UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-10399
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HENDERSON GLOBAL FUNDS
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(Exact name of registrant as specified in charter)
737 NORTH MICHIGAN AVENUE, SUITE 1950
CHICAGO, ILLINOIS 60611
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(Address of principal executive offices)(Zip code)
(Name and Address of Agent for Service) Copy to:
CHRISTOPHER K. YARBROUGH CATHY G. O'KELLY
737 NORTH MICHIGAN AVENUE, SUITE 1950 VEDDER, PRICE, KAUFMAN & KAMMHOLZ
CHICAGO, ILLINOIS 60611 222 NORTH LASALLE STREET
CHICAGO, ILLINOIS 60601
Registrant's telephone number, including area code: (312) 397-1122
Date of fiscal year end: July 31
Date of reporting period: July 31, 2006
Item 1: Report to Shareholders.
[LOGO: HENDERSON GLOBAL INVESTORS]
HENDERSON GLOBAL FUNDS
ANNUAL REPORT
JULY 31, 2006
EUROPEAN FOCUS FUND
GLOBAL TECHNOLOGY FUND
INTERNATIONAL OPPORTUNITIES FUND
JAPAN-ASIA FOCUS FUND
WORLDWIDE INCOME FUND
U.S. CORE GROWTH FUND
TABLE OF CONTENTS
LETTER TO SHAREHOLDERS ...................................................... 1
EUROPEAN FOCUS FUND
Commentary .................................................................. 2
Performance Summary ......................................................... 3
GLOBAL TECHNOLOGY FUND
Commentary .................................................................. 4
Performance Summary ......................................................... 5
INTERNATIONAL OPPORTUNITIES FUND
Commentary .................................................................. 6
Performance Summary ......................................................... 7
JAPAN-ASIA FOCUS FUND
Commentary .................................................................. 8
Performance Summary ......................................................... 9
WORLDWIDE INCOME FUND
Commentary .................................................................. 10
Performance Summary ......................................................... 11
U.S. CORE GROWTH FUND
Commentary .................................................................. 12
Performance Summary ......................................................... 13
PORTFOLIOS OF INVESTMENTS ................................................... 14
STATEMENT OF ASSETS AND LIABILITIES ......................................... 32
STATEMENT OF OPERATIONS ..................................................... 34
STATEMENTS OF CHANGES IN NET ASSETS ......................................... 35
STATEMENTS OF CHANGES - CAPITAL STOCK ACTIVITY .............................. 41
FINANCIAL HIGHLIGHTS ........................................................ 48
NOTES TO FINANCIAL STATEMENTS ............................................... 54
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ..................... 61
OTHER INFORMATION ........................................................... 63
TRUSTEES AND OFFICERS ....................................................... 68
THERE ARE RISKS OF INVESTING IN FUNDS LIKE THE EUROPEAN FOCUS, GLOBAL
TECHNOLOGY, INTERNATIONAL OPPORTUNITIES, JAPAN-ASIA FOCUS AND WORLDWIDE INCOME
FUNDS THAT INVEST IN SECURITIES OF FOREIGN COUNTRIES, SUCH AS ERRATIC MARKET
CONDITIONS, ECONOMIC AND POLITICAL INSTABILITY, AND FLUCTUATIONS IN CURRENCY AND
EXCHANGE RATES. In addition, each Fund except the U.S. Core Growth Fund is
non-diversified, meaning they may invest in a limited geographic area or in a
small number of issuers. As such, investing in these Funds may involve greater
risk and volatility than investing in a more diversified fund. The European
Focus, Global Technology, International Opportunities, Japan-Asia Focus and
Worldwide Income Funds may also invest in securities issued by smaller
companies, which typically involves greater risk than investing in larger
companies. The Global Technology Fund's returns may be considerably more
volatile than a fund that does not invest in technology companies, because
technology companies may react similarly to certain market pressures and events.
This may be significantly affected by short product cycles, aggressive pricing
of products and services, competition from new market entrants, and obsolescence
of existing technology. There are risks of investing in funds similar to the
Worldwide Income Fund that invest in high yield securities. High yield, lower
rated bonds involve a greater degree of risk than investment grade bonds in
return for higher yield potential. As such, securities rated below investment
grade generally entail greater credit, market, issuer and liquidity risk than
investment grade securities. In addition, the Worldwide Income Fund is subject
to interest rate risk, which is the risk that the debt securities in the Fund's
portfolio will decline in value because of increases in market interest rates.
The views in this report were those of the Fund managers as of July 31, 2006,
and may not reflect the views of the managers on the date this report is first
published or anytime thereafter. These views are intended to assist shareholders
of the Funds in understanding their investment in the Funds and do not
constitute investment advice.
The page deliberately left blank.
HENDERSON GLOBAL FUNDS
LETTER TO SHAREHOLDERS
Dear fellow shareholder,
We are pleased to provide the annual report for the Henderson Global Funds,
which covers the year ended July 31, 2006.
Over the past year, we have generally seen a continuation of the general
economic recovery around the world. However, this has been tempered with market
volatility caused by concerns over high oil prices, geopolitical tensions, and
uncertainty over interest rates. Short-term fears over inflation have also led
to a significant tightening of global monetary conditions. During this time,
many international companies posted strong returns as investors generally sought
greater portfolio diversification. After a strong growth period, global equity
markets reached a five-year peak in May and then fell somewhat sharply, with
emerging markets hit the hardest. However, a robust second quarter earnings
season helped boost equities towards the end of the period. Looking forward, we
believe equity markets will be driven in the near future mainly by sentiment
about US inflation, interest rates and growth.
During the year we launched the Japan-Asia Focus Fund on January 31, 2006. In
May we decided to broaden the scope of the Worldwide Income Fund (formerly the
Income Advantage Fund) in order to leverage the experience of Henderson's
UK-based fixed income and equity teams and to increase the Fund's ability to
invest in a variety of attractive investment opportunities worldwide. We feel
that this could benefit shareholders by providing additional diversification
benefits while tapping into Henderson's significant expertise in this area.
Additionally, we are pleased to note that three of the Henderson Global Funds,
the European Focus Fund, Global Technology Fund and International Opportunities
Fund, are about to celebrate their five-year anniversary. Over the past five
years, we have maintained our bottom-up stock picking methodology, providing
investors with the global perspective and local insight that we feel
differentiate our Funds. We will remain focused on seeking out exciting
investment opportunities around the world and bringing them to our shareholders'
portfolios.
Thank you for investing in the Henderson Global Funds. We appreciate your trust
and support in our Funds and look forward to serving your financial needs in the
years to come.
/s/ Sean Dranfield
Sean Dranfield
President, Henderson Global Funds
1
HENDERSON GLOBAL FUNDS
COMMENTARY
EUROPEAN FOCUS FUND
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EUROPEAN FOCUS FUND
TOP 10 LONG-TERM HOLDINGS
AS A PERCENTAGE
SECURITY OF NET ASSETS
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NATIONAL BANK OF GREECE 3.0%
BAYER 2.9
SEADRILL 2.8
OMV 2.6
GAZPROM 2.5
PFLEIDERER 2.3
AZIMUT HOLDING 2.1
AXA 2.0
XSTRATA 1.8
CENTAMIN EGYPT 1.8
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Despite recent volatility, European equity markets have done well over the year
ended July 31, 2006. The European Focus Fund (the "Fund") has also performed
well, outperforming its benchmark, the MSCI Europe Index (the "Index") with a
return of 23.72% (A-shares at NAV) versus a return of 22.78% for the Index.
For most of the year, the macro economic picture in Europe has broadly continued
to improve and this has provided a supportive backdrop for the Fund's holdings.
Corporate restructuring and buoyant merger and acquisition activity seem to have
offset the disappointment of the indecisive German election and kept markets on
track.
Since May we have seen a sharp correction in equity markets amid concerns over
inflation and interest rates. Smaller companies in particular have suffered as
risk aversion has increased. However, the correction was not a huge surprise as
markets had increased quite aggressively over a relatively short period of time.
We believe that the volatility is likely to continue in the near-term,
especially given the escalation of the Middle East situation. We will also keep
a watchful eye on the US economy and on the housing market in particular. That
said, continuing European economic strength and the large pool of private equity
money provide a positive outlook on a nine to twelve-month view.
Our strategy over the period has remained largely unchanged. Throughout the
period we have continued to adhere to our "bottom up" stock-picking approach
that has served us well over recent years. At a sector level, our overweight in
the energy sector, particularly oil services companies, has boosted the Fund's
returns thanks to the high price of oil and increasing capital expenditure in
the sector.
The Fund continues to be predominantly focused on the established markets of
Western Europe. However, over the last year we have given more attention to
countries further east including Russia and Turkey. The weightings in these
countries are likely to remain small and we are conscious of the risks, but we
believe it would be short-sighted to ignore the ever changing dynamics in these
regions and the interesting companies that are emerging.
In summary, we remain cautiously optimistic as we look to the year ahead.
Markets are unlikely to find a significantly firmer footing until there is
greater clarity over the outlook for inflation, interest rates and economic
growth. However, after the market correction, European equity markets have very
attractive valuations and we believe provide a fertile hunting ground for our
stock picking approach.
2
HENDERSON GLOBAL FUNDS
PERFORMANCE SUMMARY
EUROPEAN FOCUS FUND
PIE CHARTS:
PORTFOLIO COMPOSITION BY COUNTRY
(AS A % OF TOTAL LONG-TERM INVESTMENTS)
United Kingdom 27.3%
Germany 11.4
France 8.2
Greece 7.1
Austria 6.8
Spain 6.6
Other 32.6
PORTFOLIO COMPOSITION BY SECTOR
(AS A % OF TOTAL LONG-TERM INVESTMENTS)
Financials 25.1%
Energy 18.1
Industrials 15.4
Consumer Discretionary 14.8
Materials 11.9
Information Technology 5.5
Other 9.2
Line Chart:
INVESTMENT COMPARISON
Value of $10,000
European Focus Fund Class A w/out sales charge - $36,694
European Focus Fund Class A w/sales charge - $34,584
MSCI Europe Index - $17,448
European Focus Fund European Focus Fund MSCI
Class A w/out sales charge Class A w/sales charge Europe Index
Date
8/31/01 10000 9425 10000
9910 9340 9002
10960 10330 9288
12120 11423 9661
12250 11546 9908
1/31/02 12110 11414 9391
12450 11734 9390
12980 12234 9902
13080 12328 9834
13280 12516 9816
12850 12111 9479
7/31/02 11610 10942 8426
11890 11206 8426
10610 10000 7318
11580 10914 8026
12520 11800 8420
12524 11804 8115
1/31/03 12353 11643 7732
11891 11207 7480
11700 11027 7372
13469 12694 8379
14665 13822 8932
15007 14144 9024
7/31/03 15549 14655 9209
16142 15214 9193
16786 15820 9381
17821 16796 10009
18650 17577 10436
20277 19111 11292
1/31/04 21819 20565 11426
23267 21929 11762
22696 21391 11398
22686 21381 11317
22485 21192 11495
23299 21959 11675
7/31/04 22062 20794 11355
21904 20644 11365
23193 21859 11820
24165 22776 12248
26072 24573 13150
27901 26296 13707
1/31/05 28252 26628 13455
29858 28141 14130
29284 27600 13779
28006 26396 13451
26822 25280 13518
27936 26329 13710
7/31/05 29659 27954 14211
30714 28948 14426
30726 28959 14776
29483 27788 14312
30420 28671 14559
31858 30026 15074
1/31/06 34457 32476 16061
35195 33171 16072
36532 34431 16703
39444 37176 17575
37282 35138 17120
36744 34631 17183
7/31/06 36694 34584 17448
TOTAL RETURNS AS OF JULY 31, 2006
SINCE
NASDAQ INCEPTION
AT NAV SYMBOL CLASS ONE YEAR THREE YEARS* (8/31/01)*
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Henderson European Focus Fund HFEAX Class A 23.72% 33.14% 30.26%
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Henderson European Focus Fund HFEBX Class B 22.79 32.20 29.32
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Henderson European Focus Fund HFECX Class C 22.80 32.19 29.31
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WITH SALES CHARGE
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Henderson European Focus Fund Class A 16.62% 30.54% 28.70%
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Henderson European Focus Fund Class B 18.79 31.63 29.25
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Henderson European Focus Fund Class C 22.80 32.19 29.31
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INDEX
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MSCI Europe Index 22.78% 23.74% 11.99%
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* Average annual return.
Performance data quoted represents past performance and is no guarantee of
future results. Performance results with sales charges reflect the deduction of
the maximum front end sales charge or the deduction of the applicable contingent
deferred sales charge ("CDSC"). Class A shares are subject to a maximum
front-end sales charge of 5.75%. Class B shares are subject to a CDSC which
declines from 5% the 1st year to 0% at the beginning of the 7th year. Class C
shares are subject to a CDSC of up to 1% on certain redemptions made within 12
months of purchase. Performance presented at Net Asset Value (NAV), which does
not include a sales charge, would be lower if this charge were reflected. NAV is
the value of one share of the Fund excluding any sales charges. Current
performance may be lower or higher than the performance data quoted. Investment
return and principal value will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than original cost. Shares redeemed within
30 days of purchase may be subject to a 2.0% redemption fee. For the most recent
month-end performance, please call 1.866.443.6337 or visit the Funds' website at
www.hendersonglobalinvestors.com.
Performance results also reflect expense subsidies and waivers in effect during
certain periods shown. Absent these waivers, results would have been less
favorable for certain periods. All results assume the reinvestment of dividends
and capital gains.
The investment comparison graph above reflects the change in value of a $10,000
hypothetical investment since the Fund's inception, including reinvested
dividends and distributions, compared to a broad based securities market index.
The MSCI Europe Index is a market capitalization weighted index of approximately
500 stocks traded in 16 European markets. The Fund is professionally managed
while the Index is unmanaged and not available for investment. Results in the
table and graph do not reflect the deduction of taxes that a shareholder would
pay on Fund distributions or the redemption of Fund shares.
3
HENDERSON GLOBAL FUNDS
COMMENTARY
GLOBAL TECHNOLOGY FUND
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GLOBAL TECHNOLOGY FUND
TOP 10 LONG-TERM HOLDINGS
AS A PERCENTAGE
SECURITY OF NET ASSETS
- ---------------------------------------------------
COMMSCOPE 3.4%
TEXAS INSTRUMENTS 3.2
ORACLE 3.1
MICROCHIP TECHNOLOGY 3.1
CISCO SYSTEMS 3.1
ACCENTURE 3.0
AUTODESK 3.0
HEWLETT-PACKARD 3.0
TOMTOM 2.9
CITRIX SYSTEMS 2.5
- ---------------------------------------------------
Global technology markets made strong progress for much of the reporting period,
driven by a benign macroeconomic environment, strong emerging market demand and
compelling new product cycles. Towards the end of the period, markets corrected
on concerns over inflation, interest rates and escalating tensions in the Middle
East. Technology markets were hardest hit as investors rotated into lower risk
areas of the market and stock option timing issues weighed on investor
sentiment. Disappointing desktop PC demand and conflicting datapoints from the
mobile handset foodchain also held back markets, while positive newsflow from
the Dramatic Random Access Memory (DRAM) segment and positive internet
advertising trends proved a welcome relief.
