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: 811-21938

 

Voya Natural Resources Equity Income Fund

(Exact name of registrant as specified in charter)

 

7337 East Doubletree Ranch Rd., Suite 100, Scottsdale, AZ 85258

(Address of principal executive offices) (Zip code)

 

Huey P. Falgout, Jr., 7337 East Doubletree Ranch Road, Suite 100, Scottsdale, AZ 85258

(Name and address of agent for service)

 

Registrant’s telephone number, including area code: 1-800-992-0180

 

Date of fiscal year end: February 28

 

Date of reporting period: May 31, 2017

 

 

 

  

 

 

Item 1. Schedule of Investments

 

The schedules of investments as of the close of the reporting period are set forth below for:

 

Voya Natural Resources Equity Income Fund

 

The schedules are not audited.

  

  

 

 

  PORTFOLIO OF INVESTMENTS
Voya Natural Resources Equity Income Fund as of May 31, 2017 (Unaudited)

 

Shares        Value   Percentage
of Net
Assets		 
COMMON STOCK: 99.3%
      Canada: 18.6%          
8,502     Agnico-Eagle Mines Ltd.  $411,582    0.3 
137,763     Barrick Gold Corp.   2,278,600    1.6 
131,532     Canadian Natural Resources Ltd.   3,796,013    2.7 
161,157     Cenovus Energy, Inc.   1,437,520    1.0 
86,500     Crescent Point Energy Corp.   748,225    0.5 
145,019     Enbridge, Inc.   5,584,682    3.9 
28,606     GoldCorp, Inc.   388,756    0.3 
173,959  @  Precision Drilling Corp.   631,471    0.4 
170,018     Suncor Energy, Inc.   5,323,264    3.8 
75,254     Teck Cominco Ltd. - Class B   1,344,036    0.9 
92,009     TransCanada Corp.   4,273,818    3.0 
99,010     Yamana Gold, Inc.   258,416    0.2 
          26,476,383    18.6 
                 
      Netherlands: 0.8%          
19,809     Royal Dutch Shell PLC - Class A ADR   1,077,808    0.8 
                 
      United Kingdom: 0.5%          
23,818  @  TechnipFMC PLC   689,531    0.5 
                 
      United States: 79.4%          
18,065     Alcoa Corp.   595,061    0.4 
67,221     Anadarko Petroleum Corp.   3,396,677    2.4 
10,818     Apache Corp.   505,850    0.4 
15,202     Avery Dennison Corp.   1,280,921    0.9 
18,351     Baker Hughes, Inc.   1,012,058    0.7 
31,314  @  Berry Plastics Group, Inc.   1,815,899    1.3 
27,735  @  Boise Cascade Co.   747,458    0.5 
41,614  @  Carrizo Oil & Gas, Inc.   913,011    0.6 
111,387     Chevron Corp.   11,526,327    8.1 
18,049     Compass Minerals International, Inc.   1,157,843    0.8 
13,756  @  Concho Resources, Inc./Midland TX   1,743,986    1.2 
123,382     ConocoPhillips   5,513,942    3.9 
23,793  @  Consol Energy, Inc.   345,236    0.2 
32,593  @  Crown Holdings, Inc.   1,881,920    1.3 
29,877     CVR Energy, Inc.   596,345    0.4 
109,076  @  Denbury Resources, Inc.   166,886    0.1 
18,344     Devon Energy Corp.   623,329    0.4 
14,623  @  Diamondback Energy, Inc.   1,356,430    1.0 
22,767  @  Dril-Quip, Inc.   1,129,243    0.8 
5,354     Eagle Materials, Inc.   504,882    0.4 
40,736     EOG Resources, Inc.   3,678,868    2.6 
34,171     EQT Corp.   1,888,631    1.3 
143,321     Exxon Mobil Corp.   11,537,341    8.1 
21,992  @  Forum Energy Technologies, Inc.   357,370    0.3 
66,546  @  Freeport-McMoRan, Inc.   764,614    0.5 
82,069     Graphic Packaging Holding Co.   1,108,752    0.8 
18,330     Greif, Inc. - Class A   1,089,719    0.8 

 

