John Hancock Investors Trust
07/03/2024 | Press release | Distributed by Public on 07/03/2024 10:04
Semi Annual Report by Investment Company Form N CSRS
N-CSRS
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REP
OR
T OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number
811- 04173
John Hancock Investors Trust
(Exact name of registrant as specified in charter)
200 Berkeley Street, Boston, Massachusetts 02116
(Address of principal executive offices) (Zip code)
Salvatore Schiavone
Treasurer
200 Berkeley Street
Boston, Massachusetts 02116
(Name and address of agent for service) Registrant's telephone number, including area code:
617-543-9634
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Date of fiscal year end:
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October 31
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Date of reporting period:
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April 30, 2024
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ITEM 1. REPORT TO STOCKHOLDERS.
Semiannual report
John Hancock
Investors Trust
Closed-end fixed income
Ticker: JHI
April 30, 2024
A
message
to shareholders
Dear shareholder,
Both stocks and bonds largely posted positive gains during the six months ended April 30, 2024. Concerns that interest rates would need to stay higher for longer led to a sharp increase in bond yields and weighed heavily on investor sentiment as the period began, but rapidly dissipated following a stretch of favorable inflation readings and more dovish comments from world central bank officials. Stocks moved quickly off their previous lows in response, and the U.S. Federal Reserve added fuel to the rally in December by indicating that the central bank may in fact begin to cut rates later in 2024. Stocks surged in response but began to backtrack toward the end of the period as inflation remained elevated.
As always, please be sure to contact your financial professional, who can assist with positioning your portfolio so that it's sufficiently diversified to help meet your long-term objectives and to withstand the inevitable bouts of market volatility along the way.
On behalf of everyone at John Hancock Investment Management, I'd like to take this opportunity to welcome new shareholders and thank existing shareholders for the continued trust you've placed in us.
Sincerely,
Kristie M. Feinberg
Head of Wealth and Asset Management,
United States and Europe
Manulife Investment Management
United States and Europe
Manulife Investment Management
President and CEO,
John Hancock Investment Management
John Hancock Investment Management
This commentary reflects the CEO's views as of this report's period end and are subject to change at any time. Diversification does not guarantee investment returns and does not eliminate risk of loss. All investments entail risks, including the possible loss of principal. For more up-to-date information, you can visit our website at jhinvestments.com.
John Hancock
Investors Trust
Table of contents
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2
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Your fund at a glance
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3
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Portfolio summary
|
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5
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Fund's investments
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20
|
Financial statements
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24
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Financial highlights
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25
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Notes to financial statements
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36
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Investment objective, principal investment strategies, and principal risks
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41
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Additional information
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42
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Shareholder meeting
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43
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More information
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SEMIANNUAL REPORT
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JOHN HANCOCK INVESTORS TRUST
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1 |
Table of Contents
Your fund at a glance
INVESTMENT OBJECTIVE
The fund seeks to generate income for distribution to its shareholders, with capital appreciation as a secondary objective.
AVERAGE ANNUAL TOTAL RETURNS AS OF 4/30/2024 (%)
The Bloomberg U.S. Government/Credit Index tracks the performance of U.S. government bonds, U.S. corporate bonds, and Yankee bonds.
It is not possible to invest directly in an index. Index figures do not reflect expenses, which would result in lower returns.
The performance data contained within this material represents past performance, which does not guarantee future results.
Investment returns and principal value will fluctuate and a shareholder may sustain losses. Further, the fund's performance at net asset value (NAV) is different from the fund's performance at closing market price because the closing market price is subject to the dynamics of secondary market trading. Market risk may increase when shares are purchased at a premium to NAV or sold at a discount to NAV. Current month-end performance may be higher or lower than the performance cited. The fund's most recent performance can be found at jhinvestments.com or by calling 800-852-0218.
| 2 |
JOHN HANCOCK INVESTORS TRUST
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SEMIANNUAL REPORT
|
Table of Contents
Portfolio summary
PORTFOLIO COMPOSITION AS OF 4/30/2024 (% of total investments)
QUALITY COMPOSITION AS OF 4/30/2024 (% of total investments)
Ratings are from Moody's Investors Service, Inc. If not available, we have used S&P Global Ratings. In the absence of ratings from these agencies, we have used Fitch Ratings, Inc. "Not rated" securities are those with no ratings available from these agencies. All ratings are as of 4-30-24 and do not reflect subsequent downgrades or upgrades, if any.
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SEMIANNUAL REPORT
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JOHN HANCOCK INVESTORS TRUST
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3 |
Table of Contents
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COUNTRY COMPOSITION AS OF 4/30/2024 (% of total investments)
|
|
| United States | 82.7 |
| Canada | 5.4 |
| United Kingdom | 2.4 |
| France | 1.8 |
| Luxembourg | 1.5 |
| Cayman Islands | 1.4 |
| Ireland | 1.2 |
| Netherlands | 1.0 |
| Other countries | 2.6 |
|
TOTAL
|
100.0
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| 4 |
JOHN HANCOCK INVESTORS TRUST
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SEMIANNUAL REPORT
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Table of Contents
Fund's investments
AS OF 4-30-24 (unaudited)
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
U.S. Government and Agency obligations 19.8% (11.8% of Total investments)
|
$25,075,481
|
||||
| (Cost $25,389,747) | |||||
|
U.S. Government 11.3%
|
14,270,825
|
||||
| U.S. Treasury | |||||
| Note (A)(B) | 0.250 | 05-15-24 | 9,500,000 | 9,481,225 | |
| Note (A)(B) | 0.500 | 03-31-25 | 5,000,000 | 4,789,600 | |
|
U.S. Government Agency 8.5%
|
10,804,656
|
||||
| Federal Home Loan Mortgage Corp. | |||||
| 30 Yr Pass Thru | 5.000 | 04-01-53 | 324,925 | 310,396 | |
| 30 Yr Pass Thru | 5.000 | 04-01-53 | 1,044,324 | 994,329 | |
| 30 Yr Pass Thru | 5.000 | 08-01-53 | 528,401 | 506,077 | |
| 30 Yr Pass Thru | 5.500 | 06-01-53 | 330,850 | 323,764 | |
| 30 Yr Pass Thru | 5.500 | 06-01-53 | 340,697 | 333,613 | |
| 30 Yr Pass Thru | 5.500 | 07-01-53 | 329,711 | 321,464 | |
| 30 Yr Pass Thru | 6.000 | 05-01-53 | 902,504 | 902,217 | |
| 30 Yr Pass Thru | 6.000 | 07-01-53 | 312,820 | 312,720 | |
| 30 Yr Pass Thru | 6.000 | 07-01-53 | 899,688 | 895,747 | |
| 30 Yr Pass Thru | 6.000 | 08-01-53 | 904,263 | 899,737 | |
| 30 Yr Pass Thru | 6.000 | 09-01-53 | 312,843 | 312,646 | |
| Federal National Mortgage Association | |||||
| 30 Yr Pass Thru | 4.500 | 07-01-52 | 320,040 | 295,478 | |
| 30 Yr Pass Thru | 4.500 | 10-01-52 | 556,695 | 513,623 | |
| 30 Yr Pass Thru | 5.000 | 09-01-52 | 1,064,508 | 1,017,539 | |
| 30 Yr Pass Thru | 5.000 | 10-01-52 | 1,090,552 | 1,036,300 | |
| 30 Yr Pass Thru | 5.500 | 04-01-53 | 326,357 | 319,571 | |
| 30 Yr Pass Thru | 5.500 | 07-01-53 | 311,401 | 304,633 | |
| 30 Yr Pass Thru | 6.000 | 07-01-53 | 884,354 | 887,389 | |
| 30 Yr Pass Thru | 6.000 | 09-01-53 | 317,802 | 317,413 | |
|
Corporate bonds 124.1% (74.0% of Total investments)
|
$156,928,429
|
||||
| (Cost $161,894,987) | |||||
|
Communication services 17.7%
|
22,345,631
|
||||
|
Diversified telecommunication services 2.9%
|
|||||
| Connect Finco SARL (B)(C) | 6.750 | 10-01-26 | 1,110,000 | 1,075,021 | |
| Frontier Florida LLC (B) | 6.860 | 02-01-28 | 700,000 | 663,574 | |
| GCI LLC (B)(C) | 4.750 | 10-15-28 | 820,000 | 731,477 | |
| Level 3 Financing, Inc. (C) | 4.625 | 09-15-27 | 428,000 | 246,404 | |
| Level 3 Financing, Inc. (B)(C) | 11.000 | 11-15-29 | 866,000 | 883,752 | |
|
Entertainment 1.4%
|
|||||
| AMC Entertainment Holdings, Inc. (A)(B)(C) | 7.500 | 02-15-29 | 975,000 | 668,844 | |
| Cinemark USA, Inc. (C) | 8.750 | 05-01-25 | 570,000 | 570,000 | |
| Playtika Holding Corp. (B)(C) | 4.250 | 03-15-29 | 680,000 | 585,176 |
| SEE NOTES TO FINANCIAL STATEMENTS |
SEMIANNUAL REPORT
|
JOHN HANCOCK INVESTORS TRUST
|
5 |
Table of Contents
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
Communication services (continued)
|
|||||
|
Interactive media and services 1.3%
|
|||||
| Arches Buyer, Inc. (C) | 6.125 | 12-01-28 | 310,000 | $252,146 | |
| Cars.com, Inc. (B)(C) | 6.375 | 11-01-28 | 644,000 | 615,523 | |
| Match Group Holdings II LLC (C) | 5.625 | 02-15-29 | 750,000 | 713,431 | |
|
Media 9.8%
|
|||||
| Altice Financing SA (C) | 5.750 | 08-15-29 | 400,000 | 297,110 | |
| Altice Financing SA (C) | 9.625 | 07-15-27 | 500,000 | 470,112 | |
| Altice France Holding SA (C) | 10.500 | 05-15-27 | 600,000 | 212,994 | |
| Altice France SA (A)(B)(C) | 5.500 | 10-15-29 | 625,000 | 408,928 | |
| Altice France SA (C) | 8.125 | 02-01-27 | 356,000 | 268,019 | |
| CCO Holdings LLC (B)(C) | 5.125 | 05-01-27 | 1,000,000 | 937,172 | |
| CCO Holdings LLC (B)(C) | 6.375 | 09-01-29 | 1,728,000 | 1,584,025 | |
| CCO Holdings LLC (B)(C) | 7.375 | 03-01-31 | 1,325,000 | 1,257,339 | |
| CSC Holdings LLC (B)(C) | 5.500 | 04-15-27 | 575,000 | 471,392 | |
| CSC Holdings LLC (B)(C) | 11.750 | 01-31-29 | 308,000 | 273,635 | |
| DISH Network Corp. (C) | 11.750 | 11-15-27 | 820,000 | 826,590 | |
| iHeartCommunications, Inc. | 8.375 | 05-01-27 | 1,200,000 | 643,964 | |
| LCPR Senior Secured Financing DAC (C) | 6.750 | 10-15-27 | 945,000 | 875,850 | |
| News Corp. (C) | 5.125 | 02-15-32 | 625,000 | 572,675 | |
| Paramount Global | 2.900 | 01-15-27 | 1,210,000 | 1,106,993 | |
| Sabre GLBL, Inc. (B)(C) | 8.625 | 06-01-27 | 672,000 | 594,636 | |
| Stagwell Global LLC (B)(C) | 5.625 | 08-15-29 | 771,000 | 690,304 | |
| Townsquare Media, Inc. (B)(C) | 6.875 | 02-01-26 | 970,000 | 941,347 | |
|
Wireless telecommunication services 2.3%
|
|||||
| SoftBank Group Corp. | 5.125 | 09-19-27 | 800,000 | 756,000 | |
| Sprint LLC (B) | 7.125 | 06-15-24 | 2,150,000 | 2,151,198 | |
|
Consumer discretionary 20.1%
|
25,427,756
|
||||
|
Automobile components 1.9%
|
|||||
| Clarios Global LP (B)(C) | 6.750 | 05-15-28 | 511,000 | 512,040 | |
| The Goodyear Tire & Rubber Company (A)(B) | 5.000 | 07-15-29 | 289,000 | 262,115 | |
| The Goodyear Tire & Rubber Company (B) | 5.250 | 04-30-31 | 505,000 | 452,867 | |
| ZF North America Capital, Inc. (C) | 6.750 | 04-23-30 | 554,000 | 555,152 | |
| ZF North America Capital, Inc. (C) | 6.875 | 04-14-28 | 586,000 | 589,919 | |
|
Automobiles 2.7%
|
|||||
| Ford Motor Credit Company LLC (B) | 6.950 | 03-06-26 | 1,000,000 | 1,013,531 | |
| Ford Motor Credit Company LLC (B) | 6.950 | 06-10-26 | 439,000 | 445,670 | |
| Ford Motor Credit Company LLC (B) | 7.350 | 03-06-30 | 407,000 | 423,991 | |
| General Motors Company (B) | 6.750 | 04-01-46 | 1,500,000 | 1,544,265 | |
|
Broadline retail 2.5%
|
|||||
| Liberty Interactive LLC | 8.250 | 02-01-30 | 964,000 | 534,124 | |
| Macy's Retail Holdings LLC (A)(B)(C) | 5.875 | 04-01-29 | 475,000 | 457,981 | |
| Nordstrom, Inc. | 4.250 | 08-01-31 | 500,000 | 431,258 |
| 6 |
JOHN HANCOCK INVESTORS TRUST
|
SEMIANNUAL REPORT
|
SEE NOTES TO FINANCIAL STATEMENTS |
Table of Contents
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
Consumer discretionary (continued)
|
|||||
|
Broadline retail (continued)
|
|||||
| Nordstrom, Inc. | 5.000 | 01-15-44 | 900,000 | $683,161 | |
| QVC, Inc. (B) | 5.950 | 03-15-43 | 1,000,000 | 611,662 | |
| Wand NewCo 3, Inc. (B)(C) | 7.625 | 01-30-32 | 428,000 | 435,105 | |
|
Diversified consumer services 1.6%
|
|||||
| Garda World Security Corp. (B)(C) | 4.625 | 02-15-27 | 750,000 | 713,280 | |
| Sotheby's (B)(C) | 7.375 | 10-15-27 | 1,450,000 | 1,351,288 | |
