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 number811- 4186
John Hancock Income Securities Trust
(Exact name of registrant as specified in charter)
200 Berkeley Street, Boston, Massachusetts 02116
(Address of principal executive offices) (Zip code)
Salvatore Schiavone
Treasurer
200 Berkeley Street
Boston, Massachusetts 02116
(Name and address of agent for service)
Registrant's telephone number, including area code:617-663-4497
Date of fiscal year end: | October 31 |
| |
Date of reporting period: | April 30, 2019 |
ITEM 1. REPORTS TO STOCKHOLDERS.
John Hancock
Income Securities Trust
Ticker: JHS
Semiannual report 4/30/19
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the fund's shareholder reports such as this one will no longer be sent by mail, unless you specifically request paper copies of the reports from the transfer agent or from your financial intermediary. Instead, the reports will be made available on our website, and you will be notified by mail each time a report is posted and be provided with a website link to access the report.
If you have already elected to receive shareholder reports electronically, you will not be affected by this change and you do not need to take any action. You may elect to receive shareholder reports and other communications electronically by calling the transfer agent, Computershare, at 800-852-0218, by going to "Communication Preferences" at computershare.com/investor, or by contacting your financial intermediary.
You may elect to receive all reports in paper, free of charge, at any time. You can inform the transfer agent or your financial intermediary that you wish to continue receiving paper copies of your shareholder reports by following the instructions listed above. Your election to receive reports in paper will apply to all funds held with John Hancock Investment Management or your financial intermediary.
![jhdigest_income-digcovmask.jpg](https://capedge.com/proxy/N-CSRS/0001145443-19-000319/jhdigest_income-digcovmask.jpg)
A message to shareholders
Dear shareholder,
A solid and stable economy enabled the U.S. Federal Reserve (Fed) to continue normalizing monetary policy for most of 2018; however, concerns about the strength of the broader global economy and the durability of the now 10-year-old bull market led investors to dial back riskexposures. Those concerns may ultimately have been shared by the Fed, which has so far in 2019 shifted to a neutral stance on interest rates after three years of hikes. The markets responded favorably, with most bond indexes registering gains in the first four months of 2019 before hitting a patch of turbulence after period end as trade turmoil between the United States and China flared again.
As always, your best resource in unpredictable markets is your financial advisor, who can help position your portfolio so that it's sufficiently diversified to meet your long-term objectives and to withstand the inevitable turbulence along the way.
On behalf of everyone at John Hancock Investment Management, I'd like to take this opportunity to welcome new shareholders and thank existing shareholders for the continued trust you've placed in us.
Sincerely,
Andrew G. Arnott
President and CEO,
John Hancock Investment Management
Head of Wealth and Asset Management,
United States and Europe
This commentary reflects the CEO's views, which are subject to change at any time. Investing involves risks, including the potential loss of principal. Diversification does not guarantee a profit or eliminate the risk of a loss. It is not possible to invest directly in an index. For more up-to-date information, please visit our website at jhinvestments.com.
John Hancock
Income Securities Trust
Table of contents
| | | |
2 | | Your fund at a glance |
3 | | Portfolio Summary |
5 | | Fund's investments |
27 | | Financial statements |
31 | | Financial highlights |
32 | | Notes to financial statements |
39 | | Additional information |
40 | | Shareholder meeting |
41 | | More information |
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 1
INVESTMENT OBJECTIVE
The fund seeks to generate a high level of current income consistent with prudent investment risk.
AVERAGE ANNUAL TOTAL RETURNS AS OF 4/30/19 (%)
The Bloomberg Barclays U.S. Government/Credit Bond Index is an unmanaged index of U.S. government bonds, U.S. corporate bonds, and Yankee bonds.
It is not possible to invest directly in an index. Index figures do not reflect expenses or sales charges, which would result in lower returns.
The performance data contained within this material represents past performance, which does not guarantee future results.
Investment returns and principal value will fluctuate and a shareholder may sustain losses. Further, the fund's performance at net asset value (NAV) is different from the fund's performance at closing market price because the closing market price is subject to the dynamics of secondary market trading. Market risk may be augmented when shares are purchased at a premium to NAV or sold at a discount to NAV. Current month-end performance may be higher or lower than the performance cited. The fund's most recent performance can be found at jhinvestments.com or by calling 800-852-0218.
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 2
PORTFOLIO COMPOSITION AS OF 4/30/19 (%)
A note about risks
As is the case with all exchange-listed closed-end funds, shares of this fund may trade at a discount or a premium to the fund's net asset value (NAV). An investment in the fund is subject to investment and market risks, including the possible loss of the entire principal invested. There is no guarantee prior distribution levels will be maintained, and distributions may include a substantial return of capital. Fixed-income investments are subject to interest-rate and credit risk; their value will normally decline as interest rates rise or if a creditor, grantor, or counterparty is unable or unwilling to make principal, interest, or settlement payments. Investments in higher-yielding, lower-rated securities are subject to a higher risk of default. An issuer of securities held by the fund may default, have its credit rating downgraded, or otherwise perform poorly, which may affect fund performance. Mortgage- and asset-backed securities may be sensitive to changes in interest rates and may be subject to early repayment and the market's perception of issuer creditworthiness. Liquidity—the extent to which a security may be sold or a derivative position closed without negatively affecting its market value—may be impaired by reduced trading volume, heightened volatility, rising interest rates, and other market conditions. The fund's use of leverage creates additional risks, including greater volatility of the fund's NAV, market price, and returns. There is no assurance that the fund's leverage strategy will be successful. Derivatives transactions, such as hedging and other strategic transactions, may increase a fund's volatility and could produce disproportionate losses, potentially more than the fund's principal investment. Cybersecurity incidents may allow an unauthorized party to gain access to fund assets, customer data, or proprietary information, or cause a fund or its service providers to suffer data corruption or lose operational functionality. Similar incidents affecting issuers of fund securities may negatively impact performance.
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 3
QUALITY COMPOSITION AS OF 4/30/19 (%)
COUNTRY COMPOSITION AS OF 4/30/19 (%)
| |
United States | 86.0 |
United Kingdom | 3.5 |
Netherlands | 2.2 |
Canada | 1.4 |
France | 1.3 |
Other countries | 5.6 |
TOTAL | 100.0 |
As a percentage of total investments. | |
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 4
AS OF 4-30-19 (unaudited)
| Rate (%) | Maturity date | | Par value^ | Value |
U.S. Government and Agency obligations 49.2% (32.5% of Total investments) | | $85,529,598 |
(Cost $85,835,549) | | | | | |
U.S. Government 4.3% | | | | | 7,430,998 |
U.S. Treasury | | | | | |
Bond | 3.375 | 11-15-48 | | 4,380,000 | 4,766,843 |
Note | 2.250 | 04-30-24 | | 347,000 | 346,498 |
Note (A)(B) | 2.625 | 02-15-29 | | 2,294,000 | 2,317,657 |
U.S. Government Agency 44.9% | | | | | 78,098,600 |
Federal Home Loan Mortgage Corp. | | | | | |
15 Yr Pass Thru | 3.000 | 10-01-31 | | 2,558,132 | 2,581,898 |
30 Yr Pass Thru | 3.000 | 03-01-43 | | 583,594 | 583,192 |
30 Yr Pass Thru | 3.500 | 07-01-46 | | 2,206,130 | 2,239,641 |
30 Yr Pass Thru | 3.500 | 10-01-46 | | 758,798 | 770,443 |
30 Yr Pass Thru | 3.500 | 12-01-46 | | 435,526 | 444,115 |
30 Yr Pass Thru | 3.500 | 02-01-47 | | 2,305,345 | 2,349,369 |
30 Yr Pass Thru | 3.500 | 11-01-48 | | 3,972,877 | 4,049,987 |
30 Yr Pass Thru | 4.000 | 04-01-46 | | 2,139,893 | 2,220,076 |
30 Yr Pass Thru | 4.000 | 04-01-47 | | 2,165,562 | 2,246,029 |
30 Yr Pass Thru | 4.000 | 05-01-47 | | 2,118,048 | 2,187,384 |
30 Yr Pass Thru | 4.000 | 06-01-47 | | 2,282,083 | 2,356,789 |
30 Yr Pass Thru | 4.000 | 03-01-48 | | 1,863,399 | 1,921,691 |
30 Yr Pass Thru | 4.500 | 09-01-41 | | 1,091,158 | 1,160,517 |
Federal National Mortgage Association | | | | | |
30 Yr Pass Thru | 3.000 | 12-01-42 | | 1,982,525 | 1,979,612 |
30 Yr Pass Thru | 3.000 | 07-01-43 | | 634,266 | 630,560 |
30 Yr Pass Thru | 3.500 | 12-01-42 | | 2,797,017 | 2,852,615 |
30 Yr Pass Thru | 3.500 | 01-01-43 | | 2,384,123 | 2,431,887 |
30 Yr Pass Thru | 3.500 | 04-01-45 | | 1,134,696 | 1,157,252 |
30 Yr Pass Thru | 3.500 | 11-01-46 | | 2,338,214 | 2,381,039 |
30 Yr Pass Thru | 3.500 | 07-01-47 | | 2,699,174 | 2,747,767 |
30 Yr Pass Thru | 3.500 | 07-01-47 | | 1,922,666 | 1,963,288 |
30 Yr Pass Thru | 3.500 | 11-01-47 | | 1,025,672 | 1,044,137 |
30 Yr Pass Thru | 4.000 | 10-01-40 | | 215,841 | 225,379 |
30 Yr Pass Thru | 4.000 | 09-01-41 | | 1,384,040 | 1,442,172 |
30 Yr Pass Thru | 4.000 | 09-01-41 | | 380,571 | 397,744 |
30 Yr Pass Thru | 4.000 | 09-01-41 | | 779,405 | 811,654 |
30 Yr Pass Thru | 4.000 | 10-01-41 | | 1,130,406 | 1,180,711 |
30 Yr Pass Thru | 4.000 | 06-01-46 | | 2,282,879 | 2,365,209 |
30 Yr Pass Thru | 4.000 | 02-01-47 | | 3,333,394 | 3,466,110 |
30 Yr Pass Thru | 4.000 | 06-01-47 | | 1,995,286 | 2,059,700 |
30 Yr Pass Thru | 4.000 | 06-01-47 | | 3,643,182 | 3,789,370 |
30 Yr Pass Thru | 4.000 | 11-01-47 | | 2,583,057 | 2,661,360 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 5 |
| Rate (%) | Maturity date | | Par value^ | Value |
U.S. Government Agency (continued) | | | | | |
30 Yr Pass Thru | 4.000 | 12-01-47 | | 941,438 | $978,626 |
30 Yr Pass Thru | 4.000 | 01-01-48 | | 3,507,520 | 3,621,958 |
30 Yr Pass Thru | 4.000 | 04-01-48 | | 2,837,428 | 2,941,530 |
30 Yr Pass Thru | 4.000 | 06-01-48 | | 4,788,227 | 4,960,883 |
30 Yr Pass Thru | 4.500 | 07-01-41 | | 1,927,680 | 2,048,707 |
30 Yr Pass Thru | 4.500 | 07-01-48 | | 2,397,978 | 2,510,127 |
30 Yr Pass Thru | 5.000 | 04-01-41 | | 239,638 | 259,427 |
|
30 Yr Pass Thru | 5.500 | 08-01-40 | | 72,306 | 78,645 |
Foreign government obligations 0.9% (0.6% of Total investments) | | $1,631,088 |
(Cost $1,783,035) | | | | | |
Argentina 0.2% | | | | | 454,356 |
Provincia de Buenos Aires Bond (C) | 7.875 | 06-15-27 | | 390,000 | 259,350 |
Republic of Argentina Bond (A)(B) | 5.875 | 01-11-28 | | 282,000 | 195,006 |
Qatar 0.4% | | | | | 662,766 |
State of Qatar | | | | | |
Bond (C) | 3.375 | 03-14-24 | | 384,000 | 389,280 |
Bond (A)(B)(C) | 5.103 | 04-23-48 | | 245,000 | 273,486 |
Saudi Arabia 0.3% | | | | | 513,966 |
Kingdom of Saudi Arabia Bond (A)(B)(C) | 4.375 | 04-16-29 | | 490,000 | 513,966 |
|
Corporate bonds 78.7% (52.0% of Total investments) | | $136,905,285 |
(Cost $134,476,154) | | | | | |
Communication services 9.2% | | | | 16,094,925 |
Diversified telecommunication services 2.8% | | | |
AT&T, Inc. (B) | 4.350 | 03-01-29 | | 418,000 | 432,169 |
C&W Senior Financing DAC (A)(B)(C) | 6.875 | 09-15-27 | | 240,000 | 240,238 |
Cincinnati Bell, Inc. (A)(B)(C) | 7.000 | 07-15-24 | | 355,000 | 327,498 |
GCI LLC | 6.875 | 04-15-25 | | 225,000 | 235,688 |
Liquid Telecommunications Financing PLC (C) | 8.500 | 07-13-22 | | 205,000 | 207,609 |
Radiate Holdco LLC (A)(B)(C) | 6.625 | 02-15-25 | | 245,000 | 240,713 |
Radiate Holdco LLC (C) | 6.875 | 02-15-23 | | 87,000 | 87,000 |
Sprint Spectrum Company LLC (B)(C) | 3.360 | 03-20-23 | | 162,500 | 162,094 |
Telecom Argentina SA (C) | 6.500 | 06-15-21 | | 180,000 | 170,100 |
Telecom Italia Capital SA | 7.200 | 07-18-36 | | 365,000 | 373,943 |
Telecom Italia SpA (A)(B)(C) | 5.303 | 05-30-24 | | 250,000 | 249,063 |
UPC Holding BV (C) | 5.500 | 01-15-28 | | 205,000 | 207,050 |