Over the year ended July 31, 2006, the Fund outperformed its benchmarks due
largely to strong stock selection. The Fund returned 5.83% (A-shares at NAV)
against the -1.26% return of the MSCI World IT Index and the 5.38% return of the
S&P 500 Index. Our choice of holdings within Communications Equipment and the
Internet sector proved particularly beneficial.
We have increased our position in internet holdings, as internet stocks have
continued their disruptive disintermediation of old economy business models at a
rapid pace, particularly within advertising.
Our overweight position has had a strong positive impact on the Fund's
performance, with a number of holdings producing exceptional returns. We have
recently been concentrating on smaller capitalization names where we see good
value and strong growth prospects.
Having been structurally underweight the communications equipment industry for
some time, we reduced the underweight at the beginning of 2006. We have a
positive view on those companies exposed to spending on wire-line broadband
infrastructure (especially cable related) and have significant exposure to this
theme in the routing and optical spaces. We remain highly skeptical of wireless
infrastructure spending.
We are now underweight in software, primarily as a function of a lack of
compelling bottom-up stock ideas. Within the sector, our exposure is mostly
limited to enterprise software names since we feel that while corporate capital
expenditure trends are strong, the consumer, particularly in the US, remains
vulnerable.
Recently we have increased our position in Information Technology (IT) services.
We believe offshore demand continues to gain traction driven by low billing
rates and increasing comfort with the services offered. India remains the number
one offshore destination and we are focused on companies with significant
operations there.
We believe that the broad backdrop for technology remains constructive over the
intermediate term, as relative valuation is favorable, corporate capital
expenditure trends seem supportive and several new product cycles are emerging.
Our view is dependent on the assumption of continuing moderate economic growth
on a global basis.
4
HENDERSON GLOBAL FUNDS
PERFORMANCE SUMMARY
GLOBAL TECHNOLOGY FUND
PIE CHARTS:
PORTFOLIO COMPOSITION BY COUNTRY
(AS A % OF TOTAL LONG-TERM INVESTMENTS)
United States 71.5%
Netherlands 5.7
Switzerland 3.7
Japan 3.3
Germany 2.8
Taiwan 2.1
Other 10.9
PORTFOLIO COMPOSITION BY INDUSTRY
(AS A % OF TOTAL LONG-TERM INVESTMENTS)
Semiconductor & Semi Equipment 23.4%
Communications Equipment 20.4
Software 14.3
Computers & Peripherals 13.5
IT Services 8.0
Internet Software & Services 6.1
Other 14.3
LINE CHART:
INVESTMENT COMPARISON
Value of $10,000
Global Technology Fund Class A w/out sales charge - $13,189
Global Technology Fund Class A w/sales charge - $12,430
MSCI World IT Index - $9,982
S&P 500 Index - $12,263
Global Technology Fund Global Technology Fund
Class A w/out Class A w/ MSCI World IT S&P 500
sales charge sales charge Index Index
Date
08/31/01 10,000 9,425 10,000 10,000
7,850 7,399 8,282 9,192
8,980 8,464 9,609 9,368
10,690 10,075 11,176 10,086
11,040 10,405 10,955 10,175
01/31/02 10,910 10,283 10,850 10,026
9,660 9,105 9,659 9,833
10,480 9,877 10,274 10,202
9,480 8,935 9,046 9,584
8,940 8,426 8,686 9,513
8,140 7,672 7,664 8,836
07/31/02 7,360 6,937 6,912 8,148
6,930 6,532 6,828 8,201
5,920 5,580 5,632 7,309
6,900 6,503 6,756 7,952
7,890 7,436 7,863 8,421
6,918 6,520 6,729 7,926
01/31/03 6,989 6,587 6,633 7,718
6,969 6,568 6,723 7,602
6,878 6,482 6,609 7,676
7,464 7,035 7,257 8,308
8,395 7,912 7,883 8,746
8,810 8,303 7,923 8,858
07/31/03 9,669 9,113 8,394 9,014
10,266 9,676 8,950 9,190
10,104 9,523 8,901 9,093
10,873 10,248 9,692 9,607
11,055 10,419 9,770 9,692
11,237 10,591 9,992 10,200
01/31/04 11,894 11,211 10,509 10,387
12,077 11,382 10,263 10,532
11,925 11,239 10,084 10,373
11,278 10,629 9,478 10,210
11,632 10,963 9,777 10,350
12,036 11,344 10,079 10,550
07/31/04 10,661 10,048 9,200 10,201
10,135 9,552 8,793 10,242
10,782 10,162 9,042 10,353
11,540 10,877 9,493 10,511
12,376 11,665 9,963 10,937
12,792 12,057 10,254 11,309
01/31/05 12,099 11,403 9,714 11,033
12,110 11,413 9,809 11,264
11,811 11,132 9,551 11,065
11,277 10,629 9,187 10,855
12,216 11,514 9,807 11,200
11,822 11,142 9,681 11,216
07/31/05 12,462 11,745 10,106 11,633
12,590 11,866 10,125 11,527
12,867 12,127 10,284 11,620
12,579 11,856 10,055 11,428
13,470 12,695 10,782 11,862
13,784 12,991 10,769 11,866
01/31/06 14,779 13,929 11,178 12,180
14,714 13,868 10,985 12,213
15,374 14,490 11,300 12,366
15,666 14,765 11,277 12,531
14,390 13,562 10,494 12,171
14,011 13,205 10,344 12,188
07/31/06 13,189 12,430 9,982 12,263
TOTAL RETURNS AS OF JULY 31, 2006
SINCE
NASDAQ INCEPTION
AT NAV SYMBOL CLASS ONE YEAR THREE YEARS* (8/31/01)*
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Henderson Global Technology Fund HFGAX Class A 5.83% 10.90% 5.79%
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Global Technology Fund HFGBX Class B 5.01 10.04 5.09
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Henderson Global Technology Fund HFGCX Class C 5.11 10.06 5.04
- ------------------------------------------------------------------------------------------------------------------------------------
WITH SALES CHARGE
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Global Technology Fund Class A -0.23% 8.74% 4.52%
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Henderson Global Technology Fund Class B 1.01 9.20 4.93
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Henderson Global Technology Fund Class C 5.11 10.06 5.04
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INDEX
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MSCI World IT Index -1.26% 5.94% -0.04%
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S&P 500 Index 5.38 10.80 4.23
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* Average annual return.
Performance data quoted represents past performance and is no guarantee of
future results. Performance results with sales charges reflect the deduction of
the maximum front end sales charge or the deduction of the applicable contingent
deferred sales charge ("CDSC"). Class A shares are subject to a maximum
front-end sales charge of 5.75%. Class B shares are subject to a CDSC which
declines from 5% the 1st year to 0% at the beginning of the 7th year. Class C
shares are subject to a CDSC of up to 1% on certain redemptions made within 12
months of purchase. Performance presented at Net Asset Value (NAV), which does
not include a sales charge, would be lower if this charge were reflected. NAV is
the value of one share of the Fund excluding any sales charges. Current
performance may be lower or higher than the performance data quoted. Investment
return and principal value will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than original cost. Shares redeemed within
30 days of purchase may be subject to a 2.0% redemption fee. For the most recent
month-end performance, please call 1.866.443.6337 or visit the Funds' website at
ww.hendersonglobalinvestors.com.
Performance results also reflect expense subsidies and waivers in effect during
the periods shown. Absent these waivers, results would have been less favorable.
All results assume the reinvestment of dividends and capital gains.
The investment comparison graph above reflects the change in value of a $10,000
hypothetical investment since the Fund's inception, including reinvested
dividends and distributions, compared to a broad based securities market index
and an industry focused index. The S&P 500 Index is a broad based measurement of
changes in stock market conditions based on the average of 500 widely held
common stocks. The MSCI World Info Tech Index currently consists of 23 developed
market countries, and aims to capture 60% of the total market capitalization of
each country by various technology-related industries. The Fund is
professionally managed while the Indices are unmanaged and not available for
investment. Results in the table and graph do not reflect the deduction of taxes
that a shareholder would pay on Fund distributions or the redemption of Fund
shares.
5
HENDERSON GLOBAL FUNDS
COMMENTARY
INTERNATIONAL OPPORTUNITIES FUND
INTERNATIONAL OPPORTUNITIES FUND
TOP 10 LONG-TERM HOLDINGS
- ---------------------------------------------------
AS A PERCENTAGE
SECURITY OF NET ASSETS
- ---------------------------------------------------
SUMITOMO MITSUI FINANCIAL 2.8%
BAYER 2.8
FRESENIUS 2.7
CAPITA GROUP 2.7
TAKEDA PHARMACEUTICAL 2.7
INDUSTRIA DE DISENO TEXTIL 2.6
SEKISUI CHEMICAL 2.6
NTT DOCOMO 2.6
TDK 2.5
DEUTSCHE POST 2.5
- ---------------------------------------------------
International equity markets performed well for much of the year ended July 31,
2006, supported by a benign macroeconomic environment and strong emerging market
demand. Since May, we have seen a sharp correction in equity markets amid
concerns over inflation and interest rates. Markets that had risen the most over
the preceding months were hit the hardest, with Japanese and emerging markets
giving up most of their year-to-date gains. Over the period, the Fund
outperformed its benchmark, posting a return of 25.98% (A-shares at NAV) versus
a return of 24.51% for the MSCI EAFE index.
The correction was not a huge surprise as certain international markets had
increased quite dramatically over a relatively short period of time. We believe
that market volatility is likely to continue in the near-term, especially given
the escalation of the Middle East situation. We will also keep a watchful eye on
the US economy and on the housing market in particular. That said, continuing
economic strength, company buy backs, and the large pool of private equity money
provide a positive outlook on a nine to twelve-month view.
For most of the year, the macroeconomic picture in Europe has broadly continued
to improve and this has provided a supportive backdrop for the Fund's holdings.
Corporate restructuring and buoyant merger and acquisition activity seem to have
offset the disappointment of the indecisive German election and kept markets on
track. We have reduced our exposure to cyclical areas of the market,
concentrating on companies that we feel offer potentially reliable growth
opportunities.
Japanese equities surged for the first half of the period, driven by the
improving domestic economy and Koizumi's landslide election victory. However, in
January, the Livedoor scandal brought about swift risk reassessment of the more
highly-rated areas of the market. Japanese markets recovered, but then suffered
a renewed bout of selling pressure in May.
Asian markets, too, were hit hard during the correction. Having performed
strongly for much of the period, the rally came to an abrupt halt in May as
investors seemed to become markedly more risk averse, particularly with respect
to emerging markets.
Having been up strongly during the period, technology markets ended marginally
lower as macroeconomic concerns weighed down investor sentiment. We have reduced
our exposure to the sector during the period, but with attractive relative
valuations and compelling product cycles, we may look to increase our exposure
again prior to the seasonally strong fourth quarter.
In summary, for the year ahead we remain cautiously optimistic and hope that
central bankers are not too aggressive with any interest rate adjustments.
Markets are unlikely to find a significantly firmer footing until there is
greater clarity over the outlook for inflation, interest rates and economic
growth. However, the recent correction has brought about a renewed focus on
valuation, which suits our bottom-up, fundamentally driven process, and we
believe valuations look more attractive than they have for some time.
6
HENDERSON GLOBAL FUNDS
PERFORMANCE SUMMARY
INTERNATIONAL OPPORTUNITIES FUND
PIE CHARTS:
PORTFOLIO COMPOSITION BY COUNTRY
(AS A % OF TOTAL LONG-TERM INVESTMENTS)
Japan 23.6%
Germany 15.0
France 13.1
United Kingdom 10.6
Korea 5.0
Spain 4.9
Other 27.8
PORTFOLIO COMPOSITION BY SECTOR
(AS A % OF TOTAL LONG-TERM INVESTMENTS)
Industrials 22.1%
Financials 21.9
Consumer Discretionary 17.4
Information Technology 12.3
Materials 6.7
Telecomm Service 5.8
Other 13.8
Line chart:
INVESTMENT COMPARISON
Value of $10,000
Int'l Opportunities Fund Class A w/out sales charge - $23,166
Int'l Opportunities Fund Class A w/sales charge - $21,835
MSCI EAFE Index - $17,339
Int'l Opportunities Fund Int'l Opportunities Fund
Class A w/out Class A w/ MSCI EAFE
sales charge sales charge Index
Date
8/31/01 10000 9425 10000
9080 8558 8989
9930 9359 9219
11430 10773 9560
11640 10971 9617
1/31/02 11610 10942 9106
11290 10641 9171
11840 11159 9716
11950 11263 9741
11940 11253 9874
11540 10876 9484
7/31/02 10510 9906 8549
10410 9811 8531
9280 8746 7617
10060 9482 8027
10710 10094 8393
10328 9735 8111
1/31/03 10167 9583 7773
9553 9004 7595
9453 8909 7451
10500 9896 8191
11164 10522 8694
11647 10977 8909
7/31/03 12070 11376 9126
12906 12163 9348
13127 12372 9638
13973 13169 10239
13973 13169 10469
14890 14034 11287
1/31/04 15501 14610 11448
15878 14965 11714
16378 15436 11785
15889 14975 11528
15613 14716 11564
15950 15033 11836
7/31/04 15226 14351 11454
15196 14322 11507
15552 14658 11809
16164 15234 12213
17126 16141 13051
17902 16872 13624
1/31/05 17767 16746 13375
18492 17428 13955
18254 17204 13611
17705 16687 13306
17446 16443 13326
17622 16609 13508
7/31/05 18388 17331 13924
19164 18062 14280
19733 18599 14919
19288 18179 14485
19990 18842 14842
20852 19654 15534
1/31/06 22273 20993 16489
22165 20892 16455
23005 21683 17006
24156 22769 17831
23252 21916 17160
23317 21977 17167
7/31/06 23166 21835 17339
TOTAL RETURNS AS OF JULY 31, 2006
SINCE
NASDAQ INCEPTION
AT NAV SYMBOL CLASS ONE YEAR THREE YEARS* (8/31/01)*
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Int'l Opportunities Fund HFOAX Class A 25.98% 24.28% 18.63%
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Int'l Opportunities Fund HFOBX Class B 24.97 23.35 17.78
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Int'l Opportunities Fund HFOCX Class C 25.06 23.34 17.77
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Int'l Opportunities Fund HFORX Class R** 25.57 23.93 18.32
- ------------------------------------------------------------------------------------------------------------------------------------
WITH SALES CHARGE
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Int'l Opportunities Fund Class A 18.77% 21.85% 17.21%
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Int'l Opportunities Fund Class B 20.97 22.69 17.67
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Int'l Opportunities Fund Class C 25.06 23.34 17.77
- ------------------------------------------------------------------------------------------------------------------------------------
INDEX
- ------------------------------------------------------------------------------------------------------------------------------------
MSCI EAFE Index 24.51% 23.85% 11.84%
- ------------------------------------------------------------------------------------------------------------------------------------
* Average annual return.
