UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-21667
Fidelity Central Investment Portfolios LLC
(Exact name of registrant as specified in charter)
245 Summer St., Boston, MA 02210
(Address of principal executive offices) (Zip code)
William C. Coffey, Secretary
245 Summer St.
Boston, Massachusetts 02210
(Name and address of agent for service)
Registrant's telephone number, including area code:
617-563-7000
Date of fiscal year end: | August 31 |
Date of reporting period: | February 28, 2019 |
Item 1.
Reports to Stockholders
Fidelity® Specialized High Income Central Fund Semi-Annual Report February 28, 2019 |
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of a fund’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the fund or from your financial intermediary, such as a financial advisor, broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from a fund electronically, by contacting your financial intermediary. For Fidelity customers, visit Fidelity's web site or call Fidelity using the contact information listed below.
You may elect to receive all future reports in paper free of charge. If you wish to continue receiving paper copies of your shareholder reports, you may contact your financial intermediary or, if you are a Fidelity customer, visit Fidelity’s website, or call Fidelity at the applicable toll-free number listed below. Your election to receive reports in paper will apply to all funds held with the fund complex/your financial intermediary.
Account Type | Website | Phone Number |
Brokerage, Mutual Fund, or Annuity Contracts: | fidelity.com/mailpreferences | 1-800-343-3548 |
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Advisor Sold Accounts Serviced Through Your Financial Intermediary: | Contact Your Financial Intermediary | Your Financial Intermediary's phone number |
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Contents
Board Approval of Investment Advisory Contracts and Management Fees |
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-800-544-8544 to request a free copy of the proxy voting guidelines.
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A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
Investment Summary (Unaudited)
Top Five Holdings as of February 28, 2019
(by issuer, excluding cash equivalents) | % of fund's net assets |
CCO Holdings LLC/CCO Holdings Capital Corp. | 3.3 |
Icahn Enterprises LP/Icahn Enterprises Finance Corp. | 2.9 |
Ally Financial, Inc. | 2.8 |
Sirius XM Radio, Inc. | 2.3 |
Bank of America Corp. | 1.9 |
13.2 |
Top Five Market Sectors as of February 28, 2019
% of fund's net assets | |
Energy | 14.8 |
Healthcare | 9.5 |
Telecommunications | 9.2 |
Diversified Financial Services | 8.7 |
Banks & Thrifts | 7.9 |
Quality Diversification (% of fund's net assets)
As of February 28, 2019 | ||
BBB | 4.6% | |
BB | 69.9% | |
B | 20.2% | |
Short-Term Investments and Net Other Assets | 5.3% |
We have used ratings from Moody's Investors Service, Inc. Where Moody's® ratings are not available, we have used S&P® ratings. All ratings are as of the date indicated and do not reflect subsequent changes.
Asset Allocation (% of fund's net assets)
As of February 28, 2019* | ||
Nonconvertible Bonds | 88.8% | |
Convertible Bonds, Preferred Stocks | 0.3% | |
Bank Loan Obligations | 1.0% | |
Other Investments | 4.6% | |
Short-Term Investments and Net Other Assets (Liabilities) | 5.3% |
* Foreign investments - 18.8%
Schedule of Investments February 28, 2019 (Unaudited)
Showing Percentage of Net Assets
Corporate Bonds - 89.1% | |||
Principal Amount | Value | ||
Convertible Bonds - 0.3% | |||
Broadcasting - 0.3% | |||
DISH Network Corp.: | |||
2.375% 3/15/24 | $1,930,000 | $1,599,412 | |
3.375% 8/15/26 | 1,030,000 | 884,667 | |
2,484,079 | |||
Nonconvertible Bonds - 88.8% | |||
Aerospace - 1.5% | |||
BBA U.S. Holdings, Inc. 5.375% 5/1/26 (a) | 5,585,000 | 5,689,719 | |
BWX Technologies, Inc. 5.375% 7/15/26 (a) | 5,195,000 | 5,298,900 | |
TransDigm, Inc. 6.25% 3/15/26 (a) | 4,475,000 | 4,586,875 | |
15,575,494 | |||
Air Transportation - 0.5% | |||
Aercap Global Aviation Trust 6.5% 6/15/45 (a)(b) | 4,955,000 | 4,930,225 | |
Banks & Thrifts - 3.6% | |||
Ally Financial, Inc.: | |||
4.25% 4/15/21 | 1,520,000 | 1,537,100 | |
5.125% 9/30/24 | 4,755,000 | 4,992,750 | |
5.75% 11/20/25 | 16,535,000 | 17,527,100 | |
8% 11/1/31 | 3,415,000 | 4,217,525 | |
Royal Bank of Scotland Group PLC: | |||
5.125% 5/28/24 | 3,630,000 | 3,679,448 | |
6% 12/19/23 | 4,000,000 | 4,203,217 | |
36,157,140 | |||
Broadcasting - 2.3% | |||
Sirius XM Radio, Inc.: | |||
3.875% 8/1/22 (a) | 8,300,000 | 8,245,635 | |
5% 8/1/27 (a) | 2,995,000 | 2,927,553 | |
5.375% 7/15/26 (a) | 3,500,000 | 3,508,750 | |
6% 7/15/24 (a) | 8,520,000 | 8,828,850 | |
23,510,788 | |||
Cable/Satellite TV - 6.6% | |||
CCO Holdings LLC/CCO Holdings Capital Corp.: | |||
4% 3/1/23 (a) | 3,775,000 | 3,728,266 | |
5% 2/1/28 (a) | 8,615,000 | 8,291,938 | |
5.125% 2/15/23 | 550,000 | 558,938 | |
5.125% 5/1/23 (a) | 2,000,000 | 2,035,200 | |
5.125% 5/1/27 (a) | 4,160,000 | 4,082,000 | |
5.375% 5/1/25 (a) | 5,000,000 | 5,118,750 | |
5.5% 5/1/26 (a) | 3,545,000 | 3,614,872 | |
5.75% 2/15/26 (a) | 1,570,000 | 1,626,975 | |
5.875% 4/1/24 (a) | 2,130,000 | 2,217,863 | |
5.875% 5/1/27 (a) | 2,500,000 | 2,567,969 | |
CSC Holdings LLC: | |||
5.375% 7/15/23 (a) | 9,515,000 | 9,778,566 | |
5.5% 5/15/26 (a) | 1,805,000 | 1,825,306 | |
5.5% 4/15/27 (a) | 2,025,000 | 2,035,125 | |
DISH DBS Corp.: | |||
5.875% 11/15/24 | 2,290,000 | 1,928,638 | |
7.75% 7/1/26 | 1,375,000 | 1,189,375 | |
Virgin Media Secured Finance PLC 5.5% 8/15/26 (a) | 2,545,000 | 2,532,275 | |
Ziggo Secured Finance BV 5.5% 1/15/27 (a) | 14,290,000 | 13,789,850 | |
66,921,906 | |||
Capital Goods - 1.2% | |||
AECOM: | |||
5.125% 3/15/27 | 7,600,000 | 7,210,500 | |
5.875% 10/15/24 | 4,539,000 | 4,755,283 | |
11,965,783 | |||
Chemicals - 3.2% | |||
CF Industries Holdings, Inc. 5.15% 3/15/34 | 3,110,000 | 2,923,276 | |
NOVA Chemicals Corp. 4.875% 6/1/24 (a) | 6,210,000 | 6,012,522 | |
OCI NV 6.625% 4/15/23 (a) | 3,420,000 | 3,539,700 | |
Olin Corp.: | |||
5% 2/1/30 | 2,570,000 | 2,496,113 | |
5.125% 9/15/27 | 3,500,000 | 3,526,250 | |
The Chemours Co. LLC: | |||
5.375% 5/15/27 | 4,000,000 | 3,900,000 | |
7% 5/15/25 | 1,700,000 | 1,772,250 | |
Valvoline, Inc. 4.375% 8/15/25 | 3,510,000 | 3,325,725 | |
W. R. Grace & Co.-Conn. 5.625% 10/1/24 (a) | 4,500,000 | 4,680,000 | |
32,175,836 | |||
Containers - 2.1% | |||
Ardagh Packaging Finance PLC/Ardagh MP Holdings U.S.A., Inc. 4.625% 5/15/23 (a) | 11,500,000 | 11,586,250 | |
Crown Americas LLC/Crown Americas Capital Corp. V 4.25% 9/30/26 | 3,680,000 | 3,542,000 | |
OI European Group BV 4% 3/15/23 (a) | 3,860,000 | 3,773,150 | |
Owens-Brockway Glass Container, Inc. 5.375% 1/15/25 (a) | 900,000 | 917,955 | |
Silgan Holdings, Inc. 4.75% 3/15/25 | 1,060,000 | 1,038,800 | |
20,858,155 | |||
Diversified Financial Services - 8.7% | |||
Crown Americas LLC/Crown Americas Capital Corp. IV 4.75% 2/1/26 | 1,250,000 | 1,256,025 | |
FLY Leasing Ltd.: | |||
5.25% 10/15/24 | 4,159,000 | 3,951,050 | |
6.375% 10/15/21 | 1,665,000 | 1,677,488 | |
Icahn Enterprises LP/Icahn Enterprises Finance Corp.: | |||
5.875% 2/1/22 | 21,415,000 | 21,655,890 | |
6% 8/1/20 | 2,555,000 | 2,580,550 | |
6.25% 2/1/22 | 3,100,000 | 3,192,380 | |
6.375% 12/15/25 | 1,390,000 | 1,429,963 | |
6.75% 2/1/24 | 740,000 | 774,225 | |
MSCI, Inc.: | |||
4.75% 8/1/26 (a) | 3,230,000 | 3,230,000 | |
5.25% 11/15/24 (a) | 3,460,000 | 3,546,500 | |
5.375% 5/15/27 (a) | 4,455,000 | 4,599,788 | |
Navient Corp.: | |||
5.875% 10/25/24 | 260,000 | 250,250 | |
6.5% 6/15/22 | 5,405,000 | 5,562,015 | |
6.625% 7/26/21 | 3,500,000 | 3,618,125 | |
6.75% 6/15/26 | 2,175,000 | 2,088,000 | |
7.25% 9/25/23 | 4,470,000 | 4,609,688 | |
Park Aerospace Holdings Ltd.: | |||
4.5% 3/15/23 (a) | 1,665,000 | 1,652,513 | |
5.25% 8/15/22 (a) | 2,390,000 | 2,446,667 | |
5.5% 2/15/24 (a) | 4,120,000 | 4,259,050 | |
Quicken Loans, Inc. 5.25% 1/15/28 (a) | 5,390,000 | 4,911,638 | |
SLM Corp.: | |||
5.5% 1/25/23 | 2,865,000 | 2,829,188 | |
6.125% 3/25/24 | 750,000 | 731,250 | |
7.25% 1/25/22 | 1,350,000 | 1,415,813 | |
Springleaf Financial Corp.: | |||
6.875% 3/15/25 | 2,375,000 | 2,434,375 | |
7.125% 3/15/26 | 2,805,000 | 2,819,306 | |
87,521,737 | |||
Diversified Media - 1.2% | |||
E.W. Scripps Co. 5.125% 5/15/25 (a) | 1,145,000 | 1,102,063 | |
Nielsen Co. SARL (Luxembourg): | |||
5% 2/1/25 (a) | 2,905,000 | 2,868,688 | |
5.5% 10/1/21 (a) | 305,000 | 307,669 | |
Nielsen Finance LLC/Nielsen Finance Co. 5% 4/15/22 (a) | 7,535,000 | 7,516,163 | |
11,794,583 | |||
Energy - 14.1% | |||
Cheniere Corpus Christi Holdings LLC: | |||
5.125% 6/30/27 | 3,500,000 | 3,570,000 | |
5.875% 3/31/25 | 1,970,000 | 2,098,070 | |
7% 6/30/24 | 9,965,000 | 11,036,238 | |
Cheniere Energy Partners LP: | |||
5.25% 10/1/25 | 15,555,000 | 15,749,438 | |
5.625% 10/1/26 (a) | 2,620,000 | 2,669,125 | |
Consolidated Energy Finance SA 3 month U.S. LIBOR + 3.750% 6.5382% 6/15/22 (a)(b)(c) | 4,435,000 | 4,412,860 | |
Crestwood Midstream Partners LP/Crestwood Midstream Finance Corp.: | |||
5.75% 4/1/25 | 5,995,000 | 6,034,342 | |
6.25% 4/1/23 | 2,690,000 | 2,761,339 | |
CVR Refining LLC/Coffeyville Finance, Inc. 6.5% 11/1/22 | 3,216,000 | 3,280,320 | |
DCP Midstream Operating LP 5.375% 7/15/25 | 5,760,000 | 5,990,400 | |
Duke Energy Field Services 8.125% 8/16/30 | 685,000 | 791,175 | |
Endeavor Energy Resources LP/EER Finance, Inc.: | |||
5.5% 1/30/26 (a) | 295,000 | 309,013 | |
5.75% 1/30/28 (a) | 295,000 | 314,175 | |
Hess Infrastructure Partners LP 5.625% 2/15/26 (a) | 4,820,000 | 4,844,100 | |
Hilcorp Energy I LP/Hilcorp Finance Co.: | |||
5% 12/1/24 (a) | 7,853,000 | 7,538,880 | |
5.75% 10/1/25 (a) | 2,990,000 | 2,971,313 | |
Jonah Energy LLC 7.25% 10/15/25 (a) | 1,080,000 | 696,600 | |
Magnolia Oil & Gas Operating LLC 6% 8/1/26 (a) | 1,635,000 | 1,630,913 | |
Nabors Industries, Inc. 5.5% 1/15/23 | 1,289,000 | 1,208,438 | |
NextEra Energy Partners LP: | |||
4.25% 9/15/24 (a) | 5,210,000 | 5,118,825 | |
4.5% 9/15/27 (a) | 2,365,000 | 2,246,750 | |
Noble Holding International Ltd. 7.75% 1/15/24 | 288,000 | 256,320 | |
Parsley Energy LLC/Parsley 5.25% 8/15/25 (a) | 6,185,000 | 6,121,295 | |
PBF Holding Co. LLC/PBF Finance Corp. 7% 11/15/23 | 2,700,000 | 2,760,750 | |
QEP Resources, Inc. 5.25% 5/1/23 | 3,000,000 | 2,887,500 | |
Rose Rock Midstream LP/Rose Rock Finance Corp. 5.625% 11/15/23 | 2,000,000 | 1,870,000 | |
Sanchez Energy Corp. 7.25% 2/15/23 (a) | 3,725,000 | 3,212,813 | |
SemGroup Corp. 7.25% 3/15/26 | 4,965,000 | 4,803,638 | |
Southwestern Energy Co. 7.75% 10/1/27 | 1,245,000 | 1,293,244 | |
Summit Midstream Holdings LLC: | |||
5.5% 8/15/22 | 2,980,000 | 2,971,656 | |
5.75% 4/15/25 | 7,595,000 | 7,253,225 | |
Sunoco LP/Sunoco Finance Corp. 5.5% 2/15/26 | 4,198,000 | 4,169,873 | |
Targa Resources Partners LP/Targa Resources Partners Finance Corp.: | |||
4.25% 11/15/23 | 5,440,000 | 5,372,000 | |
5.125% 2/1/25 | 3,420,000 | 3,437,100 | |
5.25% 5/1/23 | 275,000 | 278,779 | |
5.375% 2/1/27 | 460,000 | 462,305 | |
5.875% 4/15/26 (a) | 3,160,000 | 3,286,400 | |
6.75% 3/15/24 | 1,640,000 | 1,717,900 | |
Teine Energy Ltd. 6.875% 9/30/22 (a) | 1,015,000 | 1,020,075 | |
TerraForm Power Operating LLC: | |||
4.25% 1/31/23 (a) | 765,000 | 757,893 | |
5% 1/31/28 (a) | 865,000 | 821,750 | |
6.625% 6/15/25 (a)(b) | 2,235,000 | 2,346,750 | |
142,373,580 | |||
Food/Beverage/Tobacco - 3.0% | |||
C&S Group Enterprises LLC 5.375% 7/15/22 (a) | 3,270,000 | 3,290,438 | |
JBS U.S.A. LLC/JBS U.S.A. Finance, Inc.: | |||
5.75% 6/15/25 (a) | 6,190,000 | 6,278,517 | |
5.875% 7/15/24 (a) | 7,680,000 | 7,895,040 | |
Lamb Weston Holdings, Inc.: | |||
4.625% 11/1/24 (a) | 2,000,000 | 2,010,000 | |
4.875% 11/1/26 (a) | 1,325,000 | 1,326,656 | |
Vector Group Ltd. 6.125% 2/1/25 (a) | 10,995,000 | 9,730,575 | |
30,531,226 | |||
Gaming - 4.9% | |||
CRC Escrow Issuer LLC/CRC Finance LLC 5.25% 10/15/25 (a) | 3,000,000 | 2,846,250 | |
GLP Capital LP/GLP Financing II, Inc. 5.25% 6/1/25 | 1,745,000 | 1,806,930 | |
MCE Finance Ltd. 4.875% 6/6/25 (a) | 7,690,000 | 7,392,754 | |
MGM Growth Properties Operating Partnership LP: | |||
4.5% 9/1/26 | 14,000,000 | 13,416,620 | |
4.5% 1/15/28 | 2,285,000 | 2,147,169 | |
5.75% 2/1/27 (a) | 920,000 | 941,850 | |
MGM Mirage, Inc.: | |||
5.75% 6/15/25 | 4,480,000 | 4,576,768 | |
6% 3/15/23 | 2,175,000 | 2,275,594 | |
Scientific Games Corp. 5% 10/15/25 (a) | 6,230,000 | 6,035,313 | |
Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp. 5.25% 5/15/27 (a) | 2,825,000 | 2,702,289 | |
Wynn Macau Ltd.: | |||
4.875% 10/1/24 (a) | 2,735,000 | 2,639,275 | |
5.5% 10/1/27 (a) | 2,405,000 | 2,293,023 | |
49,073,835 | |||
Healthcare - 9.5% | |||
Charles River Laboratories International, Inc. 5.5% 4/1/26 (a) | 985,000 | 1,024,400 | |
CTR Partnership LP/CareTrust Capital Corp. 5.25% 6/1/25 | 2,585,000 | 2,597,925 | |
HCA Holdings, Inc.: | |||
4.5% 2/15/27 | 4,950,000 | 4,990,439 | |
5% 3/15/24 | 2,335,000 | 2,442,724 | |
5.25% 6/15/26 | 7,245,000 | 7,639,876 | |
Hologic, Inc.: | |||
4.375% 10/15/25 (a) | 1,255,000 | 1,233,038 | |
4.625% 2/1/28 (a) | 235,000 | 227,363 | |
IMS Health, Inc. 5% 10/15/26 (a) | 5,200,000 | 5,291,000 | |
MPT Operating Partnership LP/MPT Finance Corp.: | |||
5% 10/15/27 | 4,875,000 | 4,838,438 | |
5.25% 8/1/26 | 7,755,000 | 7,851,938 | |
5.5% 5/1/24 | 1,405,000 | 1,438,369 | |
6.375% 3/1/24 | 960,000 | 1,005,600 | |
Sabra Health Care LP/Sabra Capital Corp.: | |||
5.375% 6/1/23 | 1,155,000 | 1,160,775 | |
5.5% 2/1/21 | 5,385,000 | 5,462,409 | |
Teleflex, Inc.: | |||
4.625% 11/15/27 | 805,000 | 800,766 | |
4.875% 6/1/26 | 7,400,000 | 7,501,750 | |
Tenet Healthcare Corp.: | |||
4.375% 10/1/21 | 1,485,000 | 1,503,563 | |
4.5% 4/1/21 | 2,000,000 | 2,025,000 | |
4.625% 7/15/24 | 11,310,000 | 11,239,313 | |
5.125% 5/1/25 | 2,400,000 | 2,379,000 | |