Verizon Communications, Inc. (B) | 4.400 | 11-01-34 | | 260,000 | 274,496 |
Verizon Communications, Inc. (B) | 4.672 | 03-15-55 | | 295,000 | 311,372 |
Verizon Communications, Inc. (B) | 4.862 | 08-21-46 | | 830,000 | 903,584 |
Verizon Communications, Inc. (B) | 5.012 | 08-21-54 | | 255,000 | 285,222 |
6 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
| Rate (%) | Maturity date | | Par value^ | Value |
Communication services (continued) | | | | |
Diversified telecommunication services (continued) | | | |
West Corp. (C) | 8.500 | 10-15-25 | | 125,000 | $110,156 |
Entertainment 1.6% | | | |
Activision Blizzard, Inc. (A)(B) | 3.400 | 09-15-26 | | 271,000 | 269,552 |
Lions Gate Capital Holdings LLC (A)(B)(C) | 5.875 | 11-01-24 | | 147,000 | 149,940 |
Netflix, Inc. (A)(B) | 4.875 | 04-15-28 | | 280,000 | 277,550 |
Netflix, Inc. (A)(B)(C) | 5.375 | 11-15-29 | | 92,000 | 93,150 |
Netflix, Inc. (A)(B) | 5.875 | 11-15-28 | | 400,000 | 422,000 |
The Walt Disney Company (B)(C) | 7.750 | 01-20-24 | | 1,020,000 | 1,228,603 |
Viacom, Inc. (6.250% to 2-28-27, then 3 month LIBOR + 3.899%) | 6.250 | 02-28-57 | | 260,000 | 267,176 |
Interactive media and services 0.1% | | | |
Rackspace Hosting, Inc. (A)(B)(C) | 8.625 | 11-15-24 | | 255,000 | 237,788 |
Media 3.6% | | | |
Altice Financing SA (A)(B)(C) | 6.625 | 02-15-23 | | 375,000 | 384,375 |
Cablevision Systems Corp. (A)(B) | 5.875 | 09-15-22 | | 210,000 | 218,400 |
CBS Corp. (B) | 3.375 | 03-01-22 | | 132,000 | 133,634 |
CBS Corp. (A)(B) | 3.700 | 08-15-24 | | 205,000 | 209,487 |
Cengage Learning, Inc. (A)(B)(C) | 9.500 | 06-15-24 | | 321,000 | 298,530 |
Charter Communications Operating LLC (A)(B) | 4.200 | 03-15-28 | | 580,000 | 579,269 |
Charter Communications Operating LLC | 5.750 | 04-01-48 | | 590,000 | 622,468 |
Charter Communications Operating LLC | 6.484 | 10-23-45 | | 606,000 | 688,251 |
Clear Channel Worldwide Holdings, Inc. (A)(B) | 6.500 | 11-15-22 | | 289,000 | 295,503 |
CSC Holdings LLC (A)(B)(C) | 7.500 | 04-01-28 | | 205,000 | 223,706 |
McGraw-Hill Global Education Holdings LLC (A)(B)(C) | 7.875 | 05-15-24 | | 195,000 | 166,725 |
MDC Partners, Inc. (A)(B)(C) | 6.500 | 05-01-24 | | 375,000 | 316,875 |
Myriad International Holdings BV (C) | 5.500 | 07-21-25 | | 400,000 | 433,122 |
National CineMedia LLC | 6.000 | 04-15-22 | | 109,000 | 109,818 |
Sirius XM Radio, Inc. (A)(B)(C) | 5.000 | 08-01-27 | | 503,000 | 507,125 |
Sirius XM Radio, Inc. (C) | 5.375 | 07-15-26 | | 260,000 | 267,475 |
Tribune Media Company | 5.875 | 07-15-22 | | 260,000 | 263,640 |
Warner Media LLC (B) | 3.800 | 02-15-27 | | 275,000 | 276,626 |
WMG Acquisition Corp. (A)(B)(C) | 4.875 | 11-01-24 | | 165,000 | 168,094 |
WMG Acquisition Corp. (C) | 5.500 | 04-15-26 | | 175,000 | 178,938 |
Wireless telecommunication services 1.1% | | | |
CC Holdings GS V LLC | 3.849 | 04-15-23 | | 350,000 | 359,210 |
Millicom International Cellular SA (A)(B)(C) | 6.250 | 03-25-29 | | 236,000 | 243,080 |
MTN Mauritius Investments, Ltd. (C) | 4.755 | 11-11-24 | | 225,000 | 216,945 |
Oztel Holdings SPC, Ltd. (C) | 6.625 | 04-24-28 | | 230,000 | 224,763 |
Sprint Capital Corp. (A)(B) | 6.875 | 11-15-28 | | 198,000 | 189,461 |
Sprint Corp. | 7.875 | 09-15-23 | | 270,000 | 280,800 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 7 |
| Rate (%) | Maturity date | | Par value^ | Value |
Communication services (continued) | | | | |
Wireless telecommunication services (continued) | | | |
Vodafone Group PLC (7.000% to 1-4-29, then 5 Year U.S. Swap Rate + 4.873%) | 7.000 | 04-04-79 | | 452,000 | $474,851 |
Consumer discretionary 6.0% | | | | 10,405,404 |
Auto components 0.2% | | | |
Lear Corp. (B) | 5.250 | 01-15-25 | | 254,000 | 263,318 |
Automobiles 2.2% | | | |
Daimler Finance North America LLC (B)(C) | 3.750 | 11-05-21 | | 431,000 | 439,205 |
Ford Motor Credit Company LLC (B) | 3.813 | 10-12-21 | | 595,000 | 596,270 |
Ford Motor Credit Company LLC (B) | 5.875 | 08-02-21 | | 928,000 | 971,165 |
General Motors Company (A)(B) | 4.875 | 10-02-23 | | 507,000 | 534,146 |
General Motors Financial Company, Inc. (B) | 3.550 | 04-09-21 | | 295,000 | 297,470 |
General Motors Financial Company, Inc. | 4.000 | 01-15-25 | | 404,000 | 405,110 |
General Motors Financial Company, Inc. | 4.300 | 07-13-25 | | 333,000 | 337,545 |
JB Poindexter & Company, Inc. (C) | 7.125 | 04-15-26 | | 74,000 | 75,480 |
Nissan Motor Acceptance Corp. (B)(C) | 3.650 | 09-21-21 | | 200,000 | 201,886 |
Diversified consumer services 0.2% | | | |
Graham Holdings Company (C) | 5.750 | 06-01-26 | | 85,000 | 89,038 |
Laureate Education, Inc. (A)(B)(C) | 8.250 | 05-01-25 | | 170,000 | 184,025 |
Hotels, restaurants and leisure 1.0% | | | |
CCM Merger, Inc. (C) | 6.000 | 03-15-22 | | 195,000 | 200,119 |
Eldorado Resorts, Inc. (A)(B) | 6.000 | 09-15-26 | | 125,000 | 129,688 |
Eldorado Resorts, Inc. | 7.000 | 08-01-23 | | 130,000 | 135,850 |
GLP Capital LP | 5.375 | 04-15-26 | | 265,000 | 279,856 |
Hilton Domestic Operating Company, Inc. (A)(B)(C) | 5.125 | 05-01-26 | | 140,000 | 143,325 |
Hilton Grand Vacations Borrower LLC | 6.125 | 12-01-24 | | 130,000 | 136,175 |
International Game Technology PLC (A)(B)(C) | 6.500 | 02-15-25 | | 225,000 | 239,621 |
Jacobs Entertainment, Inc. (C) | 7.875 | 02-01-24 | | 158,000 | 169,850 |
Resorts World Las Vegas LLC (C) | 4.625 | 04-16-29 | | 200,000 | 198,394 |
Waterford Gaming LLC (C)(D)(E) | 8.625 | 09-15-14 | | 99,739 | 0 |
Wyndham Destinations, Inc. | 5.400 | 04-01-24 | | 170,000 | 175,100 |
Household durables 0.2% | | | |
Beazer Homes USA, Inc. (A)(B) | 8.750 | 03-15-22 | | 370,000 | 386,650 |
Internet and direct marketing retail 1.9% | | | |
Amazon.com, Inc. (A)(B) | 3.150 | 08-22-27 | | 660,000 | 664,416 |
Amazon.com, Inc. (A)(B) | 4.050 | 08-22-47 | | 328,000 | 342,290 |
Expedia Group, Inc. (A)(B) | 3.800 | 02-15-28 | | 582,000 | 572,191 |
Expedia Group, Inc. | 5.000 | 02-15-26 | | 705,000 | 752,484 |
QVC, Inc. (B) | 4.375 | 03-15-23 | | 325,000 | 328,698 |
QVC, Inc. (B) | 5.125 | 07-02-22 | | 240,000 | 250,980 |
QVC, Inc. | 5.450 | 08-15-34 | | 315,000 | 302,293 |
8 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
| Rate (%) | Maturity date | | Par value^ | Value |
Consumer discretionary (continued) | | | | |
Multiline retail 0.3% | | | |
Dollar Tree, Inc. (B) | 4.200 | 05-15-28 | | 599,000 | $602,766 |
Consumer staples 1.8% | | | | 3,054,211 |
Beverages 1.2% | | | |
Anheuser-Busch InBev Worldwide, Inc. (B) | 4.600 | 04-15-48 | | 305,000 | 297,033 |
Coca-Cola European Partners PLC (B) | 4.500 | 09-01-21 | | 1,000,000 | 1,022,704 |
Constellation Brands, Inc. (A)(B) | 3.200 | 02-15-23 | | 293,000 | 294,550 |
Keurig Dr. Pepper, Inc. (B)(C) | 3.551 | 05-25-21 | | 495,000 | 500,700 |
Food and staples retailing 0.1% | | | |
Simmons Foods, Inc. (A)(B)(C) | 5.750 | 11-01-24 | | 170,000 | 156,400 |
Food products 0.3% | | | |
Conagra Brands, Inc. (B) | 3.800 | 10-22-21 | | 193,000 | 196,900 |
Kraft Heinz Foods Company (C) | 4.875 | 02-15-25 | | 221,000 | 227,374 |
Personal products 0.2% | | | |
Natura Cosmeticos SA (A)(B)(C) | 5.375 | 02-01-23 | | 355,000 | 358,550 |
Energy 11.0% | | | | 19,224,704 |
Energy equipment and services 0.5% | | | |
Archrock Partners LP | 6.000 | 10-01-22 | | 260,000 | 261,950 |
CSI Compressco LP | 7.250 | 08-15-22 | | 344,000 | 305,300 |
CSI Compressco LP (A)(B)(C) | 7.500 | 04-01-25 | | 290,000 | 281,663 |
Oil, gas and consumable fuels 10.5% | | | |
Andeavor Logistics LP (A)(B) | 4.250 | 12-01-27 | | 164,000 | 166,919 |
Andeavor Logistics LP (B) | 5.250 | 01-15-25 | | 140,000 | 146,996 |
Andeavor Logistics LP (B) | 6.375 | 05-01-24 | | 265,000 | 278,416 |
Andeavor Logistics LP (6.875% to 2-15-23, then 3 month LIBOR + 4.652%) (B)(F) | 6.875 | 02-15-23 | | 752,000 | 760,460 |
Antero Midstream Partners LP | 5.375 | 09-15-24 | | 275,000 | 280,335 |
Antero Resources Corp. (A)(B) | 5.125 | 12-01-22 | | 307,000 | 308,151 |
Cenovus Energy, Inc. | 4.450 | 09-15-42 | | 370,000 | 339,798 |
Cheniere Corpus Christi Holdings LLC (A)(B) | 5.125 | 06-30-27 | | 503,000 | 524,378 |
Chesapeake Energy Corp. (A)(B) | 7.500 | 10-01-26 | | 160,000 | 154,800 |
Cimarex Energy Company | 4.375 | 06-01-24 | | 235,000 | 244,291 |
Colorado Interstate Gas Company LLC (B)(C) | 4.150 | 08-15-26 | | 233,000 | 235,853 |
Columbia Pipeline Group, Inc. (B) | 4.500 | 06-01-25 | | 198,000 | 207,906 |
Continental Resources, Inc. (B) | 5.000 | 09-15-22 | | 521,000 | 525,323 |
DCP Midstream LP (7.375% to 12-15-22, then 3 month LIBOR + 5.148%) (F) | 7.375 | 12-15-22 | | 462,000 | 455,070 |
DCP Midstream Operating LP (5.850% to 5-21-23, then 3 month LIBOR + 3.850%) (C) | 5.850 | 05-21-43 | | 441,000 | 407,925 |
Diamondback Energy, Inc. (C) | 4.750 | 11-01-24 | | 193,000 | 197,101 |
Enable Midstream Partners LP | 3.900 | 05-15-24 | | 321,000 | 319,679 |
Enable Midstream Partners LP (B) | 4.950 | 05-15-28 | | 387,000 | 394,975 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 9 |
| Rate (%) | Maturity date | | Par value^ | Value |
Energy (continued) | | | | |
Oil, gas and consumable fuels (continued) | | | |
Enbridge Energy Partners LP (A)(B) | 4.375 | 10-15-20 | | 395,000 | $402,927 |
Enbridge, Inc. (5.500% to 7-15-27, then 3 month LIBOR + 3.418%) | 5.500 | 07-15-77 | | 340,000 | 326,454 |
Enbridge, Inc. (6.250% to 3-1-28, then 3 month LIBOR + 3.641%) | 6.250 | 03-01-78 | | 294,000 | 298,273 |
Energy Transfer Operating LP (B) | 4.200 | 04-15-27 | | 130,000 | 130,731 |
Energy Transfer Operating LP (A)(B) | 4.250 | 03-15-23 | | 422,000 | 433,029 |
Energy Transfer Operating LP (B) | 5.150 | 03-15-45 | | 345,000 | 335,965 |
Energy Transfer Operating LP | 5.875 | 01-15-24 | | 199,000 | 217,263 |
Energy Transfer Partners LP (B) | 5.000 | 10-01-22 | | 95,000 | 99,992 |
Energy Transfer Partners LP | 5.875 | 03-01-22 | | 90,000 | 96,057 |
Enterprise Products Operating LLC (5.250% to 8-16-27, then 3 month LIBOR + 3.033%) (B) | 5.250 | 08-16-77 | | 538,000 | 514,285 |
Husky Energy, Inc. (B) | 3.950 | 04-15-22 | | 305,000 | 312,155 |
Kinder Morgan Energy Partners LP (B) | 3.500 | 03-01-21 | | 500,000 | 504,470 |
Kinder Morgan Energy Partners LP (B) | 7.750 | 03-15-32 | | 195,000 | 253,221 |
Kinder Morgan, Inc. (B) | 3.150 | 01-15-23 | | 178,000 | 178,325 |
MPLX LP (B) | 4.000 | 03-15-28 | | 313,000 | 313,392 |
MPLX LP (A)(B) | 4.800 | 02-15-29 | | 160,000 | 170,135 |
Murphy Oil Corp. | 5.750 | 08-15-25 | | 164,000 | 168,515 |
Newfield Exploration Company (A)(B) | 5.625 | 07-01-24 | | 139,000 | 151,774 |
Newfield Exploration Company (A)(B) | 5.750 | 01-30-22 | | 160,000 | 170,552 |
ONEOK Partners LP (B) | 5.000 | 09-15-23 | | 162,000 | 171,882 |
Parsley Energy LLC (A)(B)(C) | 5.625 | 10-15-27 | | 231,000 | 236,198 |
Petrobras Global Finance BV | 5.750 | 02-01-29 | | 91,000 | 91,228 |
Petrobras Global Finance BV (A)(B) | 7.375 | 01-17-27 | | 545,000 | 607,130 |
Petro-Canada (A)(B) | 9.250 | 10-15-21 | | 1,000,000 | 1,147,422 |
Petroleos Mexicanos (A)(B) | 4.875 | 01-24-22 | | 325,000 | 328,023 |
Petroleos Mexicanos (A)(B) | 5.375 | 03-13-22 | | 85,000 | 86,847 |
Sabine Pass Liquefaction LLC (B) | 4.200 | 03-15-28 | | 261,000 | 263,905 |
Sabine Pass Liquefaction LLC (B) | 5.000 | 03-15-27 | | 245,000 | 260,494 |
Sabine Pass Liquefaction LLC | 5.750 | 05-15-24 | | 425,000 | 466,432 |
Sabine Pass Liquefaction LLC (B) | 5.875 | 06-30-26 | | 147,000 | 163,668 |
SM Energy Company (A)(B) | 6.625 | 01-15-27 | | 60,000 | 56,550 |
Sunoco Logistics Partners Operations LP (B) | 3.900 | 07-15-26 | | 460,000 | 457,869 |
Sunoco Logistics Partners Operations LP (B) | 4.400 | 04-01-21 | | 377,000 | 386,991 |
Sunoco Logistics Partners Operations LP (B) | 5.400 | 10-01-47 | | 240,000 | 241,571 |
Tallgrass Energy Partners LP (A)(B)(C) | 4.750 | 10-01-23 | | 222,000 | 224,340 |
Targa Resources Partners LP | 5.875 | 04-15-26 | | 220,000 | 231,619 |
Teekay Offshore Partners LP (C) | 8.500 | 07-15-23 | | 235,000 | 234,413 |
The Williams Companies, Inc. (A)(B) | 3.750 | 06-15-27 | | 355,000 | 355,022 |
The Williams Companies, Inc. (A)(B) | 4.550 | 06-24-24 | | 525,000 | 553,271 |
The Williams Companies, Inc. | 5.750 | 06-24-44 | | 315,000 | 343,225 |
10 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
| Rate (%) | Maturity date | | Par value^ | Value |
Energy (continued) | | | | |
Oil, gas and consumable fuels (continued) | | | |
WPX Energy, Inc. | 5.250 | 09-15-24 | | 100,000 | $103,250 |
YPF SA (C) | 8.500 | 07-28-25 | | 370,000 | 338,550 |
Financials 23.2% | | | | 40,280,728 |
Banks 12.9% | | | |
Australia & New Zealand Banking Group, Ltd. (6.750% to 6-15-26, then 5 Year U.S. ISDAFIX + 5.168%) (A)(B)(C)(F) | 6.750 | 06-15-26 | | 200,000 | 216,750 |
Banco Santander SA (A)(B) | 4.379 | 04-12-28 | | 200,000 | 204,863 |