** Class R shares inception was 9/30/05. The performance for Class R shares
for the period prior to 9/30/05 is based on the performance of Class A
shares, adjusted for the higher expenses applicable to R shares. Class R
shares are not subject to a front-end sales charge but are subject to a
distribution fee of 0.50%
Performance data quoted represents past performance and is no guarantee of
future results. Performance results with sales charges reflect the deduction of
the maximum front end sales charge or the deduction of the applicable contingent
deferred sales charge ("CDSC"). Class A shares are subject to a maximum
front-end sales charge of 5.75%. Class B shares are subject to a CDSC which
declines from 5% the 1st year to 0% at the beginning of the 7th year. Class C
shares are subject to a CDSC of up to 1% on certain redemptions made within 12
months of purchase. Class R shares have no front-end sales charge or CDSC.
Performance presented at Net Asset Value (NAV), which does not include a sales
charge, would be lower if this charge were reflected. NAV is the value of one
share of the Fund excluding any sales charges. Current performance may be lower
or higher than the performance data quoted. Investment return and principal
value will fluctuate so that an investor's shares, when redeemed, may be worth
more or less than original cost. Shares redeemed within 30 days of purchase may
be subject to a 2.0% redemption fee. For the most recent month-end performance,
please call 1.866.443.6337 or visit the Funds' website at
www.hendersonglobalinvestors.com.
Performance results also reflect expense subsidies and waivers in effect during
certain periods shown. Absent these waivers, results would have been less
favorable for certain periods. All results assume the reinvestment of dividends
and capital gains.
The investment comparison graph above reflects the change in value of a $10,000
hypothetical investment since the Fund's inception, including reinvested
dividends and distributions, compared to a broad based securities market index.
The MSCI EAFE Index tracks the stocks of approximately 1,000 international
companies in Europe, Australasia, and the Far East. The Fund may invest in
emerging markets while the Index only consists of companies in developed
markets. The Fund is professionally managed while the Index is unmanaged and not
available for investment. Results in the table and graph do not reflect the
deduction of taxes that a shareholder would pay on Fund distributions or the
redemption of Fund shares.
7
HENDERSON GLOBAL FUNDS
COMMENTARY
JAPAN-ASIA FOCUS FUND
- ---------------------------------------------------
JAPAN-ASIA FOCUS FUND
TOP 10 LONG-TERM HOLDINGS
AS A PERCENTAGE
SECURITY OF NET ASSETS
- ---------------------------------------------------
MITSUBISHI UFJ FINANCIAL 5.6%
SUMITOMO MITSUI FINANCIAL 5.3
TDK 4.4
TOKEN 4.0
HINO MOTORS 3.9
TAKEDA PHARMACEUTICAL 3.9
AIOI INSURANCE 3.9
UBE INDUSTRIES 3.8
SEKISUI CHEMICAL 3.4
KAPPA CREATE 3.3
- ---------------------------------------------------
The period from the Fund's launch on January 31, 2006, to the end of July
coincided with a highly volatile time for Japanese and Asian equity markets.
Over this period, the Fund posted a return of -3.50% (A-shares at NAV), in line
with the -3.48% return of the MSCI Japan Index.
January saw the arrest of the president of the internet company Livedoor, which
triggered a reassessment of the more highly rated areas of the market. Markets
then recovered strongly in March and early April, spurred by an apparent growing
confidence in the strength of the domestic economy and the broad macroeconomic
backdrop, but corrected during May and June. This latter period of poor
performance seems to have been the result of large investment outflows from
Japan, particularly by foreign investors, likely due to concern over global
interest rate increases, rising commodity prices and slowing economic growth.
Towards the end of the reporting period, Japanese equities rebounded from a
6-month low as Wall Street rallied. Supportive domestic data releases on
consumption, unemployment and bank lending all provided further evidence that
the economy appeared to be continuing to emerge from its 7-year deflationary
slump. Asian (ex-Japan) equity markets outperformed their developed country
counterparts by a wide margin early in the period, but the rally came to an
abrupt halt in May as investors seemed to become markedly more risk-averse,
particularly within emerging markets.
From a stock-picker's perspective the good news to emerge from the correction in
equities has been a renewed focus on valuation. This suits our fundamentally-
driven process and has provided us with opportunities to increase or initiate a
number of positions during market weakness. Particular stocks which had fallen
sharply included Takeda Pharmaceutical, recording media manufacturer TDK,
truck-maker Hino Motors and consumer finance company, Takefuji. We added to all
of these stock positions at price levels we found compelling. We also initiated
a position in Tadano, Japan's leading construction crane manufacturer, which has
benefited from a sustained revival in Japanese demand for cranes, while also
winning market share in the US and European crane markets.
We also took the opportunity to reduce or sell a number of holdings as a result
of the share price volatility. Semiconductor-related stock Sumitomo Bakelite and
apartment-builder Leopalace21 were both sold after hitting our fair value
targets, and both consequently underperformed the market. Towards the end of the
period we also reduced our large holding in house builder Sekisui Chemical,
which had outperformed very strongly on the back of a rising order trend for its
detached houses.
Within the Financials sector, we maintain a position in Daiwa Securities, given
our long term view that financial market activity is on a secular uptrend from
which brokerage firms will benefit. We have also increased our positions in
Mitsubishi UFJ Financial and Sumitomo Mitsui Financial, our two large bank
holdings, on our expectations that increased bank lending and higher interest
rates will potentially yield better profits for these companies.
Persistently high commodity prices and the prospect of slower growth in the US
have taken some of the shine off the outlook for equities. However, we believe
that growth in the US will slow but not disappear, and therefore our forecast of
a broadening and sustained recovery in Japan remains intact. Confidence is
percolating through the corporate sector, as reflected in recent capital
investment plans to levels not seen in over a decade, while consumers' rising
expectations for higher prices reaffirms the move towards a more inflationary
environment. The Bank of Japan's interest rate increase in July, the first in 6
years, was widely anticipated and markets barely raised an eyebrow. While the
Japanese economy is set for further expansion, companies will have to contain a
rising cost base to prolong what is already a four-year cycle of growing
profits. We have positioned the Fund toward stocks with strong individual growth
profiles, predominantly those with higher exposure to the domestic economy, and
away from cyclical stocks with higher exposure to overseas economies.
8
HENDERSON GLOBAL FUNDS
PERFORMANCE SUMMARY
JAPAN-ASIA FOCUS FUND
PIE CHARTS:
PORTFOLIO COMPOSITION BY COUNTRY
(AS A % OF TOTAL LONG-TERM INVESTMENTS)
Japan 89.8%
Korea 3.4
Taiwan 1.9
China 1.6
Hong Kong 1.4
Singapore 0.9
Other 1.0
PORTFOLIO COMPOSITION BY SECTOR
(AS A % OF TOTAL LONG-TERM INVESTMENTS)
Financials 28.5%
Consumer Discretionary 19.9
Information Technology 17.6
Industrials 14.6
Materials 11.8
Health Care 4.1
Other 3.5
Line Chart:
INVESTMENT COMPARISON
Value of $10,000
Japan-Asia Focus Fund Class A w/out sales charge - $9,650
Japan-Asia Focus Fund Class A w/sales charge - $9,095
MSCI Japan Index - $9,652
Japan-Asia Focus Japan-Asia Focus
Fund Class A w/out Fund Class A w/ MSCI Japan
sales charge /sales charge Index
Date
1/31/06 10000 9425 10000
9860 9293 9915
10360 9764 10169
4/30/06 10490 9887 10465
9850 9284 9814
9920 9350 9705
7/31/06 9650 9095 9652
TOTAL RETURNS AS OF JULY 31, 2006
SINCE
NASDAQ INCEPTION
AT NAV SYMBOL CLASS (1/31/06)
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Japan-Asia Focus Fund HFJAX Class A -3.50%
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Japan-Asia Focus Fund HFJCX Class C -3.80
- ------------------------------------------------------------------------------------------------------------------------------------
WITH SALES CHARGE
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Japan-Asia Focus Fund Class A -9.05%
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Japan-Asia Focus Fund Class C -4.80
- ------------------------------------------------------------------------------------------------------------------------------------
INDEX
- ------------------------------------------------------------------------------------------------------------------------------------
MSCI Japan Index -3.48%
- ------------------------------------------------------------------------------------------------------------------------------------
Performance data quoted represents past performance and is no guarantee of
future results. Performance results with sales charges reflect the deduction of
the maximum front end sales charge or the deduction of the applicable contingent
deferred sales charge ("CDSC"). Class A shares are subject to a maximum
front-end sales charge of 5.75%. Class C shares are subject to a CDSC of up to
1% on certain redemptions made within 12 months of purchase. Performance
presented at Net Asset Value (NAV), which does not include a sales charge, would
be lower if this charge were reflected. NAV is the value of one share of the
Fund excluding any sales charges. Current performance may be lower or higher
than the performance data quoted. Investment return and principal value will
fluctuate so that an investor's shares, when redeemed, may be worth more or less
than original cost. Shares redeemed within 30 days of purchase may be subject to
a 2.0% redemption fee. For the most recent month-end performance, please call
1.866.443.6337 or visit the Funds' website at www.hendersonglobalinvestors.com.
Performance results also reflect expense subsidies and waivers in effect during
periods shown. Absent these waivers, results would have been less favorable. All
results assume the reinvestment of dividends and capital gains.
The investment comparison graph above reflects the change in value of a $10,000
hypothetical investment since the Fund's inception, including reinvested
dividends and distributions, compared to a broad based securities market index.
The MSCI Japan Index is a market capitalization weighted index designed to
measure equity market performance in Japan. The Fund may invest in emerging
markets while the Index only consists of companies in developed markets. The
Fund is professionally managed while the Index is unmanaged and not available
for investment. Results in the table and graph do not reflect the deduction of
taxes that a shareholder would pay on Fund distributions or the redemption of
Fund shares.
9
HENDERSON GLOBAL FUNDS
COMMENTARY
WORLDWIDE INCOME FUND
- ---------------------------------------------------
WORLDWIDE INCOME FUND
TOP 10 LONG-TERM HOLDINGS
AS A PERCENTAGE
SECURITY OF NET ASSETS
- ---------------------------------------------------
FEDERAL REPUBLIC OF BRAZIL 3.7%
REPUBLIC OF URUGUAY 3.4
REPUBLIC OF PERU 3.3
REPUBLIC OF TURKEY 3.0
REPUBLIC OF COLOMBIA 3.0
WRG ACQUISITIONS 2.7
CORUS FINANCE 2.4
WIND ACQUISITION FINANCE 2.2
NTL CABLE 2.1
PIPE HOLDINGS 2.1
- ---------------------------------------------------
In May 2006, we decided to change the focus and broaden the scope of the Fund in
order to leverage the expertise and experience of Henderson's fixed income and
equity teams and to increase the Fund's ability to invest in a variety of
attractive investment opportunities worldwide. The Fund will now invest in
global investment grade debt, high yield debt, emerging market debt and high
yielding international equities. Allocation between the different asset classes
is managed by Chris Wozniak, Director of Fixed Income, who has over 20 years'
experience of managing fixed income and equity investments. The Fund's benchmark
is now the Lehman Brothers Global Aggregate Bond (ex US Mortgage Backed
Securities) Index since this Index more accurately reflects the investments of
the Fund. Over the year ended July 31, 2006, the Fund returned 4.70% (A-shares
at NAV) versus the 2.03% return of its benchmark and the 4.19% return of the
Merrill Lynch High Yield Master II Index, the Fund's previous benchmark.
In general, market conditions improved towards the end of the reporting period
as investors became increasingly confident in a soft landing for the US economy.
Global economic data has continued to show improvement even as interest rates
have been rising in many markets. Equity markets have recovered from previous
weakness as the earnings season has again delivered positive surprises and
investors have built in an expectation of lower Treasury yields.
The beginning of 2006 saw a renewed move to still tighter high yield bond
spreads* over 10-year US Treasury bonds in spite of an already expensive high
yield bond market. However, high yield bond markets continued to fare well
towards the middle of the year as equity markets suffered the first bouts of
weakness. The asset class then weakened towards the end of the period as risk
aversion rose along with expectations for global interest rate increases.
Investment-grade corporate bonds have stabilized and in some cases recovered
somewhat as the new issue calendar wound down for the summer break. Global
government bond markets in the US, Japan and Europe saw yields fall and prices
rise as the soft landing scenario was accepted as the likely outcome.
Inflation concerns continued due to high energy costs and some late-cycle
increases in wage compensation, but inflation remained under close control. We
believe there is little risk of a wage/price spiral because employers appear to
be reducing hiring as a cost control measure, and US interest rates have likely
already peaked.
The Fund's largest single asset class exposure is to high yield corporate bonds,
with holdings in the US, Europe and the UK. We broadened the allocation to
emerging market debt at the end of the period with the acquisition of new
holdings in Ecuador, El Salvador, Indonesia and the Ukraine.
The bond holdings are tilted towards short and intermediate terms, reflecting
the Fund's income focus. Principal sector exposures include chemicals, paper,
capital goods, beverages and media. Country exposures include Argentina, Brazil,
Peru, Turkey and the Philippines in addition to the new purchases in July.
Looking ahead, we anticipate raising the equity exposure in new geographies
including Australia and Singapore. Overall, we feel there are reasonable
prospects of ongoing dividend growth and capital growth going forward and we
will continue to utilize our bottom-up stock-picking methodology to seek out
attractive investments around the world.
*The yield spread is the difference between yields on differing debt
instruments, calculated by deducting the yield of one instrument from another.
The higher the yield spread, the greater the difference between the yields
offered by each instrument. The spread can be measured between debt instruments
of differing maturities, credit ratings and risk. Reviewing the yield spread is
one factor in determining potential investment opportunities.
