento cumulativo YTD fiscale sul NAV di -6,79%. Il tasso di distribuzione cumulativa YTD fiscale si attesta allo 0,77%. Si consiglia agli azionisti che le distribuzioni potrebbero costituire un ritorno di capitale piuttosto che riflettere la performance dell'investimento.
Virtus Total Return Fund Inc. (NYSE: ZTR) ha anunciado su distribución mensual de $0.05 por acción, pagadera el 30 de enero de 2025. El Fondo opera bajo un Plan de Distribución Gestionada, con el objetivo de mantener niveles de distribución consistentes. Para enero de 2025, el 100% de la distribución ($0.050) proviene del Retorno de Capital, mientras que la distribución acumulada hasta la fecha del año fiscal muestra el 14.9% ($0.015) de Ingresos de Inversión Netos y el 85.1% ($0.085) de Retorno de Capital.
Los métricas de rendimiento del Fondo revelan un Rendimiento Total Anual Promedio sobre NAV de 5 años del 2.93%, una Tasa de Distribución Annualizada Actual del 9.27%, y un Rendimiento Total Acumulativo YTD Fiscal sobre NAV de -6.79%. La Tasa de Distribución Acumulativa YTD Fiscal se sitúa en 0.77%. Se aconseja a los accionistas que las distribuciones pueden constituir un retorno de capital en lugar de reflejar el rendimiento de la inversión.
Virtus Total Return Fund Inc. (NYSE: ZTR)는 주당 $0.05의 월별 배당금을 발표했으며, 이는 2025년 1월 30일에 지급됩니다. 이 펀드는 일관된 배당 수준 유지하는 것을 목표로 하는 관리된 배당 계획(Managed Distribution Plan) 아래에서 운영됩니다. 2025년 1월에 대해서는 배당금의 100%($0.050)가 자본 환수(Return of Capital)에서 나오는 반면, 회계 연도 기준 배당금은 순투자 수익(Net Investment Income)에서 14.9%($0.015) 및 자본 환수에서 85.1%($0.085)를 차지합니다.
펀드의 성과 지표는 5년 평균 연간 총 수익률(NAV)의 2.93%, 연간화된 현재 배당률 9.27%, 그리고 회계 연도 기준 누적 총 수익률(NAV) -6.79%를 보여줍니다. 회계 연도 기준 누적 배당률은 0.77%입니다. 주주들에게는 배당금이 투자 성과를 반영하기보다는 자본 환수일 수 있다는 점을 유의하라고 권장합니다.
Virtus Total Return Fund Inc. (NYSE: ZTR) a annoncé sa distribution mensuelle de 0,05 $ par action, payable le 30 janvier 2025. Le Fonds fonctionne selon un Plan de Distribution Géré, visant à maintenir des niveaux de distribution constants. Pour janvier 2025, 100 % de la distribution (0,050 $) provient du Retour de Capital, tandis que la distribution cumulée depuis le début de l'exercice fiscal montre 14,9 % (0,015 $) provenant de Revenu d'Investissement Net et 85,1 % (0,085 $) provenant du Retour de Capital.
Les indicateurs de performance du Fonds révèlent un Rendement Annuel Total Moyen sur NAV de 5 ans de 2,93%, un Taux de Distribution Actuel Annualisé de 9,27 %, et un Rendement Total Cumulé YTD Fiscal sur NAV de -6,79 %. Le Taux de Distribution Cumulatif YTD Fiscal s'élève à 0,77 %. Les actionnaires sont avisés que les distributions peuvent constituer un retour de capital plutôt que de refléter la performance des investissements.
Virtus Total Return Fund Inc. (NYSE: ZTR) hat seine monatliche Ausschüttung von $0.05 pro Aktie bekannt gegeben, die am 30. Januar 2025 zahlbar ist. Der Fonds operiert unter einem verwalteten Ausschüttungsplan, der darauf abzielt, konsistente Ausschüttungsniveaus aufrechtzuerhalten. Im Januar 2025 stammen 100% der Ausschüttung ($0.050) aus Rückzahlungen des Kapitals, während die bisherige Ausschüttung im Fiskaljahr 14,9% ($0.015) aus Nettotageseinnahmen und 85,1% ($0.085) aus Rückzahlungen des Kapitals zeigt.