Bank of America Corp. (B) | 3.950 | 04-21-25 | | 425,000 | 434,518 |
Bank of America Corp. (B) | 4.200 | 08-26-24 | | 170,000 | 176,401 |
Bank of America Corp. (A)(B) | 4.450 | 03-03-26 | | 450,000 | 472,473 |
Bank of America Corp. (6.300% to 3-10-26, then 3 month LIBOR + 4.553%) (A)(B)(F) | 6.300 | 03-10-26 | | 610,000 | 666,425 |
Barclays Bank PLC (B)(C) | 10.179 | 06-12-21 | | 475,000 | 537,220 |
Barclays PLC (A)(B) | 4.375 | 01-12-26 | | 340,000 | 345,402 |
Barclays PLC (7.750% to 9-15-23, then 5 Year U.S. Swap Rate + 4.842%) (F) | 7.750 | 09-15-23 | | 275,000 | 284,281 |
BPCE SA (B)(C) | 4.500 | 03-15-25 | | 475,000 | 484,216 |
BPCE SA (A)(B)(C) | 5.700 | 10-22-23 | | 1,145,000 | 1,227,858 |
Citigroup, Inc. (B) | 4.600 | 03-09-26 | | 586,000 | 616,600 |
Citigroup, Inc. (B) | 5.500 | 09-13-25 | | 165,000 | 182,149 |
Citigroup, Inc. (6.250% to 8-15-26, then 3 month LIBOR + 4.517%) (A)(B)(F) | 6.250 | 08-15-26 | | 525,000 | 562,406 |
Cooperatieve Rabobank UA (11.000% to 6-30-19, then 3 month LIBOR + 10.868%) (B)(C)(F) | 11.000 | 06-30-19 | | 1,000,000 | 1,012,100 |
Credit Agricole SA (7.875% to 1-23-24, then 5 Year U.S. Swap Rate + 4.898%) (C)(F) | 7.875 | 01-23-24 | | 600,000 | 651,755 |
Danske Bank A/S (B)(C) | 5.000 | 01-12-22 | | 286,000 | 294,131 |
Fifth Third Bancorp (5.100% to 6-30-23, then 3 month LIBOR + 3.033%) (A)(B)(F) | 5.100 | 06-30-23 | | 420,000 | 413,175 |
Freedom Mortgage Corp. (C) | 8.125 | 11-15-24 | | 259,000 | 229,863 |
Freedom Mortgage Corp. (C) | 8.250 | 04-15-25 | | 105,000 | 93,188 |
HSBC Holdings PLC (3.950% to 5-18-23, then 3 month LIBOR + 0.987%) (A)(B) | 3.950 | 05-18-24 | | 495,000 | 508,520 |
HSBC Holdings PLC (6.375% to 9-17-24, then 5 Year U.S. ISDAFIX + 3.705%) (B)(F) | 6.375 | 09-17-24 | | 200,000 | 205,250 |
HSBC Holdings PLC (6.875% to 6-1-21, then 5 Year U.S. ISDAFIX + 5.514%) (B)(F) | 6.875 | 06-01-21 | | 340,000 | 356,575 |
ING Bank NV (B)(C) | 5.800 | 09-25-23 | | 1,000,000 | 1,091,959 |
ING Groep NV (B) | 3.550 | 04-09-24 | | 277,000 | 277,524 |
JPMorgan Chase & Co. (B) | 3.200 | 06-15-26 | | 410,000 | 407,850 |
JPMorgan Chase & Co. (3.514% to 6-18-21, then 3 month LIBOR + 0.610%) (A)(B) | 3.514 | 06-18-22 | | 710,000 | 719,822 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 11 |
| Rate (%) | Maturity date | | Par value^ | Value |
Financials (continued) | | | | |
Banks (continued) | | | |
JPMorgan Chase & Co. (6.750% to 2-1-24, then 3 month LIBOR + 3.780%) (F) | 6.750 | 02-01-24 | | 805,000 | $891,787 |
Lloyds Banking Group PLC (B) | 4.450 | 05-08-25 | | 745,000 | 775,357 |
Lloyds Banking Group PLC (7.500% to 6-27-24, then 5 Year U.S. Swap Rate + 4.760%) (F) | 7.500 | 06-27-24 | | 385,000 | 404,250 |
M&T Bank Corp. (5.125% to 11-1-26, then 3 month LIBOR + 3.520%) (A)(B)(F) | 5.125 | 11-01-26 | | 345,000 | 350,175 |
Mitsubishi UFJ Financial Group, Inc. (B) | 3.218 | 03-07-22 | | 690,000 | 696,436 |
Regions Bank (3.374% to 8-13-20, then 3 month LIBOR + 0.500%) (B) | 3.374 | 08-13-21 | | 504,000 | 506,740 |
Regions Financial Corp. (A)(B) | 3.800 | 08-14-23 | | 200,000 | 206,132 |
Santander Holdings USA, Inc. (B) | 3.400 | 01-18-23 | | 270,000 | 270,184 |
Santander Holdings USA, Inc. (B) | 3.700 | 03-28-22 | | 469,000 | 474,897 |
Santander Holdings USA, Inc. (A)(B) | 4.450 | 12-03-21 | | 319,000 | 329,576 |
Santander UK Group Holdings PLC (A)(B)(C) | 4.750 | 09-15-25 | | 365,000 | 368,630 |
Societe Generale SA (7.375% to 9-13-21, then 5 Year U.S. Swap Rate + 6.238%) (A)(B)(C)(F) | 7.375 | 09-13-21 | | 340,000 | 353,600 |
The PNC Financial Services Group, Inc. (A)(B) | 3.500 | 01-23-24 | | 230,000 | 235,636 |
The PNC Financial Services Group, Inc. (4.850% to 6-1-23, then 3 month LIBOR + 3.040%) (B)(F) | 4.850 | 06-01-23 | | 335,000 | 334,163 |
The PNC Financial Services Group, Inc. (6.750% to 8-1-21, then 3 month LIBOR + 3.678%) (A)(B)(F) | 6.750 | 08-01-21 | | 545,000 | 579,744 |
The Royal Bank of Scotland Group PLC | 3.875 | 09-12-23 | | 480,000 | 484,061 |
The Royal Bank of Scotland Group PLC (8.625% to 8-15-21, then 5 Year U.S. Swap Rate + 7.598%) (A)(B)(F) | 8.625 | 08-15-21 | | 612,000 | 657,900 |
The Toronto-Dominion Bank (B) | 3.250 | 03-11-24 | | 373,000 | 378,346 |
Wells Fargo & Company (3 month LIBOR + 3.770%) (F)(G) | 6.558 | 06-15-19 | | 370,000 | 371,850 |
Wells Fargo & Company (5.875% to 6-15-25, then 3 month LIBOR + 3.990%) (A)(B)(F) | 5.875 | 06-15-25 | | 975,000 | 1,053,000 |
Capital markets 2.4% | | | |
Ares Capital Corp. (B) | 3.625 | 01-19-22 | | 290,000 | 289,912 |
Cantor Fitzgerald LP (B)(C) | 4.875 | 05-01-24 | | 390,000 | 390,619 |
Credit Suisse Group AG (7.500% to 12-11-23, then 5 Year U.S. Swap Rate + 4.598%) (A)(B)(C)(F) | 7.500 | 12-11-23 | | 295,000 | 316,019 |
Credit Suisse Group AG (7.500% to 7-17-23, then 5 Year U.S. Swap Rate + 4.600%) (A)(B)(C)(F) | 7.500 | 07-17-23 | | 310,000 | 325,113 |
FS KKR Capital Corp. (B) | 4.250 | 01-15-20 | | 290,000 | 290,630 |
Lazard Group LLC (B) | 4.375 | 03-11-29 | | 230,000 | 234,904 |
12 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
| Rate (%) | Maturity date | | Par value^ | Value |
Financials (continued) | | | | |
Capital markets (continued) | | | |
Macquarie Bank, Ltd. (A)(B)(C) | 4.875 | 06-10-25 | | 520,000 | $541,911 |
Morgan Stanley (B) | 3.875 | 01-27-26 | | 400,000 | 409,825 |
Stifel Financial Corp. (A)(B) | 4.250 | 07-18-24 | | 217,000 | 222,152 |
The Goldman Sachs Group, Inc. (B) | 3.850 | 01-26-27 | | 730,000 | 735,501 |
UBS Group Funding Switzerland AG (7.000% to 1-31-24, then 5 Year U.S. Swap Rate + 4.344%) (C)(F) | 7.000 | 01-31-24 | | 295,000 | 307,529 |
Consumer finance 2.6% | | | |
Ally Financial, Inc. | 5.125 | 09-30-24 | | 645,000 | 681,475 |
Capital One Financial Corp. (B) | 3.450 | 04-30-21 | | 465,000 | 470,107 |
Capital One Financial Corp. (B) | 3.500 | 06-15-23 | | 1,335,000 | 1,360,579 |
Capital One Financial Corp. (B) | 3.900 | 01-29-24 | | 230,000 | 236,235 |
Credit Acceptance Corp. | 6.125 | 02-15-21 | | 249,000 | 249,311 |
Credito Real SAB de CV (C) | 7.250 | 07-20-23 | | 200,000 | 207,600 |
Credito Real SAB de CV (9.125% to 11-29-22, then 10 Year CMT + 7.026%) (C)(F) | 9.125 | 11-29-22 | | 225,000 | 223,315 |
Discover Financial Services (A)(B) | 3.950 | 11-06-24 | | 458,000 | 468,265 |
Discover Financial Services | 4.100 | 02-09-27 | | 124,000 | 124,292 |
Discover Financial Services (B) | 5.200 | 04-27-22 | | 85,000 | 90,376 |
Enova International, Inc. (C) | 8.500 | 09-01-24 | | 58,000 | 55,680 |
Enova International, Inc. (C) | 8.500 | 09-15-25 | | 260,000 | 253,560 |
Springleaf Finance Corp. (A)(B) | 6.875 | 03-15-25 | | 105,000 | 112,613 |
Diversified financial services 1.4% | | | |
ASP AMC Merger Sub, Inc. (C) | 8.000 | 05-15-25 | | 205,000 | 131,200 |
Doric Nimrod Air Alpha 2013-1 Class B Pass Through Trust (C) | 6.125 | 11-30-21 | | 56,856 | 57,027 |
Gogo Intermediate Holdings LLC (C) | 9.875 | 05-01-24 | | 188,000 | 192,230 |
Jefferies Financial Group, Inc. (A)(B) | 5.500 | 10-18-23 | | 655,000 | 689,126 |
Jefferies Group LLC (B) | 4.150 | 01-23-30 | | 365,000 | 339,909 |
Jefferies Group LLC (B) | 4.850 | 01-15-27 | | 422,000 | 425,404 |
Refinitiv US Holdings, Inc. (A)(B)(C) | 6.250 | 05-15-26 | | 43,000 | 44,129 |
Refinitiv US Holdings, Inc. (A)(B)(C) | 8.250 | 11-15-26 | | 69,000 | 69,927 |
Trident Merger Sub, Inc. (C) | 6.625 | 11-01-25 | | 85,000 | 79,263 |
Voya Financial, Inc. (5.650% to 5-15-23, then 3 month LIBOR + 3.580%) (A)(B) | 5.650 | 05-15-53 | | 463,000 | 464,158 |
Insurance 3.0% | | | |
Aquarius & Investments PLC (6.375% to 9-1-19, then 5 Year U.S. Swap Rate + 5.210%) | 6.375 | 09-01-24 | | 435,000 | 438,584 |
AXA SA (B) | 8.600 | 12-15-30 | | 175,000 | 235,918 |
Brighthouse Financial, Inc. (B) | 3.700 | 06-22-27 | | 595,000 | 550,676 |
CNO Financial Group, Inc. (A)(B) | 5.250 | 05-30-25 | | 293,000 | 307,284 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 13 |
| Rate (%) | Maturity date | | Par value^ | Value |
Financials (continued) | | | | |
Insurance (continued) | | | |
Liberty Mutual Group, Inc. (7.800% to 3-15-37, then 3 month LIBOR + 3.576%) (C) | 7.800 | 03-07-87 | | 705,000 | $842,475 |
MetLife, Inc. (6.400% to 12-15-36, then 3 month LIBOR + 2.205%) (A)(B) | 6.400 | 12-15-66 | | 355,000 | 392,495 |
MetLife, Inc. (9.250% to 4-8-38, then 3 month LIBOR + 5.540%) (B)(C) | 9.250 | 04-08-68 | | 315,000 | 431,550 |
Nationstar Mortgage Holdings, Inc. (C) | 8.125 | 07-15-23 | | 160,000 | 161,200 |
Nationstar Mortgage Holdings, Inc. (C) | 9.125 | 07-15-26 | | 128,000 | 128,000 |
Nationwide Building Society (3.622% to 4-26-22, then 3 month LIBOR + 1.181%) (B)(C) | 3.622 | 04-26-23 | | 273,000 | 274,669 |
Nippon Life Insurance Company (5.100% to 10-16-24, then 5 Year U.S. ISDAFIX + 3.650%) (B)(C) | 5.100 | 10-16-44 | | 365,000 | 381,425 |
Prudential Financial, Inc. (5.875% to 9-15-22, then 3 month LIBOR + 4.175%) (A)(B) | 5.875 | 09-15-42 | | 637,000 | 676,494 |
Teachers Insurance & Annuity Association of America (B)(C) | 4.270 | 05-15-47 | | 430,000 | 443,410 |
Thrifts and mortgage finance 0.9% | | | |
Ladder Capital Finance Holdings LLLP (C) | 5.250 | 03-15-22 | | 95,000 | 97,375 |
Ladder Capital Finance Holdings LLLP (A)(B)(C) | 5.250 | 10-01-25 | | 148,000 | 147,445 |
MGIC Investment Corp. | 5.750 | 08-15-23 | | 99,000 | 106,178 |
Quicken Loans, Inc. (A)(B)(C) | 5.250 | 01-15-28 | | 235,000 | 227,950 |
Quicken Loans, Inc. (B)(C) | 5.750 | 05-01-25 | | 550,000 | 558,250 |
Radian Group, Inc. | 4.500 | 10-01-24 | | 144,000 | 144,216 |
Radian Group, Inc. | 5.250 | 06-15-20 | | 99,000 | 100,980 |
Stearns Holdings LLC (C) | 9.375 | 08-15-20 | | 158,000 | 148,520 |
Health care 4.5% | | | | 7,819,027 |
Biotechnology 0.4% | | | |
Celgene Corp. | 3.250 | 02-20-23 | | 258,000 | 259,625 |
Shire Acquisitions Investments Ireland DAC (B) | 3.200 | 09-23-26 | | 473,000 | 460,745 |
Health care equipment and supplies 0.2% | | | |
Boston Scientific Corp. (B) | 3.450 | 03-01-24 | | 264,000 | 268,752 |
Health care providers and services 3.0% | | | |
Centene Corp. (C) | 5.375 | 06-01-26 | | 255,000 | 266,156 |
CVS Health Corp. (B) | 3.350 | 03-09-21 | | 699,000 | 704,037 |
CVS Health Corp. (B) | 5.050 | 03-25-48 | | 322,000 | 318,313 |
DaVita, Inc. (A)(B) | 5.000 | 05-01-25 | | 405,000 | 396,268 |
Express Scripts Holding Company (B) | 4.750 | 11-15-21 | | 1,000,000 | 1,043,746 |
HCA, Inc. | 5.250 | 04-15-25 | | 375,000 | 401,640 |
HCA, Inc. | 5.250 | 06-15-26 | | 320,000 | 341,801 |
14 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
| Rate (%) | Maturity date | | Par value^ | Value |
Health care (continued) | | | | |
Health care providers and services (continued) | | | |
HCA, Inc. | 7.500 | 02-15-22 | | 300,000 | $330,000 |
MEDNAX, Inc. (B)(C) | 5.250 | 12-01-23 | | 290,000 | 295,075 |
MEDNAX, Inc. (C) | 6.250 | 01-15-27 | | 224,000 | 228,480 |
Select Medical Corp. | 6.375 | 06-01-21 | | 360,000 | 360,450 |
Team Health Holdings, Inc. (A)(B)(C) | 6.375 | 02-01-25 | | 65,000 | 55,250 |
Universal Health Services, Inc. (B)(C) | 4.750 | 08-01-22 | | 240,000 | 242,131 |
Universal Health Services, Inc. (C) | 5.000 | 06-01-26 | | 309,000 | 316,339 |
Life sciences tools and services 0.2% | | | |
IQVIA, Inc. (B)(C) | 4.875 | 05-15-23 | | 260,000 | 264,225 |
Pharmaceuticals 0.7% | | | |
Bausch Health Companies, Inc. (A)(B)(C) | 6.125 | 04-15-25 | | 375,000 | 379,688 |
Bayer US Finance II LLC (B)(C) | 3.500 | 06-25-21 | | 200,000 | 201,028 |
GlaxoSmithKline Capital PLC (A)(B) | 3.000 | 06-01-24 | | 441,000 | 443,228 |
Teva Pharmaceutical Finance Netherlands III BV (A)(B) | 6.750 | 03-01-28 | | 235,000 | 242,050 |
Industrials 8.9% | | | | 15,536,332 |
Aerospace and defense 0.6% | | | |
Arconic, Inc. (A)(B) | 5.125 | 10-01-24 | | 324,000 | 334,109 |
Huntington Ingalls Industries, Inc. (B)(C) | 5.000 | 11-15-25 | | 466,000 | 480,679 |
Kratos Defense & Security Solutions, Inc. (C) | 6.500 | 11-30-25 | | 215,000 | 228,169 |
Air freight and logistics 0.1% | | | |
XPO Logistics, Inc. (C) | 6.500 | 06-15-22 | | 211,000 | 215,748 |
Airlines 4.6% | | | |
Air Canada 2013-1 Class A Pass Through Trust (B)(C) | 4.125 | 11-15-26 | | 209,420 | 213,651 |
Air Canada 2017-1 Class B Pass Through Trust (C) | 3.700 | 07-15-27 | | 304,339 | 295,117 |
America West Airlines 2000-1 Pass Through Trust | 8.057 | 01-02-22 | | 73,849 | 77,150 |
American Airlines 2000-1 Pass Through Trust | 6.977 | 11-23-22 | | 85,288 | 88,017 |
American Airlines 2013-2 Class A Pass Through Trust (B) | 4.950 | 07-15-24 | | 275,730 | 285,849 |
American Airlines 2015-1 Class A Pass Through Trust (B) | 3.375 | 11-01-28 | | 379,262 | 373,687 |
American Airlines 2015-1 Class B Pass Through Trust (B) | 3.700 | 11-01-24 | | 428,845 | 436,049 |