10
HENDERSON GLOBAL FUNDS
PERFORMANCE SUMMARY
WORLDWIDE INCOME FUND
Pie Charts:
PORTFOLIO COMPOSITION BY COUNTRY
(AS A % OF TOTAL LONG-TERM INVESTMENTS)
United Kingdom 20.4%
United States 20.0
Germany 8.1
Italy 5.1
France 4.8
Brazil 4.0
Other 37.6
PORTFOLIO COMPOSITION BY SECTOR
(AS A % OF TOTAL LONG-TERM INVESTMENTS)
Sovereign 28.9%
Chemicals 11.5
Environmental 6.2
Media - Cable 4.9
Beverage 4.9
Steel production 4.8
Other 38.8
Line Chart:
INVESTMENT COMPARISON
Value of $10,000
Worldwide Income Fund Class A w/out sales charge - $12,999
Worldwide Income Fund Class A w/sales charge - $12,381
Merrill Lynch US High Yield Master II Index - $12,570
Lehman Brothers Global Aggregate Bond (ex US MBS) Index - $11,261
Worldwide Income Worldwide Income Merrill Lynch Lehman Brothers Global
Class A w/out Fund Class A w/ US High Yield Aggregate Bond
sales charge sales charge Master II Index (ex US MBS) Index
Date
9/30/03 10000 9525 10000 10000
10/31/03 10220 9735 10207 9941
10570 10068 10348 10089
11023 10499 10594 10458
1/31/04 11164 10634 10765 10492
11154 10624 10753 10540
11236 10702 10825 10669
11143 10614 10753 10245
10957 10437 10585 10308
11072 10546 10738 10328
7/31/04 11281 10745 10883 10310
11496 10950 11081 10547
11660 11106 11235 10690
11889 11324 11452 10974
12033 11462 11571 11316
12195 11616 11745 11504
1/31/05 12168 11590 11733 11355
12359 11772 11901 11388
11970 11401 11576 11233
11832 11270 11452 11383
12029 11458 11657 11195
12227 11646 11879 11131
7/31/05 12417 11827 12065 11037
12465 11873 12109 11231
12388 11800 11987 11034
12243 11660 11900 10857
12375 11785 11957 10762
12507 11911 12067 10869
1/31/06 12652 12050 12259 11022
12821 12212 12336 10969
12836 12227 12413 10858
12939 12326 12493 11095
12853 12244 12485 11263
12803 12195 12438 11157
7/31/06 12999 12381 12570 11261
TOTAL RETURNS AS OF JULY 31, 2006
SINCE
NASDAQ INCEPTION
AT NAV SYMBOL CLASS ONE YEAR (9/30/03)*
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Worldwide Income Fund HFAAX Class A 4.70% 9.69%
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Worldwide Income Fund HFABX Class B 3.93 8.81
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Worldwide Income Fund HFACX Class C 3.92 8.87
- ------------------------------------------------------------------------------------------------------------------------------------
WITH SALES CHARGE
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Worldwide Income Fund Class A -0.27% 7.82%
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Worldwide Income Fund Class B -0.07 7.59
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson Worldwide Income Fund Class C 3.92 8.87
- ------------------------------------------------------------------------------------------------------------------------------------
INDEX
- ------------------------------------------------------------------------------------------------------------------------------------
Lehman Brothers Global Aggregate Bond (ex US MBS) Index 2.03% 4.28%
- ------------------------------------------------------------------------------------------------------------------------------------
Merrill Lynch US High Yield Master II Index 4.19 8.41
- ------------------------------------------------------------------------------------------------------------------------------------
* Average annual return.
Performance data quoted represents past performance and is no guarantee of
future results. Performance results with sales charges reflect the deduction of
the maximum front end sales charge or the deduction of the applicable contingent
deferred sales charge ("CDSC"). Class A shares are subject to a maximum
front-end sales charge of 4.75%. Class B shares are subject to a CDSC which
declines from 5% the 1st year to 0% at the beginning of the 7th year. Class C
shares are subject to a CDSC of up to 1% on certain redemptions made within 12
months of purchase. Performance presented at Net Asset Value (NAV), which does
not include a sales charge, would be lower if this charge were reflected. NAV is
the value of one share of the Fund excluding any sales charges. Current
performance may be lower or higher than the performance data quoted. Investment
return and principal value will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than original cost. Shares redeemed within
30 days of purchase may be subject to a 2.0% redemption fee. For the most recent
month-end performance, please call 1.866.443.6337 or visit the Funds' website at
www.hendersonglobalinvestors.com.
Performance results also reflect expense subsidies and waivers in effect during
the periods shown. Absent these waivers, results would have been less favorable.
All results assume the reinvestment of dividends and capital gains.
The investment comparison graph above reflects the change in value of a $10,000
hypothetical investment since the Fund's inception, including reinvested
dividends and distributions, compared to a broad based securities market index.
The Fund used to compare its performance to the Merrill Lynch US High Yield
Master II Index, which is a broad-based index consisting of all
US-dollar-denominated high-yield bonds with a minimum outstanding amount of $100
million and maturing over one year. Currently, the Fund compares its performance
to the Lehman Brothers Global Aggregate Bond (ex US MBS) Index, which is a
broad-based measure of the global investment-grade fixed-rate debt markets,
excluding US Mortgage-Backed Securities. The Fund believes that the Lehman
Brothers Index more accurately reflects its revised strategy and is now a more
appropriate benchmark for the Fund. The Fund is professionally managed while the
indices are unmanaged and not available for investment. Results in the table and
graph do not reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemption of Fund shares.
11
HENDERSON GLOBAL FUNDS
COMMENTARY
U.S. CORE GROWTH FUND
- ---------------------------------------------------
U.S. CORE GROWTH FUND
TOP 10 LONG-TERM HOLDINGS
AS A PERCENTAGE
SECURITY OF NET ASSETS
- ---------------------------------------------------
GOLDMAN SACHS 3.9%
COMCAST 3.5
HUMANA 3.5
MONSANTO 3.4
CAPITAL ONE FINANCIAL 3.2
GOOGLE 3.1
WALT DISNEY 3.0
CVS 3.0
AMERICAN EXPRESS 3.0
MEMC ELECTRIC MATERIALS 2.8
- ---------------------------------------------------
A difficult fiscal fourth quarter, in which equity markets pulled back sharply,
capped off a disappointing year for the Fund, which had posted solid returns
through the first three fiscal quarters. For the full fiscal year, the Fund lost
4.69% (A-shares at NAV), which compares to a gain of 5.38% for the S&P 500
Index.
Conflicting commentary from the Federal Reserve in early May reversed the
market's positive trend, as the message highlighted inflation risks which
triggered broad-based selling, particularly among hedge funds trying to reduce
their market exposure. Growth stocks and smaller capitalization stocks were
among the hardest hit. Emerging markets and US small capitalization growth
stocks fell approximately 25% and 15%, respectively, from peak to trough during
the quarter, while the S&P 500 Index pulled back a little more than 5%. Most S&P
500 Index companies announced solid earnings results for the second quarter, but
investors seemed to give less credit to positive news than normal. Stocks of
those companies that announced disappointing earnings were dealt with severely,
as concerns of weakening consumer spending and a slowing economy held investor
attention. Technology stocks bore the brunt of the selling, even companies which
met and raised earnings guidance, reflecting a harsh and unpredictable investor
sentiment.
The Fund continued to maintain its largest exposures in consumer discretionary,
technology, and healthcare, which were the three weakest areas for the market in
the fiscal year. We have reduced our technology weighting a bit in recent months
(from 25% to 20% at the end of the period) and slightly trimmed consumer
discretionary and healthcare exposure, while we added to staples and financials,
which went from 10% to 17% of the Fund. Over the past few months, we have become
more critical in our assessment of the Fund's holdings with regard to their
economic risk, and we have made minor portfolio adjustments accordingly.
This kind of market serves to test our patience more than to undermine our
belief in our process, which has remained consistent since we launched the Fund.
We remain confident in our ability to find companies with strong fundamentals
and mis-priced stocks. Sometimes timing associated with company-specific
investing is difficult, so we have to stick with the investment discipline that
we believe in, in order to seek to build real wealth over meaningful time
periods.
12
HENDERSON GLOBAL FUNDS
PERFORMANCE SUMMARY
U.S. CORE GROWTH FUND
PIE CHART:
PORTFOLIO COMPOSITION BY SECTOR
(AS A % OF TOTAL LONG-TERM INVESTMENTS)
Consumer Discretionary 21.5%
Information Technology 20.3
Healthcare 19.2
Financials 17.6
Consumer Staples 7.3
Industrials 4.5
Other 9.6
Line Chart:
INVESTMENT COMPARISON
Value of $10,000
U.S. Core Growth Fund Class A w/out sales charge - $10,467
U.S. Core Growth Fund Class A w/sales charge - $9,865
S&P 500 Index - $12,009
U.S. Core Growth U.S. Core Growth
Fund Class A Fund Class A S&P 500
w/out sales charge w/sales charge Index
Date
4/30/04 10000 9425 10000
10160 9576 10137
10380 9783 10334
7/31/04 9690 9133 9992
9420 8878 10032
9710 9152 10140
10/31/04 9930 9359 10296
10420 9821 10713
10902 10275 11078
1/31/05 10420 9821 10808
10510 9906 11035
10400 9802 10840
4/30/05 10108 9527 10634
10621 10010 10972
10641 10029 10987
7/31/05 10982 10351 11396
10850 10228 11292
10939 10313 11384
10/31/05 10780 10162 11194
10972 10342 11617
10952 10323 11620
1/31/06 11448 10790 11928
11306 10656 11960
11387 10733 12110
4/30/06 11590 10923 12272
10932 10304 11919
10892 10266 11935
7/31/06 10467 9865 12009
TOTAL RETURNS AS OF JULY 31, 2006
SINCE
NASDAQ INCEPTION
AT NAV SYMBOL CLASS ONE YEAR (4/30/04)*
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson U.S. Core Growth Fund HFUAX Class A -4.69% 2.05%
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson U.S. Core Growth Fund HFUBX Class B -5.38 1.28
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson U.S. Core Growth Fund HFUCX Class C -5.38 1.28
- ------------------------------------------------------------------------------------------------------------------------------------
WITH SALES CHARGE
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson U.S. Core Growth Fund Class A -10.20% -0.60%
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson U.S. Core Growth Fund Class B -9.38 -0.49
- ------------------------------------------------------------------------------------------------------------------------------------
Henderson U.S. Core Growth Fund Class C -5.38 1.28
- ------------------------------------------------------------------------------------------------------------------------------------
INDEX
- ------------------------------------------------------------------------------------------------------------------------------------
S&P 500 Index 5.38% 8.48%
- ------------------------------------------------------------------------------------------------------------------------------------
* Average annual return.
Performance data quoted represents past performance and is no guarantee of
future results. Performance results with sales charges reflect the deduction of
the maximum front end sales charge or the deduction of the applicable contingent
deferred sales charge ("CDSC"). Class A shares are subject to a maximum
front-end sales charge of 5.75%. Class B shares are subject to a CDSC which
declines from 5% the 1st year to 0% at the beginning of the 7th year. Class C
shares are subject to a CDSC of up to 1% on certain redemptions made within 12
months of purchase. Performance presented at Net Asset Value (NAV), which does
not include a sales charge, would be lower if this charge were reflected. NAV is
the value of one share of the Fund excluding any sales charges. Current
performance may be lower or higher than the performance data quoted. Investment
return and principal value will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than original cost. Shares redeemed within
30 days of purchase may be subject to a 2.0% redemption fee. For the most recent
month-end performance, please call 1.866.443.6337 or visit the Funds' website at
www.hendersonglobalinvestors.com.
Performance results also reflect expense subsidies and waivers in effect during
the periods shown. Absent these waivers, results would have been less favorable.
All results assume the reinvestment of dividends and capital gains.
The investment comparison graph above reflects the change in value of $10,000
hypothetical investment since the Fund's inception, including reinvested
dividends and distributions, compared to a broad based securities market index.
The S&P 500 Index is a broad based measurement of changes in stock market
conditions based on the average of 500 widely held stocks. The Fund is
professionally managed while the Index is unmanaged and not available for
investment. Results in the table and graph do not reflect the deduction of taxes
that a shareholder would pay on Fund distributions or the redemption of Fund
shares.
13
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
EUROPEAN FOCUS FUND
JULY 31, 2006
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
COMMON STOCKS - 96.31%
AUSTRALIA - 1.77%
17,450,000 Centamin Egypt, Ltd. * ................... $ 9,127,046
------------
AUSTRIA - 6.50%
43,000 Agrana Beteiligung AG .................... 4,304,175
19,000 Andritz AG ............................... 3,325,073
60,000 austriamicrosystems AG * ................. 3,257,080
220,000 OMV AG ................................... 13,494,967
235,000 Telekom Austria AG ....................... 5,310,344
80,000 Wienerberger AG .......................... 3,792,346
------------
33,483,985
------------
BELGIUM - 2.06%
276,600 Agfa Gevaert N.V. ........................ 6,416,453
205,000 RHJ International * ...................... 4,195,110
------------
10,611,563
------------
CYPRUS - 1.71%
1,150,000 Urals Energy Public
Co., Ltd. * .............................. 8,807,618
------------
FRANCE - 7.93%
91,030 Alstom * ................................. 7,901,344
300,000 Axa ...................................... 10,346,942
4,000,000 Rhodia S.A. * ............................ 7,766,593
120,000 Total S.A. ............................... 8,162,588
30,600 Vallourec S.A. ........................... 6,652,854
------------
40,830,321
------------
GERMANY - 11.00%
300,000 Bayer AG ................................. 14,780,798
225,000 Commerzbank AG ........................... 7,886,669
200,000 Deutsche Post AG ......................... 4,951,203
100,000 Hypo Real Estate Holding AG .............. 5,561,801
246,579 KarstadtQuelle AG * ...................... 5,801,933
150,000 Leoni AG ................................. 5,865,183
500,482 Pfleiderer AG ............................ 11,827,343
------------
56,674,930
------------
GREECE - 6.81%
180,000 Coca-Cola Hellenic Bottling
Co. S.A. ................................. 5,702,315
300,080 Hellenic Telecommunications
Organization S.A. * ...................... 6,846,136
250,000 Motor Oil (Hellas) Corinth
Refineries S.A. .......................... 6,961,831
400,000 National Bank of
Greece S.A. .............................. 15,543,406
------------
35,053,688
------------
HUNGARY - 0.17%
8,046 Mol Magyar Olaj-es
Gazipari Rt. ............................. 893,079
------------
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
ITALY - 5.87%
1,060,000 Azimut Holding SpA ....................... $ 10,832,354
700,000 Enel SpA ................................. 6,178,785
200,000 ENI SpA .................................. 6,134,076
150,000 Geox SpA ................................. 1,781,973
686,000 UniCredito Italiano SpA .................. 5,279,687
------------
30,206,875
------------
LUXEMBOURG - 1.55%
150,000 Arcelor .................................. 7,990,138
------------
NETHERLANDS - 3.00%
70,000 Aalberts Industries N.V. ................. 5,056,589
571,900 AMTEL Vredestein N.V., GDR * ............. 2,876,657
150,000 Axalto Holding N.V. * .................... 3,314,853
100,000 Ballast Nedam N.V. ....................... 4,215,421
------------
15,463,520
------------
NORWAY - 4.51%
1,100,506 SeaDrill, Ltd. * ......................... 14,349,761
300,000 Statoil ASA .............................. 8,895,930
------------
23,245,691
------------
PORTUGAL - 0.94%
610,168 Sonae, SGPS S.A. * ....................... 4,832,458
------------
RUSSIA - 4.05%
312,500 Gazprom, GDR ............................. 13,025,000
225,000 Novolipetsk Steel, GDR ................... 4,934,250
396,000 Trader Media East,
Ltd., GDR * .............................. 2,890,800
------------
20,850,050
------------
SPAIN - 6.37%
50,000 Acciona S.A. ............................. 7,626,079
208,029 Antena 3 de Television S.A. .............. 4,525,489
300,000 Gamesa Corp.