6.25% 2/1/27 (a) | 1,615,000 | 1,662,441 | |
Valeant Pharmaceuticals International, Inc. 7% 3/15/24 (a) | 10,725,000 | 11,301,469 | |
Wellcare Health Plans, Inc.: | |||
5.25% 4/1/25 | 7,780,000 | 7,942,991 | |
5.375% 8/15/26 (a) | 2,460,000 | 2,530,725 | |
96,091,312 | |||
Homebuilders/Real Estate - 0.4% | |||
Howard Hughes Corp. 5.375% 3/15/25 (a) | 3,325,000 | 3,283,438 | |
Starwood Property Trust, Inc. 4.75% 3/15/25 | 660,000 | 642,048 | |
3,925,486 | |||
Hotels - 1.0% | |||
Hilton Escrow Issuer LLC 4.25% 9/1/24 | 4,785,000 | 4,713,225 | |
Hilton Worldwide Finance LLC/Hilton Worldwide Finance Corp.: | |||
4.625% 4/1/25 | 3,000,000 | 2,985,000 | |
4.875% 4/1/27 | 590,000 | 587,050 | |
Wyndham Hotels & Resorts, Inc. 5.375% 4/15/26 (a) | 1,715,000 | 1,734,980 | |
10,020,255 | |||
Leisure - 0.2% | |||
Mattel, Inc. 6.75% 12/31/25 (a) | 2,565,000 | 2,526,525 | |
Metals/Mining - 1.2% | |||
Freeport-McMoRan, Inc.: | |||
3.55% 3/1/22 | 6,500,000 | 6,426,875 | |
3.875% 3/15/23 | 1,395,000 | 1,374,745 | |
4.55% 11/14/24 | 620,000 | 613,800 | |
Nufarm Australia Ltd. 5.75% 4/30/26 (a) | 3,900,000 | 3,634,527 | |
12,049,947 | |||
Restaurants - 0.6% | |||
1011778 BC Unlimited Liability Co./New Red Finance, Inc. 4.25% 5/15/24 (a) | 2,665,000 | 2,595,044 | |
KFC Holding Co./Pizza Hut Holding LLC 5% 6/1/24 (a) | 3,000,000 | 3,038,340 | |
5,633,384 | |||
Services - 1.6% | |||
Aramark Services, Inc.: | |||
4.75% 6/1/26 | 2,415,000 | 2,396,888 | |
5.125% 1/15/24 | 4,015,000 | 4,100,319 | |
CDK Global, Inc.: | |||
4.875% 6/1/27 | 715,000 | 702,638 | |
5.875% 6/15/26 | 3,020,000 | 3,114,375 | |
Corrections Corp. of America: | |||
4.625% 5/1/23 | 4,595,000 | 4,416,944 | |
5% 10/15/22 | 130,000 | 129,007 | |
Prime Security One MS, Inc. 4.875% 7/15/32 (a) | 1,555,000 | 1,310,088 | |
16,170,259 | |||
Steel - 0.1% | |||
Commercial Metals Co. 5.375% 7/15/27 | 1,480,000 | 1,385,650 | |
Super Retail - 0.3% | |||
Sally Holdings LLC: | |||
5.5% 11/1/23 | 1,100,000 | 1,111,000 | |
5.625% 12/1/25 | 240,000 | 235,500 | |
The William Carter Co. 5.625% 3/15/27 (a)(d) | 1,600,000 | 1,600,000 | |
2,946,500 | |||
Technology - 6.0% | |||
Entegris, Inc. 4.625% 2/10/26 (a) | 3,000,000 | 2,947,500 | |
Fair Isaac Corp. 5.25% 5/15/26 (a) | 2,845,000 | 2,873,450 | |
First Data Corp.: | |||
5% 1/15/24 (a) | 4,000,000 | 4,105,040 | |
5.375% 8/15/23 (a) | 4,745,000 | 4,856,508 | |
Gartner, Inc. 5.125% 4/1/25 (a) | 535,000 | 539,013 | |
Micron Technology, Inc. 5.5% 2/1/25 | 1,815,000 | 1,864,822 | |
Nuance Communications, Inc.: | |||
5.375% 8/15/20 (a) | 1,794,000 | 1,794,000 | |
5.625% 12/15/26 | 4,960,000 | 5,059,200 | |
Open Text Corp. 5.875% 6/1/26 (a) | 4,260,000 | 4,481,861 | |
Qorvo, Inc. 5.5% 7/15/26 (a) | 5,230,000 | 5,334,600 | |
Sensata Technologies BV: | |||
4.875% 10/15/23 (a) | 2,840,000 | 2,918,100 | |
5% 10/1/25 (a) | 4,020,000 | 4,060,200 | |
SoftBank Corp. 5.375% 7/30/22 (Reg. S) | 1,950,000 | 1,989,000 | |
Symantec Corp.: | |||
4.2% 9/15/20 | 515,000 | 520,687 | |
5% 4/15/25 (a) | 13,630,000 | 13,578,405 | |
TTM Technologies, Inc. 5.625% 10/1/25 (a) | 4,200,000 | 3,979,500 | |
60,901,886 | |||
Telecommunications - 8.7% | |||
Altice Financing SA: | |||
6.625% 2/15/23 (a) | 3,480,000 | 3,558,300 | |
7.5% 5/15/26 (a) | 2,940,000 | 2,844,450 | |
C&W Senior Financing Designated Activity Co. 7.5% 10/15/26 (a) | 4,850,000 | 4,947,000 | |
Equinix, Inc.: | |||
5.75% 1/1/25 | 3,000,000 | 3,123,750 | |
5.875% 1/15/26 | 6,860,000 | 7,185,850 | |
Level 3 Financing, Inc.: | |||
5.25% 3/15/26 | 3,689,000 | 3,619,831 | |
5.375% 1/15/24 | 4,000,000 | 4,025,000 | |
5.375% 5/1/25 | 2,200,000 | 2,194,500 | |
5.625% 2/1/23 | 7,000,000 | 7,052,500 | |
Millicom International Cellular SA 6.625% 10/15/26 (a) | 4,495,000 | 4,662,439 | |
Neptune Finco Corp. 6.625% 10/15/25 (a) | 16,870,000 | 17,797,850 | |
Qwest Corp. 6.75% 12/1/21 | 885,000 | 942,348 | |
SBA Communications Corp. 4.875% 9/1/24 | 2,000,000 | 1,997,500 | |
Sprint Corp. 7.875% 9/15/23 | 1,000,000 | 1,068,750 | |
T-Mobile U.S.A., Inc.: | |||
4.5% 2/1/26 | 1,350,000 | 1,329,737 | |
5.125% 4/15/25 | 1,525,000 | 1,563,602 | |
6% 3/1/23 | 12,285,000 | 12,622,838 | |
6% 4/15/24 | 1,450,000 | 1,506,188 | |
6.5% 1/15/24 | 1,700,000 | 1,763,750 | |
Telenet Finance Luxembourg Notes SARL 5.5% 3/1/28 (a) | 3,200,000 | 3,080,000 | |
U.S. West Communications 7.25% 9/15/25 | 945,000 | 1,008,618 | |
87,894,801 | |||
Transportation Ex Air/Rail - 1.6% | |||
Avolon Holdings Funding Ltd.: | |||
5.125% 10/1/23 (a) | 12,255,000 | 12,377,550 | |
5.25% 5/15/24 (a)(d) | 1,000,000 | 1,025,000 | |
5.5% 1/15/23 (a) | 2,190,000 | 2,245,188 | |
15,647,738 | |||
Utilities - 4.7% | |||
Clearway Energy Operating LLC 5.75% 10/15/25 (a) | 1,195,000 | 1,174,088 | |
Dolphin Subsidiary II, Inc. 7.25% 10/15/21 | 3,057,000 | 3,278,633 | |
DPL, Inc. 6.75% 10/1/19 | 2,475,000 | 2,509,031 | |
InterGen NV 7% 6/30/23 (a) | 3,460,000 | 3,114,000 | |
NRG Energy, Inc.: | |||
5.75% 1/15/28 | 775,000 | 795,344 | |
6.625% 1/15/27 | 665,000 | 708,225 | |
NRG Yield Operating LLC 5% 9/15/26 | 1,435,000 | 1,338,138 | |
NSG Holdings II LLC/NSG Holdings, Inc. 7.75% 12/15/25 (a) | 6,587,383 | 7,048,499 | |
The AES Corp.: | |||
4.5% 3/15/23 | 965,000 | 972,238 | |
4.875% 5/15/23 | 9,680,000 | 9,773,775 | |
5.125% 9/1/27 | 1,550,000 | 1,592,625 | |
6% 5/15/26 | 2,155,000 | 2,268,138 | |
Vistra Operations Co. LLC 5.5% 9/1/26 (a) | 12,550,000 | 13,020,625 | |
47,593,359 | |||
TOTAL NONCONVERTIBLE BONDS | 896,177,390 | ||
TOTAL CORPORATE BONDS | |||
(Cost $890,093,543) | 898,661,469 | ||
Bank Loan Obligations - 1.0% | |||
Energy - 0.4% | |||
Consolidated Energy Finance SA Tranche B, term loan 3 month U.S. LIBOR + 2.500% 4.9938% 5/7/25 (b)(c) | 4,427,750 | 4,283,848 | |
Gaming - 0.1% | |||
Scientific Games Corp. Tranche B 5LN, term loan 3 month U.S. LIBOR + 2.750% 5.3123% 8/14/24 (b)(c) | 619,047 | 613,191 | |
Telecommunications - 0.5% | |||
Frontier Communications Corp. Tranche B 1LN, term loan 3 month U.S. LIBOR + 3.750% 6.25% 6/15/24 (b)(c) | 4,039,747 | 3,888,256 | |
Level 3 Financing, Inc. Tranche B, term loan 3 month U.S. LIBOR + 2.250% 4.7311% 2/22/24 (b)(c) | 1,575,000 | 1,567,692 | |
TOTAL TELECOMMUNICATIONS | 5,455,948 | ||
TOTAL BANK LOAN OBLIGATIONS | |||
(Cost $10,373,332) | 10,352,987 | ||
Preferred Securities - 4.6% | |||
Banks & Thrifts - 4.3% | |||
Bank of America Corp.: | |||
5.875% (b)(e) | 3,220,000 | 3,236,721 | |
6.25% (b)(e) | 14,760,000 | 16,061,528 | |
Barclays PLC 7.875% (Reg. S) (b)(e) | 7,895,000 | 8,411,136 | |
Credit Agricole SA: | |||
6.625% (a)(b)(e) | 5,485,000 | 5,604,068 | |
7.875% (a)(b)(e) | 1,480,000 | 1,610,049 | |
Royal Bank of Scotland Group PLC 7.5% (b)(e) | 2,445,000 | 2,533,529 | |
Wells Fargo & Co. 5.9% (b)(e) | 5,995,000 | 6,181,257 | |
TOTAL BANKS & THRIFTS | 43,638,288 | ||
Energy - 0.3% | |||
Andeavor Logistics LP 6.875% (b)(e) | 2,635,000 | 2,580,742 | |
TOTAL PREFERRED SECURITIES | |||
(Cost $44,797,260) | 46,219,030 | ||
Shares | Value | ||
Money Market Funds - 4.4% | |||
Fidelity Cash Central Fund, 2.44% (f) | |||
(Cost $44,615,286) | 44,608,303 | 44,617,224 | |
TOTAL INVESTMENT IN SECURITIES - 99.1% | |||
(Cost $989,879,421) | 999,850,710 | ||
NET OTHER ASSETS (LIABILITIES) - 0.9% | 9,145,720 | ||
NET ASSETS - 100% | $1,008,996,430 |
Legend
(a) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the end of the period, the value of these securities amounted to $458,483,949 or 45.4% of net assets.
(b) Coupon rates for floating and adjustable rate securities reflect the rates in effect at period end.
(c) Coupon is indexed to a floating interest rate which may be multiplied by a specified factor and/or subject to caps or floors.
(d) Security or a portion of the security purchased on a delayed delivery or when-issued basis.
(e) Security is perpetual in nature with no stated maturity date.
(f) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $433,451 |
Total | $433,451 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations, if applicable.
Investment Valuation
The following is a summary of the inputs used, as of February 28, 2019, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | ||||
Corporate Bonds | $898,661,469 | $-- | $898,661,469 | $-- |
Bank Loan Obligations | 10,352,987 | -- | 10,352,987 | -- |
Preferred Securities | 46,219,030 | -- | 46,219,030 | -- |
Money Market Funds | 44,617,224 | 44,617,224 | -- | -- |
Total Investments in Securities: | $999,850,710 | $44,617,224 | $955,233,486 | $-- |
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 81.2% |
Cayman Islands | 3.6% |
Netherlands | 3.2% |
Luxembourg | 2.5% |
Canada | 2.5% |
United Kingdom | 2.0% |
Ireland | 1.6% |
Multi-National | 1.4% |
Others (Individually Less Than 1%) | 2.0% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
February 28, 2019 (Unaudited) | ||
Assets | ||
Investment in securities, at value — See accompanying schedule: Unaffiliated issuers (cost $945,264,135) | $955,233,486 | |
Fidelity Central Funds (cost $44,615,286) | 44,617,224 | |
Total Investment in Securities (cost $989,879,421) | $999,850,710 | |
Interest receivable | 12,946,116 | |
Distributions receivable from Fidelity Central Funds | 75,936 | |
Total assets | 1,012,872,762 | |
Liabilities | ||
Payable for investments purchased | ||
Regular delivery | $1,273,825 | |
Delayed delivery | 2,600,000 | |
Other payables and accrued expenses | 2,507 | |
Total liabilities | 3,876,332 | |
Net Assets | $1,008,996,430 | |
Net Assets consist of: | ||
Paid in capital | $1,000,344,190 | |
Total distributable earnings (loss) | 8,652,240 | |
Net Assets, for 10,187,420 shares outstanding | $1,008,996,430 | |
Net Asset Value, offering price and redemption price per share ($1,008,996,430 ÷ 10,187,420 shares) | $99.04 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended February 28, 2019 (Unaudited) | ||
Investment Income | ||
Dividends | $1,533,774 | |
Interest | 19,845,304 | |
Income from Fidelity Central Funds | 433,451 | |
Total income | 21,812,529 | |
Expenses | ||
Custodian fees and expenses | $4,797 | |
Independent directors' fees and expenses | 2,359 | |
Miscellaneous | 3 | |
Total expenses before reductions | 7,159 | |
Expense reductions | (5,202) | |
Total expenses after reductions | 1,957 | |
Net investment income (loss) | 21,810,572 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | (608,744) | |
Fidelity Central Funds | (1,938) | |
Total net realized gain (loss) | (610,682) | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | 10,201,859 | |
Fidelity Central Funds | 1,938 | |
Total change in net unrealized appreciation (depreciation) | 10,203,797 | |
Net gain (loss) | 9,593,115 | |
Net increase (decrease) in net assets resulting from operations | $31,403,687 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended February 28, 2019 (Unaudited) | Year ended August 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $21,810,572 | $36,135,330 |
Net realized gain (loss) | (610,682) | 8,414,693 |
Change in net unrealized appreciation (depreciation) | 10,203,797 | (26,557,082) |
Net increase (decrease) in net assets resulting from operations | 31,403,687 | 17,992,941 |
Distributions to shareholders | (26,006,107) | – |
Distributions to shareholders from net investment income | – | (36,303,188) |
Distributions to shareholders from net realized gain | – | (14,417,046) |
Total distributions | (26,006,107) | (50,720,234) |
Affiliated share transactions | ||
Proceeds from sales of shares | 258,395,398 | 32,625,000 |
Reinvestment of distributions | 26,006,107 | 50,720,221 |
Cost of shares redeemed | – | (100,013,409) |
Net increase (decrease) in net assets resulting from share transactions | 284,401,505 | (16,668,188) |
Total increase (decrease) in net assets | 289,799,085 | (49,395,481) |
Net Assets | ||
Beginning of period | 719,197,345 | 768,592,826 |
End of period | $1,008,996,430 | $719,197,345 |
Other Information | ||
Distributions in excess of net investment income end of period | $(790,177) | |
Shares | ||
Sold | 2,716,808 | 326,440 |
Issued in reinvestment of distributions | 266,577 | 498,455 |
Redeemed | – | (966,557) |
Net increase (decrease) | 2,983,385 | (141,662) |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity Specialized High Income Central Fund
Six months ended (Unaudited) February 28, | Years endedAugust 31, | |||||
2019 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $99.83 | $104.63 | $103.06 | $101.49 | $107.68 | $103.63 |
Income from Investment Operations | ||||||
Net investment income (loss)A | 2.618 | 5.188 | 5.489 | 5.682 | 5.462 | 5.687 |
Net realized and unrealized gain (loss) | (.203) | (2.758) | 1.901 | 1.436 | (6.176) | 3.995 |
Total from investment operations | 2.415 | 2.430 | 7.390 | 7.118 | (.714) | 9.682 |
Distributions from net investment income | (2.641) | (5.217) | (5.531) | (5.548) | (5.476) | (5.632) |
Distributions from net realized gain | (.564) | (2.013) | (.289) | – | – | – |
Total distributions | (3.205) | (7.230) | (5.820) | (5.548) | (5.476) | (5.632) |
Net asset value, end of period | $99.04 | $99.83 | $104.63 | $103.06 | $101.49 | $107.68 |
Total ReturnB,C | 2.52% | 2.42% | 7.39% | 7.39% | (.70)% | 9.53% |
Ratios to Average Net AssetsD,E | ||||||
Expenses before reductionsF | - %G | -% | -% | -% | -% | -% |
Expenses net of fee waivers, if anyF | - %G | -% | -% | -% | -% | -% |
Expenses net of all reductionsF | - %G | -% | -% | -% | -% | -% |
Net investment income (loss) | 5.43%G | 5.13% | 5.31% | 5.75% | 5.22% | 5.34% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $1,008,996 | $719,197 | $768,593 | $834,126 | $749,914 | $474,640 |
Portfolio turnover rateH | 25%G | 62% | 51% | 46% | 49% | 78% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
E Expense ratios reflect operating expenses of the Fund. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the Fund during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
F Amount represents less than .005%.