|
Hotels, restaurants and leisure 9.1%
|
|||||
| Affinity Interactive (B)(C) | 6.875 | 12-15-27 | 703,000 | 629,223 | |
| Allwyn Entertainment Financing UK PLC (C) | 7.875 | 04-30-29 | 667,000 | 678,686 | |
| Caesars Entertainment, Inc. (B)(C) | 7.000 | 02-15-30 | 1,259,000 | 1,267,842 | |
| Carnival Corp. (B)(C) | 6.000 | 05-01-29 | 673,000 | 652,166 | |
| Carnival Corp. (A)(B)(C) | 7.000 | 08-15-29 | 111,000 | 113,950 | |
| Carnival Corp. (B)(C) | 7.625 | 03-01-26 | 750,000 | 754,652 | |
| Carnival Holdings Bermuda, Ltd. (B)(C) | 10.375 | 05-01-28 | 715,000 | 775,251 | |
| CEC Entertainment LLC (B)(C) | 6.750 | 05-01-26 | 830,000 | 818,271 | |
| Flutter Treasury Designated Activity Company (A)(B)(C) | 6.375 | 04-29-29 | 392,000 | 393,062 | |
| Full House Resorts, Inc. (A)(B)(C) | 8.250 | 02-15-28 | 546,000 | 521,120 | |
| Hilton Grand Vacations Borrower Escrow LLC (B)(C) | 6.625 | 01-15-32 | 449,000 | 442,654 | |
| International Game Technology PLC (C) | 6.250 | 01-15-27 | 2,119,000 | 2,115,909 | |
| Jacobs Entertainment, Inc. (B)(C) | 6.750 | 02-15-29 | 255,000 | 241,895 | |
| Mohegan Tribal Gaming Authority (B)(C) | 8.000 | 02-01-26 | 535,000 | 508,180 | |
| New Red Finance, Inc. (B)(C) | 4.375 | 01-15-28 | 535,000 | 497,529 | |
| Royal Caribbean Cruises, Ltd. (B)(C) | 6.250 | 03-15-32 | 133,000 | 131,108 | |
| Royal Caribbean Cruises, Ltd. (B)(C) | 9.250 | 01-15-29 | 820,000 | 875,726 | |
| Wyndham Hotels & Resorts, Inc. (C) | 4.375 | 08-15-28 | 180,000 | 165,045 | |
|
Household durables 1.1%
|
|||||
| KB Home | 7.250 | 07-15-30 | 225,000 | 230,318 | |
| Newell Brands, Inc. (A)(B) | 6.375 | 09-15-27 | 1,142,000 | 1,113,600 | |
|
Specialty retail 1.2%
|
|||||
| Amer Sports Company (B)(C) | 6.750 | 02-16-31 | 681,000 | 670,667 | |
| Asbury Automotive Group, Inc. (B)(C) | 4.625 | 11-15-29 | 160,000 | 144,674 | |
| Asbury Automotive Group, Inc. (B)(C) | 5.000 | 02-15-32 | 450,000 | 400,053 | |
| Champions Financing, Inc. (B)(C) | 8.750 | 02-15-29 | 263,000 | 268,766 | |
|
Consumer staples 1.8%
|
2,273,283
|
||||
|
Food products 1.1%
|
|||||
| Darling Ingredients, Inc. (C) | 6.000 | 06-15-30 | 60,000 | 58,287 | |
| JBS USA LUX SA (B) | 5.750 | 04-01-33 | 840,000 | 803,352 | |
| Post Holdings, Inc. (B)(C) | 5.625 | 01-15-28 | 510,000 | 494,932 |
| SEE NOTES TO FINANCIAL STATEMENTS |
SEMIANNUAL REPORT
|
JOHN HANCOCK INVESTORS TRUST
|
7 |
Table of Contents
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
Consumer staples (continued)
|
|||||
|
Household products 0.7%
|
|||||
| Edgewell Personal Care Company (C) | 5.500 | 06-01-28 | 950,000 | $916,712 | |
|
Energy 15.7%
|
19,834,204
|
||||
|
Energy equipment and services 0.6%
|
|||||
| Kodiak Gas Services LLC (B)(C) | 7.250 | 02-15-29 | 176,000 | 177,269 | |
| USA Compression Partners LP (B) | 6.875 | 09-01-27 | 543,000 | 542,098 | |
|
Oil, gas and consumable fuels 15.1%
|
|||||
| Antero Midstream Partners LP (C) | 5.375 | 06-15-29 | 425,000 | 404,414 | |
| Antero Resources Corp. (C) | 7.625 | 02-01-29 | 310,000 | 317,514 | |
| Bapco Energies BSCC (C) | 7.500 | 10-25-27 | 1,155,000 | 1,162,854 | |
| Cenovus Energy, Inc. (B) | 6.750 | 11-15-39 | 115,000 | 121,101 | |
| Cheniere Energy Partners LP | 3.250 | 01-31-32 | 325,000 | 271,526 | |
| Delek Logistics Partners LP (B)(C) | 7.125 | 06-01-28 | 535,000 | 522,540 | |
| Enbridge, Inc. (7.625% to 1-15-33, then 5 Year CMT + 4.418% to 1-15-53, then 5 Year CMT + 5.168%) (B) | 7.625 | 01-15-83 | 861,000 | 857,215 | |
| Enbridge, Inc. (8.500% to 1-15-34, then 5 Year CMT + 4.431% to 1-15-54, then 5 Year CMT + 5.181%) | 8.500 | 01-15-84 | 1,369,000 | 1,444,361 | |
| Energy Transfer LP (7.125% to 5-15-30, then 5 Year CMT + 5.306%) (D) | 7.125 | 05-15-30 | 1,285,000 | 1,233,747 | |
| EnLink Midstream LLC (C) | 5.625 | 01-15-28 | 867,000 | 851,867 | |
| EQM Midstream Partners LP (C) | 7.500 | 06-01-30 | 700,000 | 734,000 | |
| Genesis Energy LP (B) | 8.250 | 01-15-29 | 651,000 | 660,181 | |
| HF Sinclair Corp. (B)(C) | 5.000 | 02-01-28 | 105,000 | 100,741 | |
| Howard Midstream Energy Partners LLC (B)(C) | 8.875 | 07-15-28 | 511,000 | 535,210 | |
| Kinetik Holdings LP (B)(C) | 6.625 | 12-15-28 | 214,000 | 215,030 | |
| MEG Energy Corp. (B)(C) | 5.875 | 02-01-29 | 237,000 | 229,297 | |
| NuStar Logistics LP | 6.000 | 06-01-26 | 659,000 | 653,928 | |
| Occidental Petroleum Corp. | 5.500 | 12-01-25 | 450,000 | 447,710 | |
| Occidental Petroleum Corp. | 6.625 | 09-01-30 | 340,000 | 352,291 | |
| Parkland Corp. (C) | 5.875 | 07-15-27 | 1,150,000 | 1,121,225 | |
| Petroleos Mexicanos | 6.700 | 02-16-32 | 632,000 | 516,793 | |
| Sabine Pass Liquefaction LLC (B) | 5.000 | 03-15-27 | 1,000,000 | 985,242 | |
| Sitio Royalties Operating Partnership LP (B)(C) | 7.875 | 11-01-28 | 258,000 | 265,313 | |
| Southwestern Energy Company | 8.375 | 09-15-28 | 1,570,000 | 1,620,763 | |
| Sunoco LP | 4.500 | 04-30-30 | 374,000 | 336,545 | |
| Sunoco LP | 6.000 | 04-15-27 | 436,000 | 430,727 | |
| Venture Global Calcasieu Pass LLC (B)(C) | 6.250 | 01-15-30 | 520,000 | 514,133 | |
| Venture Global LNG, Inc. (B)(C) | 9.500 | 02-01-29 | 1,457,000 | 1,566,074 | |
| Viper Energy, Inc. (A)(B)(C) | 7.375 | 11-01-31 | 624,000 | 642,495 |
| 8 |
JOHN HANCOCK INVESTORS TRUST
|
SEMIANNUAL REPORT
|
SEE NOTES TO FINANCIAL STATEMENTS |
Table of Contents
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
Financials 29.3%
|
$37,063,757
|
||||
|
Banks 15.9%
|
|||||
| Bank of America Corp. (6.100% to 3-17-25, then 3 month CME Term SOFR + 4.160%) (B)(D) | 6.100 | 03-17-25 | 2,760,000 | 2,755,126 | |
| Barclays PLC (8.000% to 9-15-29, then 5 Year CMT + 5.431%) (B)(D) | 8.000 | 03-15-29 | 2,200,000 | 2,163,379 | |
| BNP Paribas SA (8.000% to 8-22-31, then 5 Year CMT + 3.727%) (C)(D) | 8.000 | 08-22-31 | 692,000 | 687,659 | |
| BNP Paribas SA (9.250% to 11-17-27, then 5 Year CMT + 4.969%) (C)(D) | 9.250 | 11-17-27 | 600,000 | 635,630 | |
| Citizens Financial Group, Inc. (5.650% to 10-6-25, then 5 Year CMT + 5.313%) (D) | 5.650 | 10-06-25 | 1,000,000 | 977,232 | |
| Comerica, Inc. (5.982% to 1-30-29, then Overnight SOFR + 2.155%) (B) | 5.982 | 01-30-30 | 648,000 | 629,266 | |
| Credit Agricole SA (8.125% to 12-23-25, then 5 Year U.S. Swap Rate + 6.185%) (B)(C)(D) | 8.125 | 12-23-25 | 1,495,000 | 1,513,688 | |
| Fifth Third Bancorp (5.631% to 1-29-31, then Overnight SOFR + 1.840%) (B) | 5.631 | 01-29-32 | 523,000 | 508,256 | |
| Fifth Third Bancorp (6.361% to 10-27-27, then SOFR Compounded Index + 2.192%) (B) | 6.361 | 10-27-28 | 465,000 | 468,756 | |
| ING Groep NV (6.500% to 4-16-25, then 5 Year U.S. Swap Rate + 4.446%) (A)(B)(D) | 6.500 | 04-16-25 | 1,135,000 | 1,117,133 | |
| JPMorgan Chase & Co. (3 month CME Term SOFR + 4.042%) (B)(D)(E) | 9.348 | 05-01-24 | 3,500,000 | 3,500,000 | |
| Popular, Inc. | 7.250 | 03-13-28 | 620,000 | 621,642 | |
| The PNC Financial Services Group, Inc. (6.250% to 3-15-30, then 7 Year CMT + 2.808%) (B)(D) | 6.250 | 03-15-30 | 537,000 | 504,835 | |
| The Toronto-Dominion Bank (8.125% to 10-31-27, then 5 Year CMT + 4.075%) (B) | 8.125 | 10-31-82 | 1,600,000 | 1,645,285 | |
| Truist Financial Corp. (5.711% to 1-24-34, then Overnight SOFR + 1.922%) (B) | 5.711 | 01-24-35 | 841,000 | 816,180 | |
| Wells Fargo & Company (5.875% to 6-15-25, then 9.865% thereafter) (D) | 5.875 | 06-15-25 | 1,565,000 | 1,554,290 | |
|
Capital markets 0.9%
|
|||||
| Boost Newco Borrower LLC (B)(C) | 7.500 | 01-15-31 | 419,000 | 432,447 | |
| Brookfield Capital Finance LLC (B) | 6.087 | 06-14-33 | 641,000 | 648,270 | |
|
Consumer finance 3.1%
|
|||||
| Ally Financial, Inc. (A)(B) | 5.800 | 05-01-25 | 2,000,000 | 1,995,993 | |
| Ally Financial, Inc. (A)(B) | 7.100 | 11-15-27 | 910,000 | 939,712 | |
| OneMain Finance Corp. | 9.000 | 01-15-29 | 444,000 | 465,476 | |
| World Acceptance Corp. (C) | 7.000 | 11-01-26 | 572,000 | 531,717 |
| SEE NOTES TO FINANCIAL STATEMENTS |
SEMIANNUAL REPORT
|
JOHN HANCOCK INVESTORS TRUST
|
9 |
Table of Contents
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
Financials (continued)
|
|||||
|
Financial services 2.7%
|
|||||
| Block, Inc. | 3.500 | 06-01-31 | 1,075,000 | $908,111 | |
| Macquarie Airfinance Holdings, Ltd. (C) | 6.400 | 03-26-29 | 88,000 | 87,745 | |
| Macquarie Airfinance Holdings, Ltd. (C) | 6.500 | 03-26-31 | 95,000 | 95,071 | |
| Macquarie Airfinance Holdings, Ltd. (C) | 8.125 | 03-30-29 | 353,000 | 369,134 | |
| Macquarie Airfinance Holdings, Ltd. (C) | 8.375 | 05-01-28 | 379,000 | 397,893 | |
| Nationstar Mortgage Holdings, Inc. (B)(C) | 6.000 | 01-15-27 | 600,000 | 587,932 | |
| NMI Holdings, Inc. (C) | 7.375 | 06-01-25 | 775,000 | 780,741 | |
| Radian Group, Inc. (B) | 6.200 | 05-15-29 | 254,000 | 252,353 | |
|
Insurance 6.7%
|
|||||
| Acrisure LLC (C) | 8.250 | 02-01-29 | 266,000 | 263,815 | |
| Alliant Holdings Intermediate LLC (B)(C) | 6.750 | 04-15-28 | 766,000 | 765,192 | |
| Alliant Holdings Intermediate LLC (B)(C) | 7.000 | 01-15-31 | 581,000 | 582,820 | |
| AmWINS Group, Inc. (B)(C) | 6.375 | 02-15-29 | 402,000 | 397,133 | |
| Athene Holding, Ltd. (B) | 6.150 | 04-03-30 | 686,000 | 698,626 | |
| Athene Holding, Ltd. (B) | 6.650 | 02-01-33 | 1,020,000 | 1,053,948 | |
| Howden UK Refinance PLC (B)(C) | 7.250 | 02-15-31 | 706,000 | 696,976 | |
| HUB International, Ltd. (B)(C) | 7.250 | 06-15-30 | 634,000 | 643,300 | |
| HUB International, Ltd. (C) | 7.375 | 01-31-32 | 321,000 | 318,043 | |
| Panther Escrow Issuer LLC (B)(C) | 7.125 | 06-01-31 | 755,000 | 758,916 | |
| Prudential Financial, Inc. (3.700% to 10-1-30, then 5 Year CMT + 3.035%) (B) | 3.700 | 10-01-50 | 2,100,000 | 1,795,677 | |
| SBL Holdings, Inc. (B)(C) | 5.000 | 02-18-31 | 587,000 | 498,359 | |
|
Health care 5.1%
|
6,410,535
|
||||
|
Health care equipment and supplies 1.0%
|
|||||
| Medline Borrower LP (B)(C) | 6.250 | 04-01-29 | 532,000 | 528,597 | |
| Varex Imaging Corp. (B)(C) | 7.875 | 10-15-27 | 715,000 | 728,771 | |
|
Health care providers and services 3.7%
|
|||||
| Centene Corp. | 4.625 | 12-15-29 | 400,000 | 372,487 | |
| DaVita, Inc. (B)(C) | 3.750 | 02-15-31 | 440,000 | 362,064 | |
| Encompass Health Corp. (B) | 4.750 | 02-01-30 | 600,000 | 550,225 | |
| HCA, Inc. (B) | 5.500 | 06-15-47 | 1,760,000 | 1,582,204 | |
| HealthEquity, Inc. (B)(C) | 4.500 | 10-01-29 | 810,000 | 737,768 | |
| Tenet Healthcare Corp. (B) | 5.125 | 11-01-27 | 567,000 | 548,530 | |
| Tenet Healthcare Corp. (A)(B) | 6.125 | 10-01-28 | 600,000 | 592,472 | |
|
Life sciences tools and services 0.2%
|
|||||
| Icon Investments Six DAC (F) | 5.849 | 05-08-29 | 200,000 | 200,000 | |
|
Pharmaceuticals 0.2%
|
|||||
| Bausch Health Companies, Inc. (A)(B)(C) | 9.000 | 01-30-28 | 86,000 | 84,428 | |
| Bausch Health Companies, Inc. (C) | 14.000 | 10-15-30 | 30,000 | 19,350 | |
| Endo Finance Holdings, Inc. (A)(B)(C) | 8.500 | 04-15-31 | 102,000 | 103,639 |
| 10 |
JOHN HANCOCK INVESTORS TRUST
|
SEMIANNUAL REPORT
|
SEE NOTES TO FINANCIAL STATEMENTS |
Table of Contents
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
Industrials 15.0%
|
$18,959,317
|
||||
|
Aerospace and defense 2.3%
|
|||||
| Bombardier, Inc. (B)(C) | 7.875 | 04-15-27 | 980,000 | 973,893 | |
| TransDigm, Inc. (B)(C) | 6.375 | 03-01-29 | 654,000 | 649,006 | |
| TransDigm, Inc. (B)(C) | 6.750 | 08-15-28 | 967,000 | 971,109 | |
| TransDigm, Inc. (B)(C) | 7.125 | 12-01-31 | 350,000 | 356,676 | |
|
Building products 0.2%
|
|||||
| Miter Brands Acquisition Holdco, Inc. (B)(C) | 6.750 | 04-01-32 | 258,000 | 256,227 | |
|
Commercial services and supplies 2.1%
|
|||||
| Allied Universal Holdco LLC (B)(C) | 7.875 | 02-15-31 | 117,000 | 117,258 | |
| APX Group, Inc. (C) | 6.750 | 02-15-27 | 373,000 | 370,526 | |
| Cimpress PLC | 7.000 | 06-15-26 | 725,000 | 719,389 | |
| Clean Harbors, Inc. (B)(C) | 6.375 | 02-01-31 | 459,000 | 454,730 | |
| GFL Environmental, Inc. (B)(C) | 6.750 | 01-15-31 | 368,000 | 370,975 | |
| VT Topco, Inc. (B)(C) | 8.500 | 08-15-30 | 611,000 | 632,411 | |
|
Construction and engineering 1.4%
|
|||||
| AECOM | 5.125 | 03-15-27 | 900,000 | 874,354 | |
| Global Infrastructure Solutions, Inc. (B)(C) | 5.625 | 06-01-29 | 550,000 | 494,146 | |
| MasTec, Inc. (B)(C) | 4.500 | 08-15-28 | 450,000 | 419,827 | |
|
Electrical equipment 1.3%
|
|||||
| EMRLD Borrower LP (B)(C) | 6.625 | 12-15-30 | 1,072,000 | 1,062,394 | |
| Vertiv Group Corp. (C) | 4.125 | 11-15-28 | 564,000 | 522,325 | |
|
Ground transportation 2.5%
|
|||||
| Uber Technologies, Inc. (A)(B)(C) | 6.250 | 01-15-28 | 1,165,000 | 1,164,339 | |
| Uber Technologies, Inc. (C) | 7.500 | 09-15-27 | 600,000 | 610,874 | |
| Uber Technologies, Inc. (C) | 8.000 | 11-01-26 | 1,350,000 | 1,363,394 | |
|
Machinery 0.6%
|
|||||
| Esab Corp. (B)(C) | 6.250 | 04-15-29 | 192,000 | 191,280 | |
| TK Elevator U.S. Newco, Inc. (B)(C) | 5.250 | 07-15-27 | 600,000 | 573,941 | |
|
Passenger airlines 2.0%
|
|||||
| Air Canada 2020-1 Class C Pass Through Trust (C) | 10.500 | 07-15-26 | 625,000 | 678,125 | |
| American Airlines 2013-1 Class A Pass Through Trust (B) | 4.000 | 01-15-27 | 313,172 | 304,768 | |
| American Airlines 2016-3 Class B Pass Through Trust | 3.750 | 04-15-27 | 297,855 | 286,296 | |
| United Airlines 2020-1 Class A Pass Through Trust (B) | 5.875 | 10-15-27 | 269,970 | 269,228 | |
| United Airlines 2020-1 Class B Pass Through Trust (B) | 4.875 | 07-15-27 | 1,008,504 | 984,651 | |
|
