Interim Management Statement

RNS Number : 1006Y
Henderson Diversified Income Ltd
27 August 2009
 



HENDERSON DIVERSIFIED INCOME LIMITED


27 AUGUST 2009


HENDERSON DIVERSIFIED INCOME LIMITED


Interim Management Statement 


Review of the period from May 2009 to 31 July 2009 


MATERIAL EVENTS OR TRANSACTIONS DURING THE PERIOD


Review: Over the three months to 31 July 2009, three month LIBOR fell from 1.45% to 0.89%, which reduced the level of dividend payable for this period. However, our income target of 1.25% over LIBOR continues to be exceeded. Over the period, gearing rose slightly from 15% to 16% of net assets as the fund continued to pursue opportunities in the secondary market where, during the period, it was possible to buy bonds trading at a deep discount to par value. This strategy will help ensure capital upside potential as the credit market continues its process of healing. Opportunities in the primary market have also been pursued selectively. Cash was sourced from the gearing facility and sale of bonds which have rallied to levels where capital appreciation is limited.


Dividends: a second interim dividend of 1.25p per ordinary share in respect of the year ended 31 October 2009, was paid on 30 June 2009 to holders registered on 12 June 2009.


A third interim dividend of 1.10p per ordinary share in respect of the year ended 31 October 2009, was declared on 27 August 2009 and will be paid on 30 September 2009 to holders registered on 11 September 2009.


Share Price:  Over the period the share price rose from 52.3to 62.0p whilst the share price discount to net asset value fell from -13.1% to -3.3%.


There are no other material events or transactions to report.


PERFORMANCE AND FINANCIAL HIGHLIGHTS


Performance to 31 July 2009 


1 month

3 months

Since launch

Net Asset Value Total Return per ordinary share

7.42

25.83

-23.36

Share Price Total Return per ordinary share

5.98

21.20

-28.57





The Fund was Launched in July 2007

Source: Datastream


Financial Position 


at 31 Jul2009 

at 30 April 2009 

Net assets

£62m

£51m

Net asset value (cum income)

64.1p

52.5p

Ordinary share price

62.0p

52.3p

Premium

-3.3%

2.1%

Gearing

16%

15%

Target Yield

3 month LIBOR + 1.25%*

3 month LIBOR + 1.25%

Total Expense Ratio

1.83%

1.98%

*3 month £ LIBOR was 0.89% on 31 July 2009






Dividends Paid/Declared in Financial Year to date


 
Amount
Pay Date
Record Date
First Interim
1.75p
31 March 2009
13 March 2009
Second Interim
1.25p
30 June 2009
12 June 2009
Third Interim
1.10p
30 September 2009
11 September 2009
 
 
 
 


 

THE PORTFOLIO


Top 10 Investments 

Country

% of portfolio  

% of portfolio 



at 31 Jul 2009

at 30 Apr 2009

Imperial Tobacco Finance 8.125% 15/03/2024

U.K.

2.9%

3.3%

Kabel (secured loan B & C)

Germany

2.5%

2.8%

Bauch & Lomb (secured loan term B)

Euro

2.5%

3.0%

Orangina (secured loan term B)

Euro

2.4%

2.8%

Infonxx (secured loan term B)

Euro

2.3%

3.0%

Molnlycke (secured loan B & C)

Euro

2.3%

2.6%

Kabel Deutschland 10.75% 01/07/2014

Germany

2.2%

2.7%

Weetabix (secured loan B)

U.K.

2.1%

2.3%

BNP Paribas 7.436%

Euro

2.0%

1.7%

AZ Electronics (secured loan B & C)

Euro

1.9%

1.8%



Sector Breakdown

% at 31 July 2009

% at 30 April 2009

Secured Loans

50.5

55.7

Investment Grade Bonds

30.6

28.2

High Yield Corporate Bonds

16.3

13.0

Credit Default Swaps**

0.2

0.3

Unit Trust

0.1

0.1

Cash

2.4

2.8


**The total gross exposure to short and long risk positions in credit default swaps at 31 July 2009 was £5.3 million (3April 2008: £7.5 million).


The objective of Henderson Diversified Income Limited is to provide Shareholders with a high level of income and capital growth over the long term.


The Company aims to deliver these objectives for Shareholders by investing selectively across the full spectrum of fixed income asset classes including, but not limited to, secured loans, asset-backed securities, investment grade corporate bonds, high yield corporate bonds, unrated bonds, gilts, preference and selective high yield equity shares, hybrid securities, convertible bonds and floating rate notes.


Further information on the Company, including an up to date NAV and share price information, can be found at http://www.hendersondiversifiedincome.com


For further information, please contact:


Jeremy Hamon

Company Secretary

Telephone: 01534 709108


James de Sausmarez

Director

Head of Investment Trusts

Henderson Global Investors

Telephone: 020 7818 3349

Sarah Gibbons-Cook

Investor Relations and PR Manager

Henderson Global Investors

Telephone: 020 7818 3198



- ENDS -


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