American Airlines 2016-1 Class A Pass Through Trust (B) | 4.100 | 07-15-29 | | 361,929 | 362,110 |
American Airlines 2017-1 Class A Pass Through Trust (B) | 4.000 | 08-15-30 | | 175,500 | 172,517 |
American Airlines 2017-1 Class AA Pass Through Trust (B) | 3.650 | 08-15-30 | | 270,000 | 268,974 |
American Airlines 2017-2 Class A Pass Through Trust (B) | 3.600 | 04-15-31 | | 158,907 | 152,170 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 15 |
| Rate (%) | Maturity date | | Par value^ | Value |
Industrials (continued) | | | | |
Airlines (continued) | | | |
Azul Investments LLP (A)(B)(C) | 5.875 | 10-26-24 | | 95,000 | $90,512 |
British Airways 2013-1 Class A Pass Through Trust (B)(C) | 4.625 | 06-20-24 | | 474,587 | 490,628 |
British Airways 2013-1 Class B Pass Through Trust (C) | 5.625 | 12-20-21 | | 56,945 | 57,640 |
British Airways 2018-1 Class A Pass Through Trust (B)(C) | 4.125 | 03-20-33 | | 145,224 | 146,996 |
Continental Airlines 2007-1 Class A Pass Through Trust (B) | 5.983 | 10-19-23 | | 376,570 | 393,667 |
Continental Airlines 2012-1 Class B Pass Through Trust | 6.250 | 10-11-21 | | 94,052 | 95,576 |
Delta Air Lines 2002-1 Class G-1 Pass Through Trust (B) | 6.718 | 07-02-24 | | 428,988 | 454,426 |
Delta Air Lines, Inc. (B) | 3.625 | 03-15-22 | | 476,000 | 479,826 |
Delta Air Lines, Inc. (B) | 3.800 | 04-19-23 | | 195,000 | 198,808 |
Delta Air Lines, Inc. | 4.375 | 04-19-28 | | 355,000 | 350,839 |
Northwest Airlines 2007-1 Class A Pass Through Trust (B) | 7.027 | 05-01-21 | | 271,427 | 275,580 |
United Airlines 2014-2 Class A Pass Through Trust (B) | 3.750 | 03-03-28 | | 388,700 | 391,148 |
United Airlines 2014-2 Class B Pass Through Trust (B) | 4.625 | 03-03-24 | | 339,631 | 344,963 |
United Airlines 2016-1 Class A Pass Through Trust (B) | 3.450 | 01-07-30 | | 280,860 | 274,092 |
United Airlines 2016-1 Class B Pass Through Trust (B) | 3.650 | 01-07-26 | | 422,431 | 413,095 |
United Airlines 2018-1 Class B Pass Through Trust (B) | 4.600 | 03-01-26 | | 94,718 | 95,097 |
United Airlines 2019-1 Class A Pass Through Trust (B) | 4.550 | 02-25-33 | | 230,000 | 237,219 |
US Airways 2010-1 Class A Pass Through Trust | 6.250 | 10-22-24 | | 256,269 | 273,286 |
US Airways 2012-1 Class A Pass Through Trust (B) | 5.900 | 04-01-26 | | 204,464 | 221,107 |
Building products 0.2% | | | |
Masco Corp. | 4.450 | 04-01-25 | | 275,000 | 285,106 |
Owens Corning (A)(B) | 4.200 | 12-15-22 | | 155,000 | 159,262 |
Commercial services and supplies 0.3% | | | |
LSC Communications, Inc. (A)(B)(C) | 8.750 | 10-15-23 | | 180,000 | 188,100 |
Prime Security Services Borrower LLC (C) | 9.250 | 05-15-23 | | 84,000 | 88,532 |
Tervita Escrow Corp. (C) | 7.625 | 12-01-21 | | 210,000 | 212,625 |
Construction and engineering 0.3% | | | |
AECOM (A)(B) | 5.125 | 03-15-27 | | 415,000 | 416,560 |
Tutor Perini Corp. (C) | 6.875 | 05-01-25 | | 88,000 | 88,110 |
Industrial conglomerates 0.2% | | | |
3M Company (B) | 3.250 | 02-14-24 | | 370,000 | 380,443 |
16 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
| Rate (%) | Maturity date | | Par value^ | Value |
Industrials (continued) | | | | |
Professional services 0.6% | | | |
Equifax, Inc. (A)(B) | 7.000 | 07-01-37 | | 80,000 | $93,088 |
IHS Markit, Ltd. (A)(B)(C) | 4.000 | 03-01-26 | | 393,000 | 391,888 |
IHS Markit, Ltd. (C) | 4.750 | 02-15-25 | | 128,000 | 133,908 |
IHS Markit, Ltd. (A)(B) | 4.750 | 08-01-28 | | 210,000 | 218,944 |
IHS Markit, Ltd. (B)(C) | 5.000 | 11-01-22 | | 152,000 | 159,266 |
Trading companies and distributors 2.0% | | | |
AerCap Ireland Capital DAC (B) | 4.625 | 10-30-20 | | 435,000 | 444,870 |
AerCap Ireland Capital DAC (B) | 5.000 | 10-01-21 | | 373,000 | 387,903 |
Ahern Rentals, Inc. (C) | 7.375 | 05-15-23 | | 395,000 | 351,550 |
Aircastle, Ltd. (B) | 4.400 | 09-25-23 | | 176,000 | 178,825 |
Aircastle, Ltd. (A)(B) | 5.000 | 04-01-23 | | 620,000 | 644,745 |
Aircastle, Ltd. (A)(B) | 5.500 | 02-15-22 | | 215,000 | 226,684 |
Ashtead Capital, Inc. (C) | 4.375 | 08-15-27 | | 260,000 | 255,450 |
Avolon Holdings Funding, Ltd. (C) | 5.125 | 10-01-23 | | 225,000 | 233,827 |
H&E Equipment Services, Inc. (A)(B) | 5.625 | 09-01-25 | | 131,000 | 132,965 |
United Rentals North America, Inc. (A)(B) | 4.875 | 01-15-28 | | 328,000 | 325,950 |
United Rentals North America, Inc. | 5.500 | 07-15-25 | | 260,000 | 269,230 |
Information technology 6.2% | | | | 10,786,384 |
Communications equipment 0.8% | | | |
CommScope, Inc. (A)(B)(C) | 8.250 | 03-01-27 | | 377,000 | 407,160 |
Motorola Solutions, Inc. (B) | 4.600 | 02-23-28 | | 492,000 | 497,951 |
Telefonaktiebolaget LM Ericsson (A)(B) | 4.125 | 05-15-22 | | 545,000 | 554,538 |
Electronic equipment, instruments and components 0.4% | | | |
Tech Data Corp. (B) | 3.700 | 02-15-22 | | 178,000 | 178,832 |
Tech Data Corp. (B) | 4.950 | 02-15-27 | | 601,000 | 609,480 |
IT services 0.4% | | | |
Banff Merger Sub, Inc. (C) | 9.750 | 09-01-26 | | 215,000 | 215,538 |
VeriSign, Inc. | 4.750 | 07-15-27 | | 145,000 | 147,900 |
VeriSign, Inc. (A)(B) | 5.250 | 04-01-25 | | 270,000 | 286,200 |
Semiconductors and semiconductor equipment 2.5% | | | |
Advanced Micro Devices, Inc. (A)(B) | 7.000 | 07-01-24 | | 170,000 | 176,588 |
KLA-Tencor Corp. (B) | 4.100 | 03-15-29 | | 260,000 | 267,234 |
Lam Research Corp. (B) | 3.750 | 03-15-26 | | 335,000 | 345,164 |
Lam Research Corp. (A)(B) | 4.875 | 03-15-49 | | 275,000 | 297,436 |
Marvell Technology Group, Ltd. (A)(B) | 4.875 | 06-22-28 | | 385,000 | 402,350 |
Microchip Technology, Inc. (B)(C) | 3.922 | 06-01-21 | | 255,000 | 258,693 |
Microchip Technology, Inc. (A)(B)(C) | 4.333 | 06-01-23 | | 583,000 | 599,026 |
Micron Technology, Inc. | 4.975 | 02-06-26 | | 345,000 | 355,290 |
Micron Technology, Inc. | 5.327 | 02-06-29 | | 522,000 | 538,224 |
NXP BV (A)(B)(C) | 4.625 | 06-01-23 | | 645,000 | 672,903 |
NXP BV (B)(C) | 4.875 | 03-01-24 | | 267,000 | 282,505 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 17 |
| Rate (%) | Maturity date | | Par value^ | Value |
Information technology (continued) | | | | |
Semiconductors and semiconductor equipment (continued) | | | |
Qorvo, Inc. (A)(B)(C) | 5.500 | 07-15-26 | | 110,000 | $114,675 |
Software 0.5% | | | |
Citrix Systems, Inc. | 4.500 | 12-01-27 | | 354,000 | 354,104 |
j2 Cloud Services LLC (B)(C) | 6.000 | 07-15-25 | | 59,000 | 61,655 |
Microsoft Corp. (B) | 4.450 | 11-03-45 | | 340,000 | 379,945 |
Technology hardware, storage and peripherals 1.6% | | | |
Dell International LLC (A)(B)(C) | 4.900 | 10-01-26 | | 456,000 | 467,156 |
Dell International LLC (A)(B)(C) | 5.300 | 10-01-29 | | 462,000 | 475,712 |
Dell International LLC (A)(B)(C) | 6.020 | 06-15-26 | | 825,000 | 893,632 |
Dell International LLC (B)(C) | 8.350 | 07-15-46 | | 563,000 | 692,698 |
Western Digital Corp. (A)(B) | 4.750 | 02-15-26 | | 263,000 | 253,795 |
Materials 2.2% | | | | 3,840,320 |
Chemicals 1.4% | | | |
Braskem Finance, Ltd. (C) | 7.000 | 05-07-20 | | 515,000 | 533,798 |
Braskem Netherlands Finance BV (C) | 4.500 | 01-10-28 | | 340,000 | 333,200 |
Cydsa SAB de CV (C) | 6.250 | 10-04-27 | | 265,000 | 260,034 |
Mexichem SAB de CV (C) | 5.500 | 01-15-48 | | 315,000 | 300,434 |
Syngenta Finance NV (B)(C) | 4.441 | 04-24-23 | | 470,000 | 482,403 |
The Chemours Company (A)(B) | 6.625 | 05-15-23 | | 456,000 | 472,393 |
Construction materials 0.2% | | | |
Cemex SAB de CV (C) | 6.125 | 05-05-25 | | 270,000 | 281,610 |
U.S. Concrete, Inc. (A)(B) | 6.375 | 06-01-24 | | 145,000 | 148,988 |
Containers and packaging 0.3% | | | |
Ardagh Packaging Finance PLC (A)(B)(C) | 6.000 | 02-15-25 | | 215,000 | 216,613 |
Klabin Finance SA (C) | 4.875 | 09-19-27 | | 255,000 | 248,564 |
Metals and mining 0.2% | | | |
Anglo American Capital PLC (C) | 4.750 | 04-10-27 | | 270,000 | 279,263 |
Commercial Metals Company (A)(B) | 5.375 | 07-15-27 | | 92,000 | 90,620 |
Paper and forest products 0.1% | | | |
Norbord, Inc. (B)(C) | 6.250 | 04-15-23 | | 185,000 | 192,400 |
Real estate 1.7% | | | | 2,960,943 |
Equity real estate investment trusts 1.7% | | | |
American Homes 4 Rent LP (B) | 4.250 | 02-15-28 | | 305,000 | 303,538 |
American Tower Corp. (A)(B) | 3.550 | 07-15-27 | | 488,000 | 480,916 |
American Tower Corp. (B) | 4.700 | 03-15-22 | | 400,000 | 421,268 |
Equinix, Inc. (A)(B) | 5.375 | 05-15-27 | | 205,000 | 217,013 |
Omega Healthcare Investors, Inc. (B) | 4.500 | 01-15-25 | | 192,000 | 195,743 |
SBA Tower Trust (B)(C) | 3.722 | 04-09-48 | | 473,000 | 479,733 |
The GEO Group, Inc. | 6.000 | 04-15-26 | | 72,000 | 64,440 |
Ventas Realty LP (B) | 3.500 | 02-01-25 | | 254,000 | 255,533 |
18 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
| Rate (%) | Maturity date | | Par value^ | Value |
Real estate (continued) | | | | |
Equity real estate investment trusts (continued) | | | |
VEREIT Operating Partnership LP (A)(B) | 4.600 | 02-06-24 | | 523,000 | $542,759 |
Utilities 4.0% | | | | 6,902,307 |
Electric utilities 2.0% | | | |
ABY Transmision Sur SA (C) | 6.875 | 04-30-43 | | 246,900 | 275,911 |
Duke Energy Corp. (B) | 3.550 | 09-15-21 | | 1,000,000 | 1,014,874 |
Electricite de France SA (5.250% to 1-29-23, then 10 Year U.S. Swap Rate + 3.709%) (A)(B)(C)(F) | 5.250 | 01-29-23 | | 485,000 | 492,275 |
Emera US Finance LP (A)(B) | 3.550 | 06-15-26 | | 183,000 | 181,046 |
Empresa Electrica Angamos SA (C) | 4.875 | 05-25-29 | | 328,680 | 332,463 |
Exelon Generation Company LLC (B) | 4.000 | 10-01-20 | | 1,000,000 | 1,014,016 |
Instituto Costarricense de Electricidad (C) | 6.375 | 05-15-43 | | 215,000 | 172,000 |
Gas utilities 0.1% | | | |
AmeriGas Partners LP | 5.500 | 05-20-25 | | 183,000 | 187,346 |
Independent power and renewable electricity producers 0.8% | | | |
Clearway Energy Operating LLC (B) | 5.375 | 08-15-24 | | 266,000 | 270,354 |
Greenko Dutch BV (C) | 4.875 | 07-24-22 | | 310,000 | 306,187 |
NextEra Energy Capital Holdings, Inc. (A)(B) | 3.550 | 05-01-27 | | 490,000 | 495,605 |
NextEra Energy Operating Partners LP (A)(B)(C) | 4.500 | 09-15-27 | | 110,000 | 108,075 |
NRG Energy, Inc. (A)(B) | 6.250 | 05-01-24 | | 220,000 | 227,084 |
Multi-utilities 1.1% | | | |
Berkshire Hathaway Energy Company (B) | 8.480 | 09-15-28 | | 550,000 | 768,999 |
|
CMS Energy Corp. (B) | 5.050 | 03-15-22 | | 1,000,000 | 1,056,072 |
Capital preferred securities (H) 0.1% (0.0% of Total investments) | | $81,370 |
(Cost $80,333) | | | | | |
Financials 0.1% | | | | 81,370 |
Capital markets 0.1% | | | |
|
State Street Corp. (3 month LIBOR + 1.000%) (B)(G) | 3.788 | 06-01-77 | | 103,000 | 81,370 |
Term loans (I) 0.6% (0.4% of Total investments) | | $1,101,064 |
(Cost $1,097,796) | | | | | |
Communication services 0.1% | | | | | 194,250 |
Entertainment 0.1% | | | | | |
Metro-Goldwyn-Mayer, Inc., 2018 2nd Lien Term Loan (1 month LIBOR + 4.500%) | 6.990 | 07-03-26 | | 200,000 | 194,250 |
Financials 0.1% | | | | | 132,799 |
Capital markets 0.1% | | | | | |
LSF9 Atlantis Holdings LLC, 2017 Term Loan (1 month LIBOR + 6.000%) | 8.474 | 05-01-23 | | 143,438 | 132,799 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 19 |
| Rate (%) | Maturity date | | Par value^ | Value |
Health care 0.4% | | | | | $774,015 |
Health care providers and services 0.4% | | | | | |
Concentra, Inc., 2018 2nd Lien Term Loan (1 month LIBOR + 6.500%) | 8.980 | 06-01-23 | | 259,999 | 261,515 |
|
Gentiva Health Services, Inc., 2018 2nd Lien Term Loan (1 month LIBOR + 7.000%) | 9.500 | 07-02-26 | | 500,000 | 512,500 |
Collateralized mortgage obligations 9.7% (6.4% of Total investments) | | $16,765,579 |
(Cost $16,516,045) | | | | | |
Commercial and residential 7.7% | | | | | 13,407,449 |
Americold LLC Series 2010-ARTA, Class D (C) | 7.443 | 01-14-29 | | 605,000 | 638,539 |
Angel Oak Mortgage Trust I LLC Series 2018-3, Class A1 (C)(J) | 3.649 | 09-25-48 | | 196,968 | 198,171 |
Arroyo Mortgage Trust Series 2018-1, Class A1 (C)(J) | 3.763 | 04-25-48 | | 695,805 | 703,538 |
BAMLL Commercial Mortgage Securities Trust Series 2015-200P, Class C (C)(J) | 3.716 | 04-14-33 | | 490,000 | 492,959 |
BBCMS Mortgage Trust Series 2018-TALL, Class E (1 month LIBOR + 2.437%) (C)(G) | 4.910 | 03-15-37 | | 214,000 | 214,267 |
BBCMS Trust | | | | | |
Series 2015-MSQ, Class D (C)(J) | 4.123 | 09-15-32 | | 480,000 | 479,374 |
Series 2015-SRCH, Class D (C)(J) | 5.122 | 08-10-35 | | 295,000 | 307,951 |
Bear Stearns Adjustable Rate Mortgage Trust Series 2005-1, Class B2 (E)(J) | 3.518 | 03-25-35 | | 405 | 11,132 |
BWAY Mortgage Trust Series 2015-1740, Class XA IO (C) | 1.023 | 01-10-35 | | 6,885,000 | 167,825 |
BX Commercial Mortgage Trust Series 2018-BIOA, Class D (1 month LIBOR + 1.321%) (C)(G) | 3.794 | 03-15-37 | | 245,000 | 244,998 |