G Annualized
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended February 28, 2019
1. Organization.
Fidelity Specialized High Income Central Fund (the Fund) is a fund of Fidelity Central Investment Portfolios LLC (the LLC) and is authorized to issue an unlimited number of shares. Shares of the Fund are only offered to other investment companies and accounts managed by Fidelity Management & Research Company (FMR), or its affiliates (the Investing Funds). The LLC is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Delaware Limited Liability Company.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
The Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, 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:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Directors (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. Corporate bonds, bank loan obligations and preferred securities are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances. The Fund invests a significant portion of its assets in below investment grade securities. The value of these securities can be more volatile due to changes in the credit quality of the issuer and is sensitive to changes in economic, market and regulatory conditions.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level as of February 28, 2019 is included at the end of the Fund's Schedule of Investments.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost. Dividend income is recorded on the ex-dividend date. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Debt obligations may be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivables when the collection of all or a portion of interest has become doubtful based on consistently applied procedures. A debt obligation is removed from non-accrual status when the issuer resumes interest payments or when collectability of interest is reasonably assured.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction.
Distributions are declared and recorded daily and paid monthly from net investment income. Distributions from realized gains, if any, are declared and recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
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. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to partnerships and losses deferred due to wash sales.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows:
Gross unrealized appreciation | $18,402,619 |
Gross unrealized depreciation | (8,431,681) |
Net unrealized appreciation (depreciation) | $9,970,938 |
Tax cost | $989,879,772 |
Delayed Delivery Transactions and When-Issued Securities. During the period, the Fund transacted in securities on a delayed delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The securities purchased on a delayed delivery or when-issued basis are identified as such in the Fund's Schedule of Investments. The Fund may receive compensation for interest forgone in the purchase of a delayed delivery or when-issued security. With respect to purchase commitments, the Fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.
Restricted Securities. The Fund may invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. Information regarding restricted securities is included at the end of the Fund's Schedule of Investments.
Loans and Other Direct Debt Instruments. The Fund invests in direct debt instruments which are interests in amounts owed to lenders by corporate or other borrowers. These instruments may be in the form of loans, trade claims or other receivables and may include standby financing commitments such as revolving credit facilities that obligate the Fund to supply additional cash to the borrower on demand. Loans may be acquired through assignment or participation. The Fund did not have any unfunded loan commitments, which are contractual obligations for future funding, at period end.
New Accounting Pronouncement. In March 2017, the Financial Accounting Standards Board (FASB) issued an Accounting Standards Update (ASU), ASU 2017-08, which amends the amortization period for certain callable debt securities that are held at a premium. The amendment requires the premium to be amortized to the earliest call date. The amendments do not require an accounting change for securities held at a discount. The ASU is effective for annual periods beginning after December 15, 2018. Management is currently evaluating the potential impact of these changes to the financial statements.
New Rule Issuance. During August 2018, the U.S. Securities and Exchange Commission issued Final Rule Release No. 33-10532, Disclosure Update and Simplification. This Final Rule includes amendments specific to registered investment companies that are intended to eliminate overlap in disclosure requirements between Regulation S-X and GAAP. In accordance with these amendments, certain line-items in the Fund's financial statements have been combined or removed for the current period as outlined in the table below.
Financial Statement | Current Line-Item Presentation (As Applicable) | Prior Line-Item Presentation (As Applicable) |
Statement of Assets and Liabilities | Total distributable earnings (loss) | Undistributed/Distributions in excess of/Accumulated net investment income (loss) Accumulated/Undistributed net realized gain (loss) Net unrealized appreciation (depreciation) |
Statement of Changes in Net Assets | N/A - removed | Undistributed/Distributions in excess of/Accumulated net investment income (loss) end of period |
Statement of Changes in Net Assets | Distributions to shareholders | Distributions to shareholders from net investment income Distributions to shareholders from net realized gain |
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $369,037,536 and $98,231,204, respectively.
5. Fees and Other Transactions with Affiliates.
Management Fee and Expense Contract. FMR Co., Inc. (the investment adviser), an affiliate of FMR, provides the Fund with investment management services. The Fund does not pay any fees for these services. Pursuant to the Fund's management contract with the investment adviser, FMR pays the investment adviser a portion of the management fees it receives from the Investing Funds. In addition, under an expense contract, FMR also pays all other expenses of the Fund, excluding custody fees, the compensation of the independent Directors, and certain miscellaneous expenses such as proxy and shareholder meeting expenses.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
6. Expense Reductions.
Through arrangements with the Fund's custodian, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's custody expenses by $5,202.
7. Other.
The Fund's organizational documents provide former and current directors and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
At the end of the period, mutual funds managed by FMR or its affiliates were the owners of record of all of the outstanding shares of the Fund.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (September 1, 2018 to February 28, 2019).
Actual Expenses
The first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Annualized Expense Ratio-A | Beginning Account Value September 1, 2018 | Ending Account Value February 28, 2019 | Expenses Paid During Period-B September 1, 2018 to February 28, 2019 | |
Actual | .0018% | $1,000.00 | $1,025.20 | $.01 |
Hypothetical-C | $1,000.00 | $1,024.79 | $.01 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity Specialized High Income Central Fund
Each year, the Board of Directors, including the Independent Directors (together, the Board), votes on the renewal of the management contract with FMR Co., Inc. (FMRC) and the sub-advisory agreements (together, the Advisory Contracts) for the fund. FMRC and the sub-advisers are referred to herein as the Investment Advisers. The Board, assisted by the advice of fund counsel and Independent Directors' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. The Board has established various standing committees (Committees), each composed of and chaired by Independent Directors with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of the fund's Advisory Contracts. The Board also meets as needed to review matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through joint ad hoc committees to discuss certain matters relevant to all of the Fidelity funds.
At its January 2019 meeting, the Board unanimously determined to renew the fund's Advisory Contracts. In reaching its determination, the Board considered all factors it believed relevant and reached a determination, with the assistance of fund counsel and Independent Directors' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contracts was in the best interests of the fund and its shareholders and the fact that no fee is payable under the management contract was fair and reasonable.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the fund, including the backgrounds of investment personnel of Fidelity, and also considered the fund's investment objective, strategies, and related investment philosophy. The Independent Directors also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of the fund.Resources Dedicated to Investment Management and Support Services. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, training, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's trading, risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory and administrative services performed by the Investment Advisers and their affiliates under the Advisory Contracts and under separate agreements covering transfer agency, pricing and bookkeeping, and securities lending services for the fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, the fund's compliance policies and procedures. The Board also reviewed the allocation of fund brokerage, including allocations to brokers affiliated with the Investment Advisers, and the use of "soft" commission dollars to pay for research services.Investment Performance. The Board considered whether the fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions. The Board reviewed the fund's absolute investment performance, as well as the fund's relative investment performance, but did not consider performance to be a material factor in its decision to renew the fund's Advisory Contracts, as the fund is not publicly offered as a stand-alone investment product. In this regard, the Board noted that the fund is designed to offer a liquid investment option for other investment companies managed by Fidelity and ultimately to enhance the performance of those investment companies.Based on its review, the Board concluded that the nature, extent, and quality of services provided to the fund under the Advisory Contracts should continue to benefit the shareholders of the fund.Competitiveness of Management Fee and Total Expense Ratio. The Board considered that while the fund does not pay a management fee, Fidelity Management & Research Company (FMR) pays a management fee on behalf of the fund and receives fees for providing services to funds that invest in the fund. The Board also noted that FMR bears all expenses of the fund with certain exceptions. Based on its review, the Board concluded that the management fee paid on behalf of the fund and the fund's total expense ratio were reasonable in light of the services that the fund and its shareholders receive and the other factors considered.Costs of the Services and Profitability. The Board considered the level of Fidelity's profits in respect of all the Fidelity funds, as well as the profitability of the funds that invest in the fund.PricewaterhouseCoopers LLP (PwC), auditor to Fidelity and certain Fidelity funds, has been engaged annually by the Board as part of the Board's assessment of Fidelity's profitability analysis. PwC's engagement includes the review and assessment of the methodologies used by Fidelity in determining the revenues and expenses attributable to Fidelity's mutual fund business, and completion of agreed-upon procedures in respect of the mathematical accuracy of the fund profitability information and its conformity to established allocation methodologies. After considering PwC's reports issued under the engagement and information provided by Fidelity, the Board concluded that while other allocation methods may also be reasonable, Fidelity's profitability methodologies are reasonable in all material respects.The Board also reviewed Fidelity's non-fund businesses and potential indirect benefits such businesses may have received as a result of their association with Fidelity's mutual fund business (i.e., fall-out benefits) as well as cases where Fidelity's affiliates may benefit from the fund's business. The Board noted that changes to fall-out benefits year-over-year reflect business developments at Fidelity's various businesses.The Board concluded that the costs of the services provided by and the profits realized by Fidelity in connection with the operation of the fund were not relevant to the renewal of the Advisory Contracts because the fund pays no advisory fees and FMR bears all expenses of the fund with certain exceptions.Economies of Scale. The Board concluded that because the fund pays no advisory fees and FMR bears all expenses of the fund with certain exceptions, the realization of economies of scale was not a material factor in the Board's decision to renew the fund's Advisory Contract.Additional Information Requested by the Board. In order to develop fully the factual basis for consideration of the Fidelity funds' advisory contracts, the Board requested and received additional information on certain topics, including: (i) fund performance trends, in particular the underperformance of certain funds, and Fidelity's long-term strategies for certain funds; (ii) Fidelity's fund profitability methodology, profitability trends for certain funds, and the impact of certain factors on fund profitability results; (iii) metrics for evaluating index fund and ETF performance and information about ETF trading characteristics; (iv) the methodology with respect to the evaluation of competitive fund data and peer group classifications and fee comparisons; (v) the expense structures for different funds and classes; (vi) information regarding other accounts managed by Fidelity, including collective investment trusts; and (vii) Fidelity's philosophies and strategies for evaluating funds and classes with lower or declining asset levels.Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board concluded that the advisory fee arrangements are fair and reasonable, and that the fund's Advisory Contracts should be renewed.SHI-SANN-0419
1.820820.113
Fidelity® High Income Central Fund 2 Semi-Annual Report February 28, 2019 |
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of a fund’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the fund or from your financial intermediary, such as a financial advisor, broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from a fund electronically, by contacting your financial intermediary. For Fidelity customers, visit Fidelity's web site or call Fidelity using the contact information listed below.
You may elect to receive all future reports in paper free of charge. If you wish to continue receiving paper copies of your shareholder reports, you may contact your financial intermediary or, if you are a Fidelity customer, visit Fidelity’s website, or call Fidelity at the applicable toll-free number listed below. Your election to receive reports in paper will apply to all funds held with the fund complex/your financial intermediary.
Account Type | Website | Phone Number |
Brokerage, Mutual Fund, or Annuity Contracts: | fidelity.com/mailpreferences | 1-800-343-3548 |
Employer Provided Retirement Accounts: | netbenefits.fidelity.com/preferences (choose 'no' under Required Disclosures to continue to print) | 1-800-343-0860 |
Advisor Sold Accounts Serviced Through Your Financial Intermediary: | Contact Your Financial Intermediary | Your Financial Intermediary's phone number |
Advisor Sold Accounts Serviced by Fidelity: | institutional.fidelity.com | 1-877-208-0098 |
Contents
Board Approval of Investment Advisory Contracts and Management Fees |
To view a fund's proxy voting guidelines and proxy voting record for the 12-month period ended June 30, visit http://www.fidelity.com/proxyvotingresults or visit the Securities and Exchange Commission's (SEC) web site at http://www.sec.gov.
You may also call 1-800-544-8544 to request a free copy of the proxy voting guidelines.
Standard & Poor's, S&P and S&P 500 are registered service marks of The McGraw-Hill Companies, Inc. and have been licensed for use by Fidelity Distributors Corporation.
Other third-party marks appearing herein are the property of their respective owners.
All other marks appearing herein are registered or unregistered trademarks or service marks of FMR LLC or an affiliated company. © 2019 FMR LLC. All rights reserved.
A fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available on the SEC’s web site at http://www.sec.gov. A fund's Forms N-Q may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330.
Investment Summary (Unaudited)
Top Five Holdings as of February 28, 2019
(by issuer, excluding cash equivalents) | % of fund's net assets |
CCO Holdings LLC/CCO Holdings Capital Corp. | 2.7 |
Ally Financial, Inc. | 2.7 |
Altice SA | 2.4 |
Valeant Pharmaceuticals International, Inc. | 2.2 |
Tenet Healthcare Corp. | 2.1 |
12.1 |
Top Five Market Sectors as of February 28, 2019
% of fund's net assets | |
Energy | 14.6 |
Healthcare | 10.3 |
Cable/Satellite TV | 9.2 |
Telecommunications | 8.2 |
Diversified Financial Services | 8.2 |
Quality Diversification (% of fund's net assets)
As of February 28, 2019 | ||
BBB | 1.6% | |
BB | 41.5% | |
B | 41.3% | |
CCC,CC,C | 11.1% | |
Not Rated | 1.0% | |
Equities | 1.2% | |
Short-Term Investments and Net Other Assets | 2.3% |
We have used ratings from Moody's Investors Service, Inc. Where Moody's® ratings are not available, we have used S&P® ratings. All ratings are as of the date indicated and do not reflect subsequent changes.