Professional services 0.8%
|
|||||
| Concentrix Corp. (B) | 6.850 | 08-02-33 | 432,000 | 416,363 | |
| TriNet Group, Inc. (C) | 7.125 | 08-15-31 | 648,000 | 651,268 |
| SEE NOTES TO FINANCIAL STATEMENTS |
SEMIANNUAL REPORT
|
JOHN HANCOCK INVESTORS TRUST
|
11 |
Table of Contents
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
Industrials (continued)
|
|||||
|
Trading companies and distributors 1.8%
|
|||||
| Beacon Roofing Supply, Inc. (C) | 6.500 | 08-01-30 | 400,000 | $399,309 | |
| United Rentals North America, Inc. | 4.000 | 07-15-30 | 581,000 | 517,815 | |
| WESCO Distribution, Inc. (B)(C) | 6.375 | 03-15-29 | 764,000 | 758,957 | |
| WESCO Distribution, Inc. (C) | 7.250 | 06-15-28 | 535,000 | 543,463 | |
|
Information technology 5.7%
|
7,267,690
|
||||
|
Communications equipment 0.2%
|
|||||
| CommScope, Inc. (A)(B)(C) | 6.000 | 03-01-26 | 229,000 | 204,669 | |
|
IT services 0.4%
|
|||||
| Virtusa Corp. (C) | 7.125 | 12-15-28 | 639,000 | 575,803 | |
|
Semiconductors and semiconductor equipment 1.0%
|
|||||
| ON Semiconductor Corp. (C) | 3.875 | 09-01-28 | 714,000 | 647,935 | |
| Qorvo, Inc. (C) | 3.375 | 04-01-31 | 700,000 | 590,024 | |
|
Software 2.2%
|
|||||
| Consensus Cloud Solutions, Inc. (B)(C) | 6.000 | 10-15-26 | 405,000 | 383,981 | |
| Consensus Cloud Solutions, Inc. (A)(B)(C) | 6.500 | 10-15-28 | 960,000 | 840,571 | |
| NCR Voyix Corp. (B)(C) | 5.125 | 04-15-29 | 150,000 | 137,837 | |
| NCR Voyix Corp. (B)(C) | 5.250 | 10-01-30 | 535,000 | 476,413 | |
| Open Text Corp. (C) | 6.900 | 12-01-27 | 616,000 | 628,983 | |
| UKG, Inc. (B)(C) | 6.875 | 02-01-31 | 375,000 | 375,715 | |
|
Technology hardware, storage and peripherals 1.9%
|
|||||
| Dell International LLC (B) | 8.350 | 07-15-46 | 319,000 | 395,364 | |
| Seagate HDD Cayman | 5.750 | 12-01-34 | 939,000 | 890,362 | |
| Seagate HDD Cayman (B)(C) | 8.250 | 12-15-29 | 168,000 | 178,565 | |
| Xerox Holdings Corp. (B)(C) | 5.500 | 08-15-28 | 1,085,000 | 941,468 | |
|
Materials 6.3%
|
7,943,060
|
||||
|
Chemicals 1.1%
|
|||||
| Ashland, Inc. | 6.875 | 05-15-43 | 845,000 | 843,929 | |
| Braskem Idesa SAPI (C) | 6.990 | 02-20-32 | 340,000 | 255,341 | |
| SCIL IV LLC (B)(C) | 5.375 | 11-01-26 | 310,000 | 297,530 | |
|
Containers and packaging 4.4%
|
|||||
| Ardagh Metal Packaging Finance USA LLC (B)(C) | 6.000 | 06-15-27 | 658,000 | 637,837 | |
| Ardagh Packaging Finance PLC (A)(B)(C) | 4.125 | 08-15-26 | 450,000 | 375,011 | |
| Ball Corp. (B) | 6.000 | 06-15-29 | 322,000 | 320,401 | |
| Ball Corp. (B) | 6.875 | 03-15-28 | 581,000 | 590,147 | |
| Berry Global, Inc. (C) | 5.625 | 07-15-27 | 622,000 | 606,609 | |
| Clydesdale Acquisition Holdings, Inc. (C) | 8.750 | 04-15-30 | 500,000 | 483,225 | |
| OI European Group BV (C) | 6.250 | 05-15-28 | EUR | 145,000 | 160,952 |
| Owens-Brockway Glass Container, Inc. (B)(C) | 6.625 | 05-13-27 | 581,000 | 580,520 | |
| Sealed Air Corp. (B)(C) | 6.125 | 02-01-28 | 430,000 | 424,761 |
| 12 |
JOHN HANCOCK INVESTORS TRUST
|
SEMIANNUAL REPORT
|
SEE NOTES TO FINANCIAL STATEMENTS |
Table of Contents
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
Materials (continued)
|
|||||
|
Containers and packaging (continued)
|
|||||
| Sealed Air Corp. (C) | 6.875 | 07-15-33 | 487,000 | $490,228 | |
| Trivium Packaging Finance BV (B)(C) | 5.500 | 08-15-26 | 900,000 | 884,472 | |
|
Metals and mining 0.8%
|
|||||
| First Quantum Minerals, Ltd. (C) | 9.375 | 03-01-29 | 420,000 | 433,934 | |
| Novelis Corp. (C) | 4.750 | 01-30-30 | 610,000 | 558,163 | |
|
Real estate 3.2%
|
4,083,765
|
||||
|
Health care REITs 0.9%
|
|||||
| Diversified Healthcare Trust (C)(G) | 9.080 | 01-15-26 | 736,000 | 632,920 | |
| Diversified Healthcare Trust | 9.750 | 06-15-25 | 529,000 | 530,000 | |
|
Real estate management and development 0.5%
|
|||||
| Greystar Real Estate Partners LLC (C) | 7.750 | 09-01-30 | 609,000 | 627,259 | |
|
Specialized REITs 1.8%
|
|||||
| GLP Capital LP | 5.375 | 04-15-26 | 815,000 | 804,599 | |
| Outfront Media Capital LLC (B)(C) | 7.375 | 02-15-31 | 209,000 | 214,476 | |
| Uniti Group LP (B)(C) | 10.500 | 02-15-28 | 581,000 | 602,747 | |
| VICI Properties LP (C) | 4.625 | 12-01-29 | 350,000 | 324,702 | |
| VICI Properties LP (C) | 5.750 | 02-01-27 | 350,000 | 347,062 | |
|
Utilities 4.2%
|
5,319,431
|
||||
|
Electric utilities 2.0%
|
|||||
| Alexander Funding Trust II (B)(C) | 7.467 | 07-31-28 | 721,000 | 752,260 | |
| NRG Energy, Inc. | 6.625 | 01-15-27 | 336,000 | 335,305 | |
| NRG Energy, Inc. (10.250% to 3-15-28, then 5 Year CMT + 5.920%) (B)(C)(D) | 10.250 | 03-15-28 | 421,000 | 453,888 | |
| Vistra Operations Company LLC (C) | 5.625 | 02-15-27 | 1,000,000 | 972,949 | |
|
Independent power and renewable electricity producers 2.2%
|
|||||
| Calpine Corp. (C) | 4.500 | 02-15-28 | 697,000 | 650,906 | |
| Clearway Energy Operating LLC (C) | 4.750 | 03-15-28 | 650,000 | 612,527 | |
| Inversiones Latin America Power SpA (0.000% Cash and 11.500% PIK) (C) | 11.500 | 06-15-33 | 797,134 | 683,542 | |
| Talen Energy Supply LLC (B)(C) | 8.625 | 06-01-30 | 510,000 | 539,597 | |
| Vistra Corp. (8.875% to 1-15-29, then 5 Year CMT + 5.045%) (C)(D) | 8.875 | 01-15-29 | 309,000 | 318,457 | |
|
Convertible bonds 0.0% (0.0% of Total investments)
|
$53,146
|
||||
| (Cost $146,035) | |||||
|
Utilities 0.0%
|
53,146
|
||||
|
Independent power and renewable electricity producers 0.0%
|
|||||
| ILAP Holdings, Ltd. (0.000% Cash and 5.000% PIK) (C) | 5.000 | 06-15-33 | 531,461 | 53,146 |
| SEE NOTES TO FINANCIAL STATEMENTS |
SEMIANNUAL REPORT
|
JOHN HANCOCK INVESTORS TRUST
|
13 |
Table of Contents
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
Term loans (H) 9.2% (5.5% of Total investments)
|
$11,636,606
|
||||
| (Cost $11,705,840) | |||||
|
Communication services 2.3%
|
2,832,047
|
||||
|
Diversified telecommunication services 0.6%
|
|||||
| Zayo Group Holdings, Inc., 2022 USD Incremental Term Loan B (1 month CME Term SOFR + 4.325%) | 9.641 | 03-09-27 | 775,068 | 681,921 | |
|
Entertainment 0.5%
|
|||||
| UFC Holdings LLC, 2021 Term Loan B (3 month CME Term SOFR + 2.750%) | 8.336 | 04-29-26 | 663,111 | 664,146 | |
|
Interactive media and services 0.4%
|
|||||
| Arches Buyer, Inc., 2021 Term Loan B (1 month CME Term SOFR + 3.250%) | 8.666 | 12-06-27 | 563,720 | 543,601 | |
|
Media 0.8%
|
|||||
| Altice France SA, 2023 USD Term Loan B14 (I) | TBD | 08-15-28 | 356,000 | 266,000 | |
| Clear Channel International BV, 2024 CCIBV Fixed Term Loan | 15.000 | 08-12-27 | 570,000 | 561,450 | |
| Clear Channel Outdoor Holdings, Inc., 2024 Term Loan (1 month CME Term SOFR + 4.000%) | 9.430 | 08-23-28 | 115,000 | 114,929 | |
|
Consumer discretionary 2.0%
|
2,563,945
|
||||
|
Automobile components 0.5%
|
|||||
| Dealer Tire Financial LLC, 2024 Term Loan B3 (1 month CME Term SOFR + 3.750%) | 9.066 | 12-14-27 | 653,505 | 656,773 | |
|
Hotels, restaurants and leisure 0.5%
|
|||||
| IRB Holding Corp., 2024 Term Loan B (1 month CME Term SOFR + 2.750%) | 8.166 | 12-15-27 | 648,000 | 648,745 | |
|
Leisure products 0.6%
|
|||||
| J&J Ventures Gaming LLC, Term Loan (1 month CME Term SOFR + 4.000%) | 9.430 | 04-26-28 | 797,954 | 794,395 | |
|
Specialty retail 0.4%
|
|||||
| The Michaels Companies, Inc., 2021 Term Loan B (3 month CME Term SOFR + 4.250%) | 9.821 | 04-15-28 | 498,718 | 464,032 | |
|
Financials 0.8%
|
1,056,200
|
||||
|
Insurance 0.8%
|
|||||
| Acrisure LLC, 2020 Term Loan B (1 month CME Term SOFR + 3.500%) | 8.930 | 02-15-27 | 654,296 | 652,948 | |
| Truist Insurance Holdings LLC, 2nd Lien Term Loan (I) | TBD | 03-08-32 | 400,000 | 403,252 |
| 14 |
JOHN HANCOCK INVESTORS TRUST
|
SEMIANNUAL REPORT
|
SEE NOTES TO FINANCIAL STATEMENTS |
Table of Contents
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
Health care 2.1%
|
$2,684,276
|
||||
|
Biotechnology 0.5%
|
|||||
| Grifols Worldwide Operations USA, Inc., 2019 USD Term Loan B (3 month CME Term SOFR + 2.000%) | 7.459 | 11-15-27 | 682,219 | 666,616 | |
|
Health care equipment and supplies 0.7%
|
|||||
| Bausch + Lomb Corp., Term Loan (1 month CME Term SOFR + 3.250%) | 8.669 | 05-10-27 | 897,716 | 891,548 | |
|
Health care providers and services 0.4%
|
|||||
| Mamba Purchaser, Inc., 2021 Term Loan (I) | TBD | 10-16-28 | 498,728 | 500,598 | |
|
Pharmaceuticals 0.5%
|
|||||
| Bausch Health Americas, Inc., 2022 Term Loan B (1 month CME Term SOFR + 5.250%) | 10.668 | 02-01-27 | 747,329 | 625,514 | |
|
Industrials 1.7%
|
2,124,231
|
||||
|
Commercial services and supplies 0.9%
|
|||||
| Allied Universal Holdco LLC, 2021 USD Incremental Term Loan B (1 month CME Term SOFR + 3.750%) | 9.166 | 05-12-28 | 1,097,187 | 1,097,395 | |
|
Passenger airlines 0.8%
|
|||||
| AAdvantage Loyalty IP, Ltd., 2021 Term Loan (3 month CME Term SOFR + 4.750%) | 10.336 | 04-20-28 | 988,235 | 1,026,836 | |
|
Materials 0.3%
|
375,907
|
||||
|
Chemicals 0.3%
|
|||||
| Trinseo Materials Operating SCA, 2021 Term Loan B2 (3 month CME Term SOFR + 2.500%) | 8.105 | 05-03-28 | 546,114 | 375,907 | |
|
Collateralized mortgage obligations 0.1% (0.0% of Total investments)
|
$72,423
|
||||
| (Cost $103,663) | |||||
|
Commercial and residential 0.1%
|
66,115
|
||||
| HarborView Mortgage Loan Trust | |||||
| Series 2007-3, Class ES IO (C) | 0.350 | 05-19-37 | 1,513,193 | 25,700 | |
| Series 2007-4, Class ES IO | 0.350 | 07-19-47 | 1,487,461 | 19,869 | |
| Series 2007-6, Class ES IO (C) | 0.343 | 08-19-37 | 1,609,892 | 20,546 | |
|
U.S. Government Agency 0.0%
|
6,308
|
||||
| Government National Mortgage Association | |||||
| Series 2012-114, Class IO | 0.624 | 01-16-53 | 408,569 | 6,308 | |
|
Asset backed securities 5.9% (3.6% of Total investments)
|
$7,518,703
|
||||
| (Cost $7,495,934) | |||||
|
Asset backed securities 5.9%
|
7,518,703
|
||||
| Concord Music Royalties LLC | |||||
| Series 2022-1A, Class A2 (C) | 6.500 | 01-20-73 | 850,000 | 844,415 |
| SEE NOTES TO FINANCIAL STATEMENTS |
SEMIANNUAL REPORT
|
JOHN HANCOCK INVESTORS TRUST
|
15 |
Table of Contents
|
Rate (%)
|
Maturity date
|
Par value^
|
Value
|
||
|
Asset backed securities (continued)
|
|||||
| ContiMortgage Home Equity Loan Trust | |||||
| Series 1995-2, Class A5 | 8.100 | 08-15-25 | 14,301 | $6,591 | |
| CyrusOne Data Centers Issuer I LLC | |||||
| Series 2023-1A, Class B (C) | 5.450 | 04-20-48 | 773,236 | 711,163 | |
| Elevation CLO, Ltd. | |||||
| Series 2014-2A, Class A1R (3 month CME Term SOFR + 1.492%) (C)(E) | 6.820 | 10-15-29 | 18,553 | 18,553 | |
| KKR Financial CLO, Ltd. | |||||
| Series 2013-1A, Class A1R2 (3 month CME Term SOFR + 1.100%) (C)(E) | 6.427 | 04-15-29 | 1,400,000 | 1,400,000 | |
| MVW LLC | |||||
| Series 2022-1A, Class D (C) | 7.350 | 11-21-39 | 556,440 | 530,862 | |
| Series 2023-1A, Class D (C) | 8.830 | 10-20-40 | 620,188 | 612,587 | |
| Neighborly Issuer LLC | |||||
| Series 2023-1A, Class A2 (C) | 7.308 | 01-30-53 | 1,209,688 | 1,209,078 | |
| SCF Equipment Leasing LLC | |||||
| Series 2023-1A, Class A2 (C) | 6.560 | 01-22-30 | 1,000,000 | 1,003,692 | |
| Servpro Master Issuer LLC | |||||
| Series 2024-1A, Class A2 (C) | 6.174 | 01-25-54 | 519,854 | 512,186 | |
| Wellfleet CLO, Ltd. | |||||
| Series 2017-2A, Class A1R (3 month CME Term SOFR + 1.322%) (C)(E) | 6.646 | 10-20-29 | 587,389 | 587,633 | |
| Westgate Resorts LLC | |||||
| Series 2020-1A, Class C (C) | 6.213 | 03-20-34 | 82,376 | 81,943 | |
|
Shares
|
Value
|
||||
|
Common stocks 0.2% (0.1% of Total investments)
|
$213,596
|
||||
| (Cost $692,557) | |||||
|
Industrials 0.0%
|
0
|
||||
|
Passenger airlines 0.0%
|
|||||
| Global Aviation Holdings, Inc., Class A (J)(K) | 82,159 | 0 | |||
|
Utilities 0.2%
|
213,596
|
||||
|
Multi-utilities 0.2%
|
|||||
| Algonquin Power & Utilities Corp. | 10,000 | 213,596 | |||
|
Preferred securities 1.3% (0.8% of Total investments)
|
$1,710,553
|
||||
| (Cost $1,572,965) | |||||
|
Communication services 0.5%
|
667,841
|
||||
|
Wireless telecommunication services 0.5%
|
|||||
| U.S. Cellular Corp., 6.250% (B) | 34,675 | 667,841 | |||
|
Energy 0.4%
|
493,812
|
||||
|
Oil, gas and consumable fuels 0.4%
|
|||||
| Energy Transfer LP, 7.600% (7.600% to 5-15-24, then 3 month LIBOR + 5.161%) | 19,800 | 493,812 |
| 16 |
JOHN HANCOCK INVESTORS TRUST
|
SEMIANNUAL REPORT
|
SEE NOTES TO FINANCIAL STATEMENTS |
Table of Contents
|
Shares
|
Value
|
||||
|
Utilities 0.4%
|
$548,900
|
||||
|
Multi-utilities 0.4%
|
|||||
| Algonquin Power & Utilities Corp., 6.200% (6.200% to 7-1-24, then 3 month LIBOR + 4.010% to 7-1-29, then 3 month LIBOR + 4.260% to 7-1-49, then 3 month LIBOR + 5.010%) (B) | 22,000 | 548,900 | |||
|
Yield (%)
|
Shares
|
Value
|
|||
|
Short-term investments 7.0% (4.2% of Total investments)
|
$8,807,193
|
||||
| (Cost $8,809,510) | |||||
|
Short-term funds 7.0%
|
8,807,193
|
||||
| John Hancock Collateral Trust (L) | 5.4256(M) | 881,001 | 8,807,193 |
|
Total investments (Cost $217,811,238) 167.6%
|
$212,016,130
|
||
|
Other assets and liabilities, net (67.6%)
|
(85,505,413)
|
||
|
Total net assets 100.0%
|
$126,510,717
|
| The percentage shown for each investment category is the total value of the category as a percentage of the net assets of the fund unless otherwise indicated. | |
| ^All par values are denominated in U.S. dollars unless otherwise indicated. | |
|
Currency Abbreviations
|
|
| EUR | Euro |
|
Security Abbreviations and Legend
|
|
| CME | CME Group Published Rates |
| CMT | Constant Maturity Treasury |
