United States Securities and Exchange Commission Washington, DC 20549 FORM N-Q QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY Investment Company Act file number 811-00179 Central Securities Corporation (Exact name of registrant as specified in charter) 630 Fifth Avenue, Suite 820 New York, N.Y. 10111 (Address of principal executive offices) Registrant's telephone number including area code: 212-698-2020 Date of fiscal year end: December 31 Date of reporting period: September 30, 2009 Item 1. Schedule of Investments. CENTRAL SECURITIES CORPORATION Statement of Investments September 30, 2009 (Unaudited) PORTFOLIO SECURITIES 91.1% STOCKS (COMMON UNLESS SPECIFIED OTHERWISE) Prin.Amt. or Shares Value --------- ----- Banking and Finance 4.2% 675,000 The Bank of New York Mellon Corporation............. $19,568,250 150,000 NewStar Financial, Inc. (a)......................... 493,500 ----------- 20,061,750 ----------- Business Services 0.2% 100,000 Heritage-Crystal Clean Inc. (a)..................... 1,275,000 ----------- Communications 1.6% 1,000,000 Arbinet-thexchange, Inc. (a)........................ 2,350,000 200,000 AT&T Inc............................................ 5,402,000 40,000 Vodafone Group PLC.................................. 900,000 ----------- 7,752,000 ----------- Electronics 20.5% 920,000 Agilent Technologies, Inc. (a)...................... 25,603,600 370,000 Analog Devices, Inc................................. 10,204,600 831,000 Coherent, Inc. (a).................................. 19,378,920 630,000 Flextronics International Inc. (a).................. 4,706,100 710,000 Intel Corporation................................... 13,894,700 300,000 Maxim Integrated Products, Inc...................... 5,442,000 350,000 Motorola, Inc....................................... 3,006,500 1,000,000 RadiSys Corporation (a)............................. 8,690,000 3,230,000 Sonus Networks, Inc. (a)............................ 6,847,600 ----------- 97,774,020 ----------- Energy 10.8% 300,000 Berry Petroleum Company Class A..................... 8,034,000 200,000 Devon Energy Corporation............................ 13,466,000 2,000,000 GeoMet, Inc. (a).................................... 3,380,000 670,000 McMoRan Exploration Co. (a)......................... 5,058,500 300,000 Murphy Oil Corporation.............................. 17,271,000 200,000 Nexen Inc........................................... 4,514,000 ----------- 51,723,500 ----------- Health Care 2.3% 120,000 Abbott Laboratories................................. 5,936,400 100,000 Medtronic, Inc...................................... 3,680,000 260,000 Vical Inc. (a)...................................... 1,107,600 ----------- 10,724,000 ----------- Information Technology Services 5.1 % 1,700,000 Convergys Corporation (a)........................... 16,898,000 960,000 Xerox Corporation................................... 7,430,400 ----------- 24,328,400 ----------- Prin.Amt. or Shares Value --------- ----- Insurance 29.5% 10,000 Erie Indemnity Co. Class A....................... $ 374,600 70,000 The Plymouth Rock Company, Inc. Class A (b)(c)(d)............................ 140,000,000 ------------ 140,374,600 ------------ Manufacturing 14.6% 770,000 Brady Corporation Class A........................ 22,114,400 200,000 Carlisle Companies Inc........................... 6,782,000 400,000 Dover Corporation................................ 15,504,000 200,000 General Electric Co.............................. 3,284,000 100,000 Precision Castparts Corporation.................. 10,187,000 230,000 Roper Industries, Inc............................ 11,725,400 ------------ 69,596,800 ------------ Retailing 1.9% 28,751 AeroGroup International, Inc. (a)(c)(d).......... 324,886 230,000 Walgreen Co...................................... 8,618,100 ------------ 8,942,986 ------------ Miscellaneous 0.4% Other Investments (e)............................ 1,810,334 ------------ Total Portfolio Securities (cost $270,486,570)......................... 434,363,390 ------------ SHORT-TERM INVESTMENTS 8.9% Money Market Fund 2.6% 12,420,746 Fidelity Institutional Money Market Government Portfolio 0.10%..................... 12,381,221 ------------ U.S. Treasury Obligations 6.3% 31,130,000 U.S. Treasury Bills 0.16% - 0.26% due 10/22/09 - 3/11/10......................... 30,001,476 ------------ Total Short-Term Investments (cost $42,382,697)........................... 42,382,697 ------------ Total Investments (cost $312,869,267) (100.0%)................. 