Asset Allocation (% of fund's net assets)
As of February 28, 2019* | ||
Nonconvertible Bonds | 83.3% | |
Convertible Bonds, Preferred Stocks | 1.8% | |
Common Stocks | 0.5% | |
Bank Loan Obligations | 8.9% | |
Other Investments | 3.2% | |
Short-Term Investments and Net Other Assets (Liabilities) | 2.3% |
* Foreign investments - 22.0%
Schedule of Investments February 28, 2019 (Unaudited)
Showing Percentage of Net Assets
Corporate Bonds - 84.4% | |||
Principal Amount | Value | ||
Convertible Bonds - 1.1% | |||
Broadcasting - 0.5% | |||
DISH Network Corp.: | |||
2.375% 3/15/24 | $210,000 | $174,029 | |
3.375% 8/15/26 | 4,590,000 | 3,942,351 | |
4,116,380 | |||
Energy - 0.1% | |||
Ensco Jersey Finance Ltd. 3% 1/31/24 | 1,500,000 | 1,208,444 | |
Utilities - 0.5% | |||
SolarCity Corp. 1.625% 11/1/19 | 4,395,000 | 4,173,088 | |
TOTAL CONVERTIBLE BONDS | 9,497,912 | ||
Nonconvertible Bonds - 83.3% | |||
Aerospace - 1.2% | |||
BBA U.S. Holdings, Inc. 5.375% 5/1/26 (a) | 320,000 | 326,000 | |
Bombardier, Inc.: | |||
7.5% 12/1/24 (a) | 1,425,000 | 1,453,500 | |
7.875% 4/15/27 (a) | 2,640,000 | 2,620,094 | |
DAE Funding LLC: | |||
4.5% 8/1/22 (a) | 455,000 | 450,450 | |
5% 8/1/24 (a) | 165,000 | 163,556 | |
Huntington Ingalls Industries, Inc. 5% 11/15/25 (a) | 625,000 | 637,500 | |
TransDigm UK Holdings PLC 6.875% 5/15/26 (a) | 895,000 | 872,625 | |
TransDigm, Inc.: | |||
6.25% 3/15/26 (a) | 935,000 | 958,375 | |
7.5% 3/15/27 (a) | 3,380,000 | 3,396,562 | |
10,878,662 | |||
Automotive & Auto Parts - 0.1% | |||
Allison Transmission, Inc. 5% 10/1/24 (a) | 1,160,000 | 1,167,250 | |
Banks & Thrifts - 2.8% | |||
Ally Financial, Inc.: | |||
4.25% 4/15/21 | 1,170,000 | 1,183,163 | |
5.75% 11/20/25 | 5,850,000 | 6,201,000 | |
8% 11/1/31 | 1,873,000 | 2,285,060 | |
8% 11/1/31 | 11,940,000 | 14,745,853 | |
Royal Bank of Scotland Group PLC 5.125% 5/28/24 | 555,000 | 562,560 | |
24,977,636 | |||
Broadcasting - 1.1% | |||
CBS Radio, Inc. 7.25% 11/1/24 (a) | 1,015,000 | 1,006,119 | |
Gray Escrow, Inc. 7% 5/15/27 (a) | 2,460,000 | 2,601,450 | |
iHeartCommunications, Inc. 9% 9/15/22 (b) | 780,000 | 542,100 | |
Sinclair Television Group, Inc. 5.125% 2/15/27 (a) | 320,000 | 299,200 | |
Sirius XM Radio, Inc.: | |||
3.875% 8/1/22 (a) | 825,000 | 819,596 | |
5% 8/1/27 (a) | 1,900,000 | 1,857,212 | |
5.375% 7/15/26 (a) | 2,525,000 | 2,531,313 | |
9,656,990 | |||
Building Materials - 0.6% | |||
Builders FirstSource, Inc. 5.625% 9/1/24 (a) | 1,175,000 | 1,147,094 | |
Building Materials Corp. of America: | |||
5.5% 2/15/23 (a) | 690,000 | 705,525 | |
6% 10/15/25 (a) | 1,165,000 | 1,215,969 | |
HD Supply, Inc. 5.375% 10/15/26 (a) | 1,405,000 | 1,426,075 | |
U.S. Concrete, Inc. 6.375% 6/1/24 | 425,000 | 418,625 | |
4,913,288 | |||
Cable/Satellite TV - 8.4% | |||
Altice SA: | |||
7.625% 2/15/25 (a) | 9,990,000 | 8,872,369 | |
7.75% 5/15/22 (a) | 12,375,000 | 12,297,656 | |
CCO Holdings LLC/CCO Holdings Capital Corp.: | |||
4% 3/1/23 (a) | 1,070,000 | 1,056,753 | |
5% 2/1/28 (a) | 7,085,000 | 6,819,313 | |
5.125% 2/15/23 | 1,730,000 | 1,758,113 | |
5.125% 5/1/23 (a) | 4,155,000 | 4,228,128 | |
5.125% 5/1/27 (a) | 4,210,000 | 4,131,063 | |
5.5% 5/1/26 (a) | 1,095,000 | 1,116,582 | |
5.75% 9/1/23 | 1,160,000 | 1,181,750 | |
5.875% 4/1/24 (a) | 2,995,000 | 3,118,544 | |
5.875% 5/1/27 (a) | 1,285,000 | 1,319,936 | |
CSC Holdings LLC: | |||
5.125% 12/15/21 (a) | 1,379,000 | 1,383,330 | |
5.125% 12/15/21 (a) | 760,000 | 762,386 | |
5.375% 7/15/23 (a) | 1,620,000 | 1,664,874 | |
5.375% 2/1/28 (a) | 4,590,000 | 4,509,675 | |
5.5% 5/15/26 (a) | 3,470,000 | 3,509,038 | |
5.5% 4/15/27 (a) | 2,075,000 | 2,085,375 | |
6.5% 2/1/29 (a) | 1,955,000 | 2,045,438 | |
7.75% 7/15/25 (a) | 1,240,000 | 1,323,700 | |
DISH DBS Corp.: | |||
5% 3/15/23 | 865,000 | 764,444 | |
5.875% 7/15/22 | 550,000 | 525,250 | |
6.75% 6/1/21 | 1,122,000 | 1,147,245 | |
7.75% 7/1/26 | 385,000 | 333,025 | |
Unitymedia KabelBW GmbH 6.125% 1/15/25 (a) | 1,680,000 | 1,738,800 | |
Virgin Media Finance PLC 4.875% 2/15/22 | 845,000 | 811,200 | |
Virgin Media Secured Finance PLC: | |||
5.25% 1/15/26 (a) | 805,000 | 807,399 | |
5.5% 8/15/26 (a) | 2,475,000 | 2,462,625 | |
VTR Finance BV 6.875% 1/15/24 (a) | 845,000 | 868,238 | |
Ziggo Secured Finance BV 5.5% 1/15/27 (a) | 2,410,000 | 2,325,650 | |
74,967,899 | |||
Capital Goods - 0.0% | |||
Apergy Corp. 6.375% 5/1/26 | 315,000 | 314,606 | |
Chemicals - 2.2% | |||
Blue Cube Spinco, Inc.: | |||
9.75% 10/15/23 | 1,175,000 | 1,316,000 | |
10% 10/15/25 | 1,455,000 | 1,665,975 | |
CF Industries Holdings, Inc.: | |||
3.45% 6/1/23 | 1,040,000 | 1,006,200 | |
5.15% 3/15/34 | 2,435,000 | 2,288,803 | |
5.375% 3/15/44 | 2,190,000 | 1,913,513 | |
Element Solutions, Inc. 5.875% 12/1/25 (a) | 1,570,000 | 1,588,652 | |
LSB Industries, Inc. 9.625% 5/1/23 (a) | 510,000 | 532,950 | |
NOVA Chemicals Corp. 4.875% 6/1/24 (a) | 960,000 | 929,472 | |
OCI NV 6.625% 4/15/23 (a) | 390,000 | 403,650 | |
The Chemours Co. LLC 7% 5/15/25 | 1,275,000 | 1,329,188 | |
TPC Group, Inc. 8.75% 12/15/20 (a) | 5,360,000 | 5,252,800 | |
Versum Materials, Inc. 5.5% 9/30/24 (a) | 245,000 | 254,800 | |
W. R. Grace & Co.-Conn.: | |||
5.125% 10/1/21 (a) | 345,000 | 354,967 | |
5.625% 10/1/24 (a) | 1,095,000 | 1,138,800 | |
19,975,770 | |||
Consumer Products - 0.1% | |||
Edgewell Personal Care Co. 5.5% 6/15/25 (a) | 45,000 | 43,988 | |
Tempur Sealy International, Inc. 5.5% 6/15/26 | 1,155,000 | 1,152,113 | |
1,196,101 | |||
Containers - 2.1% | |||
Ard Securities Finance SARL 8.75% 1/31/23 pay-in-kind (a)(c) | 567,550 | 533,497 | |
Ardagh Packaging Finance PLC/Ardagh MP Holdings U.S.A., Inc.: | |||
4.625% 5/15/23 (a) | 4,395,000 | 4,427,963 | |
6% 2/15/25 (a) | 3,938,000 | 3,888,775 | |
Crown Americas LLC/Crown Americas Capital Corp. IV 4.5% 1/15/23 | 365,000 | 368,650 | |
Crown Americas LLC/Crown Americas Capital Corp. V 4.25% 9/30/26 | 4,795,000 | 4,615,188 | |
OI European Group BV 4% 3/15/23 (a) | 215,000 | 210,163 | |
Owens-Brockway Glass Container, Inc.: | |||
5% 1/15/22 (a) | 925,000 | 951,418 | |
5.375% 1/15/25 (a) | 2,405,000 | 2,452,980 | |
Plastipak Holdings, Inc. 6.25% 10/15/25 (a) | 265,000 | 242,475 | |
Reynolds Group Issuer, Inc./Reynolds Group Issuer LLC/Reynolds Group Issuer (Luxembourg) SA 5.125% 7/15/23 (a) | 1,275,000 | 1,275,000 | |
18,966,109 | |||
Diversified Financial Services - 7.9% | |||
AerCap Ireland Capital Ltd./AerCap Global Aviation Trust 4.625% 10/30/20 | 1,965,000 | 1,996,398 | |
Aircastle Ltd. 5% 4/1/23 | 755,000 | 767,841 | |
CIT Group, Inc. 5% 8/15/22 | 472,000 | 487,340 | |
Crown Americas LLC/Crown Americas Capital Corp. IV 4.75% 2/1/26 | 2,661,000 | 2,673,826 | |
FLY Leasing Ltd.: | |||
5.25% 10/15/24 | 3,400,000 | 3,230,000 | |
6.375% 10/15/21 | 2,460,000 | 2,478,450 | |
Grinding Media, Inc./MC Grinding Media Canada, Inc. 7.375% 12/15/23 (a) | 655,000 | 655,819 | |
Icahn Enterprises LP/Icahn Enterprises Finance Corp.: | |||
5.875% 2/1/22 | 4,290,000 | 4,338,263 | |
6% 8/1/20 | 650,000 | 656,500 | |
6.25% 2/1/22 | 445,000 | 458,261 | |
International Lease Finance Corp. 5.875% 8/15/22 | 570,000 | 605,967 | |
MSCI, Inc.: | |||
5.375% 5/15/27 (a) | 1,070,000 | 1,104,775 | |
5.75% 8/15/25 (a) | 520,000 | 540,800 | |
Navient Corp.: | |||
5% 10/26/20 | 345,000 | 348,019 | |
5.875% 10/25/24 | 470,000 | 452,375 | |
6.625% 7/26/21 | 675,000 | 697,781 | |
6.75% 6/25/25 | 2,400,000 | 2,349,000 | |
6.75% 6/15/26 | 4,520,000 | 4,339,200 | |
7.25% 9/25/23 | 530,000 | 546,563 | |
Park Aerospace Holdings Ltd.: | |||
4.5% 3/15/23 (a) | 4,630,000 | 4,595,275 | |
5.25% 8/15/22 (a)(d) | 1,110,000 | 1,136,318 | |
5.5% 2/15/24 (a) | 9,385,000 | 9,701,744 | |
Radiate Holdco LLC/Radiate Financial Service Ltd.: | |||
6.625% 2/15/25 (a) | 1,710,000 | 1,607,400 | |
6.875% 2/15/23 (a) | 1,995,000 | 1,935,150 | |
SLM Corp.: | |||
4.875% 6/17/19 | 5,408,000 | 5,408,000 | |
6.125% 3/25/24 | 5,055,000 | 4,928,625 | |
7.25% 1/25/22 | 605,000 | 634,494 | |
8% 3/25/20 | 2,370,000 | 2,475,062 | |
Springleaf Financial Corp.: | |||
6.125% 5/15/22 | 1,065,000 | 1,104,938 | |
6.875% 3/15/25 | 535,000 | 548,375 | |
7.125% 3/15/26 | 5,040,000 | 5,065,704 | |
8.25% 12/15/20 | 1,195,000 | 1,279,546 | |
Transocean Poseidon Ltd. 6.875% 2/1/27 (a) | 1,350,000 | 1,387,125 | |
70,534,934 | |||
Diversified Media - 0.9% | |||
Clear Channel Worldwide Holdings, Inc. Series A, 6.5% 11/15/22 | 2,220,000 | 2,267,175 | |
E.W. Scripps Co. 5.125% 5/15/25 (a) | 395,000 | 380,188 | |
Nielsen Co. SARL (Luxembourg) 5% 2/1/25 (a) | 870,000 | 859,125 | |
Nielsen Finance LLC/Nielsen Finance Co. 5% 4/15/22 (a) | 4,185,000 | 4,174,538 | |
7,681,026 | |||
Energy - 13.4% | |||
AmeriGas Partners LP/AmeriGas Finance Corp. 5.5% 5/20/25 | 575,000 | 569,250 | |
Antero Midstream Partners LP/Antero Midstream Finance Corp. 5.75% 3/1/27 (a) | 1,665,000 | 1,677,488 | |
Antero Resources Corp. 5.625% 6/1/23 (Reg. S) | 815,000 | 817,038 | |
Antero Resources Finance Corp. 5.375% 11/1/21 | 990,000 | 993,713 | |
Baytex Energy Corp.: | |||
5.125% 6/1/21 (a) | 275,000 | 270,875 | |
5.625% 6/1/24 (a) | 830,000 | 744,925 | |
Blue Racer Midstream LLC/Blue Racer Finance Corp. 6.625% 7/15/26 (a) | 1,070,000 | 1,091,400 | |
California Resources Corp. 8% 12/15/22 (a) | 7,970,000 | 6,366,038 | |
Callon Petroleum Co.: | |||
6.125% 10/1/24 | 335,000 | 337,513 | |
6.375% 7/1/26 | 515,000 | 515,000 | |
Cheniere Corpus Christi Holdings LLC 5.125% 6/30/27 | 4,100,000 | 4,182,000 | |
Chesapeake Energy Corp.: | |||
4.875% 4/15/22 | 380,000 | 364,800 | |
5.375% 6/15/21 | 676,000 | 674,310 | |
5.75% 3/15/23 | 745,000 | 718,925 | |
8% 6/15/27 | 1,150,000 | 1,138,903 | |
CNX Midstream Partners LP 6.5% 3/15/26 (a) | 1,030,000 | 1,011,975 | |
Compressco Partners LP/Compressco Finance, Inc. 7.5% 4/1/25 (a) | 535,000 | 518,950 | |
Consolidated Energy Finance SA: | |||
3 month U.S. LIBOR + 3.750% 6.5382% 6/15/22 (a)(c)(e) | 820,000 | 815,907 | |
6.5% 5/15/26 (a) | 1,545,000 | 1,463,888 | |
6.875% 6/15/25 (a) | 980,000 | 955,500 | |
Covey Park Energy LLC 7.5% 5/15/25 (a) | 600,000 | 558,000 | |
CVR Refining LLC/Coffeyville Finance, Inc. 6.5% 11/1/22 | 1,665,000 | 1,698,300 | |
DCP Midstream LLC 5.85% 5/21/43 (a)(c) | 540,000 | 477,900 | |
DCP Midstream Operating LP 5.375% 7/15/25 | 445,000 | 462,800 | |
Denbury Resources, Inc.: | |||
4.625% 7/15/23 | 3,555,000 | 2,346,300 | |
5.5% 5/1/22 | 2,535,000 | 1,863,225 | |
7.5% 2/15/24 (a) | 3,185,000 | 2,842,613 | |
9.25% 3/31/22 (a) | 495,000 | 496,238 | |
Drax Finco PLC 6.625% 11/1/25 (a) | 820,000 | 833,325 | |
Endeavor Energy Resources LP/EER Finance, Inc.: | |||
5.5% 1/30/26 (a) | 385,000 | 403,288 | |
5.75% 1/30/28 (a) | 3,770,000 | 4,015,050 | |
Ensco PLC: | |||
4.5% 10/1/24 | 780,000 | 603,486 | |
5.2% 3/15/25 | 420,000 | 322,350 | |
5.75% 10/1/44 | 1,156,000 | 742,730 | |
7.75% 2/1/26 | 535,000 | 449,400 | |
EP Energy LLC/Everest Acquisition Finance, Inc.: | |||
7.75% 5/15/26 (a) | 5,995,000 | 5,313,069 | |
8% 11/29/24 (a) | 3,135,000 | 2,210,175 | |
Exterran Energy Solutions LP 8.125% 5/1/25 | 885,000 | 879,469 | |
Exterran Partners LP/EXLP Finance Corp. 6% 4/1/21 | 435,000 | 432,825 | |
FTS International, Inc. 6.25% 5/1/22 | 130,000 | 123,500 | |
Hess Infrastructure Partners LP 5.625% 2/15/26 (a) | 2,000,000 | 2,010,000 | |
Hilcorp Energy I LP/Hilcorp Finance Co.: | |||
5% 12/1/24 (a) | 2,275,000 | 2,184,000 | |
5.75% 10/1/25 (a) | 960,000 | 954,000 | |
6.25% 11/1/28 (a) | 1,665,000 | 1,631,700 | |
Holly Energy Partners LP/Holly Finance Corp. 6% 8/1/24 (a) | 575,000 | 589,375 | |
Jonah Energy LLC 7.25% 10/15/25 (a) | 3,815,000 | 2,460,675 | |
KLX Energy Services Holdings, Inc. 11.5% 11/1/25 (a) | 1,100,000 | 1,144,000 | |
MEG Energy Corp.: | |||
6.375% 1/30/23 (a) | 180,000 | 164,250 | |
7% 3/31/24 (a) | 2,105,000 | 1,926,075 | |
Nabors Industries, Inc. 5.75% 2/1/25 | 3,740,000 | 3,300,550 | |
Neptune Energy Bondco PLC 6.625% 5/15/25 (a) | 1,065,000 | 1,045,298 | |
NextEra Energy Partners LP 4.25% 9/15/24 (a) | 4,510,000 | 4,431,075 | |
NGL Energy Partners LP/NGL Energy Finance Corp. 6.125% 3/1/25 | 1,255,000 | 1,182,838 | |
Nine Energy Service, Inc. 8.75% 11/1/23 (a) | 455,000 | 455,000 | |
Noble Holding International Ltd.: | |||
5.25% 3/15/42 | 620,000 | 384,400 | |
6.05% 3/1/41 | 755,000 | 479,425 | |
7.75% 1/15/24 | 1,373,000 | 1,221,970 | |
7.875% 2/1/26 (a) | 860,000 | 804,100 | |
7.95% 4/1/25 (c) | 1,040,000 | 910,000 | |
Parsley Energy LLC/Parsley: | |||
5.25% 8/15/25 (a) | 575,000 | 569,078 | |
5.625% 10/15/27 (a) | 445,000 | 440,550 | |
6.25% 6/1/24 (a) | 165,000 | 169,125 | |
PBF Holding Co. LLC/PBF Finance Corp.: | |||
7% 11/15/23 | 955,000 | 976,488 | |
7.25% 6/15/25 | 265,000 | 271,758 | |
PBF Logistics LP/PBF Logistics Finance, Inc. 6.875% 5/15/23 | 370,000 | 376,586 | |
Precision Drilling Corp. 7.125% 1/15/26 (a) | 730,000 | 717,225 | |
Rose Rock Midstream LP/Rose Rock Finance Corp.: | |||
5.625% 7/15/22 | 2,400,000 | 2,337,000 | |
5.625% 11/15/23 | 900,000 | 841,500 | |
Sanchez Energy Corp.: | |||
6.125% 1/15/23 | 2,775,000 | 419,719 | |
7.25% 2/15/23 (a) | 7,945,000 | 6,852,563 | |
SemGroup Corp.: | |||