| IO | Interest-Only Security - (Interest Tranche of Stripped Mortgage Pool). Rate shown is the annualized yield at the end of the period. |
| LIBOR | London Interbank Offered Rate |
| PIK | Pay-in-Kind Security - Represents a payment-in-kind which may pay interest in additional par and/or cash. Rates shown are the current rate and most recent payment rate. |
| SOFR | Secured Overnight Financing Rate |
| (A) | All or a portion of this security is on loan as of 4-30-24, and is a component of the fund's leverage under the Liquidity Agreement. |
| (B) | All or a portion of this security is pledged as collateral pursuant to the Liquidity Agreement. Total collateral value at 4-30-24 was $112,397,129. A portion of the securities pledged as collateral were loaned pursuant to the Liquidity Agreement. The value of securities on loan amounted to $20,721,070. |
| (C) | These securities are exempt from registration under Rule 144A of the Securities Act of 1933. Such securities may be resold, normally to qualified institutional buyers, in transactions exempt from registration. Rule 144A securities amounted to $101,245,627 or 80.0% of the fund's net assets as of 4-30-24. |
| (D) | Perpetual bonds have no stated maturity date. Date shown as maturity date is next call date. |
| (E) | Variable rate obligation. The coupon rate shown represents the rate at period end. |
| (F) | Security purchased or sold on a when-issued or delayed delivery basis. |
| (G) | Zero coupon bonds are issued at a discount from their principal amount in lieu of paying interest periodically. Rate shown is the effective yield at period end. |
| (H) | Term loans are variable rate obligations. The rate shown represents the rate at period end. |
| (I) | This position represents an unsettled loan commitment at period end. Certain details associated with this purchase are not known prior to the settlement date, including coupon rate, which is disclosed as TBD (To Be Determined). |
| (J) | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. Refer to Note 2 to the financial statements. |
| SEE NOTES TO FINANCIAL STATEMENTS |
SEMIANNUAL REPORT
|
JOHN HANCOCK INVESTORS TRUST
|
17 |
Table of Contents
| (K) | Non-income producing security. |
| (L) | Investment is an affiliate of the fund, the advisor and/or subadvisor. |
| (M) | The rate shown is the annualized seven-day yield as of 4-30-24. |
| 18 |
JOHN HANCOCK INVESTORS TRUST
|
SEMIANNUAL REPORT
|
SEE NOTES TO FINANCIAL STATEMENTS |
Table of Contents
DERIVATIVES
FORWARD FOREIGN CURRENCY CONTRACTS
|
Contract to buy
|
Contract to sell
|
Counterparty (OTC)
|
Contractual
settlement date |
Unrealized
appreciation |
Unrealized
depreciation |
||
| USD | 79,448 | EUR | 72,500 | MSCS | 5/15/2024 | $2,039 | - |
|
$2,039
|
-
|
SWAPS
|
Interest rate swaps
|
||||||||||
|
Counterparty (OTC)/
Centrally cleared |
Notional
amount |
Currency
|
Payments
made |
Payments
received |
Fixed
payment frequency |
Floating
payment frequency |
Maturity
date |
Unamortized
upfront payment paid (received) |
Unrealized
appreciation (depreciation) |
Value
|
| Centrally cleared | 43,000,000 | USD | Fixed 3.662% |
USD SOFR Compounded OIS
(a)
|
Semi-Annual | Quarterly | May 2026 | - | $825,240 | $825,240 |
| Centrally cleared | 22,000,000 | USD | Fixed 3.473% |
USD SOFR Compounded OIS
(a)
|
Semi-Annual | Quarterly | May 2026 | - | 521,307 | 521,307 |
| Centrally cleared | 13,000,000 | USD | Fixed 3.817% |
USD SOFR Compounded OIS
(a)
|
Semi-Annual | Quarterly | Dec 2026 | - | 214,477 | 214,477 |
|
-
|
$1,561,024
|
$1,561,024
|
|
(a)
|
At 4-30-24, the overnight SOFR was 5.340%. |
|
Derivatives Currency Abbreviations
|
|
| EUR | Euro |
| USD | U.S. Dollar |
|
Derivatives Abbreviations
|
|
| MSCS | Morgan Stanley Capital Services LLC |
| OIS | Overnight Index Swap |
| OTC | Over-the-counter |
| SOFR | Secured Overnight Financing Rate |
At 4-30-24, the aggregate cost of investments for federal income tax purposes was $219,542,192. Net unrealized depreciation aggregated to $5,962,999, of which $3,404,771 related to gross unrealized appreciation and $9,367,770 related to gross unrealized depreciation.
See Notes to financial statements regarding investment transactions and other derivatives information.
| SEE NOTES TO FINANCIAL STATEMENTS |
SEMIANNUAL REPORT
|
JOHN HANCOCK INVESTORS TRUST
|
19 |
Table of Contents
Financial statements
STATEMENT OF ASSETS AND LIABILITIES
4-30-24 (unaudited)
|
Assets
|
|
| Unaffiliated investments, at value (Cost $209,001,728) | $203,208,937 |
| Affiliated investments, at value (Cost $8,809,510) | 8,807,193 |
|
Total investments, at value (Cost $217,811,238)
|
212,016,130
|
| Receivable for centrally cleared swaps | 1,251,643 |
| Unrealized appreciation on forward foreign currency contracts | 2,039 |
| Foreign currency, at value (Cost $4,566) | 4,474 |
| Dividends and interest receivable | 3,014,939 |
| Receivable for investments sold | 1,435,717 |
| Other assets | 229,079 |
|
Total assets
|
217,954,021
|
|
Liabilities
|
|
| Liquidity agreement | 86,900,000 |
| Payable for investments purchased | 3,845,703 |
| Payable for delayed delivery securities purchased | 200,000 |
| Interest payable | 435,949 |
| Payable to affiliates | |
| Accounting and legal services fees | 4,718 |
| Other liabilities and accrued expenses | 56,934 |
|
Total liabilities
|
91,443,304
|
|
Net assets
|
$126,510,717
|
|
Net assets consist of
|
|
| Paid-in capital | $170,752,996 |
| Total distributable earnings (loss) | (44,242,279) |
|
Net assets
|
$126,510,717
|
|
Net asset value per share
|
|
| Based on 8,744,547 shares of beneficial interest outstanding - unlimited number of shares authorized with no par value | $14.47 |
| 20 |
JOHN HANCOCK INVESTORS TRUST
|
SEMIANNUAL REPORT
|
SEE NOTES TO FINANCIAL STATEMENTS |
Table of Contents
STATEMENT OF OPERATIONS
For the six months ended
4-30-24 (unaudited)
|
Investment income
|
|
| Interest | $6,620,913 |
| Dividends from affiliated investments | 205,204 |
| Dividends | 91,357 |
| Less foreign taxes withheld | (4,069) |
|
Total investment income
|
6,913,405
|
|
Expenses
|
|
| Investment management fees | 600,305 |
| Interest expense | 2,643,981 |
| Accounting and legal services fees | 12,755 |
| Transfer agent fees | 22,622 |
| Trustees' fees | 21,400 |
| Custodian fees | 13,442 |
| Printing and postage | 20,949 |
| Professional fees | 127,557 |
| Stock exchange listing fees | 11,830 |
| Other | 11,254 |
|
Total expenses
|
3,486,095
|
| Less expense reductions | (9,853) |
|
Net expenses
|
3,476,242
|
|
Net investment income
|
3,437,163
|
|
Realized and unrealized gain (loss)
|
|
|
Net realized gain (loss) on
|
|
| Unaffiliated investments and foreign currency transactions | (1,349,184) |
| Affiliated investments | 2,439 |
| Forward foreign currency contracts | 72,020 |
| Swap contracts | 801,169 |
|
(473,556)
|
|
|
Change in net unrealized appreciation (depreciation) of
|
|
| Unaffiliated investments and translation of assets and liabilities in foreign currencies | 9,463,505 |
| Affiliated investments | (2,014) |
| Forward foreign currency contracts | (73,466) |
| Swap contracts | 82,284 |
|
9,470,309
|
|
|
Net realized and unrealized gain
|
8,996,753
|
|
Increase in net assets from operations
|
$12,433,916
|
| SEE NOTES TO FINANCIAL STATEMENTS |
SEMIANNUAL REPORT
|
JOHN HANCOCK INVESTORS TRUST
|
21 |
Table of Contents
STATEMENTS OF CHANGES IN NET ASSETS
|
Six months ended
4-30-24 (unaudited) |
Year ended
10-31-23 |
|
|
Increase (decrease) in net assets
|
||
|
From operations
|
||
| Net investment income | $3,437,163 | $7,058,371 |
| Net realized loss | (473,556) | (12,002,635) |
| Change in net unrealized appreciation (depreciation) | 9,470,309 | 14,102,978 |
|
Increase in net assets resulting from operations
|
12,433,916
|
9,158,714
|
|
Distributions to shareholders
|
||
| From earnings | (4,076,708) | (7,651,480) |
|
Total distributions
|
(4,076,708)
|
(7,651,480)
|
|
Total increase
|
8,357,208
|
1,507,234
|
|
Net assets
|
||
| Beginning of period | 118,153,509 | 116,646,275 |
|
End of period
|
$126,510,717
|
$118,153,509
|
|
Share activity
|
||
|
Shares outstanding
|
||
| Beginning of period | 8,744,547 | 8,744,547 |
|
End of period
|
8,744,547
|
8,744,547
|
| 22 |
JOHN HANCOCK INVESTORS TRUST
|
SEMIANNUAL REPORT
|
SEE NOTES TO FINANCIAL STATEMENTS |
Table of Contents
STATEMENT OF CASH FLOWS
For the six months ended
4-30-24 (unaudited)
|
Cash flows from operating activities
|
|
| Net increase in net assets from operations | $12,433,916 |
|
Adjustments to reconcile net increase in net assets from operations to net cash provided by operating activities:
|
|
| Long-term investments purchased | (52,497,077) |
| Long-term investments sold | 50,784,422 |
| Net purchases and sales of short-term investments | 1,496,690 |
| Net amortization of premium (discount) | (24,799) |
| (Increase) Decrease in assets: | |
| Unrealized appreciation on forward foreign currency contracts | 90,128 |
| Receivable for centrally cleared swaps | (41,759) |
| Foreign currency, at value | (4,474) |
| Dividends and interest receivable | (276,418) |
| Receivable for investments sold | (802,710) |
| Other assets | (10,398) |
| Increase (Decrease) in liabilities: | |
| Unrealized depreciation on forward foreign currency contracts | (16,662) |
| Payable for investments purchased | 914,339 |
| Payable for delayed delivery securities purchased | 200,000 |
| Interest payable | (14,531) |
| Payable to affiliates | (3,866) |
| Other liabilities and accrued expenses | (46,257) |
| Net change in unrealized (appreciation) depreciation on: | |
| Investments | (9,461,360) |
| Net realized (gain) loss on: | |
| Investments | 1,351,760 |
|
Net cash provided by operating activities
|
$4,070,944
|
|
Cash flows provided by (used in) financing activities
|
|
| Distributions to shareholders | $(4,076,708) |
|
Net cash used in financing activities
|
$(4,076,708)
|
|
Net decrease in cash
|
$(5,764)
|
|
Cash at beginning of period
|
$5,764
|
|
Cash at end of period
|
-
|
|
Supplemental disclosure of cash flow information:
|
|
|
Cash paid for interest
|
$(2,658,512)
|
| SEE NOTES TO FINANCIAL STATEMENTS |
SEMIANNUAL REPORT
|
JOHN HANCOCK INVESTORS TRUST
|
23 |
Table of Contents
Financial highlights
|
Period ended
|
4-30-24
1
|
10-31-23
|
10-31-22
|
10-31-21
|
10-31-20
|
10-31-19
|
|
Per share operating performance
|
||||||
|
Net asset value, beginning of period
|
$13.51
|
$13.34
|
$18.63
|
$17.11
|
$18.38
|
$16.99
|
|
Net investment income
2
|
0.39 | 0.81 | 1.18 | 1.36 | 1.27 | 1.19 |
| Net realized and unrealized gain (loss) on investments | 1.04 | 0.24 | (5.15) | 1.59 | (1.19) | 1.40 |
|
Total from investment operations
|
1.43
|
1.05
|
(3.97)
|
2.95
|
0.08
|
2.59
|
|
Less distributions
|
||||||
| From net investment income | (0.47) | (0.88) | (1.32) | (1.43) | (1.35) | (1.20) |
|
Net asset value, end of period
|
$14.47
|
$13.51
|
$13.34
|
$18.63
|
$17.11
|
$18.38
|
|
Per share market value, end of period
|
$13.25
|
$11.92
|
$12.37
|
$18.62
|
$15.47
|
$17.14
|
|
Total return at net asset value (%)
3,4
|
10.97
5
|
8.54
|
(22.00)
|
17.65
|
1.56
|
16.56
|
|
Total return at market value (%)
3
|
15.17
5
|
3.27
|
(27.68)
|
30.05
|
(1.53)
|
19.07
|
|
Ratios and supplemental data
|
||||||
| Net assets, end of period (in millions) | $127 | $118 | $117 | $162 | $149 | $160 |
| Ratios (as a percentage of average net assets): | ||||||
| Expenses before reductions |
5.57
6
|
5.29 | 2.37 | 1.46 | 1.91 | 2.74 |
|
Expenses including reductions
7
|
5.55
6
|
5.28 | 2.35 | 1.45 | 1.90 | 2.73 |
| Net investment income |
5.49
6
|
5.84 | 7.43 | 7.30 | 7.42 | 6.77 |
| Portfolio turnover (%) | 25 | 45 | 39 | 52 | 62 | 40 |
|
Senior securities
|
||||||
| Total debt outstanding end of period (in millions) | $87 | $87 | $87 | $87 | $87 | $87 |
|
Asset coverage per $1,000 of debt
8
|
$2,456 | $2,360 | $2,342 | $2,869 | $2,714 | $2,841 |
|
1
|
Six months ended 4-30-24. Unaudited. |
|
2
|
Based on average daily shares outstanding. |
|
3
|
Total return based on net asset value reflects changes in the fund's net asset value during each period. Total return based on market value reflects changes in market value. Each figure assumes that distributions from income, capital gains and tax return of capital, if any, were reinvested. |
|
4
|
Total returns would have been lower had certain expenses not been reduced during the applicable periods. |
|
5
|
Not annualized. |
|
6
|
Annualized. |
|
7
|
Expenses including reductions excluding interest expense were 1.33% (annualized), 1.27%, 1.19%, 1.06%, 1.08% and 1.04% for the periods ended 4-30-24, 10-31-23, 10-31-22, 10-31-21, 10-31-20 and 10-31-19, respectively. |
|
8
|
Asset coverage equals the total net assets plus borrowings divided by the borrowings of the fund outstanding at period end (Note 8). As debt outstanding changes, the level of invested assets may change accordingly. Asset coverage ratio provides a measure of leverage. |
| 24 |
JOHN HANCOCK Investors Trust
|
SEMIANNUAL REPORT
|
SEE NOTES TO FINANCIAL STATEMENTS |
Table of Contents
Notes to financial statements (unaudited)
Note 1-Organization
John Hancock Investors Trust (the fund) is a closed-end management investment company organized as a Massachusetts business trust and registered under the Investment Company Act of 1940, as amended (the 1940 Act).