Die Leistungskennzahlen des Fonds zeigen eine 5-jähriger durchschnittlicher jährlicher Gesamtertrag auf NAV von 2,93%, eine annualisierte aktuelle Ausschüttungsquote von 9,27% sowie eine kumulierte Gesamtverzinsung des Fiskaljahres auf NAV von -6,79%. Die kumulierte Ausschüttungsquote YTD fiskalisch liegt bei 0,77%. Aktionären wird geraten, dass Ausschüttungen eine Rückzahlung des Kapitals darstellen können, anstatt die Anlageleistung widerzuspiegeln.
- Maintains consistent monthly distribution of $0.05 per share
- Annualized Current Distribution Rate of 9.27%
- 5-year Average Annual Total Return on NAV of 2.93%
- 100% of January 2025 distribution comes from Return of Capital, indicating no current earnings or capital gains
- Negative Fiscal YTD Cumulative Total Return on NAV of -6.79%
- 85.1% of Fiscal YTD distributions represent Return of Capital rather than earned income
Insights
The latest distribution announcement from Virtus Total Return Fund reveals concerning patterns that warrant careful investor attention. The most striking revelation is that 100% of the January 2025 distribution consists of return of capital, essentially giving investors back their own money rather than distributing actual earnings.
This distribution structure raises significant sustainability concerns. With a 9.27% annualized distribution rate against a mere 2.93% five-year average annual return, the fund is distributing substantially more than it earns. This gap between distribution and actual returns typically leads to NAV erosion over time, potentially impacting long-term investor value.
The fiscal year-to-date figures amplify these concerns:
- A negative return of -6.79% while maintaining distributions
- Only 14.9% of fiscal YTD distributions came from net investment income
- 85.1% represented return of capital
While managed distribution plans can provide steady income streams that some investors prefer, the current structure appears unsustainable without significant improvement in underlying performance. The high proportion of return of capital distributions, combined with negative returns, suggests the fund may be prioritizing distribution stability over long-term capital preservation.
Investors should note that while return of capital distributions aren't immediately taxable, they reduce cost basis and could lead to larger capital gains taxes when shares are eventually sold. The fund's current trajectory indicates a potential need for distribution policy adjustment to better align with its actual earning capacity.
Amount of Distribution |
Ex-Date/Record Date |
Payable Date |
|
January 13, 2025 |
January 30, 2025 |
Under the terms of its Managed Distribution Plan, the Fund will seek to maintain a consistent distribution level that may be paid, in part or in full, from net investment income and realized capital gains, or a combination thereof. Shareholders should note, however, that if the Fund's aggregate net investment income and net realized capital gains are less than the amount of the distribution level, the difference will be distributed from the Fund's assets and will constitute a return of the shareholder's capital. You should not draw any conclusions about the Fund’s investment performance from the amount of this distribution or from the terms of the Fund’s Managed Distribution Plan.
The Fund estimates that it has distributed more than its income and capital gains; therefore, a portion of your distribution may be a return of capital. A return of capital may occur, for example, when some or all of the money that you invested in the Fund is paid back to you. A return of capital distribution does not necessarily reflect the Fund’s investment performance and should not be confused with ‘yield’ or ‘income’.
The Fund provided this estimate of the sources of the distributions:
Distribution Estimates |
January 2025 (MTD) |
Fiscal Year-to-Date (YTD) (1) |
||||||
(Sources) |
Per Share
|
Percentage
|
Per Share
|
Percentage of Current Distribution |
||||
Net Investment Income |
$ |
- |
0.0 |
% |
$ |
0.015 |
14.9 |
% |
Net Realized Short-Term Capital Gains |
|
- |
0.0 |
% |
|
- |
0.0 |
% |
Net Realized Long-Term Capital Gains |
|
- |
0.0 |
% |
|
- |
0.0 |
% |
Return of Capital (or other Capital Source) |
|
0.050 |
100.0 |
% |
|
0.085 |
85.1 |
% |
Total Distribution |
$ |
0.050 |
100.0 |
% |
$ |
0.100 |
100.0 |
% |
(1) Fiscal year started December 1, 2024. |
||||||||
Information regarding the Fund’s performance and distribution rates is set forth below. Please note that all performance figures are based on the Fund’s net asset value (NAV) and not the market price of the Fund’s shares. Performance figures are not meant to represent individual shareholder performance.
