Interim Management Statement

RNS Number : 0279L

Henderson Diversified Income Ltd

29 August 2012

 



HENDERSON DIVERSIFIED INCOME LIMITED

29 AUGUST 2012

HENDERSON DIVERSIFIED INCOME LIMITED

Interim Management Statement

Review of the period from 1 May 2012 to 31 July 2012

MATERIAL EVENTS OR TRANSACTIONS DURING THE PERIOD

Dividends: a second interim dividend of 1.25p per ordinary share in respect of the year ended 31 October 2012, was paid on 29 June 2012 to holders registered on 8 June 2012.

A third interim dividend of 1.25p per ordinary share in respect of the year ended 31 October 2012, was declared on 29 August 2012 and will be paid on 28 September 2012 to holders registered on 7 September 2012.

Share Price:  Over the period the share price declined from 81.9p to 78.5p whilst the share price to net asset value moved from a premium of +3.0% to a discount of -2.6%.

Review: 

Over the three months to 31 July 2012, three month sterling LIBOR fell from 1.01% to 0.74% and three month EURIBOR fell from 0.71% to 0.39%.  Since half of the portfolio is held in variable rate secured loans these reductions are impacting revenues but this has been tempered by the bond portfolio where attractive rates have been secured. Global economic data continues to be disappointing with the UK recording its third quarter of contracting growth and it now seems clear that low interest rates will be remaining for some time.  Governments, banks, corporates, and individuals are all continuing to deleverage irrespective of the low cost of borrowing and this is stifling growth. Consequently, more sub-par growth is expected, which combined with slowing inflation forms a relatively favourable backdrop for middle of the curve (by maturity and credit risk) credit investing, which is our current focus.

There are no other material events or transactions to report.

PERFORMANCE AND FINANCIAL HIGHLIGHTS

Performance to 31 July 2012

	1 month %	3 months %	Since launch %
Net Asset Value Total Return per ordinary share	1.39	3.09	16.80
Share Price Total Return per ordinary share	0.64	-2.63	13.53

The Fund was launched in July 2007

Source:   Datastream

Financial Position

	at 31 July 2012	at 30 April 2012
Net assets	£67m	£66m
Net asset value (cum income)	80.6p	79.5p
Ordinary share price	78.5p	81.9p
(Discount)/Premium	(2.6%)	3.0%
Total Gearing  (financial and synthetic)	20.5%	25.5%
Target Yield	3 month LIBOR + 1.25%*	3 month LIBOR + 1.25%*
Actual Share Price Yield	6.37%	6.11%
Total Expense Ratio (Source: Henderson fact sheet)	1.56%	1.54%

*3 month £ LIBOR was 1.01% on 30 April 2012 and 0.74% on 31 July 2012

Dividends Paid/Declared in Financial Year to date

	Amount	Pay Date	Record Date
Fourth Interim	1.25p	30 December 2011	9 December 2011
First Interim	1.25p	30 March 2012	9 March 2012
Second Interim	1.25p	29 June 2012	8 June 2012
Third Interim	1.25p	28 September 2012	7 September 2012

THE PORTFOLIO

Top 10 Investments		Country	% of portfolio		% of portfolio
			at 31 Jul 2012		at 30 Apr 2012
Alliance Boots (Secured term loan B 07/15)		UK	2.6%		2.6%
Convatec Healthcare (7.375% 15/12/17)		USA	2.4%		2.4%
Vue Entertainment (Secured loan B 12/17)		UK	2.3%		-
RBS WorldPay (Secured term loan A & B 6/17)		UK	2.3%		2.3%
Daily Mail & General Trust (5.75% 7/12/18 and 6.375% 21/06/27)		UK	2.3%		2.1%
ISS (Secured second lien loan 12/15)		Denmark	2.3%		2.3%
BAA (7.125% 14/02/24 & 7.125% 01/03/17)		UK	2.2%		2.1%
Smurfit Kappa Funding (7.75% 15/11/19)		Ireland	2.2%		2.2%
William Hill (7.125% 11/11/16)		UK	2.1%		2.1%
Weetabix (Secured second lien loan 06/15)		UK	2.1%		2.0%
Sector Breakdown	% at 31 July 2012			% at 30 April 2012
Secured Loans	51.1			50.7
High Yield Corporate Bonds	29.2			30.4
Investment Grade Bonds	18.0			17.2
Equities	1.6			1.6
Derivatives	0.1			0.1

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: [phone]	James de Sausmarez Director Head of Investment Trusts Henderson Global Investors Telephone: [phone]
Sarah Gibbons-Cook Investor Relations and PR Manager Henderson Global Investors Telephone: [phone]

Henderson Diversified Income Limited has its registered office at Liberté House, 19-23 La Motte Street, St Helier, Jersey JE2 4SY and it is regulated by the Jersey Financial Services Commission

Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

- ENDS -

 

END

 

 

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