Note 2-Significant accounting policies
The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (US GAAP), which require management to make certain estimates and assumptions as of the date of the financial statements. Actual results could differ from those estimates and those differences could be significant. The fund qualifies as an investment company under Topic 946 of Accounting Standards Codification of US GAAP.
Events or transactions occurring after the end of the fiscal period through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the fund:
Security valuation.
Investments are stated at value as of the scheduled close of regular trading on the New York Stock Exchange (NYSE), normally at 4:00 P.M., Eastern Time. In case of emergency or other disruption resulting in the NYSE not opening for trading or the NYSE closing at a time other than the regularly scheduled close, the net asset value (NAV) may be determined as of the regularly scheduled close of the NYSE pursuant to the Valuation Policies and Procedures of the Advisor, John Hancock Investment Management LLC.
In order to value the securities, the fund uses the following valuation techniques: Debt obligations are typically valued based on evaluated prices provided by an independent pricing vendor. Independent pricing vendors utilize matrix pricing, which takes into account factors such as institutional-size trading in similar groups of securities, yield, quality, coupon rate, maturity, type of issue, trading characteristics and other market data, as well as broker supplied prices. Equity securities, including exchange-traded or closed-end funds, are typically valued at the last sale price or official closing price on the exchange or principal market where the security trades. In the event there were no sales during the day or closing prices are not available, the securities are valued using the last available bid price. Investments by the fund in open-end mutual funds, including John Hancock Collateral Trust (JHCT), are valued at their respective NAVs each business day. Swaps are generally valued using evaluated prices obtained from an independent pricing vendor. Forward foreign currency contracts are valued at the prevailing forward rates which are based on foreign currency exchange spot rates and forward points supplied by an independent pricing vendor. Foreign securities and currencies are valued in U.S. dollars based on foreign currency exchange rates supplied by an independent pricing vendor.
In certain instances, the Pricing Committee of the Advisor may determine to value equity securities using prices obtained from another exchange or market if trading on the exchange or market on which prices are typically obtained did not open for trading as scheduled, or if trading closed earlier than scheduled, and trading occurred as normal on another exchange or market.
Other portfolio securities and assets, for which reliable market quotations are not readily available, are valued at fair value as determined in good faith by the Pricing Committee following procedures established by the Advisor and adopted by the Board of Trustees. The frequency with which these fair valuation procedures are used cannot be predicted and fair value of securities may differ significantly from the value that would have been used had a ready market for such securities existed.
The fund uses a three tier hierarchy to prioritize the pricing assumptions, referred to as inputs, used in valuation techniques to measure fair value. Level 1 includes securities valued using quoted prices in active markets for identical securities, including registered investment companies. Level 2 includes securities valued using other significant observable inputs. Observable inputs may include quoted prices for similar securities, interest rates, prepayment speeds and credit risk. Prices for securities valued using these inputs are received from independent pricing vendors and brokers and are based on an evaluation of the inputs described. Level 3 includes securities
|
SEMIANNUAL REPORT
|
JOHN HANCOCK Investors Trust
|
25 |
Table of Contents
valued using significant unobservable inputs when market prices are not readily available or reliable, including the Advisor's assumptions in determining the fair value of investments. Factors used in determining value may include market or issuer specific events or trends, changes in interest rates and credit quality. The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. Changes in valuation techniques and related inputs may result in transfers into or out of an assigned level within the disclosure hierarchy.
The following is a summary of the values by input classification of the fund's investments as of April 30, 2024, by major security category or type:
|
Total
value at 4-30-24 |
Level 1
quoted price |
Level 2
significant observable inputs |
Level 3
significant unobservable inputs |
|
|
Investments in securities:
|
||||
|
Assets
|
||||
| U.S. Government and Agency obligations |
$25,075,481
|
- | $25,075,481 | - |
| Corporate bonds |
156,928,429
|
- | 156,928,429 | - |
| Convertible bonds |
53,146
|
- | 53,146 | - |
| Term loans |
11,636,606
|
- | 11,636,606 | - |
| Collateralized mortgage obligations |
72,423
|
- | 72,423 | - |
| Asset backed securities |
7,518,703
|
- | 7,518,703 | - |
| Common stocks |
213,596
|
$213,596 | - | - |
| Preferred securities |
1,710,553
|
1,710,553 | - | - |
| Short-term investments |
8,807,193
|
8,807,193 | - | - |
|
Total investments in securities
|
$212,016,130
|
$10,731,342
|
$201,284,788
|
-
|
|
Derivatives:
|
||||
|
Assets
|
||||
| Forward foreign currency contracts |
$2,039
|
- | $2,039 | - |
| Swap contracts |
1,561,024
|
- | 1,561,024 | - |
|
Level 3 includes securities valued at $0. Refer to Fund's investments.
|
The fund holds liabilities for which the fair value approximates the carrying amount for financial statement purposes. As of April 30, 2024, the liability for the fund's Liquidity agreement on the Statement of assets and liabilities is categorized as Level 2 within the disclosure hierarchy.
When-issued/delayed-delivery securities.
The fund may purchase or sell securities on a when-issued or delayed-delivery basis, or in a "To Be Announced" (TBA) or "forward commitment" transaction, with delivery or payment to occur at a later date beyond the normal settlement period. TBA securities resulting from these transactions are included in the portfolio or in a schedule to the portfolio (Sale Commitments Outstanding). At the time a fund enters into a commitment to purchase or sell a security, the transaction is recorded and the value of the security is reflected in its NAV. The price of such security and the date that the security will be delivered and paid for are fixed at the time the transaction is negotiated. The value of the security may vary with market fluctuations. No interest accrues on debt securities until settlement takes place. At the time that the fund enters into this type of transaction, the fund is required to have sufficient cash and/or liquid securities to cover its commitments.
Certain risks may arise upon entering into when-issued or delayed-delivery securities transactions, including the
| 26 |
JOHN HANCOCK Investors Trust
|
SEMIANNUAL REPORT
|
Table of Contents
potential inability of counterparties to meet the terms of their contracts, and the issuer's failure to issue the securities due to political, economic or other factors. Additionally, losses may arise due to changes in the value of the securities purchased or sold prior to settlement date.
Term loans (Floating rate loans).
The fund may invest in term loans, which are debt securities and are often rated below investment grade at the time of purchase. Term loans are generally subject to legal or contractual restrictions on resale and generally have longer settlement periods than conventional debt securities. Term loans involve special types of risk, including credit risk, interest-rate risk, counterparty risk, and risk associated with extended settlement. The liquidity of term loans, including the volume and frequency of secondary market trading in such loans, varies significantly over time and among individual loans. During periods of infrequent trading, valuing a term loan can be more difficult and buying and selling a term loan at an acceptable price can be more difficult and delayed, which could result in a loss.
The fund's ability to receive payments of principal, interest and other amounts in connection with term loans will depend primarily on the financial condition of the borrower. The fund's failure to receive scheduled payments on a term loan due to a default, bankruptcy or other reason would adversely affect the fund's income and would likely reduce the value of its assets. Transactions in loan investments typically take a significant amount of time (i.e., seven days or longer) to settle. This could pose a liquidity risk to the fund. Because term loans may not be rated by independent credit rating agencies, a decision to invest in a particular loan could depend exclusively on the subadvisor's credit analysis of the borrower and/or term loan agents. There is greater risk that the fund may have limited rights to enforce the terms of an underlying loan than for other types of debt instruments.
Mortgage and asset backed securities.
The fund may invest in mortgage-related securities, such as mortgage-backed securities, and other asset-backed securities, which are debt obligations that represent interests in pools of mortgages or other income-bearing assets, such as consumer loans or receivables. Such securities often involve risks that are different from the risks associated with investing in other types of debt securities. Mortgage-backed and other asset-backed securities are subject to changes in the payment patterns of borrowers of the underlying debt. When interest rates fall, borrowers are more likely to refinance or prepay their debt before its stated maturity. This may result in the fund having to reinvest the proceeds in lower yielding securities, effectively reducing the fund's income. Conversely, if interest rates rise and borrowers repay their debt more slowly than expected, the time in which the mortgage-backed and other asset-backed securities are paid off could be extended, reducing the fund's cash available for reinvestment in higher yielding securities. The timely payment of principal and interest of certain mortgage-related securities is guaranteed with the full faith and credit of the U.S. Government. Pools created and guaranteed by non-governmental issuers, including government-sponsored corporations (e.g., FNMA), may be supported by various forms of insurance or guarantees, but there can be no assurance that private insurers or guarantors can meet their obligations under the insurance policies or guarantee arrangements. The fund is also subject to risks associated with securities with contractual cash flows including asset-backed and mortgage related securities such as collateralized mortgage obligations, mortgage pass-through securities and commercial mortgage-backed securities. The value, liquidity and related income of these securities are sensitive to changes in economic conditions, including real estate value, pre-payments, delinquencies and/or defaults, and may be adversely affected by shifts in the market's perception of the issuers and changes in interest rates.
Security transactions and related investment income.
Investment security transactions are accounted for on a trade date plus one basis for daily NAV calculations. However, for financial reporting purposes, investment transactions are reported on trade date. Interest income is accrued as earned. Interest income includes coupon interest and amortization/accretion of premiums/discounts on debt securities. Debt obligations may be placed in a non-accrual status and related interest income may be reduced by stopping current accruals and writing off interest receivable when the collection of all or a portion of interest has become doubtful. Dividend income is recorded on ex-date, except for dividends of certain foreign securities where the dividend may not be known until after the ex-date. In those cases, dividend income, net of withholding taxes, is recorded when the fund becomes aware of the dividends. Non-cash dividends, if any, are recorded at the fair market value of the securities received.
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Distributions received on securities that represent a tax return of capital and/or capital gain, if any, are recorded as a reduction of cost of investments and/or as a realized gain, if amounts are estimable. Gains and losses on securities sold are determined on the basis of identified cost and may include proceeds from litigation.
Foreign investing.
Assets, including investments, and liabilities denominated in foreign currencies are translated into U.S. dollar values each day at the prevailing exchange rate. Purchases and sales of securities, income and expenses are translated into U.S. dollars at the prevailing exchange rate on the date of the transaction. The effect of changes in foreign currency exchange rates on the value of securities is reflected as a component of the realized and unrealized gains (losses) on investments. Foreign investments are subject to a decline in the value of a foreign currency versus the U.S. dollar, which reduces the dollar value of securities denominated in that currency.
Funds that invest internationally generally carry more risk than funds that invest strictly in U.S. securities. Risks can result from differences in economic and political conditions, regulations, market practices (including higher transaction costs), accounting standards and other factors.
Foreign taxes.
The fund may be subject to withholding tax on income, capital gains or repatriations imposed by certain countries, a portion of which may be recoverable. Foreign taxes are accrued based upon the fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests. Taxes are accrued based on gains realized by the fund as a result of certain foreign security sales. In certain circumstances, estimated taxes are accrued based on unrealized appreciation of such securities. Investment income is recorded net of foreign withholding taxes.
Overdrafts.
Pursuant to the custodian agreement, the fund's custodian may, in its discretion, advance funds to the fund to make properly authorized payments. When such payments result in an overdraft, the fund is obligated to repay the custodian for any overdraft, including any costs or expenses associated with the overdraft. The custodian may have a lien, security interest or security entitlement in any fund property that is not otherwise segregated or pledged, to the maximum extent permitted by law, to the extent of any overdraft.
Expenses.
Within the John Hancock group of funds complex, expenses that are directly attributable to an individual fund are allocated to such fund. Expenses that are not readily attributable to a specific fund are allocated among all funds in an equitable manner, taking into consideration, among other things, the nature and type of expense and the fund's relative net assets. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Statement of cash flows.
A Statement of cash flows is presented when a fund has a significant amount of borrowing during the period, based on the average total borrowing in relation to total assets, or when a certain percentage of the fund's investments is classified as Level 3 in the fair value hierarchy. Information on financial transactions that have been settled through the receipt and disbursement of cash is presented in the Statement of cash flows. The cash amount shown in the Statement of cash flows is the amount included in the fund's Statement of assets and liabilities and represents the cash on hand at the fund's custodian and does not include any short-term investments or collateral on derivative contracts, if any.
Federal income taxes.
The fund intends to continue to qualify as a regulated investment company by complying with the applicable provisions of the Internal Revenue Code and will not be subject to federal income tax on taxable income that is distributed to shareholders. Therefore, no federal income tax provision is required.
For federal income tax purposes, as of October 31, 2023, the fund has a short-term capital loss carryforward of $5,642,181 and a long-term capital loss carryforward of $32,924,154 available to offset future net realized capital gains. These carryforwards do not expire.
As of October 31, 2023, the fund had no uncertain tax positions that would require financial statement recognition, derecognition or disclosure. The fund's federal tax returns are subject to examination by the Internal Revenue Service for a period of three years.
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Distribution of income and gains.
Distributions to shareholders from net investment income and net realized gains, if any, are recorded on the ex-date. The fund generally declares and pays dividends quarterly. Capital gain distributions, if any, are typically distributed annually.
Such distributions, on a tax basis, are determined in conformity with income tax regulations, which may differ from US GAAP. Distributions in excess of tax basis earnings and profits, if any, are reported in the fund's financial statements as a return of capital. The final determination of tax characteristics of the fund's distribution will occur at the end of the year and will subsequently be reported to shareholders.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Temporary book-tax differences, if any, will reverse in a subsequent period. Book-tax differences are primarily attributable to foreign currency transactions, amortization and accretion on debt securities, derivative transactions and wash sale loss deferrals.
Note 3-Derivative instruments
The fund may invest in derivatives in order to meet its investment objective. Derivatives include a variety of different instruments that may be traded in the over-the-counter (OTC) market, on a regulated exchange or through a clearing facility. The risks in using derivatives vary depending upon the structure of the instruments, including the use of leverage, optionality, the liquidity or lack of liquidity of the contract, the creditworthiness of the counterparty or clearing organization and the volatility of the position. Some derivatives involve risks that are potentially greater than the risks associated with investing directly in the referenced securities or other referenced underlying instrument. Specifically, the fund is exposed to the risk that the counterparty to an OTC derivatives contract will be unable or unwilling to make timely settlement payments or otherwise honor its obligations. OTC derivatives transactions typically can only be closed out with the other party to the transaction.
Derivatives which are typically traded through the OTC market are regulated by the Commodity Futures Trading Commission (the CFTC). Derivative counterparty risk is managed through an ongoing evaluation of the creditworthiness of all potential counterparties and, if applicable, designated clearing organizations. The fund attempts to reduce its exposure to counterparty risk for derivatives traded in the OTC market, whenever possible, by entering into an International Swaps and Derivatives Association (ISDA) Master Agreement with each of its OTC counterparties. The ISDA gives each party to the agreement the right to terminate all transactions traded under the agreement if there is certain deterioration in the credit quality or contractual default of the other party, as defined in the ISDA. Upon an event of default or a termination of the ISDA, the non-defaulting party has the right to close out all transactions and to net amounts owed.