Tecnologica S.A. ......................... 6,399,775
237,841 Gestevision Telecinco S.A. ............... 5,784,698
500,000 Telefonica S.A. .......................... 8,456,390
------------
32,792,431
------------
SWEDEN - 1.60%
480,000 TradeDoubler AB * ........................ 8,258,580
------------
SWITZERLAND - 2.08%
73,000 Credit Suisse Group ...................... 4,090,326
600,000 Temenos Group AG * ....................... 6,631,181
------------
10,721,507
------------
TURKEY - 0.90%
1,100,000 Turkiye Vakiflar
Bankasi T.A.O. ........................... 4,627,404
------------
See Notes to Financial Statements.
14
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
EUROPEAN FOCUS FUND
JULY 31, 2006 (CONTINUED)
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
UNITED ARAB EMIRATES - 1.19%
900,000 Kingdom Hotel Investments,
GDR * .................................... $ 6,120,000
------------
UNITED KINGDOM - 26.30%
450,000 Admiral Group plc ........................ 5,581,583
800,000 Burberry Group plc ....................... 7,098,399
20,000,000 Corporate Services Group plc * ........... 2,869,247
327,869 Dana Petroleum plc * ..................... 7,055,530
1,667,519 Debenhams plc * .......................... 5,606,865
2,650,000 Evolution Group plc ...................... 6,460,010
928,923 Gondola Holdings plc ..................... 5,795,661
1,000,000 Halfords Group plc ....................... 5,473,239
100,000 Investec plc ............................. 5,221,059
3,061,565 IP Group plc * ........................... 7,377,513
3,000,000 ITV plc .................................. 5,449,889
1,000,000 Lancashire Holdings, Ltd. * .............. 5,809,479
750,000 Lloyds TSB Group plc ..................... 7,551,389
100,000 Man Group plc ............................ 4,584,071
126,679 NDS Group plc, ADR * ..................... 5,996,984
2,500,000 Old Mutual plc ........................... 7,565,399
340,000 Omega International Group plc ............ 1,387,737
1,850,000 Prosperity Minerals
Holdings, Ltd. * ......................... 5,270,094
1,515,063 Regal Petroleum plc * .................... 1,988,171
2,900,000 Regus Group plc * ........................ 5,254,683
1,300,000 Tesco plc ................................ 8,730,096
275,000 Travis Perkins plc ....................... 7,833,924
221,159 Xstrata plc .............................. 9,489,480
------------
135,450,502
------------
TOTAL LONG-TERM
INVESTMENTS .............................. 496,041,386
------------
(Cost $411,920,977)
PAR VALUE
AMOUNT (NOTE 2)
- -----------------------------------------------------------------------
SHORT-TERM INVESTMENT - 3.40%
REPURCHASE
AGREEMENT - 3.40%
$17,500,000 State Street Bank & Trust Co.,
Repurchase Agreement, dated
7/31/06 at 3.40% to be
repurchased at $17,501,653
on 8/1/06 collateralized by
$15,565,000 U.S. Treasury
Bond 6.25% due 8/15/23 with
a value of $17,854,580.................... $ 17,500,000
------------
TOTAL SHORT-TERM INVESTMENT .............. 17,500,000
------------
(Cost $17,500,000)
TOTAL INVESTMENTS - 99.71% ............................ 513,541,386
------------
(Cost $429,420,977)
NET OTHER ASSETS AND
LIABILITIES - 0.29% ...................... 1,494,246
------------
TOTAL NET ASSETS - 100.00%............................. $515,035,632
============
* Non-income producing security
ADR American Depositary Receipt
GDR Global Depositary Receipts
See Notes to Financial Statements.
15
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
EUROPEAN FOCUS FUND
JULY 31, 2006 (CONTINUED)
OTHER INFORMATION:
INDUSTRY CONCENTRATION AS % OF NET
A PERCENTAGE OF NET ASSETS: ASSETS
- ---------------------------------------------------------------------------
Integrated Oil & Gas..................................... 9.83%
Diversified Banks........................................ 7.94
Asset Management & Custody Banks......................... 5.24
Building Products........................................ 4.33
Integrated Telecommunication Services.................... 4.00
Oil & Gas Exploration & Products......................... 3.47
Broadcasting & Cable TV.................................. 3.06
Industrial Machinery..................................... 2.92
Diversified Chemicals.................................... 2.87
Oil & Gas Drilling....................................... 2.79
Heavy Electrical Equipment............................... 2.78
Steel.................................................... 2.51
Construction & Engineering............................... 2.30
Department Stores........................................ 2.21
Multi-line Insurance..................................... 2.01
Diversified Metal & Mining............................... 1.84
Diversified Capital Markets.............................. 1.81
Gold..................................................... 1.77
Food Retail.............................................. 1.69
Internet Software & Services............................. 1.60
Home Improvement Retail.................................. 1.52
Specialty Chemicals...................................... 1.51
Life & Health Insurance.................................. 1.47
Apparel, Accessories & Luxury Goods...................... 1.38
Oil & Gas Refining & Marketing........................... 1.35
Systems Software......................................... 1.29
Investment Banking & Brokerage........................... 1.25
Photographic Products.................................... 1.25
Electric Utilities....................................... 1.20
Real Estate Management & Development..................... 1.19
Application Software..................................... 1.16
Auto Parts & Equipment................................... 1.14
Reinsurance.............................................. 1.13
Restaurants.............................................. 1.13
Soft Drinks.............................................. 1.11
Property & Casualty Insurance............................ 1.08
Thrifts & Mortgage Finance............................... 1.08
Automotive Retail........................................ 1.06
Office Services & Supply................................. 1.02
Air Freight & Logistics.................................. 0.96
Forest Products.......................................... 0.94
Agricultural Products.................................... 0.83
Computer Storage & Peripheral............................ 0.64
Semiconductors........................................... 0.63
Advertising.............................................. 0.56
Tires & Rubber........................................... 0.56
Human Resources & Employment Services.................... 0.56
Footwear................................................. 0.34
-------
Long-Term Investments.................................... 96.31
Short-Term Investment.................................... 3.40
-------
Total Investments........................................ 99.71
Net Other Assets and Liabilities......................... 0.29
-------
100.00%
=======
See Notes to Financial Statements.
16
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
GLOBAL TECHNOLOGY FUND
JULY 31, 2006
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
COMMON STOCKS - 95.40%
CHINA - 1.54%
11,150 Ctrip.com International,
Ltd., ADR ................................ $ 564,357
------------
FINLAND - 1.49%
27,430 Nokia Oyj ................................ 544,157
------------
FRANCE - 1.13%
13,000 Parrot S.A. * ............................ 415,155
------------
GERMANY - 2.72%
54,700 ADVA AG Optical
Networking * ............................. 460,468
50,000 Infineon Technologies AG * ............... 533,954
------------
994,422
------------
HONG KONG - 1.45%
278,000 Tencent Holdings, Ltd. ................... 530,941
------------
INDIA - 1.51%
13,500 Infosys Technologies,
Ltd., ADR ................................ 554,715
------------
JAPAN - 3.17%
13,500 Canon, Inc. .............................. 648,829
76,000 Epson Toyocom Corp. * .................... 511,771
------------
1,160,600
------------
KOREA - 1.58%
5,404 Gmarket, Inc. ADR * ...................... 78,520
4,505 NHN Corp. * .............................. 500,870
------------
579,390
------------
NETHERLANDS - 5.48%
30,250 ASML Holding N.V. * ...................... 596,236
20,300 Tele Atlas N.V. * ........................ 332,439
28,942 TomTom N.V. * ............................ 1,076,951
------------
2,005,626
------------
SWITZERLAND - 3.52%
29,200 Logitech International S.A. * ............ 593,231
3,900 Roche Holding AG ......................... 694,080
------------
1,287,311
------------
TAIWAN - 2.04%
17,951 Hon Hai Precision Industry Co.,
Ltd, GDR ................................. 212,899
61,799 Taiwan Semiconductor
Manufacturing Co., Ltd., ADR ............. 535,797
------------
748,696
------------
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
UNITED KINGDOM - 1.60%
269,000 ARM Holdings plc ......................... $ 584,147
------------
UNITED STATES - 68.17%
127,337 3Com Corp. * ............................. 603,577
38,150 Accenture, Ltd., Class A ................. 1,116,269
18,395 Amdocs, Ltd. * ........................... 667,371
9,900 Amphenol Corp., Class A .................. 555,192
13,200 Anixter International, Inc. .............. 727,716
10,200 Apple Computer, Inc. * ................... 693,192
53,000 Arris Group, Inc. * ...................... 566,570
32,110 Autodesk, Inc. * ......................... 1,095,272
12,500 CheckFree Corp. * ........................ 556,250
63,000 Cisco Systems, Inc. * .................... 1,124,550
29,250 Citrix Systems, Inc. * ................... 929,273
8,775 Cognizant Technology
Solutions Corp. * ........................ 574,675
39,700 CommScope, Inc. * ........................ 1,239,831
14,600 Cymer, Inc. * ............................ 571,152
12,000 Digital River, Inc. * .................... 538,080
12,300 Electronic Arts, Inc. * .................. 579,453
1,490 Google, Inc., Class A * .................. 576,034
34,250 Hewlett-Packard Co. ...................... 1,092,917
38,250 Intevac, Inc. * .......................... 805,928
14,500 Komag, Inc. * ............................ 555,495
20,460 Marvell Technology
Group, Ltd. * ............................ 379,533
35,055 Microchip Technology, Inc. ............... 1,130,874
24,000 Microsoft Corp. .......................... 576,720
12,650 Monster Worldwide, Inc. * ................ 506,000
25,000 Motorola, Inc. ........................... 569,000
22,200 National Semiconductor Corp. ............. 516,372
15,900 Network Appliance, Inc. * ................ 472,071
77,000 Oracle Corp. * ........................... 1,152,690
15,750 Rackable Systems, Inc. * ................. 335,790
9,000 SanDisk Corp. * .......................... 419,940
23,300 Tessera Technologies, Inc. * ............. 733,251
39,375 Texas Instruments, Inc. .................. 1,172,587
19,800 Varian Semiconductor
Equipment Associates, Inc. * ............. 627,660
28,875 VistaPrint, Ltd. * ....................... 638,715
24,400 Xyratex, Ltd. * .......................... 567,056
------------
24,967,056
------------
TOTAL LONG-TERM
INVESTMENTS .............................. 34,936,573
------------
(Cost $35,372,521)
See Notes to Financial Statements.
17
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
GLOBAL TECHNOLOGY FUND
JULY 31, 2006 (CONTINUED)
PAR VALUE
AMOUNT (NOTE 2)
- -----------------------------------------------------------------------
SHORT-TERM INVESTMENT - 3.36%
REPURCHASE
AGREEMENT - 3.36%
$ 1,232,000 State Street Bank & Trust Co.,
Repurchase Agreement, dated
7/31/06 at 2.55% to be
repurchased at $1,232,087 on
8/01/06 collateralized by
$1,100,000 U.S. Treasury Bond
6.25% due 8/15/23 with a value
of $1,261,808 ............................ $ 1,232,000
------------
TOTAL SHORT-TERM
INVESTMENT ............................... 1,232,000
------------
(Cost $1,232,000)
TOTAL INVESTMENTS - 98.76% ............................ 36,168,573
------------
(Cost $36,604,521)
NET OTHER ASSETS AND
LIABILITIES - 1.24% ...................... 454,766
------------
TOTAL NET ASSETS - 100.00%............................. $ 36,623,339
============
* Non-income producing security
ADR American Depositary Receipt
GDR Global Depositary Receipts
OTHER INFORMATION:
INDUSTRY CONCENTRATION AS % OF NET
A PERCENTAGE OF NET ASSETS: ASSETS
- ---------------------------------------------------------------------------
Communications Equipment................................. 19.42%
Semiconductors........................................... 13.25
Semiconductor Equipment.................................. 9.10
Computer Storage & Peripheral............................ 8.04
Application Software..................................... 7.35
IT Consulting & Other Services........................... 6.13
Internet Software & Services............................. 5.86
Computer Hardware........................................ 4.88
Systems Software......................................... 4.72
Electronic Equipment Manufacturing....................... 2.10
Technology Distributors.................................. 1.99
Internet Retail.......................................... 1.96
Pharmaceuticals.......................................... 1.90
Office Electronics....................................... 1.77
Home Entertainment Software.............................. 1.58
Hotels, Resorts & Cruises................................ 1.54
Data Processing & Outsourced Services.................... 1.52
Human Resources & Employment Services.................... 1.38
Diversified Commercial & Professional
Services............................................. 0.91
-------
Long-Term Investments.................................... 95.40
Short-Term Investment.................................... 3.36
-------
Total Investments........................................ 98.76
Net Other Assets and Liabilities......................... 1.24
-------
100.00%
=======
See Notes to Financial Statements.