Shares        Value   Percentage
of Net
Assets		 
COMMON STOCK: (continued)
      United States: (continued)          
33,855  @  Gulfport Energy Corp.  $485,819    0.3 
71,586     Halliburton Co.   3,234,971    2.3 
202,721     Hecla Mining Co.   1,163,619    0.8 
6,453     Hess Corp.   296,128    0.2 
22,470     International Paper Co.   1,188,214    0.8 
55,458     KapStone Paper and Packaging Corp.   1,171,828    0.8 
196,136     Kinder Morgan, Inc.   3,679,511    2.6 
73,466  @  Laredo Petroleum, Inc.   863,226    0.6 
101,366     Marathon Oil Corp.   1,319,785    0.9 
40,157     Marathon Petroleum Corp.   2,089,770    1.5 
2,399     Martin Marietta Materials, Inc.   537,616    0.4 
9,521     National Oilwell Varco, Inc.   311,051    0.2 
18,667  @  Newfield Exploration Co.   606,304    0.4 
48,756     Newmont Mining Corp.   1,665,017    1.2 
58,938     Noble Energy, Inc.   1,690,931    1.2 
49,151     Occidental Petroleum Corp.   2,896,468    2.0 
50,275  @  Owens-Illinois, Inc.   1,134,707    0.8 
19,402     Packaging Corp. of America   1,982,108    1.4 
39,386     PBF Energy, Inc.   760,938    0.5 
24,107     Phillips 66   1,834,784    1.3 
17,436     Pioneer Natural Resources Co.   2,909,371    2.1 
21,902     Plains GP Holdings L.P.   584,126    0.4 
121,758  @  QEP Resources, Inc.   1,217,580    0.9 
32,686     Range Resources Corp.   753,739    0.5 
46,528  @  Rice Energy, Inc.   930,560    0.7 
52,882  @  Rowan Companies PLC   636,699    0.5 
136,816     Schlumberger Ltd.   9,521,025    6.7 
31,685     SM Energy Co.   537,695    0.4 
76,784     Tahoe Resources, Inc.   679,538    0.5 
11,262     Targa Resources Corp.   517,264    0.4 
19,908     Tesoro Corp.   1,657,142    1.2 
29,779  @  Transocean Ltd.   270,691    0.2 
29,101  @  Unit Corp.   518,871    0.4 
12,063     US Silica Holdings, Inc.   458,394    0.3 
51,135     Valero Energy Corp.   3,143,268    2.2 
3,229     Vulcan Materials Co.   402,495    0.3 
7,267     WestRock Co.   395,470    0.3 
58,818  @  Whiting Petroleum Corp.   415,255    0.3 
33,649     Williams Cos., Inc.   962,361    0.7 
          112,662,938    79.4 
                 
   Total Common Stock
(Cost $162,113,031)		   140,906,660    99.3 

 

  

 

 

  PORTFOLIO OF INVESTMENTS
Voya Natural Resources Equity Income Fund as of May 31, 2017 (Unaudited) (Continued)

 

Shares        Value   Percentage
of Net
Assets		 
SHORT-TERM INVESTMENTS: 0.6%          
      Mutual Funds: 0.6%          
920,000     BlackRock Liquidity Funds, FedFund, Institutional Class, 0.680%††
(Cost $920,000)		  $920,000    0.6 
                 
   Total Short-Term Investments
(Cost $920,000)		   920,000    0.6 
                 
   Total Investments in Securities
(Cost $163,033,031)		  $141,826,660    99.9 
   Assets in Excess of Other Liabilities   159,304    0.1 
   Net Assets  $141,985,964    100.0 

  

†† Rate shown is the 7-day yield as of May 31, 2017.
@ Non-income producing security.
ADR American Depositary Receipt

 

  Cost for federal income tax purposes is $163,268,941.
   
  Net unrealized depreciation consists of:

 

Gross Unrealized Appreciation  $6,167,836 
Gross Unrealized Depreciation   (27,610,117)
      
Net Unrealized Depreciation  $(21,442,281)

 

Industry Diversification  Percentage
of Net Assets		 
Oil & Gas Exploration & Production   24.3%
Integrated Oil & Gas   23.8 
Oil & Gas Equipment & Services   11.5 
Oil & Gas Storage & Transportation   11.0 
Oil & Gas Refining & Marketing   6.7 
Paper Packaging   4.2 
Gold   4.1 
Metal & Glass Containers   3.4 
Diversified Metals & Mining   2.2 
Oil & Gas   1.7 
Oil & Gas Drilling   1.5 
Construction Materials   1.1 
Paper Products   0.8 
Silver   0.8 
Materials   0.8 
Forest Products   0.5 
Aluminum   0.4 
Mining   0.3 
Coal   0.2 
Short-Term Investments   0.6 
Assets in Excess of Other Liabilities   0.1 
Net Assets   100.0%

 

 

  

 

 

  PORTFOLIO OF INVESTMENTS
Voya Natural Resources Equity Income Fund as of May 31, 2017 (Unaudited) (Continued)

 

