NB Global Floating Rate Income Fund Ltd (LON:NBLS) today announced its unaudited consolidated interim financial statements for the six months ended 30 June 2019
The Company is a closed-ended investment company incorporated and registered in Guernsey on 10 March 2011 with registered number 53155. The Company is governed under the provisions of the Companies (Guernsey) Law, 2008 as amended (the “Law”), and the Registered Collective Investment Scheme Rules 2018 issued by the Guernsey Financial Services Commission. It is a non-cellular company limited by shares and has been declared by the Guernsey Financial Services Commission to be a registered closed-ended collective investment scheme. On 20 April 2011, the Company was admitted to the Official List of the U.K. Listing Authority with a premium listing trading on the Main Market of the London Stock Exchange (“LSE”). The Company was admitted to the FTSE 250 in March 2012.
Alternative Investment Fund Manager (“AIFM”) and Manager
Investment management services are provided to the Company by Neuberger Berman Investment Advisers LLC (the “AIFM”) and Neuberger Berman Europe Limited (the “Manager”), collectively the “Investment Manager”. The AIFM is responsible for risk management and discretionary management of the Company’s portfolio and the Manager provides certain administrative services to the Company.
The Company’s investment objective is to provide its shareholders with regular dividends, at levels that are sustainable, whilst preserving the capital value of its investment portfolio, utilising the investment skills of the Investment Manager.
To pursue its investment objective, the Company invests mainly in senior secured floating rate loans issued in U.S. Dollars, Pound Sterling or Euros by primarily North American and European Union corporations, partnerships and other business issuers. These loans are at the time of investment often non-investment grade. The Company considers debt instruments to be non-investment grade if, at the time of investment, they are rated below the four highest categories (Aaa, Aa, A and Baa) by at least two independent credit ratings agencies or, if unrated, are deemed by the Investment Manager to be of comparable quality.
The coupon received when investing in floating rate loans varies with, and is periodically adjusted to reflect changes in, a generally recognised base interest rate such as LIBOR. The Company generally seeks to focus on loans of issuers that the Investment Manager believes have the ability to generate cash flow through a full business cycle, maintain adequate liquidity, possess an enterprise value in excess of senior debt and have access to both debt and equity capital.
The Company may also make investments in senior bonds on an opportunistic basis if the Investment Manager believes that such investments are attractively valued, up to a maximum in aggregate of 20% of the Net Asset Value (“NAV”) at the time of investment, provided that no more than 10% of NAV may be invested in unsecured bonds at the time of investment.
As at 30 June 2019, the Company’s share capital comprised 656,316,434 Sterling Ordinary Shares (“NBLS”) of no par value (of which 75,000,000 were held in treasury) and 39,789,020 U.S. Dollar Ordinary Shares (“NBLU”) of no par value (of which 1,342,627 were held in treasury).
For the purposes of efficient portfolio management, the Company has established a wholly-owned Luxembourg incorporated subsidiary, NB Global Floating Rate Income Fund (Lux) 1 S.à.r.l., which in turn holds a wholly-owned subsidiary, NB Global Floating Rate Income Fund (Lux) 2 S.à.r.l. Part of the portfolio of the Company is held through NB Global Floating Rate Income Fund (Lux) 2 S.à.r.l.
Non-Mainstream Pooled Investments
The Company currently conducts its affairs so that the shares issued by the Company can be recommended by Independent Financial Advisers to ordinary retail investors in accordance with the Financial Conduct Authority’s (“FCA”) rules in relation to non-mainstream investment products and intends to continue to do so for the foreseeable future.
The Company’s shares are excluded from the FCA’s restrictions, which apply to non-mainstream pooled investment products.
Dividends are paid quarterly in respect of each calendar quarter. The Company’s dividend policy is detailed below.
The rolling 12 month dividend yield (based on the previous four quarterly dividends declared and share price as at 30 June 2019) was:
· Sterling Ordinary Shares: 5.15%
· U.S. Dollar Ordinary Shares: 5.08%
|(U.S. Dollars in millions, except per share data)||AS AT 30 JUNE 2019||AS AT 31 DECEMBER 2018|
|Net Asset Value 1|
|– Sterling Ordinary Shares||$703.8||$857.0|
|– U.S. Dollar Ordinary Shares||$37.7||$54.9|
|Net Asset Value per share|
|– Sterling Ordinary Shares||£0.9513||£0.9215|
|– U.S. Dollar Ordinary Shares||$0.9795||$0.9468|
|Dividend per share|
|– Sterling Ordinary Shares||2.46 pence||4.02 pence|
|– U.S. Dollar Ordinary Shares||2.53 cents||4.13 cents|
|Gross Portfolio Yield||5.79%||5.76%|
|12 month rolling dividend yield 2|
|– Sterling Ordinary Shares||5.15%||4.53%|
|– U.S. Dollar Ordinary Shares||5.08%||4.43%|
|– Sterling Ordinary Shares||£0.8960||£0.8870|
|– U.S. Dollar Ordinary Shares||$0.9325||$0.9325|
|Discount to Net Asset Value|
|– Sterling Ordinary Shares||(5.81%)||(3.74%)|
|– U.S. Dollar Ordinary Shares||(4.80%)||(1.51%)|
|NAV Total Return 3|
|– Sterling Ordinary Shares||5.79%||(1.33%)|
|– U.S. Dollar Ordinary Shares||6.02%||(0.60%)|
|Share Price Return 4|
|– Sterling Ordinary Shares||4.01%||(3.98%)|
|– U.S. Dollar Ordinary Shares||3.15%||1.07%|
|Total Expense Ratio 5|
|– Sterling Ordinary Shares||0.55%||1.01%|
|– U.S. Dollar Ordinary Shares||0.54%||0.98%|
1 In the six months ended 30 June 2019, the Company re-purchased 159.16m Sterling Ordinary Shares at a total U.S. Dollar equivalent cost of $184.68m and 6.65m U.S. Dollar Ordinary Shares at a total cost of $6.15m.
2 Rolling 12 month dividend yield based on the four quarterly dividends declared in the prior 12 months and share price as at 30 June 2019.
3 The total return is the % of change in NAV per share from the start of the period. It assumes that dividends paid to shareholders are reinvested at NAV at the time the shares are quoted ex-dividend.
4 The share price return is the % of change in Share Price from the start of the period. It assumes that dividends paid to shareholders are reinvested at the share price at the time the shares are quoted ex-dividend.
5 Management fees and all other operating expenses expressed as a percentage of average net assets during the period