6.375% 3/15/25 | 1,580,000 | 1,489,150 | |
7.25% 3/15/26 | 1,490,000 | 1,441,575 | |
SM Energy Co.: | |||
5% 1/15/24 | 1,345,000 | 1,265,981 | |
5.625% 6/1/25 | 1,690,000 | 1,580,150 | |
6.125% 11/15/22 | 1,480,000 | 1,472,600 | |
Southwestern Energy Co.: | |||
7.5% 4/1/26 | 1,870,000 | 1,944,800 | |
7.75% 10/1/27 | 1,005,000 | 1,043,944 | |
Summit Midstream Holdings LLC 5.75% 4/15/25 | 1,230,000 | 1,174,650 | |
Targa Resources Partners LP/Targa Resources Partners Finance Corp.: | |||
4.25% 11/15/23 | 2,335,000 | 2,305,813 | |
5.25% 5/1/23 | 330,000 | 334,534 | |
5.875% 4/15/26 (a) | 1,070,000 | 1,112,800 | |
6.5% 7/15/27 (a) | 490,000 | 518,175 | |
6.75% 3/15/24 | 235,000 | 246,163 | |
6.875% 1/15/29 (a) | 865,000 | 920,684 | |
Teine Energy Ltd. 6.875% 9/30/22 (a) | 600,000 | 603,000 | |
TerraForm Power Operating LLC 4.25% 1/31/23 (a) | 1,000,000 | 990,710 | |
Transocean, Inc. 9% 7/15/23 (a) | 770,000 | 812,350 | |
U.S.A. Compression Partners LP 6.875% 4/1/26 | 320,000 | 325,600 | |
W&T Offshore, Inc. 9.75% 11/1/23 (a) | 925,000 | 915,750 | |
Weatherford International Ltd.: | |||
6.5% 8/1/36 | 540,000 | 321,300 | |
7% 3/15/38 | 351,000 | 209,723 | |
Weatherford International, Inc.: | |||
6.8% 6/15/37 | 780,000 | 466,050 | |
9.875% 3/1/25 | 4,170,000 | 2,971,125 | |
Whiting Petroleum Corp.: | |||
5.75% 3/15/21 | 855,000 | 864,619 | |
6.25% 4/1/23 | 235,000 | 236,175 | |
6.625% 1/15/26 | 620,000 | 607,600 | |
WPX Energy, Inc. 6% 1/15/22 | 61,000 | 62,983 | |
119,790,768 | |||
Entertainment/Film - 1.5% | |||
AMC Entertainment Holdings, Inc.: | |||
5.875% 11/15/26 | 5,930,000 | 5,337,593 | |
6.125% 5/15/27 | 4,917,000 | 4,406,861 | |
AMC Entertainment, Inc. 5.75% 6/15/25 | 1,495,000 | 1,379,138 | |
CBS Outdoor Americas Capital LLC/CBS Outdoor Americas Capital Corp.: | |||
5.625% 2/15/24 | 400,000 | 409,500 | |
5.875% 3/15/25 | 1,180,000 | 1,209,854 | |
New Cotai LLC/New Cotai Capital Corp. 10.625% 5/1/19 pay-in-kind (a)(c) | 1,340,723 | 670,362 | |
13,413,308 | |||
Environmental - 1.3% | |||
Covanta Holding Corp.: | |||
5.875% 3/1/24 | 1,282,000 | 1,309,243 | |
5.875% 7/1/25 | 2,865,000 | 2,857,838 | |
6% 1/1/27 | 1,615,000 | 1,619,038 | |
LBC Tank Terminals Holding Netherlands BV 6.875% 5/15/23 (a) | 3,730,000 | 3,529,513 | |
Tervita Escrow Corp. 7.625% 12/1/21 (a) | 1,755,000 | 1,750,613 | |
Waste Pro U.S.A., Inc. 5.5% 2/15/26 (a) | 315,000 | 305,550 | |
11,371,795 | |||
Food & Drug Retail - 0.1% | |||
Performance Food Group, Inc. 5.5% 6/1/24 (a) | 500,000 | 501,250 | |
Rite Aid Corp. 7.7% 2/15/27 | 229,000 | 156,077 | |
657,327 | |||
Food/Beverage/Tobacco - 2.7% | |||
C&S Group Enterprises LLC 5.375% 7/15/22 (a) | 2,455,000 | 2,470,344 | |
Cott Holdings, Inc. 5.5% 4/1/25 (a) | 1,555,000 | 1,537,506 | |
ESAL GmbH 6.25% 2/5/23 (a) | 2,460,000 | 2,482,165 | |
JBS Investments GmbH 7.25% 4/3/24 (a) | 2,255,000 | 2,329,438 | |
JBS Investments II GmbH 7% 1/15/26 (a) | 845,000 | 872,463 | |
JBS U.S.A. LLC/JBS U.S.A. Finance, Inc.: | |||
5.75% 6/15/25 (a) | 1,845,000 | 1,871,384 | |
6.75% 2/15/28 (a) | 3,000,000 | 3,101,250 | |
Lamb Weston Holdings, Inc.: | |||
4.625% 11/1/24 (a) | 1,055,000 | 1,060,275 | |
4.875% 11/1/26 (a) | 320,000 | 320,400 | |
Pilgrim's Pride Corp. 5.75% 3/15/25 (a) | 270,000 | 270,000 | |
Post Holdings, Inc.: | |||
5% 8/15/26 (a) | 4,535,000 | 4,359,269 | |
5.5% 3/1/25 (a) | 765,000 | 766,913 | |
5.625% 1/15/28 (a) | 1,070,000 | 1,033,888 | |
5.75% 3/1/27 (a) | 1,045,000 | 1,030,631 | |
Vector Group Ltd. 6.125% 2/1/25 (a) | 710,000 | 628,350 | |
24,134,276 | |||
Gaming - 2.3% | |||
Boyd Gaming Corp.: | |||
6% 8/15/26 | 680,000 | 697,425 | |
6.375% 4/1/26 | 395,000 | 411,788 | |
CRC Escrow Issuer LLC/CRC Finance LLC 5.25% 10/15/25 (a) | 3,740,000 | 3,548,325 | |
Delta Merger Sub, Inc. 6% 9/15/26 (a) | 410,000 | 417,175 | |
Downstream Development Authority 10.5% 2/15/23 (a) | 1,075,000 | 1,093,813 | |
Eldorado Resorts, Inc. 6% 4/1/25 | 1,055,000 | 1,072,144 | |
GLP Capital LP/GLP Financing II, Inc. 5.375% 4/15/26 | 190,000 | 196,306 | |
MCE Finance Ltd. 4.875% 6/6/25 (a) | 1,390,000 | 1,336,272 | |
MGM Growth Properties Operating Partnership LP 5.75% 2/1/27 (a) | 815,000 | 834,356 | |
MGM Mirage, Inc.: | |||
5.75% 6/15/25 | 1,610,000 | 1,644,776 | |
7.75% 3/15/22 | 660,000 | 724,350 | |
Scientific Games Corp. 5% 10/15/25 (a) | 1,910,000 | 1,850,313 | |
Sugarhouse HSP Gaming Prop Mezz LP/Sugarhouse HSP Gaming Finance Corp. 5.875% 5/15/25 (a) | 2,635,000 | 2,602,063 | |
Transocean, Inc. 7.25% 11/1/25 (a) | 1,890,000 | 1,804,950 | |
Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp. 5.25% 5/15/27 (a) | 2,365,000 | 2,262,270 | |
Wynn Macau Ltd. 4.875% 10/1/24 (a) | 525,000 | 506,625 | |
21,002,951 | |||
Healthcare - 9.3% | |||
Catalent Pharma Solutions 4.875% 1/15/26 (a) | 300,000 | 297,000 | |
Centene Escrow Corp. 5.375% 6/1/26 (a) | 1,060,000 | 1,099,750 | |
Community Health Systems, Inc.: | |||
5.125% 8/1/21 | 2,215,000 | 2,173,469 | |
6.25% 3/31/23 | 4,355,000 | 4,191,688 | |
8% 3/15/26 (a) | 5,235,000 | 5,166,055 | |
8.125% 6/30/24 (a) | 595,000 | 495,338 | |
8.625% 1/15/24 (a) | 1,070,000 | 1,099,425 | |
CTR Partnership LP/CareTrust Capital Corp. 5.25% 6/1/25 | 1,415,000 | 1,422,075 | |
DaVita HealthCare Partners, Inc.: | |||
5% 5/1/25 | 2,440,000 | 2,353,868 | |
5.125% 7/15/24 | 4,205,000 | 4,162,950 | |
Encompass Health Corp.: | |||
5.75% 11/1/24 | 1,000,000 | 1,010,300 | |
5.75% 9/15/25 | 695,000 | 701,950 | |
HCA Holdings, Inc.: | |||
5.25% 6/15/26 | 645,000 | 680,155 | |
5.375% 9/1/26 | 3,140,000 | 3,215,988 | |
5.625% 9/1/28 | 520,000 | 536,172 | |
5.875% 3/15/22 | 620,000 | 659,612 | |
5.875% 5/1/23 | 1,150,000 | 1,216,125 | |
5.875% 2/1/29 | 520,000 | 545,350 | |
6.25% 2/15/21 | 1,045,000 | 1,094,993 | |
Hologic, Inc. 4.375% 10/15/25 (a) | 895,000 | 879,338 | |
IMS Health, Inc. 5% 10/15/26 (a) | 680,000 | 691,900 | |
MPT Operating Partnership LP/MPT Finance Corp.: | |||
5% 10/15/27 | 75,000 | 74,438 | |
5.5% 5/1/24 | 575,000 | 588,656 | |
6.375% 3/1/24 | 735,000 | 769,913 | |
Polaris Intermediate Corp. 8.5% 12/1/22 pay-in-kind (a)(c) | 1,070,000 | 1,056,315 | |
Sabra Health Care LP/Sabra Capital Corp.: | |||
5.375% 6/1/23 | 3,010,000 | 3,025,050 | |
5.5% 2/1/21 | 1,595,000 | 1,617,928 | |
SP Finco LLC 6.75% 7/1/25 (a) | 250,000 | 227,500 | |
Teleflex, Inc. 4.875% 6/1/26 | 1,740,000 | 1,763,925 | |
Tenet Healthcare Corp.: | |||
4.375% 10/1/21 | 3,120,000 | 3,159,000 | |
4.625% 7/15/24 | 3,260,000 | 3,239,625 | |
5.125% 5/1/25 | 6,650,000 | 6,591,813 | |
6.25% 2/1/27 (a) | 2,340,000 | 2,408,738 | |
6.75% 6/15/23 | 4,450,000 | 4,561,250 | |
Teva Pharmaceutical Finance Netherlands III BV 6% 4/15/24 | 1,900,000 | 1,923,341 | |
Valeant Pharmaceuticals International, Inc.: | |||
5.5% 11/1/25 (a) | 2,385,000 | 2,405,869 | |
5.625% 12/1/21 (a) | 458,000 | 458,687 | |
5.75% 8/15/27 (a)(d) | 245,000 | 247,144 | |
5.875% 5/15/23 (a) | 5,010,000 | 4,984,950 | |
6.125% 4/15/25 (a) | 3,850,000 | 3,705,625 | |
8.5% 1/31/27 (a)(d) | 1,625,000 | 1,682,891 | |
9% 12/15/25 (a) | 1,775,000 | 1,903,137 | |
9.25% 4/1/26 (a) | 2,145,000 | 2,311,238 | |
Wellcare Health Plans, Inc.: | |||
5.25% 4/1/25 | 560,000 | 571,732 | |
5.375% 8/15/26 (a) | 570,000 | 586,388 | |
83,558,654 | |||
Homebuilders/Real Estate - 1.8% | |||
AV Homes, Inc. 6.625% 5/15/22 | 785,000 | 809,531 | |
Brookfield Residential Properties, Inc./Brookfield Residential U.S. Corp. 6.125% 7/1/22 (a) | 270,000 | 268,313 | |
Howard Hughes Corp. 5.375% 3/15/25 (a) | 1,175,000 | 1,160,313 | |
Kennedy-Wilson, Inc. 5.875% 4/1/24 | 775,000 | 762,375 | |
Lennar Corp.: | |||
4.75% 11/29/27 | 1,605,000 | 1,558,856 | |
5% 6/15/27 | 780,000 | 764,400 | |
5.25% 6/1/26 | 1,791,000 | 1,797,716 | |
5.875% 11/15/24 | 520,000 | 546,000 | |
M/I Homes, Inc. 5.625% 8/1/25 | 480,000 | 450,000 | |
Mattamy Group Corp.: | |||
6.5% 10/1/25 (a) | 800,000 | 771,408 | |
6.875% 12/15/23 (a) | 345,000 | 343,692 | |
Realogy Group LLC/Realogy Co.-Issuer Corp. 5.25% 12/1/21 (a) | 615,000 | 613,463 | |
Starwood Property Trust, Inc.: | |||
4.75% 3/15/25 | 1,930,000 | 1,877,504 | |
5% 12/15/21 | 865,000 | 883,381 | |
Taylor Morrison Communities, Inc./Monarch Communities, Inc. 5.625% 3/1/24 (a) | 2,265,000 | 2,236,688 | |
William Lyon Homes, Inc.: | |||
6% 9/1/23 | 540,000 | 502,200 | |
7% 8/15/22 | 1,030,000 | 1,032,575 | |
16,378,415 | |||
Hotels - 1.3% | |||
ESH Hospitality, Inc. 5.25% 5/1/25 (a) | 4,760,000 | 4,736,200 | |
Hilton Domestic Operating Co., Inc. 5.125% 5/1/26 (a) | 5,340,000 | 5,365,151 | |
Hilton Escrow Issuer LLC 4.25% 9/1/24 | 1,545,000 | 1,521,825 | |
11,623,176 | |||
Insurance - 0.4% | |||
Acrisure LLC / Acrisure Finance, Inc.: | |||
7% 11/15/25 (a) | 2,860,000 | 2,525,609 | |
8.125% 2/15/24 (a) | 680,000 | 696,575 | |
AmWINS Group, Inc. 7.75% 7/1/26 (a) | 535,000 | 548,375 | |
3,770,559 | |||
Leisure - 0.5% | |||
Mattel, Inc.: | |||
2.35% 8/15/21 | 1,600,000 | 1,494,000 | |
3.15% 3/15/23 | 535,000 | 472,138 | |
Rivers Pittsburgh Borrower LP 6.125% 8/15/21 (a) | 438,000 | 440,738 | |
Studio City Co. Ltd.: | |||
5.875% 11/30/19 (a) | 615,000 | 622,505 | |
7.25% 11/30/21 (a) | 1,295,000 | 1,343,951 | |
Voc Escrow Ltd. 5% 2/15/28 (a) | 535,000 | 520,288 | |
4,893,620 | |||
Metals/Mining - 2.7% | |||
Alcoa Nederland Holding BV 6.125% 5/15/28 (a) | 260,000 | 266,175 | |
Constellium NV 5.875% 2/15/26 (a) | 590,000 | 573,775 | |
First Quantum Minerals Ltd.: | |||
6.5% 3/1/24 (a) | 4,965,000 | 4,691,925 | |
6.875% 3/1/26 (a) | 3,670,000 | 3,431,450 | |
7.25% 5/15/22 (a) | 245,000 | 246,531 | |
7.25% 4/1/23 (a) | 2,705,000 | 2,657,663 | |
7.5% 4/1/25 (a) | 2,210,000 | 2,132,650 | |
FMG Resources (August 2006) Pty Ltd.: | |||
4.75% 5/15/22 (a) | 625,000 | 625,000 | |
5.125% 5/15/24 (a) | 770,000 | 762,300 | |
Freeport-McMoRan, Inc.: | |||
3.55% 3/1/22 | 2,080,000 | 2,056,600 | |
3.875% 3/15/23 | 2,335,000 | 2,301,096 | |
6.875% 2/15/23 | 770,000 | 813,313 | |
Novelis Corp. 5.875% 9/30/26 (a) | 775,000 | 755,625 | |
Nufarm Australia Ltd. 5.75% 4/30/26 (a) | 2,665,000 | 2,483,593 | |
Teck Resources Ltd. 8.5% 6/1/24 (a) | 715,000 | 767,731 | |
24,565,427 | |||
Paper - 0.1% | |||
CommScope Finance LLC 6% 3/1/26 (a) | 1,030,000 | 1,054,463 | |
NewPage Corp. 11.375% 12/31/2014 (b)(f) | 4,077,567 | 0 | |
1,054,463 | |||
Publishing/Printing - 0.1% | |||
Cengage Learning, Inc. 9.5% 6/15/24 (a) | 625,000 | 520,313 | |
Clear Channel International BV 8.75% 12/15/20 (a) | 240,000 | 245,700 | |
766,013 | |||
Restaurants - 0.8% | |||
1011778 BC Unlimited Liability Co./New Red Finance, Inc.: | |||
4.25% 5/15/24 (a) | 2,367,000 | 2,304,866 | |
5% 10/15/25 (a) | 535,000 | 518,816 | |
Golden Nugget, Inc. 6.75% 10/15/24 (a) | 1,605,000 | 1,613,025 | |
KFC Holding Co./Pizza Hut Holding LLC 5% 6/1/24 (a) | 2,870,000 | 2,906,679 | |
7,343,386 | |||
Services - 1.3% | |||
American Midstream Partners LP 9.5% 12/15/21 (a) | 535,000 | 494,345 | |
APX Group, Inc. 7.625% 9/1/23 | 1,130,000 | 995,813 | |
Aramark Services, Inc.: | |||
4.75% 6/1/26 | 1,840,000 | 1,826,200 | |
5% 4/1/25 (a) | 1,235,000 | 1,256,613 | |
Brand Energy & Infrastructure Services, Inc. 8.5% 7/15/25 (a) | 535,000 | 482,838 | |
CDK Global, Inc. 5.875% 6/15/26 | 325,000 | 335,156 | |
Corrections Corp. of America 5% 10/15/22 | 1,107,000 | 1,098,543 | |
H&E Equipment Services, Inc. 5.625% 9/1/25 | 1,070,000 | 1,059,300 | |
IHS Markit Ltd.: | |||
4% 3/1/26 (a) | 400,000 | 388,532 | |
4.75% 2/15/25 (a) | 955,000 | 974,778 | |
5% 11/1/22 (a) | 200,000 | 206,280 | |
KAR Auction Services, Inc. 5.125% 6/1/25 (a) | 810,000 | 787,725 | |
Ritchie Brothers Auctioneers, Inc. 5.375% 1/15/25 (a) | 285,000 | 289,988 | |
The GEO Group, Inc. 6% 4/15/26 | 345,000 | 319,988 | |
United Rentals North America, Inc. 5.875% 9/15/26 | 1,270,000 | 1,300,163 | |
11,816,262 | |||
Steel - 0.9% | |||
Big River Steel LLC/BRS Finance Corp. 7.25% 9/1/25 (a) | 715,000 | 740,919 | |
Cleveland-Cliffs, Inc. 5.75% 3/1/25 | 4,870,000 | 4,760,425 | |
Commercial Metals Co. 5.75% 4/15/26 | 2,140,000 | 2,102,550 | |
7,603,894 | |||
Super Retail - 0.6% | |||
Asbury Automotive Group, Inc. 6% 12/15/24 | 2,565,000 | 2,603,475 | |
Netflix, Inc. 4.375% 11/15/26 | 1,490,000 | 1,433,678 | |
Sonic Automotive, Inc. 6.125% 3/15/27 | 1,680,000 | 1,486,800 | |
5,523,953 | |||
Technology - 2.5% | |||
Banff Merger Sub, Inc. 9.75% 9/1/26 (a) | 3,730,000 | 3,613,438 | |
Fair Isaac Corp. 5.25% 5/15/26 (a) | 455,000 | 459,550 | |
First Data Corp. 5% 1/15/24 (a) | 1,210,000 | 1,241,775 | |
Itron, Inc. 5% 1/15/26 (a) | 745,000 | 724,513 | |
j2 Cloud Services LLC/j2 Global Communications, Inc. 6% 7/15/25 (a) | 625,000 | 641,706 | |
Match Group, Inc. 5.625% 2/15/29 (a) | 780,000 | 775,613 | |
Open Text Corp. 5.875% 6/1/26 (a) | 770,000 | 810,102 | |
Qorvo, Inc. 5.5% 7/15/26 (a) | 1,565,000 | 1,596,300 | |
Symantec Corp.: | |||
4.2% 9/15/20 | 655,000 | 662,233 | |
5% 4/15/25 (a) | 3,170,000 | 3,158,000 | |
TTM Technologies, Inc. 5.625% 10/1/25 (a) | 305,000 | 288,988 | |
Uber Technologies, Inc. 8% 11/1/26 (a) | 2,835,000 | 2,962,575 | |
VeriSign, Inc. 4.625% 5/1/23 | 695,000 | 706,857 | |
Veritas U.S., Inc./Veritas Bermuda Ltd.: | |||