CGBAM Commercial Mortgage Trust Series 2015-SMRT, Class F (C)(J) | 3.912 | 04-10-28 | | 325,000 | 327,204 |
CGDBB Commercial Mortgage Trust Series 2017-BIOC, Class E (1 month LIBOR + 2.150%) (C)(G) | 4.623 | 07-15-32 | | 264,000 | 264,000 |
CHT Mortgage Trust Series 2017-CSMO, Class D (1 month LIBOR + 2.250%) (C)(G) | 4.723 | 11-15-36 | | 370,000 | 370,693 |
Citigroup Commercial Mortgage Trust Series 2017-1500, Class E (1 month LIBOR + 2.500%) (C)(G) | 4.973 | 07-15-32 | | 126,000 | 124,383 |
CLNS Trust Series 2017-IKPR, Class C (1 month LIBOR + 1.100%) (C)(G) | 3.584 | 06-11-32 | | 160,000 | 159,798 |
Cold Storage Trust Series 2017-ICE3, Class D (1 month LIBOR + 2.100%) (C)(G) | 4.573 | 04-15-36 | | 305,000 | 305,088 |
COLT Mortgage Loan Trust | | | | | |
Series 2018-2, Class A1 (C)(J) | 3.470 | 07-27-48 | | 66,982 | 67,208 |
Series 2019-2, Class A1 (C)(J) | 3.337 | 05-25-49 | | 250,907 | 251,023 |
20 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
| Rate (%) | Maturity date | | Par value^ | Value |
Commercial and residential (continued) | | | | | |
Commercial Mortgage Trust (Cantor Fitzgerald/Deutsche Bank AG) | | | | | |
Series 2012-CR2, Class XA IO | 1.808 | 08-15-45 | | 1,837,879 | $80,432 |
Series 2012-CR3 Class XA IO | 1.869 | 10-15-45 | | 2,651,153 | 140,162 |
Commercial Mortgage Trust (Citigroup/Deutsche Bank AG) Series 2018-COR3, Class XA IO | 0.448 | 05-10-51 | | 2,757,271 | 97,697 |
Commercial Mortgage Trust (Deutsche Bank AG) | | | | | |
Series 2012-LC4, Class B (J) | 4.934 | 12-10-44 | | 360,000 | 372,914 |
Series 2013-300P, Class D (C)(J) | 4.540 | 08-10-30 | | 340,000 | 349,724 |
Series 2014-TWC, Class D (1 month LIBOR + 2.250%) (C)(G) | 4.723 | 02-13-32 | | 445,000 | 445,139 |
Core Industrial Trust Series 2015-CALW, Class XA IO (C) | 0.939 | 02-10-34 | | 3,601,156 | 68,271 |
GAHR Commercial Mortgage Trust | | | | | |
Series 2015-NRF, Class DFX (C)(J) | 3.495 | 12-15-34 | | 270,000 | 268,613 |
Series 2015-NRF, Class EFX (C)(J) | 3.495 | 12-15-34 | | 495,000 | 491,025 |
Galton Funding Mortgage Trust Series 2018-1, Class A43 (C)(J) | 3.500 | 11-25-57 | | 151,598 | 151,923 |
Great Wolf Trust Series 2017-WOLF, Class E (1 month LIBOR + 3.100%) (C)(G) | 5.573 | 09-15-34 | | 90,000 | 90,281 |
GS Mortgage Securities Trust | | | | | |
Series 2012-GC17, Class XA IO | 2.363 | 05-10-45 | | 9,300,579 | 368,508 |
Series 2016-RENT, Class D (C)(J) | 4.202 | 02-10-29 | | 420,000 | 421,337 |
Series 2017-485L, Class C (C)(J) | 4.115 | 02-10-37 | | 240,000 | 240,171 |
HarborView Mortgage Loan Trust | | | | | |
Series 2005-2, Class X IO | 0.955 | 05-19-35 | | 3,251,765 | 120,965 |
Series 2007-3, Class ES IO (C) | 0.350 | 05-19-47 | | 4,960,348 | 86,277 |
Series 2007-4, Class ES IO | 0.350 | 07-19-47 | | 5,108,567 | 85,008 |
Series 2007-6, Class ES IO (C) | 0.353 | 08-19-37 | | 4,321,465 | 62,235 |
Hilton Orlando Trust Series 2018-ORL, Class D (1 month LIBOR + 1.700%) (C)(G) | 4.173 | 12-15-34 | | 110,000 | 110,136 |
IMT Trust Series 2017-APTS, Class CFX (C)(J) | 3.613 | 06-15-34 | | 190,000 | 189,239 |
IndyMac Index Mortgage Loan Trust | | | | | |
Series 2005-AR12, Class AX2 IO | 1.172 | 07-25-35 | | 3,550,438 | 93,549 |
Series 2005-AR8, Class AX2 IO | 0.886 | 05-25-35 | | 3,445,373 | 122,489 |
Series 2005-AR18, Class 1X IO | 1.006 | 10-25-36 | | 4,989,951 | 198,355 |
Series 2005-AR18, Class 2X IO | 0.467 | 10-25-36 | | 4,507,622 | 70,194 |
JPMorgan Chase Commercial Mortgage Securities Trust | | | | | |
Series 2012-HSBC, Class XA IO (C) | 1.582 | 07-05-32 | | 2,699,832 | 108,316 |
Series 2018-PHH, Class A (1 month LIBOR + 0.910%) (C)(G) | 3.383 | 06-15-35 | | 170,000 | 169,785 |
Morgan Stanley Capital I Trust Series 2017-CLS, Class D (1 month LIBOR + 1.400%) (C)(G) | 3.873 | 11-15-34 | | 304,000 | 303,809 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 21 |
| Rate (%) | Maturity date | | Par value^ | Value |
Commercial and residential (continued) | | | | | |
MSCG Trust Series 2016-SNR, Class D (C) | 6.550 | 11-15-34 | | 395,250 | $395,763 |
Natixis Commercial Mortgage Securities Trust | | | | | |
Series 2018-285M, Class D (C)(J) | 3.917 | 11-15-32 | | 100,000 | 100,098 |
Series 2018-ALXA, Class C (C)(J) | 4.460 | 01-15-43 | | 175,000 | 183,937 |
One Market Plaza Trust Series 2017-1MKT, Class D (C) | 4.146 | 02-10-32 | | 190,000 | 193,776 |
Starwood Mortgage Residential Trust Series 2018-IMC1, Class A1 (C)(J) | 3.793 | 03-25-48 | | 123,121 | 124,289 |
UBS Commercial Mortgage Trust Series 2012-C1, Class B | 4.822 | 05-10-45 | | 405,000 | 420,734 |
VNDO Mortgage Trust Series 2013-PENN, Class D (C)(J) | 4.079 | 12-13-29 | | 327,000 | 327,960 |
Wells Fargo Commercial Mortgage Trust | | | | | |
Series 2013-120B, Class C (C)(J) | 2.800 | 03-18-28 | | 275,000 | 272,858 |
Series 2017-SMP, Class D (1 month LIBOR + 1.650%) (C)(G) | 4.123 | 12-15-34 | | 120,000 | 119,773 |
WF-RBS Commercial Mortgage Trust | | | | | |
Series 2012-C9, Class XA IO (C) | 2.039 | 11-15-45 | | 3,462,373 | 188,245 |
Series 2013-C15, Class B (J) | 4.622 | 08-15-46 | | 155,000 | 162,052 |
Series 2013-C16, Class B (J) | 5.195 | 09-15-46 | | 265,000 | 283,259 |
U.S. Government Agency 2.0% | | | | | 3,358,130 |
Federal Home Loan Mortgage Corp. | | | | | |
Series K005, Class AX IO | 1.343 | 11-25-19 | | 2,176,309 | 12,202 |
Series K017, Class X1 IO | 1.303 | 12-25-21 | | 3,559,791 | 99,935 |
Series K018, Class X1 IO | 1.343 | 01-25-22 | | 3,310,565 | 94,991 |
Series K021, Class X1 IO | 1.440 | 06-25-22 | | 911,552 | 34,876 |
Series K022, Class X1 IO | 1.230 | 07-25-22 | | 3,722,809 | 123,332 |
Series K718, Class X1 IO | 0.623 | 01-25-22 | | 15,893,315 | 223,835 |
Government National Mortgage Association | | | | | |
Series 2012-114, Class IO | 0.766 | 01-16-53 | | 1,358,454 | 61,879 |
Series 2016-174, Class IO | 0.914 | 11-16-56 | | 1,965,117 | 148,386 |
Series 2017-109, Class IO | 0.610 | 04-16-57 | | 2,550,762 | 136,071 |
Series 2017-124, Class IO | 0.706 | 01-16-59 | | 3,211,895 | 203,234 |
Series 2017-135, Class IO | 0.839 | 10-16-58 | | 2,071,005 | 138,458 |
Series 2017-140, Class IO | 0.609 | 02-16-59 | | 1,886,768 | 110,475 |
Series 2017-20, Class IO | 0.748 | 12-16-58 | | 3,976,247 | 241,038 |
Series 2017-22, Class IO | 1.022 | 12-16-57 | | 1,388,018 | 118,263 |
Series 2017-46, Class IO | 0.621 | 11-16-57 | | 2,993,976 | 169,824 |
Series 2017-61, Class IO | 0.769 | 05-16-59 | | 1,803,811 | 125,079 |
Series 2017-74, Class IO | 0.777 | 09-16-58 | | 3,323,212 | 195,587 |
Series 2018-114, Class IO | 0.540 | 04-16-60 | | 4,005,452 | 231,455 |
Series 2018-158, Class IO | 0.726 | 05-16-61 | | 2,718,011 | 201,470 |
Series 2018-35, Class IO | 0.526 | 03-16-60 | | 3,066,593 | 169,846 |
Series 2018-43, Class IO | 0.577 | 05-16-60 | | 4,802,771 | 267,099 |
22 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
| Rate (%) | Maturity date | | Par value^ | Value |
U.S. Government Agency (continued) | | | | | |
Series 2018-69, Class IO | 0.535 | 04-16-60 | | 2,152,407 | $121,644 |
|
Series 2018-9, Class IO | 0.558 | 01-16-60 | | 2,271,528 | 129,151 |
Asset backed securities 9.5% (6.3% of Total investments) | | $16,525,938 |
(Cost $16,375,830) | | | | | |
Asset backed securities 9.5% | | | | | 16,525,938 |
AccessLex Institute Series 2007-A, Class A3 (3 month LIBOR + 0.300%) (G) | 2.951 | 05-25-36 | | 266,369 | 261,854 |
Ally Auto Receivables Trust Series 2018-2, Class A4 | 3.090 | 06-15-23 | | 315,000 | 318,965 |
Americredit Automobile Receivables Trust | | | | | |
Series 2018-2, Class C | 3.590 | 06-18-24 | | 195,000 | 198,339 |
Series 2018-3, Class C | 3.740 | 10-18-24 | | 158,000 | 161,721 |
Applebee's Funding LLC Series 2014-1, Class A2 (C) | 4.277 | 09-05-44 | | 469,063 | 467,878 |
Arby's Funding LLC Series 2015-1A, Class A2 (C) | 4.969 | 10-30-45 | | 617,600 | 631,768 |
Avis Budget Rental Car Funding AESOP LLC Series 2019-1A, Class A (C) | 3.450 | 03-20-23 | | 215,000 | 217,635 |
CLI Funding LLC Series 2018-1A, Class A (C) | 4.030 | 04-18-43 | | 394,959 | 396,566 |
CNH Equipment Trust Series 2018-B, Class A3 | 3.190 | 11-15-23 | | 441,000 | 445,766 |
Coinstar Funding LLC Series 2017-1A, Class A2 (C) | 5.216 | 04-25-47 | | 372,400 | 379,557 |
Collegiate Funding Services Education Loan Trust Series 2005-A, Class A4 (3 month LIBOR + 0.200%) (G) | 3.013 | 03-28-35 | | 228,000 | 219,240 |
ContiMortgage Home Equity Loan Trust Series 1995-2, Class A5 | 8.100 | 08-15-25 | | 19,345 | 11,314 |
CWABS Asset-Backed Certificates Trust Series 2004-10, Class AF5B | 4.611 | 02-25-35 | | 157,482 | 157,110 |
DB Master Finance LLC | | | | | |
Series 2015-1A, Class A2II (C) | 3.980 | 02-20-45 | | 398,400 | 398,543 |
Series 2017-1A, Class A2I (C) | 3.629 | 11-20-47 | | 118,500 | 118,904 |
Series 2017-1A, Class A2II (C) | 4.030 | 11-20-47 | | 167,875 | 168,127 |
Series 2019-1A, Class A2I (C) | 3.787 | 05-20-49 | | 778,000 | 785,834 |
DLL LLC Series 2018-ST2, Class A3 (C) | 3.460 | 01-20-22 | | 275,000 | 277,908 |
Domino's Pizza Master Issuer LLC Series 2017-1A, Class A23 (C) | 4.118 | 07-25-47 | | 525,638 | 529,044 |
Driven Brands Funding LLC Series 2015-1A, Class A2 (C) | 5.216 | 07-20-45 | | 516,275 | 533,715 |
FOCUS Brands Funding LLC Series 2017-1A, Class A2I (C) | 3.857 | 04-30-47 | | 142,100 | 143,194 |
Ford Credit Floorplan Master Owner Trust Series 2018-3, Class A1 | 3.520 | 10-15-23 | | 695,000 | 708,350 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 23 |
| Rate (%) | Maturity date | | Par value^ | Value |
Asset backed securities (continued) | | | | | |
Hilton Grand Vacations Trust Series 2018-AA, Class A (C) | 3.540 | 02-25-32 | | 117,190 | $118,877 |
Honda Auto Receivables Owner Trust | | | | | |
Series 2018-2, Class A3 | 3.010 | 05-18-22 | | 250,000 | 251,891 |
Series 2018-3, Class A3 | 2.950 | 08-22-22 | | 195,000 | 196,267 |
Hyundai Auto Receivables Trust Series 2018-B, Class A3 | 3.200 | 12-15-22 | | 248,000 | 250,833 |
KeyCorp Student Loan Trust Series 2004-A, Class 1A2 (3 month LIBOR + 0.240%) (G) | 3.005 | 10-27-42 | | 231,984 | 225,131 |
MVW Owner Trust Series 2018-1A, Class A (C) | 3.450 | 01-21-36 | | 342,944 | 348,418 |
New Residential Mortgage LLC | | | | | |
Series 2018-FNT1, Class A (C) | 3.610 | 05-25-23 | | 257,176 | 259,483 |
Series 2018-FNT2, Class A (C) | 3.790 | 07-25-54 | | 162,696 | 164,035 |
NextGear Floorplan Master Owner Trust | | | | | |
Series 2017-1A, Class A2 (C) | 2.540 | 04-18-22 | | 365,000 | 363,959 |
Series 2018-1A, Class A2 (C) | 3.220 | 02-15-23 | | 105,000 | 105,532 |
Series 2018-2A, Class A2 (C) | 3.690 | 10-15-23 | | 265,000 | 269,716 |
Nissan Auto Receivables Owner Trust Series 2018-C, Class A3 | 3.220 | 06-15-23 | | 597,000 | 604,993 |
NRZ Excess Spread-Collateralized Notes | | | | | |
Series 2018-PLS1, Class A (C) | 3.193 | 01-25-23 | | 121,814 | 121,340 |
Series 2018-PLS2, Class A (C) | 3.265 | 02-25-23 | | 173,798 | 173,780 |
Oxford Finance Funding LLC Series 2019-1A, Class A2 (C) | 4.459 | 02-15-27 | | 142,000 | 143,604 |
Santander Drive Auto Receivables Trust | | | | | |
Series 2018-2, Class C | 3.350 | 07-17-23 | | 195,000 | 196,047 |
Series 2018-3, Class C | 3.510 | 08-15-23 | | 465,000 | 467,908 |
SLM Private Credit Student Loan Trust Series 2006-A, Class A5 (3 month LIBOR + 0.290%) (G) | 3.078 | 06-15-39 | | 118,941 | 116,311 |
Sonic Capital LLC Series 2016-1A, Class A2 (C) | 4.472 | 05-20-46 | | 210,217 | 213,173 |
Taco Bell Funding LLC Series 2018-1A, Class A2I (C) | 4.318 | 11-25-48 | | 471,818 | 484,731 |
Textainer Marine Containers VII, Ltd. Series 2018-1A, Class A (C) | 4.110 | 07-20-43 | | 151,360 | 154,082 |
Towd Point Mortgage Trust | | | | | |
Series 2015-1, Class A5 (C)(J) | 3.908 | 10-25-53 | | 125,000 | 129,350 |
Series 2015-2, Class 1M2 (C)(J) | 3.776 | 11-25-60 | | 300,000 | 308,181 |
Series 2017-2, Class A1 (C)(J) | 2.750 | 04-25-57 | | 97,973 | 96,802 |
Series 2018-1, Class A1 (C)(J) | 3.000 | 01-25-58 | | 179,691 | 178,047 |
Series 2018-3, Class A1 (C)(J) | 3.750 | 05-25-58 | | 269,855 | 273,952 |
Series 2018-4, Class A1 (C)(J) | 3.000 | 06-25-58 | | 431,161 | 425,131 |
Series 2018-5, Class A1A (C)(J) | 3.250 | 07-25-58 | | 119,756 | 119,541 |
Series 2019-1, Class A1 (C)(J) | 3.750 | 03-25-58 | | 261,634 | 266,104 |
Toyota Auto Receivables Owner Trust Series 2018-C, Class A3 | 3.020 | 12-15-22 | | 525,000 | 530,085 |
24 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
| Rate (%) | Maturity date | | Par value^ | Value |
Asset backed securities (continued) | | | | | |
Triton Container Finance V LLC Series 2018-1A, Class A (C) | 3.950 | 03-20-43 | | 316,542 | $317,448 |
Vantage Data Centers Issuer LLC Series 2018-1A, Class A2 (C) | 4.072 | 02-16-43 | | 197,667 | 200,085 |
Westgate Resorts LLC | | | | | |