Fair Value Measurements

The following is a summary of the fair valuations according to the inputs used as of May 31, 2017 in valuing the assets and liabilities:

 

   Quoted Prices
in Active Markets
for Identical
Investments
(Level 1)		   Significant
Other
Observable
Inputs
(Level 2)		   Significant
Unobservable
Inputs
(Level 3)		   Fair Value
at
May 31, 2017		 
Asset Table                    
Investments, at fair value                    
Common Stock*  $140,906,660   $–   $–   $140,906,660 
Short-Term Investments   920,000    –    –    920,000 
Total Investments, at fair value  $141,826,660   $–   $–   $141,826,660 
Liabilities Table                    
Other Financial Instruments+                    
Written Options  $–   $(148,958)  $–   $(148,958)
Total Liabilities  $–   $(148,958)  $–   $(148,958)

 

+ Other Financial Instruments are derivatives not reflected in the Portfolio of Investments and may include open forward foreign currency contracts, futures, centrally cleared swaps, OTC swaps and written options. Forward foreign currency contracts, futures and centrally cleared swaps are valued at the unrealized gain (loss) on the instrument.  OTC swaps and written options are valued at the fair value of the instrument.
* For further breakdown of Common Stock by sector, please refer to the Portfolio of Investments.

 

At May 31, 2017, the following over-the-counter written options were outstanding for Voya Natural Resources Equity Income Fund:

 

Number of Contracts   Counterparty  Description  Exercise
Price		     Expiration
Date		  Premiums
Received		   Fair Value 
Options on Indices                      
 796,122   UBS AG  Call on Energy Select Sector SPDR® Fund  69.440  USD  06/16/17  $384,845   $(4,074)
 276,506   Goldman Sachs & Co.  Call on Materials Select Sector SPDR® Fund  53.490  USD  06/16/17   73,081    (94,657)
 157,480   UBS AG  Call on VanEck Vectors Gold Miners ETF  23.320  USD  06/16/17   88,567    (50,227)
        Total Written OTC Options  $546,493   $(148,958)

 

Currency Abbreviations

USD - United States Dollar

 

  

 

 

  PORTFOLIO OF INVESTMENTS
Voya Natural Resources Equity Income Fund as of May 31, 2017 (Unaudited) (Continued)

 

A summary of derivative instruments by primary risk exposure is outlined in the following tables.

 

The fair value of derivative instruments as of May 31, 2017 was as follows:

 

      Fair Value 
Derivatives not accounted for as hedging instruments       
         
Liability Derivatives  Instrument Type     
         
Equity contracts  Written options  $148,958 
Total Liability Derivatives     $148,958 

 

The following is a summary by counterparty of the fair value of OTC derivative instruments subject to Master Netting Agreements and collateral pledged (received), if any, at May 31, 2017:

 

   Goldman Sachs & Co.   UBS AG   Totals 
Liabilities:               
Written options  $94,657   $54,301   $148,958 
Total Liabilities  $94,657   $54,301   $148,958 
                
Net OTC derivative instruments by counterparty, at fair value  $(94,657)  $(54,301)   (148,958)
                
Total collateral pledged by the Fund/(Received from counterparty)  $-   $-   $- 
                
Net Exposure(1)  $(94,657)  $(54,301)  $(148,958)

 

(1)Positive net exposure represents amounts due from each respective counterparty. Negative exposure represents amounts due from the Fund.

 

  

 

 

Item 2. Controls and Procedures.

 

(a)Based on our evaluation conducted within 90 days of the filing date, hereof, the design and operation of the registrant’s disclosure controls and procedures are effective to ensure that material information relating to the registrant is made known to the certifying officers by others within the appropriate entities, particularly during the period in which Forms N-Q are being prepared, and the registrant’s disclosure controls and procedures allow timely preparation and review of the information for the registrant’s Form N-Q and the officer certifications of such Form N-Q.

 

(b)There were no significant changes in the registrant’s internal controls over financial reporting that occurred during the registrant’s last fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

 

Item 3. Exhibits.

 

A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2 under the Act (17 CFR 270.30a-2) is attached hereto as EX-99.CERT.

 

  

 

 

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.

 

(Registrant): Voya Natural Resources Equity Income Fund

 

By /s/ Shaun P. Mathews  
  Shaun P. Mathews  
  President and Chief Executive Officer  
     
Date: July 27, 2017  

 

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/ Shaun P. Mathews  
  Shaun P. Mathews  
  President and Chief Executive Officer  
     
Date: July 27, 2017  
     
By /s/ Todd Modic  
  Todd Modic  
  Senior Vice President and Chief Financial Officer  
     
Date: July 27, 2017