7.5% 2/1/23 (a) | 492,000 | 467,400 | |
10.5% 2/1/24 (a) | 4,895,000 | 4,119,338 | |
22,228,388 | |||
Telecommunications - 6.8% | |||
Altice Financing SA: | |||
6.625% 2/15/23 (a) | 2,965,000 | 3,031,713 | |
7.5% 5/15/26 (a) | 2,865,000 | 2,771,888 | |
Altice Finco SA: | |||
7.625% 2/15/25 (a) | 3,335,000 | 2,984,825 | |
8.125% 1/15/24 (a) | 620,000 | 626,200 | |
C&W Senior Financing Designated Activity Co. 7.5% 10/15/26 (a) | 755,000 | 770,100 | |
Cogent Communications Group, Inc. 5.375% 3/1/22 (a) | 785,000 | 798,738 | |
CyrusOne LP/CyrusOne Finance Corp.: | |||
5% 3/15/24 | 610,000 | 620,675 | |
5.375% 3/15/27 | 290,000 | 295,075 | |
Frontier Communications Corp.: | |||
8.5% 4/1/26 (a) | 1,990,000 | 1,850,700 | |
11% 9/15/25 | 2,635,000 | 1,683,106 | |
GCI, Inc. 6.875% 4/15/25 | 1,835,000 | 1,871,700 | |
Inmarsat Finance PLC 4.875% 5/15/22 (a) | 395,000 | 395,000 | |
Intelsat Jackson Holdings SA: | |||
5.5% 8/1/23 | 1,255,000 | 1,151,463 | |
8.5% 10/15/24 (a) | 1,980,000 | 1,999,206 | |
Level 3 Financing, Inc.: | |||
5.125% 5/1/23 | 1,540,000 | 1,549,764 | |
5.375% 1/15/24 | 925,000 | 930,781 | |
5.375% 5/1/25 | 335,000 | 334,163 | |
5.625% 2/1/23 | 830,000 | 836,225 | |
Neptune Finco Corp.: | |||
6.625% 10/15/25 (a) | 3,340,000 | 3,523,700 | |
10.875% 10/15/25 (a) | 369,000 | 428,040 | |
Sable International Finance Ltd. 6.875% 8/1/22 (a) | 1,054,000 | 1,096,160 | |
SFR Group SA: | |||
6.25% 5/15/24 (a) | 695,000 | 695,000 | |
7.375% 5/1/26 (a) | 1,440,000 | 1,413,000 | |
8.125% 2/1/27 (a) | 535,000 | 537,675 | |
Sprint Capital Corp.: | |||
6.875% 11/15/28 | 2,950,000 | 2,911,281 | |
6.9% 5/1/19 | 8,700,000 | 8,721,750 | |
8.75% 3/15/32 | 1,175,000 | 1,274,141 | |
Sprint Communications, Inc. 6% 11/15/22 | 1,335,000 | 1,354,358 | |
Sprint Corp.: | |||
7.125% 6/15/24 | 3,395,000 | 3,507,816 | |
7.25% 9/15/21 | 1,845,000 | 1,948,781 | |
7.875% 9/15/23 | 2,105,000 | 2,249,719 | |
T-Mobile U.S.A., Inc.: | |||
6% 3/1/23 | 1,150,000 | 1,181,625 | |
6% 4/15/24 | 1,840,000 | 1,911,300 | |
6.5% 1/15/26 | 630,000 | 673,313 | |
ViaSat, Inc. 5.625% 9/15/25 (a) | 1,070,000 | 1,043,250 | |
Wind Tre SpA 5% 1/20/26 (a) | 1,755,000 | 1,512,986 | |
Zayo Group LLC/Zayo Capital, Inc. 5.75% 1/15/27 (a) | 980,000 | 950,600 | |
61,435,817 | |||
Textiles/Apparel - 0.0% | |||
Eagle Intermediate Global Holding BV 7.5% 5/1/25 (a) | 340,000 | 329,970 | |
Transportation Ex Air/Rail - 1.2% | |||
Avolon Holdings Funding Ltd.: | |||
5.125% 10/1/23 (a) | 1,025,000 | 1,035,250 | |
5.25% 5/15/24 (a)(d) | 1,600,000 | 1,640,000 | |
5.5% 1/15/23 (a) | 1,100,000 | 1,127,720 | |
Navios Maritime Acquisition Corp./Navios Acquisition Finance U.S., Inc. 8.125% 11/15/21 (a) | 3,155,000 | 2,287,375 | |
Navios Maritime Holdings, Inc.: | |||
7.375% 1/15/22 (a) | 8,615,000 | 3,855,213 | |
11.25% 8/15/22 (a) | 1,065,000 | 676,275 | |
Navios South American Logistics, Inc./Navios Logistics Finance U.S., Inc. 7.25% 5/1/22 (a) | 210,000 | 189,000 | |
10,810,833 | |||
Utilities - 4.3% | |||
Calpine Corp. 5.25% 6/1/26 (a) | 1,140,000 | 1,115,775 | |
Dynegy, Inc. 7.625% 11/1/24 | 1,852,000 | 1,967,750 | |
Global Partners LP/GLP Finance Corp.: | |||
6.25% 7/15/22 | 660,000 | 646,800 | |
7% 6/15/23 | 2,030,000 | 2,007,163 | |
InterGen NV 7% 6/30/23 (a) | 8,230,000 | 7,407,000 | |
NRG Energy, Inc.: | |||
5.75% 1/15/28 | 8,055,000 | 8,266,444 | |
6.625% 1/15/27 | 2,000,000 | 2,130,000 | |
NRG Yield Operating LLC 5% 9/15/26 | 485,000 | 452,263 | |
Talen Energy Supply LLC: | |||
6.5% 6/1/25 | 3,380,000 | 3,011,580 | |
10.5% 1/15/26 (a) | 3,805,000 | 3,938,175 | |
The AES Corp.: | |||
5.125% 9/1/27 | 535,000 | 549,713 | |
6% 5/15/26 | 1,515,000 | 1,594,538 | |
Vertiv Group Corp. 9.25% 10/15/24 (a) | 1,540,000 | 1,542,002 | |
Vistra Operations Co. LLC: | |||
5.5% 9/1/26 (a) | 1,215,000 | 1,260,563 | |
5.625% 2/15/27 (a) | 2,220,000 | 2,286,600 | |
38,176,366 | |||
TOTAL NONCONVERTIBLE BONDS | 747,479,892 | ||
TOTAL CORPORATE BONDS | |||
(Cost $761,349,800) | 756,977,804 | ||
Shares | Value | ||
Common Stocks - 0.5% | |||
Automotive & Auto Parts - 0.0% | |||
Chassix Holdings, Inc. warrants 7/29/20 (f)(g) | 3,722 | 30,297 | |
UC Holdings, Inc. (f)(g) | 13,838 | 314,538 | |
TOTAL AUTOMOTIVE & AUTO PARTS | 344,835 | ||
Food & Drug Retail - 0.5% | |||
Southeastern Grocers, Inc. (f)(g) | 107,421 | 4,552,502 | |
TOTAL COMMON STOCKS | |||
(Cost $3,590,304) | 4,897,337 | ||
Convertible Preferred Stocks - 0.7% | |||
Energy - 0.3% | |||
Chesapeake Energy Corp. Series A, 5.75% | 5,300 | 2,896,450 | |
Telecommunications - 0.1% | |||
Crown Castle International Corp. Series A, 6.875% | 480 | 532,598 | |
Utilities - 0.3% | |||
Vistra Energy Corp. 7.00% | 30,700 | 3,029,623 | |
TOTAL CONVERTIBLE PREFERRED STOCKS | |||
(Cost $6,577,149) | 6,458,671 | ||
Principal Amount | Value | ||
Bank Loan Obligations - 8.9% | |||
Aerospace - 0.3% | |||
TransDigm, Inc. Tranche G, term loan 3 month U.S. LIBOR + 2.500% 4.993% 8/22/24 (c)(e) | 2,663,275 | 2,624,524 | |
Broadcasting - 0.1% | |||
CBS Radio, Inc. Tranche B 1LN, term loan 3 month U.S. LIBOR + 2.750% 5.243% 11/18/24 (c)(e) | 538,198 | 534,834 | |
NEP/NCP Holdco, Inc. Tranche B 1LN, term loan 3 month U.S. LIBOR + 3.250% 5.743% 10/19/25 (c)(e) | 50,000 | 49,917 | |
TOTAL BROADCASTING | 584,751 | ||
Cable/Satellite TV - 0.8% | |||
CSC Holdings LLC Tranche B, term loan 3 month U.S. LIBOR + 2.500% 4.9888% 1/25/26 (c)(e) | 828,738 | 823,558 | |
WideOpenWest Finance LLC Tranche B, term loan 3 month U.S. LIBOR + 3.250% 5.7311% 8/19/23 (c)(e) | 6,902,787 | 6,781,989 | |
TOTAL CABLE/SATELLITE TV | 7,605,547 | ||
Capital Goods - 0.0% | |||
Apergy Corp. Tranche B, term loan 3 month U.S. LIBOR + 2.500% 5.1622% 5/9/25 (c)(e) | 62,410 | 62,332 | |
Diversified Financial Services - 0.3% | |||
Avolon TLB Borrower 1 (U.S.) LLC Tranche B3 1LN, term loan 3 month U.S. LIBOR + 2.000% 4.4804% 1/15/25 (c)(e) | 2,413,497 | 2,410,721 | |
Energy - 0.7% | |||
BCP Raptor II LLC Tranche B, term loan 3 month U.S. LIBOR + 4.750% 7.3695% 11/3/25 (c)(e) | 445,000 | 429,981 | |
California Resources Corp.: | |||
Tranche 1LN, term loan 3 month U.S. LIBOR + 10.375% 12.868% 12/31/21 (c)(e) | 825,000 | 864,707 | |
Tranche B, term loan 3 month U.S. LIBOR + 4.750% 7.243% 12/31/22 (c)(e) | 1,280,000 | 1,258,662 | |
Consolidated Energy Finance SA Tranche B, term loan 3 month U.S. LIBOR + 2.500% 4.9938% 5/7/25 (c)(e) | 542,275 | 524,651 | |
Epic Crude Services LP Tranche B 1LN, term loan 3 month U.S. LIBOR + 5.000% 2/21/26 (e)(h) | 3,230,000 | 3,189,625 | |
Natgasoline LLC Tranche B, term loan 3 month U.S. LIBOR + 3.500% 6.25% 11/14/25 (c)(e) | 165,000 | 165,000 | |
TOTAL ENERGY | 6,432,626 | ||
Environmental - 0.1% | |||
Hd Supply Waterworks Ltd. Tranche B, term loan 3 month U.S. LIBOR + 3.000% 5.7215% 8/1/24 (c)(e) | 696,188 | 689,803 | |
Food & Drug Retail - 0.8% | |||
BI-LO LLC Tranche B, term loan 3 month U.S. LIBOR + 8.000% 10.7665% 5/31/24 (c)(e) | 5,472,500 | 5,249,058 | |
Lannett Co., Inc. Tranche B, term loan 3 month U.S. LIBOR + 5.375% 7.868% 11/25/22 (c)(e) | 1,956,889 | 1,797,070 | |
TOTAL FOOD & DRUG RETAIL | 7,046,128 | ||
Gaming - 0.5% | |||
Caesars Resort Collection LLC Tranche B 1LN, term loan 3 month U.S. LIBOR + 2.750% 5.243% 12/22/24 (c)(e) | 2,110,182 | 2,102,269 | |
CityCenter Holdings LLC Tranche B, term loan 3 month U.S. LIBOR + 2.250% 4.743% 4/18/24 (c)(e) | 1,755,756 | 1,742,237 | |
Golden Nugget, Inc. Tranche B 1LN, term loan 3 month U.S. LIBOR + 2.750% 5.2411% 10/4/23 (c)(e) | 539,074 | 536,379 | |
TOTAL GAMING | 4,380,885 | ||
Healthcare - 1.0% | |||
Community Health Systems, Inc. Tranche H, term loan 3 month U.S. LIBOR + 3.250% 5.8789% 1/27/21 (c)(e) | 608,153 | 604,048 | |
RegionalCare Hospital Partners Holdings, Inc. Tranche B, term loan 3 month U.S. LIBOR + 4.500% 6.9814% 11/16/25 (c)(e) | 2,305,000 | 2,301,151 | |
U.S. Renal Care, Inc. Tranche B 1LN, term loan 3 month U.S. LIBOR + 4.250% 7.053% 12/31/22 (c)(e) | 379,137 | 378,458 | |
Valeant Pharmaceuticals International, Inc.: | |||
Tranche B 2LN, term loan 3 month U.S. LIBOR + 2.750% 5.2623% 11/27/25 (c)(e) | 1,915,375 | 1,909,150 | |
Tranche B, term loan 3 month U.S. LIBOR + 3.000% 5.5123% 6/1/25 (c)(e) | 1,195,499 | 1,196,097 | |
VVC Holding Corp. Tranche B 1LN, term loan 3 month U.S. LIBOR + 4.500% 7.197% 2/5/26 (c)(e) | 2,340,000 | 2,325,375 | |
TOTAL HEALTHCARE | 8,714,279 | ||
Insurance - 0.5% | |||
AmWINS Group, Inc. Tranche B 1LN, term loan 3 month U.S. LIBOR + 2.750% 5.2484% 1/25/24 (c)(e) | 437,767 | 435,188 | |
HUB International Ltd. Tranche B, term loan 3 month U.S. LIBOR + 2.750% 5.5144% 4/25/25 (c)(e) | 4,343,175 | 4,298,267 | |
TOTAL INSURANCE | 4,733,455 | ||
Publishing/Printing - 0.0% | |||
Cengage Learning, Inc. Tranche B, term loan 3 month U.S. LIBOR + 4.250% 6.7399% 6/7/23 (c)(e) | 260,000 | 239,606 | |
Restaurants - 0.1% | |||
Burger King Worldwide, Inc. Tranche B, term loan 3 month U.S. LIBOR + 2.250% 4.743% 2/17/24 (c)(e) | 823,421 | 816,430 | |
Services - 0.7% | |||
Almonde, Inc. Tranche B 1LN, term loan 3 month U.S. LIBOR + 3.500% 6.303% 6/13/24 (c)(e) | 3,316,599 | 3,280,414 | |
IRI Holdings, Inc. Tranche B 1LN, term loan 3 month U.S. LIBOR + 4.500% 7.1289% 11/30/25 (c)(e) | 2,820,000 | 2,777,700 | |
Laureate Education, Inc. Tranche B 1LN, term loan 3 month U.S. LIBOR + 3.500% 5.993% 4/26/24 (c)(e) | 465,851 | 466,028 | |
TOTAL SERVICES | 6,524,142 | ||
Steel - 0.1% | |||
Big River Steel LLC Tranche B, term loan 3 month U.S. LIBOR + 5.000% 7.803% 8/23/23 (c)(e) | 1,407,188 | 1,414,223 | |
Super Retail - 0.5% | |||
Bass Pro Shops LLC. Tranche B, term loan 3 month U.S. LIBOR + 5.000% 7.493% 9/25/24 (c)(e) | 4,309,091 | 4,294,742 | |
Technology - 0.8% | |||
Boxer Parent Co., Inc. Tranche B, term loan 3 month U.S. LIBOR + 4.250% 7.053% 10/2/25 (c)(e) | 1,095,000 | 1,087,740 | |
Ceridian HCM Holding, Inc. Tranche B, term loan 3 month U.S. LIBOR + 3.250% 5.743% 4/30/25 (c)(e) | 1,635,900 | 1,630,796 | |
First Data Corp. Tranche B, term loan 3 month U.S. LIBOR + 2.000% 4.4899% 4/26/24 (c)(e) | 507,612 | 506,835 | |
Kronos, Inc.: | |||
2LN, term loan 3 month U.S. LIBOR + 8.250% 10.9863% 11/1/24 (c)(e) | 2,105,000 | 2,140,701 | |
Tranche B 1LN, term loan 3 month U.S. LIBOR + 3.000% 5.7363% 11/1/23 (c)(e) | 1,666,575 | 1,659,075 | |
SS&C Technologies, Inc. Tranche B 5LN, term loan 3 month U.S. LIBOR + 2.250% 4.743% 4/16/25 (c)(e) | 229,422 | 228,346 | |
TOTAL TECHNOLOGY | 7,253,493 | ||
Telecommunications - 1.3% | |||
Frontier Communications Corp.: | |||
Tranche A, term loan 3 month U.S. LIBOR + 2.750% 5.25% 3/31/21 (c)(e) | 4,276,056 | 4,211,915 | |
Tranche B 1LN, term loan 3 month U.S. LIBOR + 3.750% 6.25% 6/15/24 (c)(e) | 276,640 | 266,266 | |
Intelsat Jackson Holdings SA: | |||
Tranche B, term loan 3 month U.S. LIBOR + 3.750% 6.2291% 11/27/23 (c)(e) | 355,000 | 354,634 | |
Tranche B-4, term loan 3 month U.S. LIBOR + 4.500% 6.9791% 1/2/24 (c)(e) | 300,000 | 303,999 | |
Tranche B-5, term loan 6.625% 1/2/24 | 300,000 | 303,000 | |
Radiate Holdco LLC Tranche B, term loan 3 month U.S. LIBOR + 3.000% 5.493% 2/1/24 (c)(e) | 3,676,901 | 3,654,509 | |
SFR Group SA Tranche B 13LN, term loan 3 month U.S. LIBOR + 4.000% 6.4888% 8/14/26 (c)(e) | 1,097,250 | 1,065,704 | |
Sprint Communications, Inc.: | |||
Tranche B 2LN, term loan 3 month U.S. LIBOR + 3.000% 5.5% 2/2/24 (c)(e) | 740,000 | 730,750 | |
Tranche B, term loan 3 month U.S. LIBOR + 2.500% 5% 2/3/24 (c)(e) | 604,238 | 595,929 | |
TOTAL TELECOMMUNICATIONS | 11,486,706 | ||
Transportation Ex Air/Rail - 0.1% | |||
International Seaways Operating Corp. Tranche B, term loan 3 month U.S. LIBOR + 5.500% 8.5% 6/22/22 (c)(e) | 537,529 | 537,529 | |
Utilities - 0.2% | |||
Vertiv Group Corp. Tranche B, term loan 3 month U.S. LIBOR + 4.000% 6.6289% 11/30/23 (c)(e) | 1,207,543 | 1,168,298 | |
Vistra Operations Co. LLC Tranche B 2LN, term loan 3 month U.S. LIBOR + 2.250% 4.743% 12/14/23 (c)(e) | 352,800 | 352,211 | |
TOTAL UTILITIES | 1,520,509 | ||
TOTAL BANK LOAN OBLIGATIONS | |||
(Cost $79,297,017) | 79,372,431 | ||
Preferred Securities - 3.2% | |||
Banks & Thrifts - 3.1% | |||
Bank of America Corp. 5.875% (c)(i) | 11,210,000 | 11,268,212 | |
Barclays Bank PLC 7.625% 11/21/22 | 1,710,000 | 1,880,681 | |
Citigroup, Inc.: | |||
5.95% (c)(i) | 6,905,000 | 7,077,493 | |
6.3% (c)(i) | 6,510,000 | 6,744,018 | |
Credit Agricole SA 6.625% (a)(c)(i) | 450,000 | 459,769 | |
TOTAL BANKS & THRIFTS | 27,430,173 | ||
Energy - 0.1% | |||
Summit Midstream Partners LP 9.5% (c)(i) | 1,065,000 | 1,006,249 | |
TOTAL PREFERRED SECURITIES | |||
(Cost $28,107,464) | 28,436,422 | ||
Shares | Value | ||
Money Market Funds - 2.4% | |||
Fidelity Cash Central Fund, 2.44% (j) | |||
(Cost $21,773,509) | 21,774,357 | 21,778,712 | |
TOTAL INVESTMENT IN SECURITIES - 100.1% | |||
(Cost $900,695,243) | 897,921,377 | ||
NET OTHER ASSETS (LIABILITIES) - (0.1)% | (689,658) | ||
NET ASSETS - 100% | $897,231,719 |
Legend
(a) Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the end of the period, the value of these securities amounted to $424,818,453 or 47.3% of net assets.