As defined by the ISDA, the fund may have collateral agreements with certain counterparties to mitigate counterparty risk on OTC derivatives. Subject to established minimum levels, collateral for OTC transactions is generally determined based on the net aggregate unrealized gain or loss on contracts with a particular counterparty. Collateral pledged to the fund, if any, is held in a segregated account by a third-party agent or held by the custodian bank for the benefit of the fund and can be in the form of cash or debt securities issued by the U.S. government or related agencies; collateral posted by the fund, if any, for OTC transactions is held in a segregated account at the fund's custodian and is noted in the accompanying Fund's investments, or if cash is posted, on the Statement of assets and liabilities. The fund's risk of loss due to counterparty risk is equal to the asset value of outstanding contracts offset by collateral received.
Certain derivatives are traded or cleared on an exchange or central clearinghouse. Exchange-traded or centrally-cleared transactions generally present less counterparty risk to a fund than OTC transactions. The exchange or clearinghouse stands between the fund and the broker to the contract and therefore, credit risk is generally limited to the failure of the exchange or clearinghouse and the clearing member.
Centrally-cleared swap contracts are subject to clearinghouse rules, including initial and variation margin requirements, daily settlement of obligations and the clearinghouse guarantee of payments to the broker. There is, however, still counterparty risk due to the potential insolvency of the broker with respect to any margin held in the
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brokers' customer accounts. While clearing members are required to segregate customer assets from their own assets, in the event of insolvency, there may be a shortfall in the amount of margin held by the broker for its clients. Collateral or margin requirements for centrally-cleared derivatives are set by the broker or applicable clearinghouse. Margin for centrally-cleared transactions is detailed in the Statement of assets and liabilities as Receivable/Payable for centrally-cleared swaps. Securities pledged by the fund for centrally-cleared transactions, if any, are identified in the Fund's investments.
Forward foreign currency contracts.
A forward foreign currency contract is an agreement between two parties to buy and sell specific currencies at a price that is set on the date of the contract. The forward contract calls for delivery of the currencies on a future date that is specified in the contract. Forwards are typically traded OTC. Risks related to the use of forwards include the possible failure of counterparties to meet the terms of the forward agreement, the failure of the counterparties to timely post collateral if applicable, and the risk that currency movements will not favor the fund thereby reducing the fund's total return, and the potential for losses in excess of the amounts recognized on the Statement of assets and liabilities.
The market value of a forward foreign currency contract fluctuates with changes in foreign currency exchange rates. Forward foreign currency contracts are marked-to-market daily and the change in value is recorded by the fund as an unrealized gain or loss. Realized gains or losses, equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed, are recorded upon delivery or receipt of the currency or settlement with the counterparty.
During the six months ended April 30, 2024, the fund used forward foreign currency contracts to manage against changes in foreign currency exchange rates. The fund held forward foreign currency contracts with USD notional values ranging from $79,000 to $5.5 million, as measured at each quarter end.
Swaps.
Swap agreements are agreements between the fund and a counterparty to exchange cash flows, assets, foreign currencies or market-linked returns at specified intervals. Swap agreements are privately negotiated in the OTC market (OTC swaps) or may be executed on a registered commodities exchange (centrally cleared swaps). Swaps are marked-to-market daily and the change in value is recorded as a component of unrealized appreciation/depreciation of swap contracts. The value of the swap will typically impose collateral posting obligations on the party that is considered out-of-the-money on the swap.
Upfront payments made/received by the fund, if any, are amortized/accreted for financial reporting purposes, with the unamortized/unaccreted portion included in the Statement of assets and liabilities. A termination payment by the counterparty or the fund is recorded as realized gain or loss, as well as the net periodic payments received or paid by the fund.
Entering into swap agreements involves, to varying degrees, elements of credit, market and documentation risk that may provide outcomes that produce losses in excess of the amounts recognized on the Statement of assets and liabilities. Such risks involve the possibility that there will be no liquid market for the swap, or that a counterparty may default on its obligation or delay payment under the swap terms. The counterparty may disagree or contest the terms of the swap. In addition to interest rate risk, market risks may also impact the swap. The fund may also suffer losses if it is unable to terminate or assign outstanding swaps or reduce its exposure through offsetting transactions.
Interest rate swaps.
Interest rate swaps represent an agreement between the fund and a counterparty to exchange cash flows based on the difference between two interest rates applied to a notional amount. The payment flows are usually netted against each other, with the difference being paid by one party to the other. The fund settles accrued net interest receivable or payable under the swap contracts at specified, future intervals.
During the six months ended April 30, 2024, the fund used interest rate swap contracts to manage against changes in the liquidity agreement interest rates. The fund held interest rate swaps with total USD notional amounts ranging from $65.0 million to $78.0 million, as measured at each quarter end.
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Fair value of derivative instruments by risk category
The table below summarizes the fair value of derivatives held by the fund at April 30, 2024 by risk category:
|
Risk
|
Statement of assets
and liabilities location |
Financial
instruments location |
Assets
derivatives fair value |
Liabilities
derivatives fair value |
| Currency | Unrealized appreciation (depreciation) on forward foreign currency contracts | Forward foreign currency contracts | $2,039 | - |
| Interest rate |
Swap contracts, at value
1
|
Interest rate swaps | 1,561,024 | - |
|
$1,563,063
|
-
|
|
1
|
Reflects cumulative value of swap contracts. Receivable/payable for centrally cleared swaps, which includes value and margin, are shown separately on the Statement of assets and liabilities. |
For financial reporting purposes, the fund does not offset OTC derivative assets or liabilities that are subject to master netting arrangements, as defined by the ISDAs, in the Statement of assets and liabilities. In the event of default by the counterparty or a termination of the agreement, the ISDA allows an offset of amounts across the various transactions between the fund and the applicable counterparty.
Effect of derivative instruments on the Statement of operations
The table below summarizes the net realized gain (loss) included in the net increase (decrease) in net assets from operations, classified by derivative instrument and risk category, for the six months ended April 30, 2024:
|
Statement of operations location - Net realized gain (loss) on:
|
|||
|
Risk
|
Forward foreign
currency contracts |
Swap contracts
|
Total
|
| Interest rate | - | $801,169 | $801,169 |
| Currency | $72,020 | - | 72,020 |
|
Total
|
$72,020
|
$801,169
|
$873,189
|
The table below summarizes the net change in unrealized appreciation (depreciation) included in the net increase (decrease) in net assets from operations, classified by derivative instrument and risk category, for the six months ended April 30, 2024:
|
Statement of operations location - Change in net unrealized appreciation (depreciation) of:
|
|||
|
Risk
|
Forward foreign
currency contracts |
Swap contracts
|
Total
|
| Interest rate | - | $82,284 | $82,284 |
| Currency | $(73,466) | - | (73,466) |
|
Total
|
$(73,466)
|
$82,284
|
$8,818
|
Note 4-Guarantees and indemnifications
Under the fund's organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. Additionally, in the normal course of business, the fund enters into contracts with service providers that contain general indemnification clauses. The fund's maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the fund that have not yet occurred. The risk of material loss from such claims is considered remote.
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Note 5-Fees and transactions with affiliates
John Hancock Investment Management LLC (the Advisor) serves as investment advisor for the fund. John Hancock Investment Management Distributors LLC (the Distributor), an affiliate of the Advisor, serves as distributor for the common shares offered through the equity shelf offering of the fund. The Advisor and the Distributor are indirect, principally owned subsidiaries of John Hancock Life Insurance Company (U.S.A.), which in turn is a subsidiary of Manulife Financial Corporation (MFC).
Management fee.
The fund has an investment management agreement with the Advisor under which the fund pays a daily management fee to the Advisor, equivalent on an annual basis, to the sum of (a) 0.650% of the first $150 million of the fund's average daily managed assets (net assets plus borrowings under the Liquidity Agreement (LA) (see Note 8)), (b) 0.375% of the next $50 million of the fund's average daily managed assets, (c) 0.350% of the next $100 million of the fund's average daily managed assets and (d) 0.300% of the fund's average daily managed assets in excess of $300 million. The Advisor has a subadvisory agreement with Manulife Investment Management (US) LLC, an indirectly owned subsidiary of MFC and an affiliate of the Advisor. The fund is not responsible for payment of the subadvisory fees.
The Advisor has contractually agreed to waive a portion of its management fee and/or reimburse expenses for certain funds of the John Hancock group of funds complex, including the fund (the participating portfolios). This waiver is based upon aggregate managed assets of all the participating portfolios. The amount of the reimbursement is calculated daily and allocated among all the participating portfolios in proportion to the daily net assets of each fund. During the six months ended April 30, 2024, this waiver amounted to 0.01% of the fund's average daily net assets, on an annualized basis. This agreement expires on July 31, 2025, unless renewed by mutual agreement of the fund and the Advisor based upon a determination that this is appropriate under the circumstances at that time.
The expense reductions described above amounted to $9,853 for the six months ended April 30, 2024.
Expenses waived or reimbursed in the current fiscal period are not subject to recapture in future fiscal periods.
The investment management fees, including the impact of the waivers and reimbursements as described above, incurred for the six months ended April 30, 2024, were equivalent to a net annual effective rate of 0.56% of the fund's average daily managed assets.
Accounting and legal services.
Pursuant to a service agreement, the fund reimburses the Advisor for all expenses associated with providing the administrative, financial, legal, compliance, accounting and recordkeeping services to the fund, including the preparation of all tax returns, periodic reports to shareholders and regulatory reports, among other services. These accounting and legal services fees incurred, for the six months ended April 30, 2024, amounted to an annual rate of 0.01% of the fund's average daily managed net assets.
Distributor.
The fund will compensate the Distributor with respect to sales of the common shares offered through the equity shelf offering at a commission rate of 1.00% of the gross proceeds of the sale of common shares, a portion of which is allocated to the selling dealers. The Distributor has an agreement with a sub-placement agent in the sale of common shares. The fund is not responsible for payment of commissions to the sub placement agent.
Trustee expenses.
The fund compensates each Trustee who is not an employee of the Advisor or its affiliates. These Trustees receive from the fund and the other John Hancock closed-end funds an annual retainer. In addition, Trustee out-of-pocket expenses are allocated to each fund based on its net assets relative to other funds within the John Hancock group of funds complex.
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Note 6-Fund share transactions
On December 10, 2015, the Board of Trustees approved a share repurchase plan, which is subsequently reviewed by the Board of Trustees each year in December. Under the current share repurchase plan, the fund may purchase in the open market, between January 1, 2024 and December 31, 2024, up to 10% of its outstanding common shares as of December 31, 2023. The share repurchase plan will remain in effect between January 1, 2024 and December 31, 2024.
During the six months ended April 30, 2024 and the year ended October 31, 2023, the fund had no activities under the repurchase program. Shares repurchased and corresponding dollar amounts, if any, are included on the Statements of changes in net assets. The anti-dilutive impacts of these share repurchases, if any, are included on the Financial highlights.
Transactions in common shares, if any, are presented in the Statements of changes in net assets. In 2012, 2015 and 2018, the fund filed registration statements with the Securities and Exchange Commission SEC), in each case registering and/or carrying forward 1,000,000 common shares, through equity shelf offering programs. Under these programs, the fund, subject to market conditions, may raise additional equity capital from time to time by offering new common shares at a price equal to or above the fund's net asset value (NAV) per common share. Shares issued in shelf offering and corresponding dollar amounts, if any, are included on the Statements of changes in net assets. The premium from shares sold through these shelf offerings, if any, are included on the Financial highlights. During the six months ended April 30, 2024 and year ended October 31, 2023, the fund had no activities under the shelf offering program. Proceeds received in connection with the shelf offering are net of commissions and offering costs. Total offering costs of $248,706 have been prepaid by the fund. As of April 30, 2024, $44,629 has been deducted from proceeds of shares issued and the remaining $204,077 is included in Other assets on the Statement of assets and liabilities.
Note 7-Leverage risk
The fund utilizes the LA to increase its assets available for investment. When the fund leverages its assets, shareholders bear the expenses associated with the LA and have potential to benefit or be disadvantaged from the use of leverage. The Advisor's fee is also increased in dollar terms from the use of leverage. Consequently, the fund and the Advisor may have differing interests in determining whether to leverage the fund's assets. Leverage creates risks that may adversely affect the return for the holders of shares, including:
| • | the likelihood of greater volatility of NAV and market price of shares; |
| • | fluctuations in the interest rate paid for the use of the LA; |
| • | increased operating costs, which may reduce the fund's total return; |
| • | the potential for a decline in the value of an investment acquired through leverage, while the fund's obligations under such leverage remains fixed; and |
| • | the fund is more likely to have to sell securities in a volatile market in order to meet asset coverage or other debt compliance requirements. |
To the extent the income or capital appreciation derived from securities purchased with funds received from leverage exceeds the cost of leverage, the fund's return will be greater than if leverage had not been used; conversely, returns would be lower if the cost of the leverage exceeds the income or capital appreciation derived. The use of securities lending to obtain leverage in the fund's investments may subject the fund to greater risk of loss than would reinvestment of collateral in short term highly rated investments.
In addition to the risks created by the fund's use of leverage, the fund is subject to the risk that it would be unable to timely, or at all, obtain replacement financing if the LA is terminated. Were this to happen, the fund would be required to de-leverage, selling securities at a potentially inopportune time and incurring tax consequences. Further, the fund's ability to generate income from the use of leverage would be adversely affected.
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Note 8-Liquidity Agreement
The fund has entered into a LA with State Street Bank and Trust Company (SSB) that allows it to borrow or otherwise access up to $86.9 million (maximum facility amount) through a line of credit, securities lending and reverse repurchase agreements. The amounts outstanding at April 30, 2024 are shown in the Statement of assets and liabilities as the Liquidity agreement.
The fund pledges its assets as collateral to secure obligations under the LA. The fund retains the risks and rewards of the ownership of assets pledged to secure obligations under the LA and makes these assets available for securities lending and reverse repurchase transactions with SSB acting as the fund's authorized agent for these transactions. All transactions initiated through SSB are required to be secured with cash collateral received from the securities borrower (the Borrower) or cash is received from the reverse repurchase agreement (Reverse Repo) counterparties. Securities lending transactions will be secured with cash collateral in amounts at least equal to 100% of the market value of the securities utilized in these transactions. Cash received by SSB from securities lending or Reverse Repo transactions is credited against the amounts borrowed under the line of credit. As of April 30, 2024, the LA balance of $86,900,000 was comprised of $65,620,601 from the line of credit and $21,279,399 cash received by SSB from securities lending or Reverse Repo transactions.
Upon return of securities by the Borrower or Reverse Repo counterparty, SSB will return the cash collateral to the Borrower or proceeds from the Reverse Repo, as applicable, which will eliminate the credit against the line of credit and will cause the drawdowns under the line of credit to increase by the amounts returned. Income earned on the loaned securities is retained by SSB, and any interest due on the reverse repurchase agreements is paid by SSB.
SSB has indemnified the fund for certain losses that may arise if the Borrower or a Reverse Repo Counterparty fails to return securities when due. With respect to securities lending transactions, upon a default of the securities borrower, SSB uses the collateral received from the Borrower to purchase replacement securities of the same issue, type, class and series. If the value of the collateral is less than the purchase cost of replacement securities, SSB is responsible for satisfying the shortfall but only to the extent that the shortfall is not due to any of the fund's losses on the reinvested cash collateral. Although the risk of the loss of the securities is mitigated by receiving collateral from the Borrower or proceeds from the Reverse Repo counterparty and through SSB indemnification, the fund could experience a delay in recovering securities or could experience a lower than expected return if the Borrower or Reverse Repo counterparty fails to return the securities on a timely basis.
Interest charged is at the rate of overnight bank funding rate (OBFR) plus 0.700% and is payable monthly on the aggregate balance of the drawdowns outstanding under the LA. As of April 30, 2024, the fund had an aggregate balance of $86,900,000 at an interest rate of 6.02%, which is reflected in the Liquidity agreement on the Statement of assets and liabilities. During the six months ended April 30, 2024, the average balance of the LA and the effective average annual interest rate were $86,900,000 and 6.12%, respectively.
The fund may terminate the LA with 60 days' notice. If certain asset coverage and collateral requirements, or other covenants are not met, the LA could be deemed in default and result in termination. Absent a default or facility termination event, SSB is required to provide the fund with 360 days' notice prior to terminating the LA.