Series 2015-2A, Class B (C) | 4.000 | 07-20-28 | | 79,377 | 79,182 |
Series 2016-1A, Class A (C) | 3.500 | 12-20-28 | | 102,664 | 102,705 |
Series 2017-1A, Class A (C) | 3.050 | 12-20-30 | | 171,065 | 170,177 |
Westlake Automobile Receivables Trust Series 2019-1A, Class C (C) | 4.050 | 03-15-24 | | 201,000 | 202,245 |
World Omni Automobile Lease Securitization Trust Series 2018-B, Class A3 | 3.190 | 12-15-21 | | 362,000 | 365,460 |
|
| | | | Shares | Value |
Common stocks 0.3% (0.2% of Total investments) | | $508,240 |
(Cost $515,695) | | | | | |
Energy 0.3% |
Oil, gas and consumable fuels 0.3% | | |
|
Royal Dutch Shell PLC, ADR, Class A | | | | 8,000 | 508,240 |
Preferred securities (K) 1.6% (1.1% of Total investments) | | $2,893,231 |
(Cost $2,737,293) | | | | | |
Consumer staples 0.3% | | | | | 546,875 |
Food and staples retailing 0.3% | |
Ocean Spray Cranberries, Inc., 6.250% (C) | | 6,250 | 546,875 |
Financials 0.5% | | | | | 908,134 |
Banks 0.5% | |
GMAC Capital Trust I (3 month LIBOR + 5.785%), 8.469% (G) | | 24,985 | 657,106 |
Wells Fargo & Company, Series L, 7.500% | | 192 | 251,028 |
Real estate 0.5% | | | | | 852,562 |
Equity real estate investment trusts 0.5% | |
Crown Castle International Corp., 6.875% | | 740 | 852,562 |
Utilities 0.3% | | | | | 585,660 |
Multi-utilities 0.3% | |
Dominion Energy, Inc., 6.750% | | 5,540 | 278,274 |
DTE Energy Company, 6.500% | | 4,475 | 249,750 |
Water utilities 0.0% | |
Aqua America, Inc., 6.000% | | 1,056 | 57,636 |
|
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 25 |
| Yield* (%) | Maturity date | | Par value^ | Value |
Short-term investments 0.8% (0.5% of Total investments) | $1,387,000 |
(Cost $1,387,000) | | | | | |
U.S. Government Agency 0.8% | | | | | 1,387,000 |
Federal Agricultural Mortgage Corp. Discount Note | 2.350 | 05-01-19 | | 544,000 | 544,000 |
Federal Home Loan Bank Discount Note | 2.300 | 05-01-19 | | 843,000 | 843,000 |
|
Total investments (Cost $260,804,730) 151.4% | | | $263,328,393 |
Other assets and liabilities, net (51.4%) | | | (89,446,644) |
Total net assets 100.0% | | | $173,881,749 |
The percentage shown for each investment category is the total value of the category as a percentage of the net assets of the fund unless otherwise indicated. |
^All par values are denominated in U.S. dollars unless otherwise indicated. |
Security Abbreviations and Legend |
ADR | American Depositary Receipt |
CMT | Constant Maturity Treasury |
IO | Interest-Only Security - (Interest Tranche of Stripped Mortgage Pool). Rate shown is the annualized yield at the end of the period. |
ISDAFIX | International Swaps and Derivatives Association Fixed Interest Rate Swap Rate |
LIBOR | London Interbank Offered Rate |
(A) | All or a portion of this security is on loan as of 4-30-19, and is a component of the fund's leverage under the Liquidity Agreement. |
(B) | All or a portion of this security is pledged as collateral pursuant to the Liquidity Agreement. Total collateral value at 4-30-19 was $103,335,963. A portion of the securities pledged as collateral were loaned pursuant to the Liquidity Agreement. The value of securities on loan amounted to $42,665,354. |
(C) | These securities are exempt from registration under Rule 144A of the Securities Act of 1933. Such securities may be resold, normally to qualified institutional buyers, in transactions exempt from registration. Rule 144A securities amounted to $66,887,819 or 38.5% of the fund's net assets as of 4-30-19. |
(D) | Non-income producing - Issuer is in default. |
(E) | Security is valued using significant unobservable inputs and is classified as Level 3 in the fair value hierarchy. |
(F) | Perpetual bonds have no stated maturity date. Date shown as maturity date is next call date. |
(G) | Variable rate obligation. The coupon rate shown represents the rate at period end. |
(H) | Includes hybrid securities with characteristics of both equity and debt that trade with, and pay, interest income. |
(I) | Term loans are variable rate obligations. The coupon rate shown represents the rate at period end. |
(J) | Variable or floating rate security, the interest rate of which adjusts periodically based on a weighted average of interest rates and prepayments on the underlying pool of assets. The interest rate shown is the current rate as of period end. |
(K) | Includes preferred stocks and hybrid securities with characteristics of both equity and debt that pay dividends on a periodic basis. |
* | Yield represents either the annualized yield at the date of purchase, the stated coupon rate or, for floating rate securities, the rate at period end. |
At 4-30-19, the aggregate cost of investments for federal income tax purposes was $262,179,489. Net unrealized appreciation aggregated to $1,148,904, of which $5,109,925 related to gross unrealized appreciation and $3,961,021 related to gross unrealized depreciation.
26 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
STATEMENT OF ASSETS AND LIABILITIES 4-30-19 (unaudited)
Assets | |
Unaffiliated investments, at value (Cost $260,804,730) | $263,328,393 |
Cash | 91,636 |
Dividends and interest receivable | 2,240,816 |
Receivable for investments sold | 104,509 |
Other assets | 30,213 |
Total assets | 265,795,567 |
Liabilities | |
Liquidity agreement | 91,300,000 |
Payable for investments purchased | 270,579 |
Interest payable | 234,311 |
Payable to affiliates | |
Accounting and legal services fees | 21,421 |
Trustees' fees | 242 |
Other liabilities and accrued expenses | 87,265 |
Total liabilities | 91,913,818 |
Net assets | $173,881,749 |
Net assets consist of | |
Paid-in capital | $175,067,771 |
Total distributable earnings (loss) | (1,186,022) |
Net assets | $173,881,749 |
|
Net asset value per share | |
Based on 11,646,585 shares of beneficial interest outstanding - unlimited number of shares authorized with no par value | $ 14.93 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 27 |
STATEMENT OF OPERATIONSFor the six months ended 4-30-19 (unaudited)
Investment income | |
Interest | $5,766,624 |
Dividends | 110,168 |
Less foreign taxes withheld | (2,301) |
Total investment income | 5,874,491 |
Expenses | |
Investment management fees | 680,105 |
Interest expense | 1,403,561 |
Accounting and legal services fees | 20,062 |
Transfer agent fees | 41,277 |
Trustees' fees | 22,156 |
Custodian fees | 13,001 |
Printing and postage | 26,919 |
Professional fees | 31,414 |
Stock exchange listing fees | 11,775 |
Other | 4,971 |
Total expenses | 2,255,241 |
Less expense reductions | (9,436) |
Net expenses | 2,245,805 |
Net investment income | 3,628,686 |
Realized and unrealized gain (loss) | |
Net realized gain (loss) on | |
Unaffiliated investments | 140,538 |
| 140,538 |
Change in net unrealized appreciation (depreciation) of | |
Unaffiliated investments | 8,679,893 |
| 8,679,893 |
Net realized and unrealized gain | 8,820,431 |
Increase in net assets from operations | $12,449,117 |
| |
28 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
STATEMENTS OF CHANGES IN NET ASSETS
| Six months ended 4-30-19 (unaudited) | Year ended 10-31-18 |
Increase (decrease) in net assets | | |
From operations | | |
Net investment income | $3,628,686 | $7,667,910 |
Net realized gain (loss) | 140,538 | (345,298) |
Change in net unrealized appreciation (depreciation) | 8,679,893 | (14,450,218) |
Increase (decrease) in net assets resulting from operations | 12,449,117 | (7,127,606) |
Distributions to shareholders | | |
From net investment income and net realized gain | (4,200,924) | (8,611,487) |
Total distributions | (4,200,924) | (8,611,487) |
Total increase (decrease) | 8,248,193 | (15,739,093) |
Net assets | | |
Beginning of period | 165,633,556 | 181,372,649 |
End of period | $173,881,749 | $165,633,556 |
Share activity | | |
Shares outstanding | | |
Beginning of period | 11,646,585 | 11,646,585 |
End of period | 11,646,585 | 11,646,585 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST | 29 |
STATEMENT OF CASH FLOWSFor the six months ended 4-30-19 (unaudited)
| |
Cash flows from operating activities | |
Net increase in net assets from operations | $12,449,117 |
Adjustments to reconcile net increase in net assets from operations to net cash provided by operating activities: | |
Long-term investments purchased | (65,392,834) |
Long-term investments sold | 63,640,749 |
Net purchases and sales in short-term investments | 1,565,000 |
Net amortization of premium (discount) | 795,719 |
(Increase) Decrease in assets: | |
Dividends and interest receivable | 126,908 |
Receivable for investments sold | (22,092) |
Other assets | (11,575) |
Increase (Decrease) in liabilities: | |
Payable for investments purchased | (160,020) |
Interest payable | 7,478 |
Payable to affiliates | (5,642) |
Other liabilities and accrued expenses | 14,941 |
Net change in unrealized (appreciation) depreciation on: | |
Investments | (8,679,893) |
Net realized (gain) loss on: | |
Investments | (128,926) |
Net cash provided by operating activities | $4,198,930 |
Cash flows provided by (used in) financing activities | |
Distributions to shareholders | $(4,200,924) |
Net cash used in financing activities | $(4,200,924) |
Net decrease in cash | $(1,994) |
Cash at beginning of period | $93,630 |
Cash at end of period | $91,636 |
Supplemental disclosure of cash flow information: | |
Cash paid for interest | $1,396,083 |
30 | JOHN HANCOCK INCOME SECURITIES TRUST | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
Period ended | 4-30-191 | 10-31-18 | 10-31-17 | 10-31-16 | 10-31-15 | 10-31-14 |
Per share operating performance | | | | | | |
Net asset value, beginning of period | $14.22 | $15.57 | $15.49 | $15.14 | $15.84 | $15.37 |
Net investment income2 | 0.31 | 0.66 | 0.75 | 0.79 | 0.81 | 0.86 |
Net realized and unrealized gain (loss) on investments | 0.76 | (1.27) | 0.14 | 0.41 | (0.62) | 0.56 |
Total from investment operations | 1.07 | (0.61) | 0.89 | 1.20 | 0.19 | 1.42 |
Less distributions | | | | | | |
From net investment income | (0.36) | (0.74) | (0.81) | (0.85) | (0.90) | (0.95) |
Anti-dilutive impact of repurchase plan | — | — | — | — | 0.013 | — |
Net asset value, end of period | $14.93 | $14.22 | $15.57 | $15.49 | $15.14 | $15.84 |
Per share market value, end of period | $14.07 | $13.14 | $14.81 | $14.26 | $13.86 | $14.29 |
Total return at net asset value (%)4,5 | 7.836 | (3.76) | 6.28 | 8.52 | 1.84 | 10.02 |
Total return at market value (%)4 | 9.976 | (6.50) | 9.82 | 9.20 | 3.28 | 6.83 |
Ratios and supplemental data | | | | | | |
Net assets, end of period (in millions) | $174 | $166 | $181 | $180 | $176 | $186 |
Ratios (as a percentage of average net assets): | | | | | | |
Expenses before reductions | 2.707 | 2.34 | 1.82 | 1.58 | 1.45 | 1.33 |
Expenses including reductions8 | 2.697 | 2.32 | 1.81 | 1.57 | 1.43 | 1.32 |
Net investment income | 4.357 | 4.44 | 4.87 | 5.24 | 5.22 | 5.50 |
Portfolio turnover (%) | 25 | 68 | 47 | 43 | 51 | 52 |
Senior securities | | | | | | |
Total debt outstanding end of period (in millions) | $91 | $91 | $91 | $91 | $91 | $91 |
Asset coverage per $1,000 of debt9 | $2,905 | $2,814 | $2,987 | $2,977 | $2,932 | $3,037 |
1 | Six months ended 4-30-19. Unaudited. |
2 | Based on average daily shares outstanding. |
3 | The repurchase plan was completed at an average repurchase price of $13.86 for 96,519 shares for the period ended 10-31-15. |
4 | Total return based on net asset value reflects changes in the fund’s net asset value during each period. Total return based on market value reflects changes in market value. Each figure assumes that distributions from income, capital gains and tax return of capital, if any, were reinvested. |
5 | Total returns would have been lower had certain expenses not been reduced during the applicable periods. |
6 | Not annualized. |
7 | Annualized. |
8 | Expenses including reductions excluding interest expense were 1.01% (annualized), 1.01%, 0.99%, 1.02%, 1.01% and 1.00% for the periods ended 4-30-19, 10-31-18, 10-31-17, 10-31-16, 10-31-15 and 10-31-14, respectively. |
9 | Asset coverage equals the total net assets plus borrowings divided by the borrowings of the fund outstanding at period end (Note 7). As debt outstanding changes, the level of invested assets may change accordingly. Asset coverage ratio provides a measure of leverage. |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK Income Securities Trust | 31 |
Notes to financial statements (unaudited)
Note 1 — Organization
John Hancock Income Securities Trust (the fund) is a closed-end management investment company organized as a Massachusetts business trust and registered under the Investment Company Act of 1940, as amended (the 1940 Act).