(b) Non-income producing - Security is in default.
(c) Coupon rates for floating and adjustable rate securities reflect the rates in effect at period end.
(d) Security or a portion of the security purchased on a delayed delivery or when-issued basis.
(e) Coupon is indexed to a floating interest rate which may be multiplied by a specified factor and/or subject to caps or floors.
(f) Level 3 security
(g) Non-income producing
(h) The coupon rate will be determined upon settlement of the loan after period end.
(i) Security is perpetual in nature with no stated maturity date.
(j) Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request.
Affiliated Central Funds
Information regarding fiscal year to date income earned by the Fund from investments in Fidelity Central Funds is as follows:
Fund | Income earned |
Fidelity Cash Central Fund | $654,888 |
Total | $654,888 |
Amounts in the income column in the above table include any capital gain distributions from underlying funds, which are presented in the corresponding line-item in the Statement of Operations, if applicable.
Investment Valuation
The following is a summary of the inputs used, as of February 28, 2019, involving the Fund's assets and liabilities carried at fair value. The inputs or methodology used for valuing securities may not be an indication of the risk associated with investing in those securities. For more information on valuation inputs, and their aggregation into the levels used below, please refer to the Investment Valuation section in the accompanying Notes to Financial Statements.
Valuation Inputs at Reporting Date: | ||||
Description | Total | Level 1 | Level 2 | Level 3 |
Investments in Securities: | ||||
Equities: | ||||
Consumer Discretionary | $344,835 | $-- | $-- | $344,835 |
Consumer Staples | 4,552,502 | -- | -- | 4,552,502 |
Energy | 2,896,450 | -- | 2,896,450 | -- |
Real Estate | 532,598 | -- | 532,598 | -- |
Utilities | 3,029,623 | -- | 3,029,623 | -- |
Corporate Bonds | 756,977,804 | -- | 756,977,804 | -- |
Bank Loan Obligations | 79,372,431 | -- | 79,372,431 | -- |
Preferred Securities | 28,436,422 | -- | 28,436,422 | -- |
Money Market Funds | 21,778,712 | 21,778,712 | -- | -- |
Total Investments in Securities: | $897,921,377 | $21,778,712 | $871,245,328 | $4,897,337 |
Other Information
Distribution of investments by country or territory of incorporation, as a percentage of Total Net Assets, is as follows (Unaudited):
United States of America | 78.0% |
Canada | 4.8% |
Luxembourg | 4.5% |
Cayman Islands | 3.2% |
Netherlands | 1.9% |
Multi-National | 1.4% |
United Kingdom | 1.4% |
Ireland | 1.2% |
Bermuda | 1.1% |
Others (Individually Less Than 1%) | 2.5% |
100.0% |
See accompanying notes which are an integral part of the financial statements.
Financial Statements
Statement of Assets and Liabilities
February 28, 2019 (Unaudited) | ||
Assets | ||
Investment in securities, at value — See accompanying schedule: Unaffiliated issuers (cost $878,921,734) | $876,142,665 | |
Fidelity Central Funds (cost $21,773,509) | 21,778,712 | |
Total Investment in Securities (cost $900,695,243) | $897,921,377 | |
Cash | 55,757 | |
Receivable for investments sold | ||
Regular delivery | 2,390,222 | |
Delayed delivery | 713,125 | |
Interest receivable | 13,195,051 | |
Distributions receivable from Fidelity Central Funds | 52,607 | |
Total assets | 914,328,139 | |
Liabilities | ||
Payable for investments purchased | ||
Regular delivery | $12,658,509 | |
Delayed delivery | 4,434,313 | |
Other payables and accrued expenses | 3,598 | |
Total liabilities | 17,096,420 | |
Net Assets | $897,231,719 | |
Net Assets consist of: | ||
Paid in capital | $913,289,757 | |
Total distributable earnings (loss) | (16,058,038) | |
Net Assets, for 8,160,266 shares outstanding | $897,231,719 | |
Net Asset Value, offering price and redemption price per share ($897,231,719 ÷ 8,160,266 shares) | $109.95 |
See accompanying notes which are an integral part of the financial statements.
Statement of Operations
Six months ended February 28, 2019 (Unaudited) | ||
Investment Income | ||
Dividends | $746,680 | |
Interest | 26,703,897 | |
Income from Fidelity Central Funds | 654,888 | |
Total income | 28,105,465 | |
Expenses | ||
Custodian fees and expenses | $6,716 | |
Independent directors' fees and expenses | 2,753 | |
Legal | 917 | |
Miscellaneous | 3 | |
Total expenses before reductions | 10,389 | |
Expense reductions | (7,848) | |
Total expenses after reductions | 2,541 | |
Net investment income (loss) | 28,102,924 | |
Realized and Unrealized Gain (Loss) | ||
Net realized gain (loss) on: | ||
Investment securities: | ||
Unaffiliated issuers | (12,197,834) | |
Fidelity Central Funds | 2,774 | |
Foreign currency transactions | (1,007) | |
Total net realized gain (loss) | (12,196,067) | |
Change in net unrealized appreciation (depreciation) on: | ||
Investment securities: | ||
Unaffiliated issuers | 709,051 | |
Fidelity Central Funds | (2,774) | |
Total change in net unrealized appreciation (depreciation) | 706,277 | |
Net gain (loss) | (11,489,790) | |
Net increase (decrease) in net assets resulting from operations | $16,613,134 |
See accompanying notes which are an integral part of the financial statements.
Statement of Changes in Net Assets
Six months ended February 28, 2019 (Unaudited) | Year ended August 31, 2018 | |
Increase (Decrease) in Net Assets | ||
Operations | ||
Net investment income (loss) | $28,102,924 | $57,394,335 |
Net realized gain (loss) | (12,196,067) | 10,346,046 |
Change in net unrealized appreciation (depreciation) | 706,277 | (22,053,779) |
Net increase (decrease) in net assets resulting from operations | 16,613,134 | 45,686,602 |
Distributions to shareholders | (34,697,948) | – |
Distributions to shareholders from net investment income | – | (56,643,250) |
Distributions to shareholders from net realized gain | – | (616,160) |
Total distributions | (34,697,948) | (57,259,410) |
Affiliated share transactions | ||
Reinvestment of distributions | 30,985,579 | 10,617,535 |
Cost of shares redeemed | – | (14,846) |
Net increase (decrease) in net assets resulting from share transactions | 30,985,579 | 10,602,689 |
Total increase (decrease) in net assets | 12,900,765 | (970,119) |
Net Assets | ||
Beginning of period | 884,330,954 | 885,301,073 |
End of period | $897,231,719 | $884,330,954 |
Other Information | ||
Distributions in excess of net investment income end of period | $(1,009,740) | |
Shares | ||
Sold | – | – |
Issued in reinvestment of distributions | 285,731 | 94,015 |
Redeemed | – | (131) |
Net increase (decrease) | 285,731 | 93,884 |
See accompanying notes which are an integral part of the financial statements.
Financial Highlights
Fidelity High Income Central Fund 2
Six months ended (Unaudited) February 28, | Years endedAugust 31, | |||||
2019 | 2018 | 2017 | 2016 | 2015 | 2014 | |
Selected Per–Share Data | ||||||
Net asset value, beginning of period | $112.30 | $113.78 | $110.82 | $109.78 | $118.45 | $114.34 |
Income from Investment Operations | ||||||
Net investment income (loss)A | 3.513 | 7.336 | 7.352 | 7.278 | 7.064 | 7.292 |
Net realized and unrealized gain (loss) | (1.512) | (1.497) | 2.982 | .631 | (8.871) | 3.876 |
Total from investment operations | 2.001 | 5.839 | 10.334 | 7.909 | (1.807) | 11.168 |
Distributions from net investment income | (3.501) | (7.240) | (7.374) | (6.869) | (6.863) | (7.058) |
Distributions from net realized gain | (.850) | (.079) | – | – | – | – |
Total distributions | (4.351) | (7.319) | (7.374) | (6.869) | (6.863) | (7.058) |
Net asset value, end of period | $109.95 | $112.30 | $113.78 | $110.82 | $109.78 | $118.45 |
Total ReturnB,C | 1.89% | 5.29% | 9.60% | 7.75% | (1.58)% | 9.97% |
Ratios to Average Net AssetsD,E | ||||||
Expenses before reductions | - %F,G | - %G | .01% | - %G | - %G | - %G |
Expenses net of fee waivers, if any | - %F,G | - %G | .01% | - %G | - %G | - %G |
Expenses net of all reductions | - %F,G | - %G | .01% | - %G | - %G | - %G |
Net investment income (loss) | 6.51%F | 6.49% | 6.54% | 6.93% | 6.19% | 6.20% |
Supplemental Data | ||||||
Net assets, end of period (000 omitted) | $897,232 | $884,331 | $885,301 | $852,409 | $792,221 | $872,004 |
Portfolio turnover rateH | 47%F | 57% | 46% | 47% | 40% | 56% |
A Calculated based on average shares outstanding during the period.
B Total returns for periods of less than one year are not annualized.
C Total returns would have been lower if certain expenses had not been reduced during the applicable periods shown.
D Fees and expenses of any underlying Fidelity Central Funds are not included in the Fund's expense ratio. The Fund indirectly bears its proportionate share of the expenses of any underlying Fidelity Central Funds.
E Expense ratios reflect operating expenses of the Fund. Expenses before reductions do not reflect amounts reimbursed by the investment adviser or reductions from expense offset arrangements and do not represent the amount paid by the Fund during periods when reimbursements or reductions occur. Expenses net of fee waivers reflect expenses after reimbursement by the investment adviser but prior to reductions from expense offset arrangements. Expenses net of all reductions represent the net expenses paid by the Fund.
F Annualized
G Amount represents less than .005%.
H Amount does not include the portfolio activity of any underlying Fidelity Central Funds.
See accompanying notes which are an integral part of the financial statements.
Notes to Financial Statements (Unaudited)
For the period ended February 28, 2019
1. Organization.
Fidelity High Income Central Fund 2 (the Fund) is a fund of Fidelity Central Investment Portfolios LLC (the LLC) and is authorized to issue an unlimited number of shares. Shares of the Fund are only offered to other investment companies and accounts managed by Fidelity Management & Research Company (FMR), or its affiliates (the Investing Funds). The LLC is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company organized as a Delaware Limited Liability Company.
2. Investments in Fidelity Central Funds.
The Fund invests in Fidelity Central Funds, which are open-end investment companies generally available only to other investment companies and accounts managed by the investment adviser and its affiliates. The Fund's Schedule of Investments lists each of the Fidelity Central Funds held as of period end, if any, as an investment of the Fund, but does not include the underlying holdings of each Fidelity Central Fund. As an Investing Fund, the Fund indirectly bears its proportionate share of the expenses of the underlying Fidelity Central Funds.
The Money Market Central Funds seek preservation of capital and current income and are managed by Fidelity Investments Money Management, Inc. (FIMM), an affiliate of the investment adviser. Annualized expenses of the Money Market Central Funds as of their most recent shareholder report date are less than .005%.
A complete unaudited list of holdings for each Fidelity Central Fund is available upon request or at the Securities and Exchange Commission (the SEC) website at www.sec.gov. In addition, the financial statements of the Fidelity Central Funds are available on the SEC website or upon request.
3. Significant Accounting Policies.
The Fund is an investment company and applies the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investments Companies. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Subsequent events, if any, 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:
Investment Valuation. Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. The Board of Directors (the Board) has delegated the day to day responsibility for the valuation of the Fund's investments to the Fair Value Committee (the Committee) established by the Fund's investment adviser. In accordance with valuation policies and procedures approved by the Board, the Fund attempts to obtain prices from one or more third party pricing vendors or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with procedures adopted by the Board. Factors used in determining fair value vary by investment type and may include market or investment specific events, changes in interest rates and credit quality. The frequency with which these procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee oversees the Fund's valuation policies and procedures and reports to the Board on the Committee's activities and fair value determinations. The Board monitors the appropriateness of the procedures used in valuing the Fund's investments and ratifies the fair value determinations of the Committee.
The Fund categorizes the inputs to valuation techniques used to value its investments into a disclosure hierarchy consisting of three levels as shown below:
- Level 1 – quoted prices in active markets for identical investments
- Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
- Level 3 – unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value the Fund's investments by major category are as follows:
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing vendors or from brokers who make markets in such securities. Corporate bonds, bank loan obligations and preferred securities are valued by pricing vendors who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing vendors. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances. The Fund invests a significant portion of its assets in below investment grade securities. The value of these securities can be more volatile due to changes in the credit quality of the issuer and is sensitive to changes in economic, market and regulatory conditions.
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing vendor on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Investments in open-end mutual funds, including the Fidelity Central Funds, are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy. The aggregate value of investments by input level as of February 28, 2019 is included at the end of the Fund's Schedule of Investments.
Foreign Currency. The Fund may use foreign currency contracts to facilitate transactions in foreign-denominated securities. Gains and losses from these transactions may arise from changes in the value of the foreign currency or if the counterparties do not perform under the contracts' terms.
Foreign-denominated assets, including investment securities, and liabilities are translated into U.S. dollars at the exchange rates at period end. Purchases and sales of investment securities, income and dividends received and expenses denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The effects of exchange rate fluctuations on investments are included with the net realized and unrealized gain (loss) on investment securities. Other foreign currency transactions resulting in realized and unrealized gain (loss) are disclosed separately.