Note 9-LIBOR Discontinuation Risk
Certain debt securities, derivatives and other financial instruments have traditionally utilized LIBOR as the reference or benchmark rate for interest rate calculations. However, following allegations of manipulation and concerns regarding liquidity, the U.K. Financial Conduct Authority (UK FCA) announced that LIBOR would be discontinued as of June 30, 2023. The UK FCA elected to require the ICE Benchmark Administration Limited, the administrator of LIBOR, to continue publishing a subset of LIBOR settings on a "synthetic" basis. The synthetic publication of the one-, three and six-month U.S. dollar LIBOR will continue until September 30, 2024.
Although the transition process away from LIBOR has become increasingly well-defined in advance of the discontinuation dates, the impact on certain debt securities, derivatives and other financial instruments remains
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uncertain. Market participants have adopted alternative rates such as Secured Overnight Financing Rate (SOFR) or otherwise amended financial instruments referencing LIBOR to include fallback provisions and other measures that contemplated the discontinuation of LIBOR or other similar market disruption events, but neither the effect of the transition process nor the viability of such measures is known. To facilitate the transition of legacy derivatives contracts referencing LIBOR, the International Swaps and Derivatives Association, Inc. launched a protocol to incorporate fallback provisions. However, there are obstacles to converting certain longer term securities and transactions to a new benchmark or benchmarks and the effectiveness of one alternative reference rate versus multiple alternative reference rates in new or existing financial instruments and products has not been determined. Certain proposed replacement rates to LIBOR, such as SOFR, which is a broad measure of secured overnight U.S. Treasury repo rates, are materially different from LIBOR, and changes in the applicable spread for financial instruments transitioning away from LIBOR will need to be made to accommodate the differences.
The utilization of an alternative reference rate, or the transition process to an alternative reference rate, may adversely affect the fund's performance.
Note 10
-
Purchase and sale of securities
Purchases and sales of securities, other than short-term investments and U.S. Treasury obligations, amounted to $52,497,077 and $45,284,422, respectively, for the six months ended April 30, 2024. Purchases and sales of U.S. Treasury obligations aggregated $0 and $5,500,000, respectively, for the six months ended April 30, 2024.
Note 11-Industry or sector risk
The fund may invest a large percentage of its assets in one or more particular industries or sectors of the economy. If a large percentage of the fund's assets are economically tied to a single or small number of industries or sectors of the economy, the fund will be less diversified than a more broadly diversified fund, and it may cause the fund to underperform if that industry or sector underperforms. In addition, focusing on a particular industry or sector may make the fund's NAV more volatile. Further, a fund that invests in particular industries or sectors is particularly susceptible to the impact of market, economic, regulatory and other factors affecting those industries or sectors.
Note 12-Investment in affiliated underlying funds
The fund may invest in affiliated underlying funds that are managed by the Advisor and its affiliates. Information regarding the fund's fiscal year to date purchases and sales of the affiliated underlying funds as well as income and capital gains earned by the fund, if any, is as follows:
|
Dividends and distributions
|
|||||||||
|
Affiliate
|
Ending
share amount |
Beginning
value |
Cost of
purchases |
Proceeds
from shares sold |
Realized
gain (loss) |
Change in
unrealized appreciation (depreciation) |
Income
distributions received |
Capital gain
distributions received |
Ending
value |
| John Hancock Collateral Trust | 881,001 | $10,303,458 | $36,027,068 | $(37,523,758) | $2,439 | $(2,014) | $205,204 | - | $8,807,193 |
Note 13-New accounting pronouncement
In March 2020, the Financial Accounting Standards Board (FASB) issued an Accounting Standards Update (ASU), ASU 2020-04, Reference Rate Reform (Topic 848), which provides optional, temporary relief with respect to the financial reporting of contracts subject to certain types of modifications due to the discontinuation of the LIBOR and other IBOR-based reference rates as of the end of 2021. In January 2021 and December 2022, the FASB issued ASU No. 2021-01 and ASU No. 2022-06, with further amendments to Topic 848. The temporary relief provided by ASU 2020-04 is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2024. Management expects that the adoption of the guidance will not have a material impact to the financial statements.
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Table of Contents
Investment objective, principal investment strategies, and principal risks
Unaudited
Investment Objective
The Fund's primary investment objective is to generate income for distribution to its shareholders, with capital appreciation as a secondary objective.
Principal Investment Strategies
The preponderance of the Fund's assets are invested in a diversified portfolio of debt securities issued by U.S. and non-U.S. corporations and governments, some of which may carry equity features. The Fund emphasizes corporate debt securities which pay interest on a fixed or contingent basis and which may possess certain equity features, such as conversion or exchange rights, warrants for the acquisition of the stock of the same or different issuers, or participations based on revenues, sales or profits.
The Fund may invest up to 70% of its net assets (plus borrowings for investment purposes) in debt securities rated below investment grade, commonly known as "junk bonds." The Fund also may purchase preferred securities and may acquire common stock through the exercise of conversion or exchange rights acquired in connection with other securities owned by the Fund. The Fund will not acquire any additional preferred securities or common stock if as a result of that acquisition the value of all preferred securities and common stocks in the Fund's portfolio would exceed 20% of its total assets. Up to 50% of the value of the Fund's assets may be invested in restricted securities acquired through private placements. The Fund may also purchase mortgage-backed securities.
At least 30% of Fund's net assets (plus borrowings for investment purposes) will be represented by (a) debt securities which are rated, at the time of acquisition, investment grade (i.e., at least "Baa" by Moody's Investors Service, Inc. (Moody's) or "BBB" by Standard & Poor's Global Ratings Inc. (S&P)) or in unrated securities determined by the Subadvisor to be of comparable credit quality, (b) securities issued or guaranteed by the U.S. government or its agencies and instrumentalities, and (c) cash or cash equivalents.
The Fund may also invest in derivatives such as foreign currency forward contracts, credit default swaps, futures contracts, options, foreign currency swaps, interest-rate swaps, swaps and reverse repurchase agreements. The fund utilizes a liquidity agreement to increase its assets available for investments and may also seek to obtain additional income or portfolio leverage by making secured loans of its portfolio securities with a value of up to 33 1/3% of its total assets. In addition, the Fund may invest in repurchase agreements. The Fund may also invest up to 20% of its total assets in illiquid securities.
The Advisor may also take into consideration environmental, social, and/or governance (ESG) factors, alongside other relevant factors, as part of its investment selection process. The ESG characteristics utilized in the fund's investment process may change over time and one or more characteristics may not be relevant with respect to all issuers that are eligible fund investments.
Principal Risks
As is the case with all exchange-listed closed-end funds, shares of this fund may trade at a discount or a premium to the fund's net asset value (NAV). An investment in the fund is subject to investment and market risks, including the possible loss of the entire principal invested.
The fund's main risks are listed below in alphabetical order, not in order of importance.
Changing distribution level & return of capital risk.
There is no guarantee prior distribution levels will be maintained, and distributions may include a substantial tax return of capital. A return of capital is the return of all or a portion of a shareholder's investment in the fund.
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Credit and counterparty risk.
The issuer or guarantor of a fixed-income security, the counterparty to an over-the-counter derivatives contract, or a borrower of fund securities may not make timely payments or otherwise honor its obligations. U.S. government securities are subject to varying degrees of credit risk depending upon the nature of their support. A downgrade or default affecting any of the fund's securities could affect the fund's performance.
Cybersecurity and operational risk.
Cybersecurity breaches may allow an unauthorized party to gain access to fund assets, customer data, or proprietary information, or cause a fund or its service providers to suffer data corruption or lose operational functionality. Similar incidents affecting issuers of a fund's securities may negatively impact performance. Operational risk may arise from human error, error by third parties, communication errors, or technology failures, among other causes.
Economic and market events risk.
Events in certain sectors historically have resulted, and may in the future result, in an unusually high degree of volatility in the financial markets, both domestic and foreign. These events have included, but are not limited to: bankruptcies, corporate restructurings, and other similar events; bank failures; governmental efforts to limit short selling and high frequency trading; measures to address U.S. federal and state budget deficits; social, political, and economic instability in Europe; economic stimulus by the Japanese central bank; dramatic changes in energy prices and currency exchange rates; and China's economic slowdown. Interconnected global economies and financial markets increase the possibility that conditions in one country or region might adversely impact issuers in a different country or region. Both domestic and foreign equity markets have experienced increased volatility and turmoil, with issuers that have exposure to the real estate, mortgage, and credit markets particularly affected. Financial institutions could suffer losses as interest rates rise or economic conditions deteriorate.
In addition, relatively high market volatility and reduced liquidity in credit and fixed-income markets may adversely affect many issuers worldwide. Actions taken by the U.S. Federal Reserve (Fed) or foreign central banks to stimulate or stabilize economic growth, such as interventions in currency markets, could cause high volatility in the equity and fixed-income markets. Reduced liquidity may result in less money being available to purchase raw materials, goods, and services from emerging markets, which may, in turn, bring down the prices of these economic staples. It may also result in emerging-market issuers having more difficulty obtaining financing, which may, in turn, cause a decline in their securities prices.
Beginning in March 2022, the Fed began increasing interest rates and has signaled the potential for further increases. As a result, risks associated with rising interest rates are currently heightened. It is difficult to accurately predict the pace at which the Fed will increase interest rates any further, or the timing, frequency or magnitude of any such increases, and the evaluation of macro-economic and other conditions could cause a change in approach in the future. Any such increases generally will cause market interest rates to rise and could cause the value of the fund's investments, and the fund's net asset value (NAV), to decline, potentially suddenly and significantly.
In addition, as the Fed increases the target Fed funds rate, any such rate increases, among other factors, could cause markets to experience continuing high volatility. A significant increase in interest rates may cause a decline in the market for equity securities. These events and the possible resulting market volatility may have an adverse effect on the fund.
Political turmoil within the United States and abroad may also impact the fund. Although the U.S. government has honored its credit obligations, it remains possible that the United States could default on its obligations. While it is impossible to predict the consequences of such an unprecedented event, it is likely that a default by the United States would be highly disruptive to the U.S. and global securities markets and could significantly impair the value of the fund's investments. Similarly, political events within the United States at times have resulted, and may in the future result, in a shutdown of government services, which could negatively affect the U.S. economy, decrease the value of many fund investments, and increase uncertainty in or impair the operation of the U.S. or
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other securities markets. In recent years, the U.S. renegotiated many of its global trade relationships and imposed or threatened to impose significant import tariffs. These actions could lead to price volatility and overall declines in U.S. and global investment markets.
Uncertainties surrounding the sovereign debt of a number of European Union (EU) countries and the viability of the EU have disrupted and may in the future disrupt markets in the United States and around the world. If one or more countries leave the EU or the EU dissolves, the global securities markets likely will be significantly disrupted. On January 31, 2020, the United Kingdom (UK) left the EU, commonly referred to as "Brexit," the UK ceased to be a member of the EU, and the UK and EU entered into a Trade and Cooperation Agreement. While the full impact of Brexit is unknown, Brexit has already resulted in volatility in European and global markets. There remains significant market uncertainty regarding Brexit's ramifications, and the range and potential implications of possible political, regulatory, economic, and market outcomes are difficult to predict.
A widespread health crisis such as a global pandemic could cause substantial market volatility, exchange trading suspensions and closures, which may lead to less liquidity in certain instruments, industries, sectors or the markets generally, and may ultimately affect fund performance. For example, the coronavirus (COVID-19) pandemic has resulted and may continue to result in significant disruptions to global business activity and market volatility due to disruptions in market access, resource availability, facilities operations, imposition of tariffs, export controls and supply chain disruption, among others. While many countries have lifted some or all restrictions related to the coronavirus (COVID-19) and the United States ended the public health emergency and national emergency declarations relating to the coronavirus (COVID-19) pandemic on May 11, 2023, the continued impact of coronavirus (COVID-19) and related variants is uncertain. The impact of a health crisis and other epidemics and pandemics that may arise in the future, could affect the global economy in ways that cannot necessarily be foreseen at the present time. A health crisis may exacerbate other pre-existing political, social and economic risks. Any such impact could adversely affect the fund's performance, resulting in losses to your investment.
Political and military events, including in Ukraine, North Korea, Russia, Venezuela, Iran, Syria, and other areas of the Middle East, and nationalist unrest in Europe and South America, also may cause market disruptions.
As a result of continued political tensions and armed conflicts, including the Russian invasion of Ukraine commencing in February of 2022, the extent and ultimate result of which are unknown at this time, the United States and the EU, along with the regulatory bodies of a number of countries, have imposed economic sanctions on certain Russian corporate entities and individuals, and certain sectors of Russia's economy, which may result in, among other things, the continued devaluation of Russian currency, a downgrade in the country's credit rating, and/or a decline in the value and liquidity of Russian securities, property or interests. These sanctions could also result in the immediate freeze of Russian securities and/or funds invested in prohibited assets, impairing the ability of the fund to buy, sell, receive or deliver those securities and/or assets. These sanctions or the threat of additional sanctions could also result in Russia taking counter measures or retaliatory actions, which may further impair the value and liquidity of Russian securities. The United States and other nations or international organizations may also impose additional economic sanctions or take other actions that may adversely affect Russia-exposed issuers and companies in various sectors of the Russian economy. Any or all of these potential results could lead Russia's economy into a recession. Economic sanctions and other actions against Russian institutions, companies, and individuals resulting from the ongoing conflict may also have a substantial negative impact on other economies and securities markets both regionally and globally, as well as on companies with operations in the conflict region, the extent to which is unknown at this time. The United States and the EU have also imposed similar sanctions on Belarus for its support of Russia's invasion of Ukraine. Additional sanctions may be imposed on Belarus and other countries that support Russia. Any such sanctions could present substantially similar risks as those resulting from the sanctions imposed on Russia, including substantial negative impacts on the regional and global economies and securities markets.
In addition, there is a risk that the prices of goods and services in the United States and many foreign economies may decline over time, known as deflation. Deflation may have an adverse effect on stock prices and creditworthiness and may make defaults on debt more likely. If a country's economy slips into a deflationary
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pattern, it could last for a prolonged period and may be difficult to reverse. Further, there is a risk that the present value of assets or income from investments will be less in the future, known as inflation. Inflation rates may change frequently and drastically as a result of various factors, including unexpected shifts in the domestic or global economy, and the fund's investments may be affected, which may reduce the fund's performance. Further, inflation may lead to the rise in interest rates, which may negatively affect the value of debt instruments held by the fund, resulting in a negative impact on the fund's performance. Generally, securities issued in emerging markets are subject to a greater risk of inflationary or deflationary forces, and more developed markets are better able to use monetary policy to normalize markets.
Equity securities risk.
The price of equity securities may decline due to changes in a company's financial condition or overall market conditions.
ESG integration risk.
The manager considers ESG factors that it deems relevant or additive, along with other material factors and analysis, when managing the fund. The manager may consider these ESG factors on all or a meaningful portion of the fund's investments. In certain situations, the extent to which these ESG factors may be applied according to the manager's integrated investment process may not include U.S. Treasuries, government securities, or other asset classes. ESG factors may include, but are not limited to, matters regarding board diversity, climate change policies, and supply chain and human rights policies. Incorporating ESG criteria and making investment decisions based on certain ESG characteristics, as determined by the manager, carries the risk that the fund may perform differently, including underperforming funds that do not utilize ESG criteria or funds that utilize different ESG criteria. Integration of ESG factors into the fund's investment process may result in a manager making different investments for the fund than for a fund with a similar investment universe and/or investment style that does not incorporate such considerations in its investment strategy or processes, and the fund's investment performance may be affected. Because ESG factors are one of many considerations for the fund, the manager may nonetheless include companies with low ESG characteristics or exclude companies with high ESG characteristics in the fund's investments.
Fixed-income securities risk.
A rise in interest rates typically causes bond prices to fall. The longer the average maturity or duration of the bonds held by a fund, the more sensitive it will likely be to interest-rate fluctuations. An issuer may not make all interest payment or repay all or any of the principal borrowed. Changes in a security's credit qualify may adversely affect fund performance. Additionally, the value of inflation-indexed securities is subject to the effects of changes in market interest rates caused by factors other than inflation ("real interest rates"). Generally, when real interest rates rise, the value of inflation-indexed securities will fall and the fund's value may decline as a result of this exposure to these securities.
Foreign securities risk.
Less information may be publicly available regarding foreign issuers, including foreign government issuers. Foreign securities may be subject to foreign taxes and may be more volatile than U.S. securities. Currency fluctuations and political and economic developments may adversely impact the value of foreign securities. If applicable, depositary receipts are subject to most of the risks associated with investing in foreign securities directly because the value of a depositary receipt is dependent upon the market price of the underlying foreign equity security. Depositary receipts are also subject to liquidity risk.
Hedging, derivatives, and other strategic transactions risk.