476,746,087 Cash, receivables and other assets less liabilities (0.0%)...................... (147,004) ------------ Net Assets (100%)............................. $476,599,083 ============ (a) Non-dividend paying. (b) Affiliate as defined in the Investment Company Act of 1940. (c) Valued at estimated fair value. (d) Restricted security. See footnote 3. (e) Securities which have been held less than one year which have not been previously disclosed and are not restricted. See accompanying notes to statement of investments. CENTRAL SECURITIES CORPORATION NOTES TO STATEMENT OF INVESTMENTS 1. Security Valuation - Securities are valued at the last sale price or, if unavailable, at the closing bid price. Corporate discount notes are valued at amortized cost, which approximates value. Securities for which no ready market exists are valued at estimated fair value by the Board of Directors. As of September 30, 2009, the tax cost of investments was $312,869,267. Net unrealized appreciation was $163,876,820 consisting of gross unrealized appreciation and gross unrealized depreciation of $222,480,584 and $58,603,764, respectively. 2. Fair Value Measurements - The Corporation's investments are categorized below in three broad hierarchical levels based on market price observability as follows: o Level 1 - Quoted prices in active markets for identical investments. The Corporation's Level 1 investments consist of securities listed on a national securities exchange or NASDAQ national market and money market funds; o Level 2 - Other significant observable data obtained from independent sources; for example, quoted prices for similar investments or the use of models or other valuation methodologies. The Corporation's Level 2 investments consist of short-term investments, carried at amortized cost. o Level 3 - Significant unobservable inputs including the Corporation's own assumptions based upon the best information available. Investments categorized as Level 3 include securities in which there is little, if any, market activity. The Corporation's Level 3 investments consist of The Plymouth Rock Company, Inc. and Aerogroup International, Inc. The methodology used for valuing securities is not necessarily an indication of the risk associated with investing in those securities. The Corporation's investments as of September 30, 2009 are classified as follows: Valuation Inputs Investments in Securities ---------------- ------------------------- Level 1 $306,419,725 Level 2 30,001,476 Level 3 140,324,886 ------------ $476,746,087 ============ The following is a reconciliation of assets in which significant unobservable inputs (Level 3) were used in determining fair value: Balance at December 31, 2008 $126,385,838 Change in unrealized appreciation of investments 13,939,048 ------------ Balance at September 30, 2009 $140,324,886 ============ No Level 3 investments were purchased, sold or transferred to Level 1 or Level 2 during the nine months ended September 30, 2009. 3. Restricted Securities - The Corporation has from time to time invested in securities the resale of which is restricted. On September 30, 2009, such investments had an aggregate value of $140,324,886, which was equal to 29.4% of the Corporation's net assets. Investments in restricted securities at September 30, 2009 were: Company Shares Security Date Purchased Cost ------- ------ -------- -------------- ---- AeroGroup International, Inc. 28,751 Common Stock 6/14/05 $17,200 The Plymouth Rock Company, Inc. 60,000 Class A Common Stock 12/15/82 1,500,000 The Plymouth Rock Company, Inc. 10,000 Class A Common Stock 6/9/84 699,986 The Corporation does not have the right to demand registration of the restricted securities. Item 2. Controls and Procedures. (a) Disclosure Controls and Procedures. The Principal Executive and Financial Officers have concluded that the Registrant's Disclosure Controls and Procedures 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) Internal Control Over Financial Reporting. During the last fiscal quarter, there was no significant change in the Registrant's internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 3. Exhibits. (a) Certifications. 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. CENTRAL SECURITIES CORPORATION By: /s/ Wilmot H. Kidd ----------------------------------- President Date: October 20, 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. By: /s/ Wilmot H. Kidd ----------------------------------- President Date: October 20, 2009 By: /s/ Charles N. Edgerton ----------------------------------- Vice President and Treasurer Date: October 20, 2009