December 31, 2024 |
|
||
Average Annual Total Return on NAV for the 5-year period (2) |
|
||
Annualized Current Distribution Rate (3) |
|
||
Fiscal YTD Cumulative Total Return on NAV (4) |
- |
||
Fiscal YTD Cumulative Distribution Rate (5) |
|
||
(2) Average Annual Total Return on NAV is the annual compound return for the five-year period. It reflects the change in the Fund’s NAV and reinvestment of all distributions. |
|||
(3) Annualized Current Distribution Rate is the current distribution rate annualized as a percentage of the Fund's NAV at month end. |
|||
(4) Fiscal YTD Cumulative Total Return on NAV is the percentage change in the Fund's NAV from the first day of the fiscal year to this month end, including distributions paid and assuming reinvestment of those distributions. |
|||
(5) Fiscal YTD Cumulative Distribution Rate is the dollar value of distributions from the first day of the fiscal year to this month end as a percentage of the Fund's NAV at month end. |
The amounts and sources of distributions reported in this notice are estimates only and are not being provided for tax reporting purposes. The actual amounts and sources of the distributions for tax purposes will depend on the Fund’s investment experience during the remainder of its fiscal year and may be subject to changes based on tax regulations. The Fund or your broker will send you a Form 1099-DIV for the calendar year that will tell you what distributions to report for federal income tax purposes.
About the Fund
Virtus Total Return Fund Inc. is a diversified closed-end fund whose investment objective is capital appreciation, with income as a secondary objective. Virtus Investment Advisers, Inc. is the investment adviser and Duff & Phelps Investment Management Co. and Newfleet Asset Management are the subadvisers to the Fund.
For more information on the Fund, contact shareholder services at (866) 270-7788, by email at closedendfunds@virtus.com, or through the Closed-End Funds section of virtus.com.
Fund Risks
An investment in a fund is subject to risk, including the risk of possible loss of principal. A fund’s shares may be worth less upon their sale than what an investor paid for them. Shares of closed-end funds may trade at a premium or discount to their NAV. For more information about the Fund’s investment objective and risks, please see the Fund’s annual report. A copy of the Fund’s most recent annual report may be obtained free of charge by contacting “Shareholder Services” as set forth at the bottom of this press release.
About Duff & Phelps Investment Management Co.
Duff & Phelps Investment Management Co. pursues investment strategies with exceptional depth of resources and expertise. With more than 35 years of experience managing investment portfolios, Duff & Phelps has earned a reputation as a leader in investing in global listed infrastructure, global listed real estate, clean energy, and diversified real assets in institutional separate accounts and open- and closed-end funds. For more information, visit dpimc.com.
About Newfleet Asset Management
Newfleet Asset Management provides comprehensive fixed income portfolio management in multiple strategies. The Newfleet Multi-Sector Strategies team that manages the Virtus Total Return Fund Inc. employs active sector rotation and disciplined risk management in portfolio construction, avoiding interest rate bets, and remaining duration neutral to each strategy’s stated benchmark. Newfleet Asset Management is a division of Virtus Fixed Income Advisers, LLC, which is a registered investment adviser affiliated with Virtus Investment Partners. For more information, visit newfleet.com.
About Virtus Investment Partners, Inc.
Virtus Investment Partners (NYSE: VRTS) is a distinctive partnership of boutique investment managers singularly committed to the long-term success of individual and institutional investors. We provide investment management products and services from our affiliated managers, each with a distinct investment style and autonomous investment process, as well as select subadvisers. Investment solutions are available across multiple disciplines and product types to meet a wide array of investor needs. Additional information about our firm, investment partners, and strategies is available at virtus.com.
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Shareholder Services
(866) 270-7788
closedendfunds@virtus.com
Source: Virtus Total Return Fund Inc.
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