Hedging, derivatives, and other strategic transactions may increase a fund's volatility and could produce disproportionate losses, potentially more than the fund's principal investment. Risks of these transactions are different from and possibly greater than risks of investing directly in securities and other traditional instruments. Under certain market conditions, derivatives could become harder to value or sell and may become subject to liquidity risk (i.e., the inability to enter into closing transactions). Derivatives and other strategic transactions that the fund intends to utilize include: foreign currency forward contracts, credit default swaps, futures contracts, options, foreign currency swaps, interest-rate swaps, swaps, and reverse repurchase agreements. Foreign currency forward contracts, futures contracts, options, and swaps generally are subject to counterparty risk. In addition, swaps may be subject to interest-rate and settlement risk, and the risk of default of the underlying reference obligation. Derivatives associated with foreign currency transactions are subject to currency risk. An event of default or insolvency of the counterparty to a reverse
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repurchase agreement could result in delays or restrictions with respect to the fund's ability to dispose of the underlying securities. In addition, a reverse repurchase agreement may be considered a form of leverage and may, therefore, increase fluctuations in the fund's NAV.
Illiquid and restricted securities risk.
Illiquid and restricted securities may be difficult to value and may involve greater risks than liquid securities. Illiquidity may have an adverse impact on a particular security's market price and the fund's ability to sell the security.
Leveraging risk.
Issuing preferred shares or using derivatives may result in a leveraged portfolio. Leveraging long exposures increases a fund's losses when the value of its investments declines. Some derivatives have the potential for unlimited loss, regardless of the size of the initial investment. The fund also utilizes a Liquidity Agreement to increase its assets available for investment. See "Note 7 - Leverage risk" above.
LIBOR discontinuation risk.
The official publication of the London Interbank Offered Rate (LIBOR), which many debt securities, derivatives and other financial instruments traditionally utilized as the reference or benchmark rate for interest rate calculations, was discontinued as of June 30, 2023. However, a subset of U.S. dollar LIBOR settings will continue to be published on a "synthetic" basis. The synthetic publication of the one-, three- and six-month U.S. dollar LIBOR will continue until September 30, 2024. The discontinuation of LIBOR and a transition to replacement rates may lead to volatility and illiquidity in markets and may adversely affect the fund's performance.
Liquidity risk.
The extent (if at all) to which a security may be sold or a derivative position closed without negatively impacting its market value may be impaired by reduced market activity or participation, legal restrictions, or other economic and market impediments. Widespread selling of fixed-income securities to satisfy redemptions during periods of reduced demand may adversely impact the price or salability of such securities.
Lower-rated and high-yield fixed-income securities risk.
Lower-rated and high-yield fixed-income securities (junk bonds) are subject to greater credit quality risk, risk of default, and price volatility than higher-rated fixed-income securities, may be considered speculative, and can be difficult to resell.
Mortgage-backed and asset-backed securities risk.
Mortgage-backed and asset-backed securities are subject to different combinations of prepayment, extension, interest-rate, and other market risks. Factors that impact the value of these securities include interest rate changes, the reliability of available information, credit quality or enhancement, and market perception.
Preferred and convertible securities risk.
Preferred stock dividends are payable only if declared by the issuer's board. Preferred stock may be subject to redemption provisions. The market values of convertible securities tend to fall as interest rates rise and rise as interest rates fall. Convertible preferred stock's value can depend heavily upon the underlying common stock's value.
U.S. Government agency obligations risk.
U.S. government-sponsored entities such as Federal National Mortgage Association (Fannie Mae), Federal Home Loan Mortgage Corporation (Freddie Mac) and the Federal Home Loan Banks, although chartered or sponsored by Congress, are not funded by congressional appropriations and the debt securities that they issue are neither guaranteed nor issued by the U.S. government. Such debt securities are subject to the risk of default on the payment of interest and/or principal, similar to the debt securities of private issuers. The maximum potential liability of the issuers of some U.S. government obligations may greatly exceed their current resources, including any legal right to support from the U.S. government. Although the U.S. government has provided financial support to Fannie Mae and Freddie Mac in the past, there can be no assurance that it will support these or other government-sponsored entities in the future.
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ADDITIONAL INFORMATION
Unaudited
The fund is a diversified, closed-end, management investment company, common shares of which were initially offered to the public in January 1971.
Dividends and distributions
During the six months ended April 30, 2024, distributions from net investment income totaling $0.4662 per share were paid to shareholders. The dates of payments and the amounts per share were as follows:
|
Payment Date
|
Income Distributions
|
| December 29, 2023 | $0.2648 |
| March 28, 2024 | 0.2014 |
|
Total
|
$0.4662
|
Shareholder communication and assistance
If you have any questions concerning the fund, we will be pleased to assist you. If you hold shares in your own name and not with a brokerage firm, please address all notices, correspondence, questions or other communications regarding the fund to the transfer agent at:
Regular Mail:
Computershare
P.O. Box 43006
Providence, RI 02940-3078
Computershare
P.O. Box 43006
Providence, RI 02940-3078
Registered or Overnight Mail:
Computershare
150 Royall Street, Suite 101
Canton, MA 02021
Computershare
150 Royall Street, Suite 101
Canton, MA 02021
If your shares are held with a brokerage firm, you should contact that firm, bank or other nominee for assistance.
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Table of Contents
SHAREHOLDER MEETING
The fund held its Annual Meeting of Shareholders on Tuesday, February 20, 2024. The following proposal was considered by the shareholders:
THE PROPOSAL PASSED ON FEBRUARY 20, 2024.
PROPOSAL: To elect twelve (12) Trustees to serve until their respective successors have been duly elected and qualified.
|
Total votes
for the nominee |
Total votes withheld
from the nominee |
|
|
Independent Trustees
|
||
| James R. Boyle | 5,964,614.389 | 175,695.165 |
| William H. Cunningham | 5,763,994.063 | 376,315.491 |
| Noni L. Ellison | 5,922,379.840 | 217,929.714 |
| Grace K. Fey | 5,922,518.389 | 217,791.165 |
| Dean C. Garfield | 5,952,926.514 | 187,383.040 |
| Deborah C. Jackson | 5,928,453.514 | 211,856.040 |
| Hassell H. McClellan | 5,768,409.389 | 371,900.165 |
| Steven R. Pruchansky | 5,779,885.389 | 360,424.165 |
| Frances G. Rathke | 5,948,023.063 | 192,286.491 |
| Gregory A. Russo | 5,778,418.389 | 361,891.165 |
|
Non-Independent Trustees
|
||
| Andrew G. Arnott | 5,934,520.389 | 205,789.165 |
| Paul Lorentz | 5,945,465.389 | 194,844.165 |
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More information
Trustees
Hassell H. McClellan,
James R. Boyle
William H. Cunningham
Noni L. Ellison
Grace K. Fey
Dean C. Garfield
Deborah C. Jackson
Paul Lorentz
Frances G. Rathke
Gregory A. Russo
Chairperson
Steven R. Pruchansky,
π
Vice Chairperson
Andrew G. Arnott
†
James R. Boyle
William H. Cunningham
*
Noni L. Ellison
Grace K. Fey
Dean C. Garfield
Deborah C. Jackson
Paul Lorentz
†
Frances G. Rathke
*
Gregory A. Russo
Officers
Kristie M. Feinberg
#
President
Charles A. Rizzo
Chief Financial Officer
Salvatore Schiavone
Treasurer
Christopher (Kit) Sechler
Secretary and Chief Legal Officer
Trevor Swanberg
Chief Compliance Officer
Investment advisor
John Hancock Investment Management LLC
Subadvisor
Manulife Investment Management (US) LLC
Portfolio Managers
James Gearhart, CFA
Jonas Grazulis, CFA
Caryn E. Rothman, CFA
Jonas Grazulis, CFA
Caryn E. Rothman, CFA
Distributor
John Hancock Investment Management Distributors LLC
Custodian
State Street Bank and Trust Company
Transfer agent
Computershare Shareowner Services, LLC
Legal counsel
K&L Gates LLP
Stock symbol
Listed New York Stock Exchange: JHI
π
Member of the Audit Committee as of September 26, 2023.
†
Non-Independent Trustee
*
Member of the Audit Committee
# Effective as of June 29, 2023.
The fund's proxy voting policies and procedures, as well as the fund proxy voting record for the most recent twelve-month period ended June 30, are available free of charge on the Securities and Exchange Commission (SEC) website at sec.gov or on our website.
All of the fund's holdings as of the end of the third month of every fiscal quarter are filed with the SEC on Form N-PORT within 60 days of the end of the fiscal quarter. The fund's Form N-PORT filings are available on our website and the SEC's website, sec.gov.
We make this information on your fund, as well as
monthly portfolio holdings
, and other fund details available on our website at jhinvestments.com or by calling 800-852-0218.
The report is certified under the Sarbanes-Oxley Act, which requires closed-end funds and other public companies to affirm that, to the best of their knowledge, the information in their financial reports is fairly and accurately stated in all material respects.
| You can also contact us: | ||
|
800-852-0218
|
Regular mail:
|
Express mail:
|
|
jhinvestments.com
|
Computershare P.O. Box 43006 Providence, RI 02940-3078 |
Computershare 150 Royall St., Suite 101 Canton, MA 02021 |
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Table of Contents
Table of Contents
John Hancock family of funds
U.S. EQUITY FUNDS
Blue Chip Growth
Classic Value
Disciplined Value
Disciplined Value Mid Cap
Equity Income
Financial Industries
Fundamental All Cap Core
Fundamental Large Cap Core
Mid Cap Growth
New Opportunities
Regional Bank
Small Cap Core
Small Cap Dynamic Growth
Small Cap Value
U.S. Global Leaders Growth
U.S. Growth
INTERNATIONAL EQUITY FUNDS
Disciplined Value International
Emerging Markets
Emerging Markets Equity
Fundamental Global Franchise
Global Environmental Opportunities
Global Equity
Global Shareholder Yield
Global Thematic Opportunities
International Dynamic Growth
International Growth
International Small Company
FIXED-INCOME FUNDS
Bond
California Municipal Bond
Emerging Markets Debt
Floating Rate Income
Government Income
High Yield
High Yield Municipal Bond
Income
Investment Grade Bond
Money Market
Municipal Opportunities
Opportunistic Fixed Income
Short Duration Bond
Short Duration Municipal Opportunities
Strategic Income Opportunities
ALTERNATIVE FUNDS
Alternative Asset Allocation
Diversified Macro
Infrastructure
Multi-Asset Absolute Return
Real Estate Securities
Seaport Long/Short
A fund's investment objectives, risks, charges, and expenses should be considered carefully before investing. The prospectus contains this and other important information about the fund. To obtain a prospectus, contact your financial professional, call John Hancock Investment Management at 800-225-5291, or visit our website at jhinvestments.com. Please read the prospectus carefully before investing or sending money.
Table of Contents
EXCHANGE-TRADED FUNDS
Corporate Bond ETF
Disciplined Value International Select ETF
Dynamic Municipal Bond ETF
Fundamental All Cap Core ETF
High Yield ETF
International High Dividend ETF
Mortgage-Backed Securities ETF
Multifactor Developed International ETF
Multifactor Emerging Markets ETF
Multifactor Large Cap ETF
Multifactor Mid Cap ETF
Multifactor Small Cap ETF
Preferred Income ETF
U.S. High Dividend ETF
ASSET ALLOCATION/TARGET DATE FUNDS
Balanced
Multi-Asset High Income
Lifestyle Blend Portfolios
Lifetime Blend Portfolios
Multimanager Lifestyle Portfolios
Multimanager Lifetime Portfolios
ENVIRONMENTAL, SOCIAL, AND
GOVERNANCE FUNDS
GOVERNANCE FUNDS
ESG Core Bond
ESG International Equity
ESG Large Cap Core
CLOSED-END FUNDS
Asset-Based Lending
Financial Opportunities
Hedged Equity & Income
Income Securities Trust
Investors Trust
Preferred Income
Preferred Income II
Preferred Income III
Premium Dividend
Tax-Advantaged Dividend Income
John Hancock ETF shares are bought and sold at market price (not NAV), and are not individually redeemed from the fund. Brokerage commissions will reduce returns.
John Hancock ETFs are distributed by Foreside Fund Services, LLC, and are subadvised by Manulife Investment Management (US) LLC or Dimensional Fund Advisors LP. Foreside is not affiliated with John Hancock Investment Management Distributors LLC, Manulife Investment Management (US) LLC or Dimensional Fund Advisors LP.
Dimensional Fund Advisors LP receives compensation from John Hancock in connection with licensing rights to the John Hancock Dimensional indexes. Dimensional Fund Advisors LP does not sponsor, endorse, or sell, and makes no representation as to the advisability of investing in, John Hancock Multifactor ETFs.
Table of Contents
A
better way
to invest
We serve investors globally through a unique multimanager approach:
We search the world to find proven portfolio teams with specialized
expertise for every strategy we offer, then we apply robust investment
oversight to ensure they continue to meet our uncompromising
standards and serve the best interests of our shareholders.
We search the world to find proven portfolio teams with specialized
expertise for every strategy we offer, then we apply robust investment
oversight to ensure they continue to meet our uncompromising
standards and serve the best interests of our shareholders.
Results
for investors
Our unique approach to asset management enables us to provide
a diverse set of investments backed by some of the world's best
managers, along with strong risk-adjusted returns across asset classes.
a diverse set of investments backed by some of the world's best
managers, along with strong risk-adjusted returns across asset classes.
John Hancock Investment Management LLC, 200 Berkeley Street, Boston, MA 02116-5010, 800-225-5291, jhinvestments.com
Manulife Investment Management, the Stylized M Design, and Manulife Investment Management & Stylized M Design are trademarks of The Manufacturers Life Insurance Company and are used by its affiliates under license.
| MF3549396 | P5SA 4/24 |
6/2024
ITEM 2. CODE OF ETHICS.
Not Applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not Applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not Applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
(a)Not applicable.
(b)Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED- END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
(a)Not applicable.
|
Total number of |
Maximum number of |
|||
|
Total number of |
Average price per |
shares purchased |
shares that may yet |
|
|
as part of publicly |
be purchased under |
|||
|
Period |
shares purchased |
share |
announced plans* |
the plans |
|
Nov-23 |
- |
- |
- |
874,455 |
|
Dec-23 |
- |
- |
- |
874,455 |
|
Jan-24 |
- |
- |
- |
874,455 |
|
Feb-24 |
- |
- |
- |
874,455 |
|
Mar-24 |
- |
- |
- |
874,455 |
|
Apr-24 |
- |
- |
- |
874,455 |
|
Total |
- |
- |
||
* On December 10, 2015, the Board of Trustees approved a share repurchase plan, which has been subsequently reviewed and approved by the Board of Trustees. Under the current share repurchase plan, the Fund may purchase in the open market, up to 10% of its outstanding common shares as of December 31, 2023. The current share plan will remain in effect between January 1, 2024 and December 31, 2024.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The registrant has adopted procedures by which shareholders may recommend nominees to the registrant's Board of Trustees. A copy of the procedures is filed as an exhibit to this Form N-CSR. See attached "John Hancock Funds - Nominating, Governance and Administration Committee Charter."
ITEM 11. CONTROLS AND PROCEDURES.
(a)Based upon their evaluation of the registrant's disclosure controls and procedures as
conducted within 90 days of the filing date of this Form N-CSR, the registrant's principal executive officer and principal financial officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.
(b)There were no changes in the registrant's internal control over financial reporting that
occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.
ITEM 12. DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
The Fund did not participate directly in securities lending activities. See Note 8 to financial statements in Item 1.
ITEM 13. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Separate certifications for the registrant's principal executive officer and principal financial officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company Act of 1940, are attached.
(b)Separate certifications for the registrant's principal executive officer and principal financial officer, as required by 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and Rule 30a-2(b) under the Investment Company Act of 1940, are attached. The certifications furnished pursuant to this paragraph are not deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section. Such certifications are not deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Registrant specifically incorporates them by reference.
(c)(1) Submission of Matters to a Vote of Security Holders is attached. See attached "John Hancock Funds - Nominating, Governance and Administration Committee Charter."SIGNATURES
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.
John Hancock Investors Trust
|
By: |
/s/ Kristie M. Feinberg |
|
------------------------------ |
|
|
Kristie M. Feinberg |
|
|
President |
|
|
Date: |
June 26, 2024 |
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/ Kristie M. Feinberg |
|
------------------------------ |
|
|
Kristie M. Feinberg |
|
|
President |
|
|
Date: |
June 26, 2024 |
|
By: |
/s/ Charles A. Rizzo |
|
------------------------------- |
|
|
Charles A. Rizzo |
|
|
Chief Financial Officer |
|
|
Date: |
June 26, 2024 |