Investment Transactions and Income. For financial reporting purposes, the Fund's investment holdings and NAV include trades executed through the end of the last business day of the period. The NAV per share for processing shareholder transactions is calculated as of the close of business of the New York Stock Exchange (NYSE), normally 4:00 p.m. Eastern time and includes trades executed through the end of the prior business day. Gains and losses on securities sold are determined on the basis of identified cost. Dividend income is recorded on the ex-dividend date, except for certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Non-cash dividends included in dividend income, if any, are recorded at the fair market value of the securities received. Income and capital gain distributions from Fidelity Central Funds, if any, are recorded on the ex-dividend date. Certain distributions received by the Fund represent a return of capital or capital gain. The Fund determines the components of these distributions subsequent to the ex-dividend date, based upon receipt of tax filings or other correspondence relating to the underlying investment. These distributions are recorded as a reduction of cost of investments and/or as a realized gain. Interest income is accrued as earned and includes coupon interest and amortization of premium and accretion of discount on debt securities as applicable. Paid in Kind (PIK) income is recorded at the fair market value of the securities received. Investment income is recorded net of foreign taxes withheld where recovery of such taxes is uncertain. Debt obligations may be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivables when the collection of all or a portion of interest has become doubtful based on consistently applied procedures. A debt obligation is removed from non-accrual status when the issuer resumes interest payments or when collectability of interest is reasonably assured.
Expenses. Expenses directly attributable to a fund are charged to that fund. Expenses attributable to more than one fund are allocated among the respective funds on the basis of relative net assets or other appropriate methods. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Income Tax Information and Distributions to Shareholders. Each year, the Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, including distributing substantially all of its taxable income and realized gains. As a result, no provision for U.S. Federal income taxes is required. The Fund files a U.S. federal tax return, in addition to state and local tax returns as required. The Fund's federal income tax returns are subject to examination by the Internal Revenue Service (IRS) for a period of three fiscal years after they are filed. State and local tax returns may be subject to examination for an additional fiscal year depending on the jurisdiction. Foreign taxes are provided for based on the Fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests.
Distributions are declared and recorded daily and paid monthly from net investment income. Distributions from realized gains, if any, are declared and recorded on the ex-dividend date. Income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP.
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. Capital accounts are not adjusted for temporary book-tax differences which will reverse in a subsequent period.
Book-tax differences are primarily due to prior period premium and discount on debt securities, certain conversion ratio adjustments, equity-debt classifications, contingent interest, capital loss carryforwards, partnerships and losses deferred due to wash sales.
As of period end, the cost and unrealized appreciation (depreciation) in securities, and derivatives if applicable, for federal income tax purposes were as follows:
Gross unrealized appreciation | $20,089,211 |
Gross unrealized depreciation | (22,905,087) |
Net unrealized appreciation (depreciation) | $(2,815,876) |
Tax cost | $900,737,253 |
Delayed Delivery Transactions and When-Issued Securities. During the period, the Fund transacted in securities on a delayed delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The securities purchased on a delayed delivery or when-issued basis are identified as such in the Fund's Schedule of Investments. The Fund may receive compensation for interest forgone in the purchase of a delayed delivery or when-issued security. With respect to purchase commitments, the Fund identifies securities as segregated in its records with a value at least equal to the amount of the commitment. Losses may arise due to changes in the value of the underlying securities or if the counterparty does not perform under the contract's terms, or if the issuer does not issue the securities due to political, economic, or other factors.
Restricted Securities. The Fund may invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. Information regarding restricted securities is included at the end of the Fund's Schedule of Investments.
Loans and Other Direct Debt Instruments. The Fund invests in direct debt instruments which are interests in amounts owed to lenders by corporate or other borrowers. These instruments may be in the form of loans, trade claims or other receivables and may include standby financing commitments such as revolving credit facilities that obligate the Fund to supply additional cash to the borrower on demand. Loans may be acquired through assignment or participation. The Fund did not have any unfunded loan commitments, which are contractual obligations for future funding, at period end.
New Rule Issuance. During August 2018, the U.S. Securities and Exchange Commission issued Final Rule Release No. 33-10532, Disclosure Update and Simplification. This Final Rule includes amendments specific to registered investment companies that are intended to eliminate overlap in disclosure requirements between Regulation S-X and GAAP. In accordance with these amendments, certain line-items in the Fund's financial statements have been combined or removed for the current period as outlined in the table below.
Financial Statement | Current Line-Item Presentation (As Applicable) | Prior Line-Item Presentation (As Applicable) |
Statement of Assets and Liabilities | Total distributable earnings (loss) | Undistributed/Distributions in excess of/Accumulated net investment income (loss) Accumulated/Undistributed net realized gain (loss) Net unrealized appreciation (depreciation) |
Statement of Changes in Net Assets | N/A - removed | Undistributed/Distributions in excess of/Accumulated net investment income (loss) end of period |
Statement of Changes in Net Assets | Distributions to shareholders | Distributions to shareholders from net investment income Distributions to shareholders from net realized gain |
4. Purchases and Sales of Investments.
Purchases and sales of securities, other than short-term securities, aggregated $241,740,156 and $186,083,058, respectively.
5. Fees and Other Transactions with Affiliates.
Management Fee and Expense Contract. FMR Co., Inc. (the investment adviser), an affiliate of FMR, provides the Fund with investment management services. The Fund does not pay any fees for these services. Pursuant to the Fund's management contract with the investment adviser, FMR pays the investment adviser a portion of the management fees it receives from the Investing Funds. In addition, under an expense contract, FMR also pays all other expenses of the Fund, excluding custody fees, the compensation of the independent Directors, and certain miscellaneous expenses such as proxy and shareholder meeting expenses.
Interfund Trades. The Fund may purchase from or sell securities to other Fidelity Funds under procedures adopted by the Board. The procedures have been designed to ensure these interfund trades are executed in accordance with Rule 17a-7 of the 1940 Act. Interfund trades are included within the respective purchases and sales amounts shown in the Purchases and Sales of Investments note.
6. Expense Reductions.
Through arrangements with the Fund's custodian, credits realized as a result of certain uninvested cash balances were used to reduce the Fund's expenses. During the period, these credits reduced the Fund's expenses by $7,848.
7. Other.
The Fund's organizational documents provide former and current directors and officers with a limited indemnification against liabilities arising in connection with the performance of their duties to the Fund. In the normal course of business, the Fund may also enter into contracts that provide general indemnifications. The Fund's maximum exposure under these arrangements is unknown as this would be dependent on future claims that may be made against the Fund. The risk of material loss from such claims is considered remote.
At the end of the period, mutual funds managed by FMR or its affiliates were the owners of record of all of the outstanding shares of the Fund.
8. Litigation.
The Fund, and other entities managed by FMR or its affiliates were named as defendants in a lawsuit filed in the United States Bankruptcy Court for the Southern District of New York in 2009. The lawsuit was brought by creditors of Motors Liquidation Company (f/k/a General Motors), which went through Chapter 11 bankruptcy proceedings in 2009, and is captioned Official Committee of Unsecured Creditors of Motors Liquidation Company v. JPMorgan Chase Bank, N.A., et al., Adversary No. 09-00504 (REG). The plaintiffs are seeking an order that the Fund and other defendants return proceeds received in 2009 in full payment of the principal and interest on General Motors secured debt. The plaintiffs contend that the Fund and the other defendants were not secured creditors at the time of the 2009 payments and, thus, were not entitled to payment in full. In January 2015, the Court of Appeals ruled that JPMorgan, as administrative agent for all of the debtholders, released the security interest on certain collateral securing the debt prior to the 2009 payments. In September 2017, an opinion was issued in a trial intended to help determine the value of any remaining, unreleased collateral. In February 2019, the parties reached a preliminary settlement that remains subject to negotiation and final approval by the Bankruptcy Court. Given these contingencies, Management cannot determine at this time the amount of loss that may be realized, but expects the amount to be less than the $1,316,020 received in 2009. The Fund is also incurring legal costs in defending the case.
9. Proposed Reorganization.
The Board of Trustees of the Fund approved an Agreement and Plan of Reorganization (the Agreement) between the Fund and Fidelity High Income Central Fund 1. The Agreement provides for the transfer of all the assets and the assumption of all the liabilities of Fidelity High Income Central Fund 1 in exchange for shares of the Fund equal in value to the net assets of Fidelity High Income Central Fund 1 on the day the reorganization is effective. The reorganization provides shareholders of Fidelity High Income Central Fund 1 access to a larger portfolio with a similar investment objective.
The reorganization does not require Fidelity High Income Central Fund 1 shareholder approval and is expected to become effective in May 2019. The reorganization is expected to qualify as a tax-free transaction for federal income tax purposes with no gain or loss recognized by the funds or their shareholders.
Shareholder Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (September 1, 2018 to February 28, 2019).
Actual Expenses
The first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Hypothetical Example for Comparison Purposes
The second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. In addition, the Fund, as a shareholder in the underlying Fidelity Central Funds, will indirectly bear its pro-rata share of the fees and expenses incurred by the underlying Fidelity Central Funds. These fees and expenses are not included in the Fund's annualized expense ratio used to calculate the expense estimate in the table below.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds.
Annualized Expense Ratio-A | Beginning Account Value September 1, 2018 | Ending Account Value February 28, 2019 | Expenses Paid During Period-B September 1, 2018 to February 28, 2019 | |
Actual | .0024% | $1,000.00 | $1,018.90 | $.01 |
Hypothetical-C | $1,000.00 | $1,024.78 | $.01 |
A Annualized expense ratio reflects expenses net of applicable fee waivers.
B Expenses are equal to the Fund's annualized expense ratio, multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).
C 5% return per year before expenses
Board Approval of Investment Advisory Contracts and Management Fees
Fidelity High Income Central Fund 2
Each year, the Board of Directors, including the Independent Directors (together, the Board), votes on the renewal of the management contract with FMR Co., Inc. (FMRC) and the sub-advisory agreements (together, the Advisory Contracts) for the fund. FMRC and the sub-advisers are referred to herein as the Investment Advisers. The Board, assisted by the advice of fund counsel and Independent Directors' counsel, requests and considers a broad range of information relevant to the renewal of the Advisory Contracts throughout the year.
The Board meets regularly and, at each of its meetings, covers an extensive agenda of topics and materials and considers factors that are relevant to its annual consideration of the renewal of the fund's Advisory Contracts, including the services and support provided to the fund and its shareholders. The Board has established various standing committees (Committees), each composed of and chaired by Independent Directors with varying backgrounds, to which the Board has assigned specific subject matter responsibilities in order to enhance effective decision-making by the Board. The Board, acting directly and through its Committees, requests and receives information concerning the annual consideration of the renewal of the fund's Advisory Contracts. The Board also meets as needed to review matters specifically related to the Board's annual consideration of the renewal of the Advisory Contracts. Members of the Board may also meet with trustees of other Fidelity funds through joint ad hoc committees to discuss certain matters relevant to all of the Fidelity funds.
At its January 2019 meeting, the Board unanimously determined to renew the fund's Advisory Contracts. In reaching its determination, the Board considered all factors it believed relevant and reached a determination, with the assistance of fund counsel and Independent Directors' counsel and through the exercise of its business judgment, that the renewal of the Advisory Contracts was in the best interests of the fund and its shareholders and the fact that no fee is payable under the management contract was fair and reasonable.
Nature, Extent, and Quality of Services Provided. The Board considered Fidelity's staffing as it relates to the fund, including the backgrounds of investment personnel of Fidelity, and also considered the fund's investment objective, strategies, and related investment philosophy. The Independent Directors also had discussions with senior management of Fidelity's investment operations and investment groups. The Board considered the structure of the investment personnel compensation program and whether this structure provides appropriate incentives to act in the best interests of the fund.Resources Dedicated to Investment Management and Support Services. The Board and the Fund Oversight and Research Committees reviewed the general qualifications and capabilities of Fidelity's investment staff, including its size, education, experience, and resources, as well as Fidelity's approach to recruiting, training, managing, and compensating investment personnel. The Board noted that Fidelity has continued to increase the resources devoted to non-U.S. offices, including expansion of Fidelity's global investment organization. The Board also noted that Fidelity's analysts have extensive resources, tools and capabilities that allow them to conduct sophisticated quantitative and fundamental analysis, as well as credit analysis of issuers, counterparties and guarantors. Further, the Board considered that Fidelity's investment professionals have sufficient access to global information and data so as to provide competitive investment results over time, and that those professionals also have access to sophisticated tools that permit them to assess portfolio construction and risk and performance attribution characteristics continuously, as well as to transmit new information and research conclusions rapidly around the world. Additionally, in its deliberations, the Board considered Fidelity's trading, risk management, compliance, and technology and operations capabilities and resources, which are integral parts of the investment management process.Administrative Services. The Board considered (i) the nature, extent, quality, and cost of advisory and administrative services performed by the Investment Advisers and their affiliates under the Advisory Contracts and under separate agreements covering transfer agency, pricing and bookkeeping, and securities lending services for the fund; (ii) the nature and extent of the supervision of third party service providers, principally custodians, subcustodians, and pricing vendors; and (iii) the resources devoted to, and the record of compliance with, the fund's compliance policies and procedures. The Board also reviewed the allocation of fund brokerage, including allocations to brokers affiliated with the Investment Advisers, and the use of "soft" commission dollars to pay for research services.Investment Performance. The Board considered whether the fund has operated in accordance with its investment objective, as well as its record of compliance with its investment restrictions. The Board reviewed the fund's absolute investment performance, as well as the fund's relative investment performance, but did not consider performance to be a material factor in its decision to renew the fund's Advisory Contracts, as the fund is not publicly offered as a stand-alone investment product. In this regard, the Board noted that the fund is designed to offer a liquid investment option for other investment companies managed by Fidelity and ultimately to enhance the performance of those investment companies.Based on its review, the Board concluded that the nature, extent, and quality of services provided to the fund under the Advisory Contracts should continue to benefit the shareholders of the fund.Competitiveness of Management Fee and Total Expense Ratio. The Board considered that while the fund does not pay a management fee, Fidelity Management & Research Company (FMR) pays a management fee on behalf of the fund and receives fees for providing services to funds that invest in the fund. The Board also noted that FMR bears all expenses of the fund with certain exceptions. Based on its review, the Board concluded that the management fee paid on behalf of the fund and the fund's total expense ratio were reasonable in light of the services that the fund and its shareholders receive and the other factors considered.Costs of the Services and Profitability. The Board considered the level of Fidelity's profits in respect of all the Fidelity funds, as well as the profitability of the funds that invest in the fund.PricewaterhouseCoopers LLP (PwC), auditor to Fidelity and certain Fidelity funds, has been engaged annually by the Board as part of the Board's assessment of Fidelity's profitability analysis. PwC's engagement includes the review and assessment of the methodologies used by Fidelity in determining the revenues and expenses attributable to Fidelity's mutual fund business, and completion of agreed-upon procedures in respect of the mathematical accuracy of the fund profitability information and its conformity to established allocation methodologies. After considering PwC's reports issued under the engagement and information provided by Fidelity, the Board concluded that while other allocation methods may also be reasonable, Fidelity's profitability methodologies are reasonable in all material respects.The Board also reviewed Fidelity's non-fund businesses and potential indirect benefits such businesses may have received as a result of their association with Fidelity's mutual fund business (i.e., fall-out benefits) as well as cases where Fidelity's affiliates may benefit from the fund's business. The Board noted that changes to fall-out benefits year-over-year reflect business developments at Fidelity's various businesses.The Board concluded that the costs of the services provided by and the profits realized by Fidelity in connection with the operation of the fund were not relevant to the renewal of the Advisory Contracts because the fund pays no advisory fees and FMR bears all expenses of the fund with certain exceptions.Economies of Scale. The Board concluded that because the fund pays no advisory fees and FMR bears all expenses of the fund with certain exceptions, the realization of economies of scale was not a material factor in the Board's decision to renew the fund's Advisory Contract.Additional Information Requested by the Board. In order to develop fully the factual basis for consideration of the Fidelity funds' advisory contracts, the Board requested and received additional information on certain topics, including: (i) fund performance trends, in particular the underperformance of certain funds, and Fidelity's long-term strategies for certain funds; (ii) Fidelity's fund profitability methodology, profitability trends for certain funds, and the impact of certain factors on fund profitability results; (iii) metrics for evaluating index fund and ETF performance and information about ETF trading characteristics; (iv) the methodology with respect to the evaluation of competitive fund data and peer group classifications and fee comparisons; (v) the expense structures for different funds and classes; (vi) information regarding other accounts managed by Fidelity, including collective investment trusts; and (vii) Fidelity's philosophies and strategies for evaluating funds and classes with lower or declining asset levels.Based on its evaluation of all of the conclusions noted above, and after considering all factors it believed relevant, the Board concluded that the advisory fee arrangements are fair and reasonable, and that the fund's Advisory Contracts should be renewed.HICII-SANN-0419
1.861965.110
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.
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.
Purchase of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers
Not applicable.
Item 10.
Submission of Matters to a Vote of Security Holders
There were no material changes to the procedures by which shareholders may recommend nominees to the Fidelity Central Investment Portfolios LLC’s Board of Trustees.
Item 11.
Controls and Procedures
(a)(i) The President and Treasurer and the Chief Financial Officer have concluded that the Fidelity Central Investment Portfolios LLC’s (the “Trust”) disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act) provide reasonable assurances that material information relating to the Trust is made known to them by the appropriate persons, based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this report.
(a)(ii) There was no change in the Trust’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act) that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Trust’s internal control over financial reporting.
Item 12.
Disclosure of Securities Lending Activities for Closed-End Management
Investment Companies
Not applicable.
Item 13.
Exhibits
(a) | (1) | Not applicable. |
(a) | (2) | Certification pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit 99.CERT. |
(a) | (3) | Not applicable. |
(b) | Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) is furnished and attached hereto as Exhibit 99.906CERT. |
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.
Fidelity Central Investment Portfolios LLC
By: | /s/Stacie M. Smith |
Stacie M. Smith | |
President and Treasurer | |
Date: | April 24, 2019 |
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/Stacie M. Smith |
Stacie M. Smith | |
President and Treasurer | |
Date: | April 24, 2019 |
By: | /s/John J. Burke III |
John J. Burke III | |
Chief Financial Officer | |
Date: | April 24, 2019 |