Interim Management Statement

RNS Number : 8106A

Henderson Diversified Income Ltd

24 February 2014

 



HENDERSON DIVERSIFIED INCOME LIMITED

24 FEBRUARY 2014

HENDERSON DIVERSIFIED INCOME LIMITED

Interim Management Statement

Review of the period from 1 November 2013 to 31 January 2014

MATERIAL EVENTS OR TRANSACTIONS DURING THE PERIOD

Dividends: a fourth interim dividend of 1.30p per ordinary share in respect of the year ended 31 October 2013, was paid on 31 December 2013 to holders registered on 6 December 2013.

A first interim dividend of 1.25p per ordinary share in respect of the year ended 31 October 2014, was declared on 14 January 2014 and will be paid on 21 March 2014 to holders registered on 7 February 2014.

Share Price:  Over the period the share price decreased from 91.5p to 90.0p, whilst the premium moved from  4.1% to 2.3%.

Review: 

Three month sterling LIBOR and three month Euribor remained relatively stable at around 0.5% and 0.3% respectively. In January there was a complete reversal of performance in the markets from 2013 as investors fled equities and emerging market assets in search of the safe haven of government bonds. Credit markets proved remarkably resilient to the weakness in equity markets. Over the quarter, the bond portfolio continued to see a rotation out of short-dated and lower yielding bonds which have run their course into high yielding opportunities provided by the primary and secondary market. We continue to see good income prospects from the bond market given our unchanged view on low default rates. The European loan market remained active with a range of new issues in which we selectively participated. The placing and offer for subscription by the Company closed in early February 2014, the funds raised were invested immediately on receipt in order to ensure an immediate income stream.

Share Issues: On 6 February 2014, an aggregate of 23,751,762 new shares were issued pursuant to the placing and offer for subscription by the Company (Prospectus published 14 January 2014) at an Issue Price of 88.5p per share. The gross proceeds of this issue was £21,020,309.

There are no other material events or transactions to report.

PERFORMANCE AND FINANCIAL HIGHLIGHTS

Performance to 31 January 2014 (Cum income)

	1 month %	3 months %	3 years %
Share Price Total Return per ordinary share	1.1	-0.2	39.6
Net Asset Value Total Return per ordinary share	0.5	1.6	26.5

The Fund was launched in July 2007

Source:   Morningstar Funddata

Financial Position

	at 31 January 2014	at 31 October 2013
Net assets	£81m	£81m
Net asset value (cum income)	88.0p	87.9p
Ordinary share price	90.0p	91.5p
Premium	+2.3%	+4.1%
Total Gearing  (financial and synthetic)	26.1%	24.3%
Target Yield	3 month LIBOR + 1.25%*	3 month LIBOR + 1.25%*
Ongoing Charge (Source: Henderson fact sheet)	1.40%	1.40%

*3 month £ LIBOR was 0.51763% on 31 October 2013 and 0.52125% on 31 January 2014

Dividends Paid/Declared in Financial Year to date

	Amount	Pay Date	Record Date
Fourth Interim	1.30p	31 December 2013	6 December 2013
First Interim	1.25p	21 March 2014	7 February 2014

THE PORTFOLIO

Top 10 Investments	Country	% of portfolio	% of portfolio
		at 31 Jan 2014	at 31 Oct 2013
Alliance Boots (secured loan 09/07/2017 extended TLB4)	UK	2.2%	2.3%
Lloyds Group Bank of Scotland 7.281% 29/05/2049, HBOS Cap Funding 6.461% 29/11/2049, HBOS Sterling Finance 7.881% 09/12/2049 Firth Rixon Secured loan 30/06/2017 TDF Term B & C and TLB2 and TLC2 Flint Consented B1 TLB & C1 French TLC, Consenting 2nd Lien D1 Worldpay Secured Loan term B1B TLB BIA TLB Wind Acquisition Finance 11.75% 15/07/2017 and TLB 27/11/2017 Iglo Birds Eye 5.874280% 31/10/2017 AA Bond 9.5% 31/07/2019 and PIK 9.5% 07/11/2019 Scottish Widows 7% sub 16/06/2043 and 5.5% 16/06/2023	UK UK France Germany UK Italy UK UK UK	2.2% 1.9% 1.7% 1.7% 1.7% 1.7% 1.7% 1.7%                1.6%	2.1% 1.9% 0.9% 1.8% 1.8% 1.8% 1.7% 1.7% 1.6%

Sector Breakdown	% at 31 January 2014	% at 31 October 2013
Secured Loans	48.9	49.2
High Yield Corporate Bonds	34.3	33.2
Investment Grade Bonds	9.6	11.1
Equities	7.2	6.5

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 BNP Paribas Securities Services S.C.A., Jersey Branch Company Secretary Telephone: [phone]	James de Sausmarez Director and 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 -

 

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