Note 2 — Significant accounting policies
The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (US GAAP), which require management to make certain estimates and assumptions as of the date of the financial statements. Actual results could differ from those estimates and those differences could be significant. The fundqualifies as an investment company under Topic 946 of Accounting Standards Codification of US GAAP.
Events or transactions occurring after the end of the fiscal period through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the fund:
Security valuation.Investments are stated at value as of the scheduled close of regular trading on the New York Stock Exchange (NYSE), normally at 4:00 p.m., Eastern Time. In case of emergency or other disruption resulting in the NYSE not opening for trading or the NYSE closing at a time other than the regularly scheduled close, the net asset value (NAV) may be determined as of the regularly scheduled close of the NYSE pursuant to the fund's Valuation Policies and Procedures.
In order to value the securities, the fund uses the following valuation techniques: Debt obligations are typically valued based on the evaluated prices provided by an independent pricing vendor. Independent pricing vendors utilize matrix pricing which takes into account factors such as institutional-size trading in similar groups of securities, yield, quality, coupon rate, maturity, type of issue, trading characteristics and other market data, as well as broker supplied prices. Equity securities held by the fund are typically valued at the last sale price or official closing price on the exchange or principal market where the security trades. In the event there were no sales during the day or closing prices are not available, the securities are valued using the last available bid price. Foreign securities and currencies are valued in U.S. dollars based on foreign currency exchange rates supplied by an independent pricing vendor.
In certain instances, the Pricing Committee may determine to value equity securities using prices obtained from another exchange or market if trading on the exchange or market on which prices are typically obtained did not open for trading as scheduled, or if trading closed earlier than scheduled, and trading occurred as normal on another exchange or market.
Other portfolio securities and assets, for which reliable market quotations are not readily available, are valued at fair value as determined in good faith by the fund's Pricing Committee following procedures established by the Board of Trustees. The frequency with which these fair valuation procedures are used cannot be predicted and fair value of securities may differ significantly from the value that would have been used had a ready market for such securities existed. Trading in foreign securities may be completed before the scheduled daily close of trading on the NYSE. Significant events at the issuer or market level may affect the values of securities between the time when the valuation of the securities is generally determined and the close of the NYSE. If a significant event occurs, these securities may be fair valued, as determined in good faith by the fund's Pricing Committee, following procedures established by the Board of Trustees. The fund uses fair value adjustment factors provided by an independent pricing vendor to value certain foreign securities in order to adjust for events that may occur between the close of foreign exchanges or markets and the close of the NYSE.
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 32
The fund uses a three-tier hierarchy to prioritize the pricing assumptions, referred to as inputs, used in valuation techniques to measure fair value. Level 1 includes securities valued using quoted prices in active markets for identical securities. Level 2 includes securities valued using other significant observable inputs. Observable inputs may include quoted prices for similar securities, interest rates, prepayment speeds and credit risk. Prices for securities valued using these inputs are received from independent pricing vendors and brokers and are based on an evaluation of the inputs described. Level 3 includes securities valued using significant unobservable inputs when market prices are not readily available or reliable, including the fund's own assumptions in determining the fair value of investments. Factors used in determining value may include market or issuer specific events or trends, changes in interest rates and credit quality. The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. Changes in valuation techniques and related inputs may result in transfers into or out of an assigned level within the disclosure hierarchy.
The following is a summary of the values by input classification of the fund's investments as of April 30, 2019, by major security category or type:
| | | | |
| Total value at 4-30-19 | Level 1 quoted price | Level 2 significant observable inputs | Level 3 significant unobservable inputs |
Investments in securities: | | | | |
Assets | | | | |
U.S. Government and Agency obligations | $85,529,598 | — | $85,529,598 | — |
Foreign government obligations | 1,631,088 | — | 1,631,088 | — |
Corporate bonds | 136,905,285 | — | 136,905,285 | — |
Capital preferred securities | 81,370 | — | 81,370 | — |
Term loans | 1,101,064 | — | 1,101,064 | — |
Collateralized mortgage obligations | 16,765,579 | — | 16,754,447 | $11,132 |
Asset backed securities | 16,525,938 | — | 16,525,938 | — |
Common stocks | 508,240 | $508,240 | — | — |
Preferred securities | 2,893,231 | 1,493,794 | 1,399,437 | — |
Short-term investments | 1,387,000 | — | 1,387,000 | — |
Total investments in securities | $263,328,393 | $2,002,034 | $261,315,227 | $11,132 |
Security transactions and related investment income. Investment security transactions are accounted for on a trade date plus one basis for daily NAV calculations. However, for financial reporting purposes, investment transactions are reported on trade date. Interest income is accrued as earned. Interest income includes coupon interest and amortization/accretion of premiums/discounts on debt securities. Debt obligations may be placed in a non-accrual status and related interest income may be reduced by stopping current accruals and writing off interest receivable when the collection of all or a portion of interest has become doubtful. Dividend income is recorded on the ex-date, except for dividends of foreign securities where the dividend may not be known until after the ex-date. In those cases, dividend income, net of withholding taxes, is recorded when the fund becomes aware of the dividends. Non-cash dividends, if any, are recorded at the fair market value of the securities received. Distributions received on securities that represent a tax return of capital or capital gain are recorded as a reduction of cost of investments and/or as a realized gain if amounts are estimable. Gains and losses on securities sold are determined on the basis of identified cost and may include proceeds from litigation.
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 33
Real estate investment trusts. The fund may invest in real estate investment trusts (REITs). Distributions from REITs may be recorded as income and subsequently characterized by the REIT at the end of the fiscal year as a reduction of cost of investments and/or as a realized gain. As a result, the fund will estimate the components of distributions from these securities. Such estimates are revised when the actual components of the distributions are known.
Foreign investing. Assets, including investments, and liabilities denominated in foreign currencies are translated into U.S. dollar values each day at the prevailing exchange rate. Purchases and sales of securities, income and expenses are translated into U.S. dollars at the prevailing exchange rate on the date of the transaction. The effect of changes in foreign currency exchange rates on the value of securities is reflected as a component of the realized and unrealized gains (losses) on investments. Foreign investments are subject to a decline in the value of a foreign currency versus the U.S. dollar, which reduces the dollar value of securities denominated in that currency.
Funds that invest internationally generally carry more risk than funds that invest strictly in U.S. securities. These risks are heightened for investments in emerging markets. Risks can result from differences in economic and political conditions, regulations, market practices (including higher transaction costs), accounting standards and other factors.
Foreign taxes. The fund may be subject to withholding tax on income, capital gains or repatriation taxes imposed by certain countries, a portion of which may be recoverable. Foreign taxes are accrued based upon the fund's understanding of the tax rules and rates that exist in the foreign markets in which it invests. Taxes are accrued based on gains realized by the fund as a result of certain foreign security sales. In certain circumstances, estimated taxes are accrued based on unrealized appreciation of such securities. Investment income is recorded net of foreign withholding taxes.
Stripped securities. Stripped securities are financial instruments structured to separate principal and interest cash flows so that one class receives principal payments from the underlying assets (PO or principal only), while the other class receives the interest cash flows (IO or interest only). Both PO and IO investments represent an interest in the cash flows of an underlying stripped security. If the underlying assets experience greater than anticipated prepayments of principal, the fund may fail to fully recover its initial investment in an IO security. The market value of these securities can be extremely volatile in response to changes in interest rates or prepayments on the underlying securities. In addition, these securities also have the risk that the fund may not receive all or part of its principal or interest payments because the borrower or issuer has defaulted on its obligation.
Overdrafts. Pursuant to the custodian agreement, the fund's custodian may, in its discretion, advance funds to the fund to make properly authorized payments. When such payments result in an overdraft, the fund is obligated to repay the custodian for any overdraft, including any costs or expenses associated with the overdraft. The custodian may have a lien, security interest or security entitlement in any fund property that is not otherwise segregated or pledged, to the maximum extent permitted by law, to the extent of any overdraft.
Expenses. Within the John Hancock group of funds complex, expenses that are directly attributable to an individual fund are allocated to such fund. Expenses that are not readily attributable to a specific fund are allocated among all funds in an equitable manner, taking into consideration, among other things, the nature and type of expense and the fund's relative net assets. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.
Federal income taxes. The fund intends to continue to qualify as a regulated investment company by complying with the applicable provisions of the Internal Revenue Code and will not be subject to federal income tax on taxable income that is distributed to shareholders. Therefore, no federal income tax provision is required.
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 34
For federal income tax purposes, as of October 31, 2018, the fund has a short-term capital loss carryforward of $1,048,671 and a long-term capital loss carryforward of $1,932,970 available to offset future net realized capital gains. These carryforwards do not expire.
As of October 31, 2018, the fund had no uncertain tax positions that would require financial statement recognition, derecognition or disclosure. The fund's federal tax returns are subject to examination by the Internal Revenue Service for a period of three years.
Distribution of income and gains. Distributions to shareholders from net investment income and net realized gains, if any, are recorded on the ex-date. The fund generally declares and pays dividends quarterly and capital gain distributions, if any, annually.
Such distributions, on a tax basis, are determined in conformity with income tax regulations, which may differ from US GAAP. Distributions in excess of tax basis earnings and profits, if any, are reported in the fund's financial statements as a return of capital. The final determination of tax characteristics of the fund's distribution will occur at the end of the year and will subsequently be reported to shareholders.
Capital accounts within the financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Temporary book-tax differences, if any, will reverse in a subsequent period. Book-tax differences are primarily attributable to expiration of a capital loss carryforward and amortization and accretion on debt securities.
Statement of cash flows. A Statement of cash flows is presented when a fund has a significant amount of borrowing during the period, based on the average total borrowing in relation to total assets, or when a certain percentage of the fund's investments is classified as Level 3 in the fair value hierarchy. Information on financial transactions that have been settled through the receipt and disbursement of cash is presented in the Statement of cash flows. The cash amount shown in the Statement of cash flows is the amount included in the fund's Statement of assets and liabilities and represents the cash on hand at the fund's custodian and does not include any short-term investments.
Note 3 — Guarantees and indemnifications
Under the fund's organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. Additionally, in the normal course of business, the fund enters into contracts with service providers that contain general indemnification clauses. The fund's maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the fund that have not yet occurred. The risk of material loss from such claims is considered remote.
Note 4 — Fees and transactions with affiliates
John Hancock Advisers, LLC (the Advisor) serves as investment advisor for the fund. The Advisor is an indirect, wholly owned subsidiary of Manulife Financial Corporation (MFC).
Management fee. The fund has an investment management agreement with the Advisor under which the fund pays a daily management fee to the Advisor equivalent on an annual basis to the sum of: (a) 0.650% of the first $150 million of the fund's average daily managed assets (net assets plus borrowings under the Liquidity Agreement (see Note 7), (b) 0.375% of the next $50 million of the fund's average daily managed assets, (c) 0.350% of the next $100 million of the fund's average daily managed assets and (d) 0.300% of the fund's average daily managed assets in excess of $300 million. The Advisor has a subadvisory agreement with Manulife Investment Management (US) LLC, an indirectly owned subsidiary of MFC and an affiliate of the Advisor. Prior to May 7, 2019, Manulife Investment
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 35
Management (US) LLC was known as John Hancock Asset Management, a division of Manulife Asset Management (US) LLC. The fund is not responsible for payment of the subadvisory fees.
The Advisor has contractually agreed to waive a portion of its management fee and/or reimburse expenses for certain funds of the John Hancock group of funds complex, including the fund (the participating portfolios). This waiver is based upon aggregate net assets of all the participating portfolios. The amount of the reimbursement is calculated daily and allocated among all the participating portfolios in proportion to the daily net assets of each fund. During the six months ended April 30, 2019, this waiver amounted to 0.01% of the fund's average daily managed assets (on an annualized basis). This agreement expires on June 30, 2020, unless renewed by mutual agreement of the fund and the Advisor based upon a determination that this is appropriate under the circumstances at that time.
The expense reductions described above amounted to $9,436 for the six months ended April 30, 2019.
The investment management fees, including the impact of the waivers and reimbursements as described above, incurred for the six months ended April 30, 2019 were equivalent to a net annual effective rate of 0.52% of the fund's average daily managed assets.
Accounting and legal services. Pursuant to a service agreement, the fund reimburses the Advisor for all expenses associated with providing the administrative, financial, legal, compliance, accounting and recordkeeping services to the fund, including the preparation of all tax returns, periodic reports to shareholders and regulatory reports, among other services. These accounting and legal services fees incurred for the six months ended April 30, 2019 amounted to an annual rate of 0.02% of the fund's average daily managed assets.
Trustee expenses.The fund compensates each Trustee who is not an employee of the Advisor or its affiliates. These Trustees receive from the fund and the other John Hancock closed-end funds an annual retainer. In addition, Trustee out-of-pocket expenses are allocated to the fund based on its net assets relative to other funds within the John Hancock group of funds complex.
Note 5 — Fund share transactions
On March 12, 2015, the Board of Trustees approved a share repurchase plan, which is subsequently reviewed and approved by the Board of Trustees each year in December. Under the current share repurchase plan, the fund may purchase in the open market, up to 10% of its outstanding common shares as of December 31, 2018. The current share repurchase plan will remain in effect between January 1,2019 to December 31, 2019. During the six months ended April 30,2019 and the year ended October 31, 2018, the fund had no activities under the repurchase program.
Note 6 — Leverage risk
The fund utilizes a Liquidity Agreement to increase its assets available for investment. When the fund leverages its assets, shareholders bear the expenses associated with the Liquidity Agreement and have potential to benefit or be disadvantaged from the use of leverage. The Advisor's fee is also increased in dollar terms from the use of leverage. Consequently, the fund and the Advisor may have differing interests in determining whether to leverage the fund's assets. Leverage creates risks that may adversely affect the return for the holders of shares, including:
• | the likelihood of greater volatility of NAV and market price of shares; |
• | fluctuations in the interest rate paid for the use of the Liquidity Agreement; |
• | increased operating costs, which may reduce the fund's total return; |
• | the potential for a decline in the value of an investment acquired through leverage, while the fund's obligations under such leverage remains fixed; and |
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 36
• | the fund is more likely to have to sell securities in a volatile market in order to meet asset coverage or other debt compliance requirements. |
To the extent the income or capital appreciation derived from securities purchased with funds received from leverage exceeds the cost of leverage, the fund's return will be greater than if leverage had not been used; conversely, returns would be lower if the cost of the leverage exceeds the income or capital appreciation derived. The use of securities lending to obtain leverage in the fund's investments may subject the fund to greater risk of loss than would reinvestment of collateral in short-term highly rated investments.