18
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
INTERNATIONAL OPPORTUNITIES FUND
JULY 31, 2006
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
COMMON STOCKS - 90.98%
AUSTRALIA - 0.78%
580,000 BHP Billiton, Ltd. ...................... $ 12,342,487
--------------
BELGIUM - 1.69%
1,152,600 Agfa Gevaert N.V. ....................... 26,737,540
--------------
CHINA - 3.94%
36,000,000 China COSCO Holdings Co.,
Ltd., Class H ........................... 17,420,401
159,800 Ctrip.com International,
Ltd., ADR ............................... 8,088,277
6,540,000 Ping An Insurance
(Group) Co. of China, Ltd.,
Class H ................................. 21,883,607
71,056,000 Shanghai Real Estate, Ltd. .............. 14,905,830
--------------
62,298,115
--------------
FRANCE - 12.25%
448,000 Alstom * ................................ 38,886,107
11,000,000 Rhodia S.A. * ........................... 21,358,132
652,913 Sodexho Alliance S.A. ................... 33,136,060
348,000 Total S.A. .............................. 23,671,504
170,000 Vallourec S.A. .......................... 36,960,298
391,600 Vinci S.A. .............................. 39,793,291
--------------
193,805,392
--------------
GERMANY - 11.31%
885,000 Bayer AG ................................ 43,603,354
650,000 Commerzbank AG .......................... 22,783,711
338,000 Deutsche Bank AG ........................ 38,966,455
1,615,000 Deutsche Post AG ........................ 39,980,967
92,656 Puma AG Rudolf
Dassler Sport ........................... 33,603,246
--------------
178,937,733
--------------
GREECE - 3.55%
670,000 Coca-Cola Hellenic Bottling
Co. S.A. ................................ 21,225,282
900,000 National Bank of Greece
S.A. .................................... 34,972,664
--------------
56,197,946
--------------
HONG KONG - 1.05%
99,200,000 Neo-China Group
(Holdings), Ltd. ........................ 7,404,700
2,550,000 Tencent Holdings, Ltd. .................. 4,870,145
9,450,000 Tian An China Investments
Co., Ltd. * ............................. 4,268,809
--------------
16,543,654
--------------
INDONESIA - 0.98%
18,800,000 PT Telekomunikasi
Indonesia ............................... 15,442,117
--------------
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
ITALY - 1.39%
2,490,000 Enel SpA $ 21,978,821
--------------
JAPAN - 22.09%
3,162,000 Daiwa Securities Group,
Inc. .................................... 35,330,996
6,930,000 Hino Motors, Ltd. ....................... 39,169,959
646,900 Kappa Create Co., Ltd. .................. 9,789,973
654,700 Nippon System
Development Co., Ltd. ................... 22,671,368
27,920 NTT DoCoMo, Inc. ........................ 40,670,243
4,743,000 Sekisui Chemical Co., Ltd. .............. 40,998,849
4,187 Sumitomo Mitsui Financial
Group, Inc. ............................. 44,556,152
652,000 Takeda Pharmaceutical
Co., Ltd. ............................... 42,084,696
511,700 TDK Corp. ............................... 39,991,557
2,332,000 Yamato Holdings Co., Ltd. ............... 34,376,379
--------------
349,640,172
--------------
KOREA - 4.73%
139,700 Hyundai Motor Co. ....................... 10,691,028
126,000 Kookmin Bank ............................ 11,001,256
7,617 Lotte Shopping Co., Ltd. ................ 2,615,553
715,000 Lotte Shopping Co.,
Ltd., GDR * ............................. 12,212,200
779,500 Shinhan Financial
Group Co., Ltd. ......................... 38,354,795
--------------
74,874,832
--------------
NETHERLANDS - 0.55%
232,350 TomTom N.V. * ........................... 8,645,899
--------------
NORWAY - 1.40%
750,000 Statoil ASA ............................. 22,239,824
--------------
SINGAPORE - 1.73%
2,385,000 DBS Group Holdings, Ltd. ................ 27,341,736
--------------
SPAIN - 4.56%
962,000 Industria de Diseno
Textil S.A. ............................. 41,793,496
1,800,000 Telefonica S.A. ......................... 30,443,002
--------------
72,236,498
--------------
SWITZERLAND - 2.40%
569,953 Kuehne & Nagel
International AG ........................ 37,979,884
--------------
TAIWAN - 3.03%
1,218,000 AU Optronics
Corp., ADR * ............................ 17,953,320
3,454,587 Taiwan Semiconductor
Manufacturing Co.,
Ltd., ADR ............................... 29,951,269
--------------
47,904,589
--------------
See Notes to Financial Statements.
19
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
INTERNATIONAL OPPORTUNITIES FUND
JULY 31, 2006 (CONTINUED)
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
UNITED KINGDOM - 9.91%
4,384,569 Capita Group plc ........................ $ 42,815,177
5,002,556 Debenhams plc * ......................... 16,820,591
3,910,150 Halfords Group plc ...................... 21,401,186
2,285,000 Lloyds TSB Group plc .................... 23,006,564
1,221,226 Regal Petroleum plc * ................... 1,602,578
4,452,000 Tesco plc ............................... 29,897,223
497,211 Xstrata plc ............................. 21,334,306
--------------
156,877,625
--------------
UNITED STATES - 3.64%
271,500 Accenture, Ltd., Class A ................ 7,944,090
259,000 Autodesk, Inc. * ........................ 8,834,490
170,700 CheckFree Corp. * ....................... 7,596,150
115,000 Cisco Systems, Inc. * ................... 2,052,750
227,000 CommScope, Inc. * ....................... 7,089,210
159,850 Digital River, Inc. * ................... 7,167,674
350,000 National Semiconductor
Corp. ................................... 8,141,000
297,000 Texas Instruments, Inc. ................. 8,844,660
--------------
57,670,024
--------------
TOTAL COMMON STOCKS ..................... 1,439,694,888
--------------
(Cost $1,308,207,042)
PREFERRED STOCK - 2.75%
GERMANY - 2.75%
264,218 Fresenius AG ............................ 43,447,937
--------------
TOTAL PREFERRED STOCK ................... 43,447,937
--------------
(Cost $38,919,451)
TOTAL LONG-TERM
INVESTMENTS - 93.73% .................... 1,483,142,825
--------------
(Cost $1,347,126,493)
PAR VALUE
AMOUNT (NOTE 2)
- -----------------------------------------------------------------------
SHORT-TERM INVESTMENT - 5.64%
REPURCHASE
AGREEMENT - 5.64%
$ 89,356,000 State Street Bank & Trust
Co., Repurchase
Agreement, dated 7/31/06
at 3.40% to be repurchased
at $89,364,439 on 8/1/06
collateralized by
$79,465,000 U.S. Treasury
Bond 6.25% due 8/15/23
with a value
of $91,154,143. ......................... $ 89,356,000
--------------
TOTAL SHORT-TERM
INVESTMENT .............................. 89,356,000
--------------
(Cost $89,356,000)
TOTAL INVESTMENTS - 99.37% ............................ 1,572,498,825
--------------
(Cost $1,436,482,493)
NET OTHER ASSETS AND
LIABILITIES - 0.63% ..................... 9,970,567
--------------
TOTAL NET ASSETS - 100.00%............................. $1,582,469,392
==============
* Non-income producing security
ADR American Depositary Receipt
GDR Global Depositary Receipt
See Notes to Financial Statements.
20
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
INTERNATIONAL OPPORTUNITIES FUND
JULY 31, 2006 (CONTINUED)
OTHER INFORMATION:
INDUSTRY CONCENTRATION AS % OF NET
A PERCENTAGE OF NET ASSETS: ASSETS
- ---------------------------------------------------------------------------
Diversified Banks........................................ 12.77%
Air Freight & Logistics.................................. 4.70
Electronic Equipment Manufacturing....................... 3.66
Marine................................................... 3.50
Semiconductors........................................... 2.97
Integrated Oil & Gas..................................... 2.90
Integrated Telecommunication Services.................... 2.90
Diversified Chemicals.................................... 2.76
Health Care Equipment.................................... 2.75
Restaurants.............................................. 2.71
Human Resources & Employment Services.................... 2.71
Pharmaceuticals.......................................... 2.66
Apparel Retail........................................... 2.64
Homebuilding............................................. 2.59
Wireless Telecommunication Services...................... 2.57
Construction & Engineering............................... 2.51
Construction & Farm Machinery & Trucks................... 2.48
Diversified Capital Markets.............................. 2.46
Heavy Electrical Equipment............................... 2.46
Industrial Machinery..................................... 2.34
Investment Banking & Brokerage........................... 2.23
Diversified Metal & Mining............................... 2.13
Footwear................................................. 2.12
Department Stores........................................ 2.00
Application Software..................................... 1.99
Food Retail.............................................. 1.89
Photographic Products.................................... 1.69
Real Estate Management & Development..................... 1.68
Electric Utilities....................................... 1.39
Life & Health Insurance.................................. 1.38
Automotive Retail........................................ 1.35
Specialty Chemicals...................................... 1.35
Soft Drinks.............................................. 1.34
Communications Equipment................................. 1.12
Internet Software & Services............................. 0.76
Automobile Manufacturers................................. 0.68
Hotels, Resorts & Cruises................................ 0.51
IT Consulting & Other Services........................... 0.50
Data Processing & Outsourced Services.................... 0.48
Oil & Gas Exploration & Products......................... 0.10
-------
Long-Term Investments.................................... 93.73
Short-Term Investment.................................... 5.64
-------
Total Investments........................................ 99.37
Net Other Assets and Liabilities......................... 0.63
-------
100.00%
=======
See Notes to Financial Statements.
21
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
JAPAN-ASIA FOCUS FUND
JULY 31, 2006
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
COMMON STOCKS - 95.12%
AUSTRALIA - 0.37%
10,000 BHP Billiton, Ltd. ....................... $ 212,801
-----------
CHINA - 1.56%
430,000 China COSCO Holdings Co.,
Ltd., Class H ............................ 208,077
120,000 Ping An Insurance (Group) Co.
of China, Ltd., Class H .................. 401,534
1,409,000 Shanghai Real Estate, Ltd. ............... 295,574
-----------
905,185
-----------
HONG KONG - 1.33%
4,900,000 Neo-China Group
(Holdings), Ltd. ......................... 365,756
172,000 Shanghai Industrial
Holdings, Ltd. ........................... 335,137
150,000 Tian An China Investments
Co., Ltd. * .............................. 67,759
-----------
768,652
-----------
INDONESIA - 0.67%
470,000 PT Telekomunikasi Indonesia .............. 386,053
-----------
JAPAN - 85.38%
288,000 Aioi Insurance Co., Ltd. ................. 2,243,308
239,000 Asahi Kasei Corp. ........................ 1,486,388
115,000 Daiwa Securities Group, Inc. ............. 1,284,967
54,800 Fuji Photo Film Co., Ltd. ................ 1,845,070
404,000 Hino Motors, Ltd. ........................ 2,283,501
71,390 Hitachi Systems &
Services, Ltd. ........................... 1,556,762
125,700 Kappa Create Co., Ltd. ................... 1,902,303
1,900 Kobe Bussan Co., Ltd. * .................. 64,966
349 Link Theory Holdings Co., Ltd. ........... 898,033
228 Mitsubishi UFJ Financial
Group, Inc. .............................. 3,221,772
240 Nippon Paper Group, Inc. ................. 956,692
27,100 Nippon System Development
Co., Ltd. ................................ 938,436
321,000 Nishi-Nippon City Bank, Ltd. ............. 1,419,573
50,300 NS Solutions Corp. ....................... 1,259,200
1,039 NTT DoCoMo, Inc. ......................... 1,513,481
4,740 OBIC Co., Ltd. ........................... 1,006,751
62,000 Ricoh Co., Ltd. .......................... 1,249,248
31,900 Sanyo Electric Credit
Co., Ltd. ................................ 603,803
225,000 Sekisui Chemical Co., Ltd. ............... 1,944,917
7,400 SMC Corp. ................................ 946,906
290 Sumitomo Mitsui Financial
Group, Inc. .............................. 3,086,048
208,000 Tadano, Ltd. ............................. 1,699,996
35,000 Takeda Pharmaceutical
Co., Ltd. ................................ 2,259,148
31,000 Takefuji Corp. ........................... 1,519,648
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
JAPAN - (continued)
32,300 TDK Corp. ................................ $ 2,524,384
91,300 Tohokushinsha Film Corp. ................. 1,034,486
33,200 Token Corp. .............................. 2,331,196
102,000 Toppan Printing Co., Ltd. ................ 1,173,518
82,600 Toyo Seikan Kaisha, Ltd. ................. 1,635,501
871,000 Ube Industries, Ltd. ..................... 2,226,028
89,000 Yamato Holdings Co., Ltd. ................ 1,311,963
-----------
49,427,993
-----------
KOREA - 3.21%
4,700 Hyundai Motor Co. ........................ 359,684
1,656 Lotte Shopping Co., Ltd. ................. 568,643
4,000 Lotte Shopping Co., Ltd., GDR * .......... 68,320
429 Samsung Electronics Co.,
Ltd., GDR ................................ 136,529
14,815 Shinhan Financial Group
Co., Ltd. ................................ 728,963
-----------
1,862,139
-----------
SINGAPORE - 0.81%
40,900 DBS Group Holdings, Ltd. ................. 468,879
-----------
TAIWAN - 1.79%
30,000 AU Optronics Corp., ADR * ................ 442,200
68,494 Taiwan Semiconductor
Manufacturing Co., Ltd., ................. 593,843
-----------
1,036,043
-----------
TOTAL LONG-TERM
INVESTMENTS .............................. 55,067,745
-----------
(Cost $57,069,684)
See Notes to Financial Statements.