In addition to the risks created by the fund's use of leverage, the fund is subject to the risk that it would be unable to timely, or at all, obtain replacement financing if the Liquidity Agreement is terminated. Were this to happen, the fund would be required to de-leverage, selling securities at a potentially inopportune time and incurring tax consequences. Further, the fund's ability to generate income from the use of leverage would be adversely affected.
Note 7 — Liquidity agreement
The fund has entered into a Liquidity Agreement (LA) with State Street Bank and Trust Company (SSB) that allows it to borrow or otherwise access up to $91.3 million (maximum facility amount) through a line of credit, securities lending and reverse repurchase agreements. The amounts outstanding at April 30, 2019 are shown in the Statement of assets and liabilities as the Liquidity agreement.
The fund pledges its assets as collateral to secure obligations under the LA. The fund retains the risks and rewards of the ownership of assets pledged to secure obligations under the LA and makes these assets available for securities lending and reverse repurchase transactions with SSB acting as the fund's authorized agent for these transactions. All transactions initiated through SSB are required to be secured with cash collateral received from the securities borrower (the Borrower) or cash is received from the reverse repurchase agreement (Reverse Repo) counterparties. Securities lending transactions will be secured with cash collateral in amounts at least equal to 100% of the market value of the securities utilized in these transactions. Cash received by SSB from securities lending or Reverse Repo transactions is credited against the amounts borrowed under the line of credit.
Upon return of securities by the Borrower or Reverse Repo counterparty, SSB will return the cash collateral to the Borrower or proceeds from the Reverse Repo, as applicable, which will eliminate the credit against the line of credit and will cause the drawdowns under the line of credit to increase by the amounts returned. Income earned on the loaned securities is retained by SSB, and any interest due on the reverse repurchase agreements is paid by SSB.
SSB has indemnified the fund for certain losses that may arise if the Borrower or a Reverse Repo Counterparty fails to return securities when due. With respect to securities lending transactions, upon a default of the securities borrower, SSB uses the collateral received from the Borrower to purchase replacement securities of the same issue, type, class and series. If the value of the collateral is less than the purchase cost of replacement securities, SSB is responsible for satisfying the shortfall but only to the extent that the shortfall is not due to any of the fund's losses on the reinvested cash collateral. Although the risk of the loss of the securities is mitigated by receiving collateral from the Borrower or proceeds from the Reverse Repo counterparty and through SSB indemnification, the fund could experience a delay in recovering securities or could experience a lower than expected return if the Borrower or Reverse Repo counterparty fails to return the securities on a timely basis.
Under normal circumstances, interest charged is at the rate of one month LIBOR (London Interbank Offered Rate) plus 0.60%, is payable monthly on the aggregate balance of the drawdowns outstanding under the LA. As of April 30, 2019, the fund had an aggregate balance of $91,300,000 at an interest rate of 3.08%, which is reflected in the
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 37
Liquidity agreement on the Statement of assets and liabilities. During the six months ended April 30, 2019, the average balance of the LA and the effective average interest rate were $91,300,000 and 3.43%, respectively.
After the six month anniversary of the effective date of the agreement, the fund may terminate the LA with 60 days' notice. If certain asset coverage and collateral requirements, or other covenants are not met, the LA could be deemed in default and result in termination. Absent a default or facility termination event, SSB is required to provide the fund with 360 days' notice prior to terminating the LA.
Note 8 — Purchase and sale of securities
Purchases and sales of securities, other than short-term securities and U.S. Treasury obligations, amounted to $39,519,961 and $34,724,159 respectively, for the period ended April 30, 2019. Purchases and sales of U.S. Treasury obligations aggregated $25,872,873 and $28,916,590, respectively, for the period ended April 30, 2019.
Note 9 — New accounting pronouncement
In March 2017, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2017-08, Premium Amortization on Purchased Callable Debt Securities, which shortens the premium amortization period for purchased non-contingently callable debt securities. The standard is effective for annual periods beginning after December 15, 2018 and interim periods within those fiscal years. Management does not expect the ASU to have an impact on the fund's net assets or total return. Depending upon holdings of the fund, the shortening of the premium amortization period could decrease interest income with a corresponding offset to unrealized gain (loss).
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 38
ADDITIONAL INFORMATION
Unaudited
Investment objective and policy
The fund is a closed-end, diversified management investment company, common shares of which were initially offered to the public on February 14, 1973, and are publicly traded on the New York Stock Exchange (the NYSE). The fund's investment objective is to generate a high level of current income consistent with prudent investment risk. There can be no assurance that the fund will achieve its investment objective. The fund utilizes a credit facility agreement to increase its assets available for investments.
Under normal circumstances, the fund invests at least 80% of its net assets (plus borrowings for investment purposes) in income securities, consisting of the following: (i) marketable corporate debt securities, (ii) governmental obligations and (iii) cash and commercial paper. The fund will notify shareholders at least 60 days prior to any change in this 80% investment policy. The fund may invest up to 20% of its total assets in income-producing preferred securities and common stocks.
Dividends and distributions
During the six months ended April 30, 2019, distributions from net investment income totaling $0.3607 per share were paid to shareholders. The dates of payments and the amounts per share were as follows:
| |
Payment date | Income distributions |
December 31, 2018 | $0.2085 |
March 29, 2019 | 0.1522 |
Total | $0.3607 |
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 39
Shareholder meeting
The fund held its Annual Meeting of Shareholders on Thursday, February 7, 2019. The following proposal was considered by the shareholders:
Proposal:To elect thirteen (13) Trustees to serve until their respective successors have been duly elected and qualified.
| | |
| Total votes for the nominee | Total votes withheld from the nominee |
Independent Trustees | | |
Charles L. Bardelis | 8,524,002.699 | 432,969.889 |
James R. Boyle | 8,539,607.699 | 417,364.889 |
Peter S. Burgess | 8,520,410.699 | 436,561.889 |
William H. Cunningham | 8,513,390.699 | 443,581.889 |
Grace K. Fey | 8,523,243.378 | 433,729.210 |
Theron S. Hoffman | 8,530,892.699 | 426,079.889 |
Deborah C. Jackson | 8,531,990.378 | 424,982.210 |
Hassell H. McClellan | 8,529,297.699 | 427,674.889 |
James M. Oates | 8,528,797.699 | 428,174.889 |
Steven R. Pruchansky | 8,523,844.699 | 433,127.889 |
Gregory A. Russo | 8,534,245.699 | 422,726.889 |
Non-Independent Trustee | | |
Andrew G. Arnott | 8,515,534.699 | 441,437.889 |
Marianne Harrison | 8,512,361.378 | 444,611.210 |
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 40
| |
Trustees
Hassell H. McClellan,Chairperson Steven R. Pruchansky,Vice Chairperson Andrew G. Arnott† Charles L. Bardelis* James R. Boyle Peter S. Burgess* William H. Cunningham Grace K. Fey Marianne Harrison†# Theron S. Hoffman* Deborah C. Jackson James M. Oates Gregory A. Russo
Officers
Andrew G. Arnott President
Francis V. Knox, Jr. Chief Compliance Officer
Charles A. Rizzo Chief Financial Officer
Salvatore Schiavone Treasurer
Christopher (Kit) Sechler** Secretary and Chief Legal Officer
| Investment advisor
John Hancock Advisers, LLC
Subadvisor
Manulife Investment Management (US) LLC
Portfolio Managers
Jeffrey N. Given, CFA Howard C. Greene, CFA
Custodian
State Street Bank and Trust Company
Transfer agent
Computershare Shareowner Services, LLC
Legal counsel
K&L Gates LLP
Stock symbol
Listed New York Stock Exchange: JHS
|
* Member of the Audit Committee
† Non-Independent Trustee
# Effective 6-19-18
** Effective 9-13-18
The fund's proxy voting policies and procedures, as well as the fund's proxy voting record for the most recent twelve-month period ended June 30, are available free of charge on the Securities and Exchange Commission (SEC) website at sec.gov or on our website.
All of the fund's holdings as of the end of the third month of every fiscal quarter are filed with the SEC on Form N-PORT within 60 days of the end of the fiscal quarter. The fund's Form N-PORT filings are available on our website and the SEC's website, sec.gov.
We make this information on your fund, as well asmonthly portfolio holdings, and other fund details available on our website at jhinvestments.com or by calling 800-852-0218.
The report is certified under the Sarbanes-Oxley Act, which requires closed-end funds and other public companies to affirm that, to the best of their knowledge, the information in their financial reports is fairly and accurately stated in all material respects. | | | |
| You can also contact us: |
| 800-852-0218 jhinvestments.com | Regular mail:
Computershare P.O. Box 505000 Louisville, KY 40233
| Express mail:
Computershare 462 South 4th Street, Suite 1600 Louisville, KY 40202
|
SEMIANNUAL REPORT | JOHN HANCOCK INCOME SECURITIES TRUST 41
John Hancock family of funds
| | |
DOMESTIC EQUITY FUNDS
Blue Chip Growth
Classic Value
Disciplined Value
Disciplined Value Mid Cap
Equity Income
Financial Industries
Fundamental All Cap Core
Fundamental Large Cap Core
Fundamental Large Cap Value
New Opportunities
Regional Bank
Small Cap Core
Small Cap Growth
Small Cap Value
U.S. Global Leaders Growth
U.S. Quality Growth
Value Equity
GLOBAL AND INTERNATIONAL EQUITY FUNDS
Disciplined Value International
Emerging Markets
Emerging Markets Equity
Fundamental Global Franchise
Global Equity
Global Shareholder Yield
Global Thematic Opportunities
International Dynamic Growth
International Growth
International Small Company
| | INCOME FUNDS
Bond
California Tax-Free Income
Emerging Markets Debt
Floating Rate Income
Government Income
High Yield
High Yield Municipal Bond
Income
Investment Grade Bond
Money Market
Short Duration Credit Opportunities
Spectrum Income
Strategic Income Opportunities
Tax-Free Bond
ALTERNATIVE AND SPECIALTY FUNDS
Absolute Return Currency
Alternative Asset Allocation
Disciplined Alternative Yield
Global Absolute Return Strategies
Infrastructure
Seaport Long/Short
|
The fund's investment objectives, risks, charges, and expenses are included in the prospectus and should be considered carefully before investing. For a prospectus, contact your financial professional, call John Hancock Investments at 800-852-0218, or visit the fund's website at jhinvestments.com. Please read the prospectus carefully before investing or sending money.
| | |
ASSET ALLOCATION
Balanced
Income Allocation
Multi-Index Lifetime Portfolios
Multi-Index Preservation Portfolios
Multimanager Lifestyle Portfolios
Multimanager Lifetime Portfolios
Retirement Income 2040
EXCHANGE-TRADED FUNDS
John Hancock Multifactor Consumer Discretionary ETF
John Hancock Multifactor Consumer Staples ETF
John Hancock Multifactor Developed International ETF
John Hancock Multifactor Emerging Markets ETF
John Hancock Multifactor Energy ETF
John Hancock Multifactor Financials ETF
John Hancock Multifactor Healthcare ETF
John Hancock Multifactor Industrials ETF
John Hancock Multifactor Large Cap ETF
John Hancock Multifactor Materials ETF
John Hancock Multifactor Media and Communications ETF
John Hancock Multifactor Mid Cap ETF
John Hancock Multifactor Small Cap ETF
John Hancock Multifactor Technology ETF
John Hancock Multifactor Utilities ETF
| | ENVIRONMENTAL, SOCIAL, AND GOVERNANCE FUNDS
ESG All Cap Core
ESG Core Bond
ESG International Equity
ESG Large Cap Core
CLOSED-END FUNDS
Financial Opportunities
Hedged Equity & Income
Income Securities Trust
Investors Trust
Preferred Income
Preferred Income II
Preferred Income III
Premium Dividend
Tax-Advantaged Dividend Income
Tax-Advantaged Global Shareholder Yield
|
John Hancock Multifactor ETF shares are bought and sold at market price (not NAV), and are not individually redeemed
from the fund. Brokerage commissions will reduce returns.
John Hancock ETFs are distributed by Foreside Fund Services, LLC, and are subadvised by Dimensional Fund Advisors LP.
Foreside is not affiliated with John Hancock Funds, LLC or Dimensional Fund Advisors LP.
Dimensional Fund Advisors LP receives compensation from John Hancock in connection with licensing rights to the
John Hancock Dimensional indexes. Dimensional Fund Advisors LP does not sponsor, endorse, or sell, and makes no
representation as to the advisability of investing in, John Hancock Multifactor ETFs.
John Hancock Investment Management
A trusted brand
John Hancock Investment Management is a premier asset manager
representing one of America's most trusted brands, with a heritage of
financial stewardship dating back to 1862. Helping our shareholders
pursue their financial goals is at the core of everything we do. It's why
we support the role of professional financial advice and operate with
the highest standards of conduct and integrity.
A better way to invest
We serve investors globally through a unique multimanager approach:
We search the world to find proven portfolio teams with specialized
expertise for every strategy we offer, then we apply robust investment
oversight to ensure they continue to meet our uncompromising
standards and serve the best interests of our shareholders.
Results for investors
Our unique approach to asset management enables us to provide
a diverse set of investments backed by some of the world's best
managers, along with strong risk-adjusted returns across asset classes.
John Hancock Advisers, LLC
200 Berkeley Street n Boston, MA 02116-5010 n 800-852-0218 n jhinvestments.com
ITEM 2. CODE OF ETHICS.
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable at this time.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable at this time.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable at this time.
ITEM 6. SCHEDULE OF INVESTMENTS.
(a) Not applicable.
(b) Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
(a) Not applicable.
(b)
| | | Total number of | Maximum number of |
| | | shares purchased | shares that may yet |
| Total number of | Average price per | as part of publicly | be purchased under |
Period | shares purchased | share | announced plans* | the plans |
Nov-18 | - | - | - | 1,164,659 |
Dec-18 | - | - | - | 1,164,659 |
Jan-19 | - | - | - | 1,164,659* |
Feb-19 | - | - | - | 1,164,659 |
Mar-19 | - | - | - | 1,164,659 |
Apr-19 | - | - | - | 1,164,659 |
Total | - | - | | |
| | | | |
| | | | |
*In March 2015, the Board of Trustees approved a share repurchase plan, which has been subsequently reviewed and approved by the Board of Trustees. Under the current share repurchase plan, the Fund may purchase in the open market up to 10% of its outstanding common shares as of December 31, 2018. The current share plan will remain in effect between January 1, 2019 and December 31, 2019. |
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The registrant has adopted procedures by which shareholders may recommend nominees to the registrant’s Board of Trustees. A copy of the procedures is filed as an exhibit to this Form N-CSR. See attached “John Hancock Funds – Nominating, Governance and Administration Committee Charter.”
ITEM 11. CONTROLS AND PROCEDURES.
(a) Based upon their evaluation of the registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this Form N-CSR, the registrant's principal executive officer and principal financial officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.
(b) There were no changes in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.
ITEM 12. DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
The Fund did not participate directly in securities lending activities. See Note 7 to financial statements in Item 1.
ITEM 13. EXHIBITS.
(a) Separate certifications for the registrant's principal executive officer and principal financial officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company Act of 1940, are attached.
(b)(1) Separate certifications for the registrant's principal executive officer and principal financial officer, as required by 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and Rule 30a-2(b) under the Investment Company Act of 1940, are attached. The certifications furnished pursuant to this paragraph are not deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section. Such certifications are not deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Registrant specifically incorporates them by reference.
(c)(1) Submission of Matters to a Vote of Security Holders is attached. See attached “John Hancock Funds – Nominating, Governance and Administration Committee Charter.”
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
John Hancock Income Securities Trust
By: | /s/ Andrew Arnott |
| Andrew Arnott |
| President |
|
Date: | June 21, 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/ Andrew Arnott |
| Andrew Arnott |
| President |
|
Date: | June 21, 2019 |
By: | /s/ Charles A. Rizzo |
| Charles A. Rizzo |
| Chief Financial Officer |
|
Date: | June 21, 2019 |