22
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
JAPAN-ASIA FOCUS FUND
JULY 31, 2006 (CONTINUED)
PAR VALUE
AMOUNT (NOTE 2)
- -----------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 4.58%
REPURCHASE
AGREEMENTS - 4.58%
$ 320,000 State Street Bank & Trust Co.,
Repurchase Agreement, dated
7/31/06 at 1.50% to be
repurchased at $320,013 on
8/1/06 collateralized by
$285,000 U.S. Treasury Bond
6.25% due 8/15/23
with a value of $326,923 ................. $ 320,000
2,330,000 State Street Bank & Trust Co.,
Repurchase Agreement, dated
7/31/06 at 2.55% to be
repurchased at $2,330,165 on
8/1/06 collateralized by
$2,075,000 U.S. Treasury Bond
6.25% due 8/15/23 with a
value of $2,380,228 ...................... 2,330,000
-----------
TOTAL SHORT-TERM
INVESTMENTS .............................. 2,650,000
-----------
(Cost $2,650,000)
TOTAL INVESTMENTS - 99.70% ............................ 57,717,745
-----------
(Cost $59,719,684)
NET OTHER ASSETS AND
LIABILITIES - 0.30% ...................... 171,666
-----------
TOTAL NET ASSETS - 100.00%............................. $57,889,411
===========
* Non-income producing security
ADR American Depositary Receipt
GDR Global Depositary Receipt
OTHER INFORMATION:
INDUSTRY CONCENTRATION AS % OF NET
A PERCENTAGE OF NET ASSETS: ASSETS
- ---------------------------------------------------------------------------
Diversified Banks........................................ 12.97%
Homebuilding............................................. 7.39
Construction & Farm Machinery & Trucks................... 6.88
IT Consulting & Other Services........................... 6.60
Electronic Equipment Manufacturing....................... 5.70
Pharmaceuticals.......................................... 3.90
Property & Casualty Insurance............................ 3.86
Diversified Chemicals.................................... 3.85
Consumer Finance......................................... 3.67
Restaurants.............................................. 3.29
Photographic Products.................................... 3.19
Metal & Glass Containers................................. 2.82
Wireless Telecommunication Services...................... 2.61
Commodity Chemicals...................................... 2.57
Regional Banks........................................... 2.45
Air Freight & Logistics.................................. 2.27
Investment Banking & Brokerage........................... 2.22
Office Electronics....................................... 2.16
Commercial Printing...................................... 2.03
Movies & Entertainment................................... 1.79
Paper Products........................................... 1.65
Industrial Machinery..................................... 1.64
Application Software..................................... 1.62
Apparel Retail........................................... 1.55
Real Estate Management & Development..................... 1.26
Semiconductors........................................... 1.26
Department Stores........................................ 1.10
Life & Health Insurance.................................. 0.69
Integrated Telecommunication Services.................... 0.67
Automobile Manufacturers................................. 0.62
Diversified Metal & Mining............................... 0.37
Marine................................................... 0.36
Industrial Conglomerates................................. 0.11
-------
Long-Term Investments.................................... 95.12
Short-Term Investments................................... 4.58
-------
Total Investments........................................ 99.70
Net Other Assets and Liabilities......................... 0.30
-------
100.00%
=======
See Notes to Financial Statements.
23
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
WORLDWIDE INCOME FUND
JULY 31, 2006
FACE VALUE
AMOUNT COUPON MATURITY (NOTE 2)
- ------------------------------------------------------------------------------------------------------------------------
CORPORATE BONDS - 62.06%
BELGIUM - 0.77%
USD 327,000 Telenet Group Holding NV (a)(b) ........................... 0/11.500% 6/15/14 $ 279,585
-----------
FRANCE - 4.45%
EUR 200,000 Belvedere S.A. (b)(c) ..................................... 6.135 5/15/13 260,909
EUR 400,000 Crown European Holdings S.A. .............................. 6.250 9/1/11 535,869
EUR 300,000 Ray Acquisition SCA ....................................... 9.375 3/15/15 414,357
EUR 300,000 Rhodia S.A. ............................................... 8.000 6/1/10 403,339
-----------
1,614,474
-----------
GERMANY - 7.54%
EUR 400,000 Cognis GmbH ............................................... 9.500 5/15/14 572,275
EUR 200,000 Escada AG (c) ............................................. 7.500 4/1/12 274,322
EUR 250,000 Iesy Hessen & Ish NRW ..................................... 6.021 4/15/13 312,165
USD 400,000 Kabel Deutschland GmbH (b) ................................ 10.625 7/1/14 426,000
EUR 450,000 Tele Columbus AG & Co. (c) ................................ 6.840 4/15/10 585,438
EUR 450,000 Tui AG (c) ................................................ 4.540 12/10/10 565,489
-----------
2,735,689
-----------
GREECE - 1.09%
EUR 300,000 Hellas Telecommunications Luxembourg V .................... 6.590 10/15/12 394,238
-----------
IRELAND - 2.18%
EUR 150,000 JSG Funding plc ........................................... 10.125 10/1/12 209,813
EUR 415,000 Riverdeep Group, Ltd. ..................................... 9.250 4/15/11 582,471
-----------
792,284
-----------
ITALY - 3.75%
EUR 400,000 Lighthouse International Co., S.A. ........................ 8.000 4/30/14 548,005
USD 750,000 Wind Acquisition Finance S.A. (b) ......................... 10.750 12/1/15 811,875
-----------
1,359,880
-----------
NETHERLANDS - 1.47%
EUR 400,000 Culligan Finance Corp. .................................... 8.000 10/1/14 532,676
-----------
NORWAY - 1.29%
EUR 200,000 Nordic Telephone Company ApS .............................. 8.250 5/1/16 267,296
EUR 150,000 Nordic Telephone Company ApS (c) .......................... 8.352 5/1/16 200,232
-----------
467,528
-----------
RUSSIA - 0.82%
USD 300,000 VTB Capital S.A. (b) ...................................... 6.250 6/30/35 297,750
-----------
SPAIN - 3.12%
EUR 450,000 Cirsa Finance Luxembourg S.A. ............................. 8.750 5/15/14 599,979
EUR 400,000 Codere Finance Luxembourg S.A. ............................ 8.250 6/15/15 533,314
-----------
1,133,293
-----------
UKRAINE - 1.07%
USD 400,000 City of Kiev .............................................. 8.000 11/6/15 389,280
-----------
See Notes to Financial Statements.
24
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
WORLDWIDE INCOME FUND
JULY 31, 2006 (CONTINUED)
FACE VALUE
AMOUNT COUPON MATURITY (NOTE 2)
- ------------------------------------------------------------------------------------------------------------------------
UNITED KINGDOM - 15.93%
GBP 350,000 Allied Domecq Financial Services plc ...................... 6.625% 6/12/14 $ 679,780
GBP 450,000 Corus Finance plc ......................................... 6.750 5/20/08 857,412
GBP 350,000 EMI Group plc ............................................. 9.750 5/20/08 699,566
EUR 300,000 FKI plc ................................................... 6.625 2/22/10 397,591
USD 300,000 Ineos Group Holdings plc (b) .............................. 8.500 2/15/16 282,750
EUR 260,000 Invensys plc .............................................. 9.875 3/15/11 374,470
GBP 400,000 NTL Cable plc ............................................. 9.750 4/15/14 766,657
GBP 400,000 Pipe Holding plc .......................................... 7.750 11/1/11 760,276
GBP 500,000 WRG Acquisitions plc (c) .................................. 8.223 12/15/11 962,020
-----------
5,780,522
-----------
UNITED STATES - 18.58%
GBP 350,000 Constellation Brands, Inc. ................................ 8.500 11/15/09 703,652
EUR 450,000 Fresenius Medical Care Capital
Trust V (Preferred) ....................................... 7.375 6/15/11 626,565
GBP 350,000 HCA, Inc. ................................................. 8.750 11/1/10 655,434
USD 350,000 Hertz Corp. (b) ........................................... 8.875 1/1/14 366,625
USD 150,000 Hertz Corp. (b) ........................................... 10.500 1/1/16 163,875
EUR 450,000 Huntsman International LLC (a) ............................ 8.250 1/1/15 580,579
EUR 330,000 Kronos International, Inc. ................................ 6.500 4/15/13 408,896
USD 600,000 Nell AF Sarl (b) .......................................... 8.375 8/15/15 585,750
EUR 400,000 Rockwood Specialties Group, Inc. .......................... 7.625 11/15/14 521,179
USD 500,000 Samsonite Corp. ........................................... 8.875 6/1/11 521,250
USD 500,000 Sungard Data Systems, Inc. (b) ............................ 10.250 8/15/15 509,375
USD 500,000 Tronox Worldwide LLC (b) .................................. 9.500 12/1/12 518,750
GBP 300,000 Warner Music Group ........................................ 8.125 4/15/14 580,014
-----------
6,741,944
-----------
TOTAL CORPORATE BONDS ..................................... 22,519,143
-----------
(Cost $22,321,474)
FOREIGN SOVEREIGN BONDS - 26.88%
ARGENTINA - 0.96%
USD 500,000 Republic of Argentina (c) ................................. 5.589 8/3/12 350,000
-----------
BRAZIL - 3.73%
USD 1,000,000 Federal Republic of Brazil ................................ 10.500 7/14/14 1,236,000
USD 100,000 Federal Republic of Brazil ................................ 8.875 10/14/19 116,250
-----------
1,352,250
-----------
COLUMBIA - 2.98%
USD 995,000 Republic of Columbia ...................................... 8.250 12/22/14 1,082,062
-----------
DOMINICAN REPUBLIC - 1.63%
USD 546,488 Dominican Republic ........................................ 9.040 1/23/18 592,939
-----------
ECUADOR - 1.16%
USD 400,000 Republic of Ecuador ....................................... 9.375 12/15/15 418,960
-----------
EL SALVADOR - 1.96%
USD 650,000 Republic of El Salvador ................................... 8.500 7/25/11 711,750
-----------
See Notes to Financial Statements.
25
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
WORLDWIDE INCOME FUND
JULY 31, 2006 (CONTINUED)
FACE VALUE
AMOUNT COUPON MATURITY (NOTE 2)
- ------------------------------------------------------------------------------------------------------------------------
INDONESIA - 1.10%
USD 400,000 Republic of Indonesia ..................................... 6.750% 3/10/14 $ 398,798
-----------
PANAMA - 1.39%
USD 500,000 Republic of Panama ........................................ 7.125 1/29/26 503,000
-----------
PERU - 3.31%
USD 1,000,000 Republic of Peru .......................................... 9.875 2/6/15 1,202,500
-----------
PHILIPPINES - 1.40%
USD 475,000 Republic of Philippines ................................... 8.000 1/15/16 508,535
-----------
TURKEY - 2.99%
USD 1,000,000 Republic of Turkey ........................................ 9.000 6/30/11 1,085,000
-----------
URUGUAY - 3.36%
USD 1,000,000 Republic of Uruguay ....................................... 7.500 3/15/15 1,017,500
USD 200,000 Republic of Uruguay ....................................... 8.000 11/18/22 201,500
-----------
1,219,000
-----------
VENEZUELA - 0.91%
USD 300,000 Republic of Venezuela ..................................... 8.500 10/8/14 329,250
-----------
TOTAL FOREIGN SOVEREIGN BONDS ............................. 9,754,044
-----------
(Cost $9,530,976)
TOTAL CORPORATE AND FOREIGN SOVEREIGN BONDS ............... 32,273,187
-----------
(Cost $31,852,450)
COMMON STOCKS - 4.10%
SHARES
12,000 Eni S.p.A. (Italy) ........................................ 368,045
15,000 HSBC Holdings plc (United Kingdom) ........................ 272,074
30,000 Lloyds TSB Group plc (United Kingdom) ..................... 302,055
25,000 Scottish Power plc (United Kingdom) ....................... 282,535
50,000 Tomkins plc (United Kingdom) .............................. 263,388
-----------
TOTAL COMMON STOCKS ....................................... 1,488,097
-----------
(Cost $1,440,666)
TOTAL LONG-TERM INVESTMENTS - 93.04% ...................... 33,761,284
-----------
(Cost $33,293,116)
See Notes to Financial Statements.
26
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
WORLDWIDE INCOME FUND
JULY 31, 2006 (CONTINUED)
PAR VALUE
AMOUNT (NOTE 2)
- ------------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 12.49%
REPURCHASE AGREEMENTS - 12.49%
$ 731,000 State Street Bank & Trust Co., Repurchase Agreement,
dated 7/31/06 at 1.50% to be repurchased at
$731,030 on 8/1/06 collateralized by $655,000 U.S.
Treasury Bond 6.25% due 8/15/23 with a value
of $751,349 ............................................... $ 731,000
3,801,000 State Street Bank & Trust Co., Repurchase Agreement,
dated 7/31/06 at 2.55% to be repurchased at
$3,801,269 on 8/1/06 collateralized by $3,380,000
U.S. Treasury Bond 6.25% due 8/15/23 with a value
of $3,877,191 ............................................. 3,801,000
-----------
TOTAL SHORT-TERM INVESTMENTS .............................. 4,532,000
-----------
(Cost $4,532,000)
TOTAL INVESTMENTS - 105.53% ................................................. 38,293,284
-----------
(Cost $37,825,116)
NET OTHER ASSETS AND LIABILITIES - (5.53)% .................................. (2,006,114)
-----------
TOTAL NET ASSETS - 100.00% .................................................. $36,287,170
===========
(a) Security is a step coupon bond where the coupon increases on a
predetermined date. Coupon shown is that currently in effect.
(b) 144A securities are those that are exempt from registration under Rule 144A
of the Securities Act of 1933, as amended. These securities may only be
resold in transactions exempt from registration which are normally those
transactions with qualified institutional buyers.
(c) Security is a floating rate bond where the interest rate is adjusted
quarterly according to LIBOR interest rate changes. Coupon shown is that
currently in effect.
See Notes to Financial Statements.
27
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
WORLDWIDE INCOME FUND
JULY 31, 2006 (CONTINUED)
OTHER INFORMATION:
INDUSTRY CONCENTRATION AS % OF NET
A PERCENTAGE OF NET ASSETS: ASSETS
- ---------------------------------------------------------------------------
Sovereign................................................ 26.88%
Chemicals................................................ 10.67
Environmental............................................ 5.77
Media - Cable............................................ 4.59
Beverage................................................. 4.53
Steel production......................................... 4.46
Telecom - Integrated..................................... 3.55
Health Services.......................................... 3.53
Media - Diversified...................................... 3.44
Support services......................................... 3.02
Diversified Capital...................................... 2.85
Banking.................................................. 2.40
Media services........................................... 2.37
Telecom - Wireless....................................... 2.24
Packaging................................................ 2.06
Printing & Publishing.................................... 1.61
Gaming................................................... 1.47
Consumer products........................................ 1.44
Software/Services........................................ 1.40
Electronics.............................................. 1.14
Municipals............................................... 1.07
Mining................................................... 1.01
Integrated Energy........................................ 0.78
Apparel/Textiles......................................... 0.76
-------
Total Long Term Investments.............................. 93.04
Short-Term Investments................................... 12.49
-------
Total Investments........................................ 105.53
Net Other Assets and Liabilities......................... -5.53
-------
100.00%
=======
See Notes to Financial Statements.
28
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
U.S. CORE GROWTH FUND
JULY 31, 2006
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
COMMON STOCKS - 100.01%
AIR FREIGHT &
LOGISTICS - 0.49%
1,100 United Parcel Service, Inc.,
Class B .................................. $ 75,801
-----------
AUTOMOBILES - 2.76%
12,850 Honda Motor Co.,
Ltd., ADR ................................ 423,408
-----------
CAPITAL MARKETS - 6.09%
9,700 American Capital
Strategies, Ltd. ......................... 339,500
3,900 Goldman Sachs Group, Inc. ................ 595,725
-----------
935,225
-----------
CHEMICALS - 3.36%
12,000 Monsanto Co. ............................. 515,880
-----------
COMMUNICATIONS
EQUIPMENT - 3.78%
16,350 Corning, Inc. * .......................... 311,794
7,600 QUALCOMM, Inc. ........................... 267,976
-----------
579,770
-----------
COMPUTER &
PERIPHERAL - 1.30%
19,700 EMC Corp. * .............................. 199,955
-----------
CONSUMER FINANCE - 6.25%
8,900 American Express Co. ..................... 463,334
6,420 Capital One Financial Corp. .............. 496,587
-----------
959,921
-----------
DIVERSIFIED FINANCIAL
SERVICES - 2.25%
750 Chicago Mercantile Exchange
Holdings, Inc. ........................... 345,900
-----------
ENERGY EQUIPMENT &
SERVICES - 2.22%
10,200 Halliburton Co. .......................... 340,272
-----------
FOOD & STAPLES
RETAILING - 3.03%
14,200 CVS Corp. ................................ 464,624
-----------
FOOD PRODUCTS - 1.97%
5,500 The Hershey Co. .......................... 302,335
-----------
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
HEALTH CARE EQUIPMENT &
SUPPLIES - 5.22%
1,690 Alcon, Inc. .............................. $ 186,610
22,731 Boston Scientific Corp. * ................ 386,654
6,190 St. Jude Medical, Inc. * ................. 228,411
-----------
801,675
-----------
HEALTH CARE PROVIDERS &
SERVICES - 9.41%
5,935 Caremark Rx, Inc. ........................ 313,368
4,200 CIGNA Corp. .............................. 383,250
9,600 Humana, Inc. * ........................... 536,928
35,500 Tenet Healthcare Corp. * ................. 210,160
-----------
1,443,706
-----------
HOTELS, RESTAURANTS &
LEISURE - 4.70%
4,600 McDonald's Corp. ......................... 162,794
5,150 Starwood Hotels & Resorts
Worldwide, Inc. .......................... 270,787
4,500 Wynn Resorts, Ltd. * ..................... 288,045
-----------
721,626
-----------
HOUSEHOLD PRODUCTS - 2.27%
6,200 The Procter & Gamble Co. ................. 348,440
-----------
INDUSTRIAL POWER PRODUCTS &
ENERGY TRADES - 2.30%
5,500 TXU Corp. ................................ 353,265
-----------
INSURANCE - 2.95%
2,900 Metlife Inc. ............................. 150,800
6,000 The Chubb Corp. .......................... 302,520
-----------
453,320
-----------
INTERNET SOFTWARE &
SERVICES - 3.14%
1,245 Google, Inc., Class A * .................. 481,317
-----------
MACHINERY - 4.01%
5,100 Danaher Corp. ............................ 332,520
3,500 PACCAR, Inc. ............................. 282,625
-----------
615,145
-----------
MEDIA - 6.57%
15,800 Comcast Corp., Class A * ................. 541,624
15,700 The Walt Disney Co. ...................... 466,133
-----------
1,007,757
-----------
MULTILINE RETAIL - 2.17%
5,300 J.C. Penney Co., Inc. .................... 333,688
-----------
See Notes to Financial Statements.
29
HENDERSON GLOBAL FUNDS
PORTFOLIO OF INVESTMENTS
U.S. CORE GROWTH FUND
JULY 31, 2006 (CONTINUED)
VALUE
SHARES (NOTE 2)
- -----------------------------------------------------------------------
OFFICE ELECTRONICS - 2.19%
23,800 Xerox Corp. * ............................ $ 335,342
-----------
OIL, GAS & CONSUMABLE
FUELS - 1.76%
4,000 Valero Energy Corp. ...................... 269,720
-----------
PHARMACEUTICALS - 4.61%
6,555 Glaxosmithkline plc, ADR ................. 362,688
10,420 Teva Pharmaceutical
Industries, Ltd., ADR .................... 344,694
-----------
707,382
-----------
SEMICONDUCTOR &
SEMICONDUCTOR
EQUIPMENT - 9.00%
22,100 Applied Materials, Inc. .................. 347,854
10,550 Broadcom Corp., Class A * ................ 253,094
14,000 MEMC Electronic
Materials, Inc. * ........................ 425,880
11,000 Microchip Technology, Inc. ............... 354,860
-----------
1,381,688
-----------
SOFTWARE - 0.95%
5,100 Adobe Systems, Inc. * .................... 145,401
-----------
SPECIALTY RETAIL - 4.28%
6,800 Best Buy Co., Inc. ....................... 308,312
14,300 The TJX Companies, Inc. .................. 348,491
-----------
656,803
-----------
TEXTILE, APPAREL & LUXURY
GOODS - 0.98%
1,900 Nike, Inc., Class B ...................... 150,100
-----------
TOTAL INVESTMENTS - 100.01% ........................... 15,349,466
-----------
(Cost $14,376,639)
NET OTHER ASSETS AND
LIABILITIES - (0.01)% .................... (933)
-----------
TOTAL NET ASSETS - 100.00% ............................ $15,348,533
===========
* Non-income producing security
ADR American Depositary Receipt
See Notes to Financial Statements.
30
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31
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
JULY 31, 2006
EUROPEAN GLOBAL
FOCUS TECHNOLOGY
FUND FUND
=============================================================================================================
ASSETS:
Investments, at value
Securities $496,041,386 $34,936,573
Repurchase agreements 17,500,000 1,232,000
- -------------------------------------------------------------------------------------------------------------
Total investments, at value 513,541,386 36,168,573
Cash 109 472
Foreign cash, at value -- 19
Dividends and interest receivable 554,997 6,397
Receivable from investment adviser -- 200
Receivable for investment securities sold 1,308 1,833,451
Receivable for fund shares sold 3,726,777 273,147
Forward foreign currency contracts -- --
Prepaid expenses and other assets 56,123 37,259
- -------------------------------------------------------------------------------------------------------------
Total Assets 517,880,700 38,319,518
- -------------------------------------------------------------------------------------------------------------
LIABILITIES:
Payable for investment securities purchased 1,357,401 1,425,768
Payable for fund shares redeemed 599,443 168,039
Payable to custodian -- --
Payable for dividends -- --
Payable to investment adviser 424,529 31,513
Payable for 12b-1 distribution and service fees 196,998 15,532
Forward foreign currency contracts -- --
Accrued expenses and other payables 266,647 55,327
- -------------------------------------------------------------------------------------------------------------
Total Liabilities 2,845,018 1,696,179
- -------------------------------------------------------------------------------------------------------------
NET ASSETS $515,035,682 $36,623,339
=============================================================================================================
NET ASSETS CONSIST OF:
Paid-in capital $395,136,262 $38,477,836
Accumulated undistributed net investment income/(loss) -- (42,881)
Accumulated net realized gain/(loss) on investments 35,780,260 (1,375,736)
Net unrealized appreciation/(depreciation) of investments
and foreign currency translations 84,119,110 (435,880)
- -------------------------------------------------------------------------------------------------------------
$515,035,632 $36,623,339
- -------------------------------------------------------------------------------------------------------------
NET ASSETS:
Class A Shares $368,593,187 $24,684,976
=============================================================================================================
Class B Shares 35,977,026 1,186,678
=============================================================================================================
Class C Shares 110,465,419 10,751,685
=============================================================================================================
Class R Shares N/A N/A
=============================================================================================================
SHARES OUTSTANDING:
Class A Shares (unlimited number of shares authorized) 12,555,303 2,025,464
=============================================================================================================
Class B Shares (unlimited number of shares authorized) 1,266,465 100,657
=============================================================================================================
Class C Shares (unlimited number of shares authorized) 3,889,093 914,436
=============================================================================================================
Class R Shares (unlimited number of shares authorized) N/A N/A
=============================================================================================================
CLASS A SHARES:
Net asset value and redemption price per share $29.36 $12.19
- -------------------------------------------------------------------------------------------------------------
Maximum sales charge * 5.75% 5.75%
Maximum offering price per share $31.15 $12.93
=============================================================================================================
CLASS B SHARES:
Net asset value and offering price per share $28.41 $11.79
=============================================================================================================
CLASS C SHARES:
Net asset value and offering price per share $28.40 $11.76
=============================================================================================================
CLASS R SHARES:
Net asset value and offering price per share N/A N/A
=============================================================================================================
Investments, at cost $429,420,977 $36,604,521
=============================================================================================================
Foreign cash, at cost -- $19
=============================================================================================================
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
JULY 31, 2006 (CONTINUED)
INTERNATIONAL JAPAN-ASIA WORLDWIDE U.S. CORE
OPPORTUNITIES FOCUS INCOME GROWTH
FUND FUND FUND FUND
===================================================================================================================================
ASSETS:
Investments, at value
Securities $1,483,142,825 $55,067,745 $33,761,284 $15,349,466
Repurchase agreements 89,356,000 2,650,000 4,532,000 --
- -----------------------------------------------------------------------------------------------------------------------------------
Total investments, at value 1,572,498,825 57,717,745 38,293,284 15,349,466
Cash 142,603 492 7,562 --
Foreign cash, at value 2 20,802 5,931 --
Dividends and interest receivable 1,637,377 37,906 540,715 6,157
Receivable from investment adviser -- 2,409 27,646 13,185
Receivable for investment securities sold 3,777,727 43,648 1,022,146 307,167
Receivable for fund shares sold 11,854,068 192,854 275,412 60,780
Forward foreign currency contracts 2,891,899 289,190 -- --
Prepaid expenses and other assets 121,114 68,368 33,179 17,828
- -----------------------------------------------------------------------------------------------------------------------------------
Total Assets 1,592,923,615 58,373,414 40,205,875 15,754,583
- -----------------------------------------------------------------------------------------------------------------------------------
LIABILITIES:
Payable for investment securities purchased 4,111,861 -- 3,282,805 207,138
Payable for fund shares redeemed 2,064,051 200,905 286,372 37,951
Payable to custodian -- -- -- 96,706
Payable for dividends -- -- 81,119 --
Payable to investment adviser 1,369,359 48,426 25,032 15,190
Payable for 12b-1 distribution and service fees 682,136 23,681 18,175 6,645
Forward foreign currency contracts 1,463,135 146,313 165,940 --
Accrued expenses and other payables 763,681 64,678 59,262 42,420
- -----------------------------------------------------------------------------------------------------------------------------------
Total Liabilities 10,454,223 484,003 3,918,705 406,050
- -----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $1,582,469,392 $57,889,411 $36,287,170 $15,348,533
===================================================================================================================================
NET ASSETS CONSIST OF:
Paid-in capital $1,368,199,581 $60,165,837 $36,565,786 $14,217,633
Accumulated undistributed net investment income/(loss) 706,682 (142,848) (5,086) --
Accumulated net realized gain/(loss) on investments 76,117,294 (274,392) (578,670) 158,073
Net unrealized appreciation/(depreciation) of investments
and foreign currency translations 137,445,835 (1,859,186) 305,140 972,827
- -----------------------------------------------------------------------------------------------------------------------------------
$1,582,469,392 $57,889,411 $36,287,170 $15,348,533
- -----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
Class A Shares $1,007,240,524 $39,381,426 $17,926,826 $10,991,406
===================================================================================================================================
Class B Shares 77,695,349 N/A 5,210,006 1,291,923
===================================================================================================================================
Class C Shares 497,402,368 18,507,985 13,150,338 3,065,204
===================================================================================================================================
Class R Shares 131,151 N/A N/A N/A
===================================================================================================================================
SHARES OUTSTANDING:
Class A Shares (unlimited number of shares authorized) 46,815,339 4,080,122 1,662,552 1,061,931
===================================================================================================================================
Class B Shares (unlimited number of shares authorized) 3,731,133 N/A 483,982 126,664
===================================================================================================================================
Class C Shares (unlimited number of shares authorized) 23,906,888 1,923,812 1,220,128 300,540
===================================================================================================================================
Class R Shares (unlimited number of shares authorized) 6,110 N/A N/A N/A
===================================================================================================================================
CLASS A SHARES:
Net asset value and redemption price per share $21.52 $9.65 $10.78 $10.35
- -----------------------------------------------------------------------------------------------------------------------------------
Maximum sales charge * 5.75% 5.75% 4.75% 5.75%
Maximum offering price per share $22.83 $10.24 $11.32 $10.98
===================================================================================================================================
CLASS B SHARES:
Net asset value and offering price per share $20.82 N/A $10.76 $10.20
===================================================================================================================================
CLASS C SHARES:
Net asset value and offering price per share $20.81 $9.62 $10.78 $10.20
===================================================================================================================================
CLASS R SHARES:
Net asset value and offering price per share $21.46 N/A N/A N/A
===================================================================================================================================
Investments, at cost $1,436,482,493 $59,719,684 $37,825,116 $14,376,639
===================================================================================================================================
Foreign cash, at cost $2 $20,473 $5,931 --
===================================================================================================================================
The Funds may impose a redemption fee of 2.00% on shares redeemed within 30 days
of purchase.
N/A Not Applicable, share class is not offered by the respective Fund.
* On sales of $50,000 or more, the sales charge will be reduced.
See Notes to Financial Statements.
32-33 spread
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED JULY 31, 2006
EUROPEAN GLOBAL INTERNATIONAL JAPAN-ASIA WORLDWIDE U.S. CORE
FOCUS TECHNOLOGY OPPORTUNITIES FOCUS INCOME GROWTH
FUND FUND FUND FUND* FUND FUND
========================================================================================================================
INVESTMENT INCOME:
Dividends $8,183,095 $114,995 $24,771,283 $264,429 $12,803 $176,222
Interest 479,950 21,215 2,038,944 24,311 2,640,329 --
Foreign taxes withheld (707,663) (11,492) (2,755,792) (19,852) (1,471) (2,102)
- ------------------------------------------------------------------------------------------------------------------------
Total Investment Income 7,955,382 124,718 24,054,435 268,888 2,651,661 174,120
- ------------------------------------------------------------------------------------------------------------------------
EXPENSES:
Investment advisory fees 3,969,622 214,410 11,065,353 195,994 288,170 233,470
12b-1 distribution and service fees:
Class A Shares 682,337 35,811 1,616,831 32,708 41,769 36,258
Class B Shares 320,130 11,151 584,293 -- 47,703 28,441
Class C Shares 922,184 60,015 3,238,035 65,163 124,247 38,771
Class R Shares -- -- 153 -- -- --
Custodian fees 384,745 53,977 886,520 51,458 42,381 43,238
Transfer agent fees 374,186 28,925 1,069,770 23,752 34,578 25,466
Administrative fees 174,139 35,407 417,405 15,552 39,027 34,208
Printing and postage fees 92,983 5,375 253,638 3,176 8,295 5,526
Registration and filing fees 81,308 40,905 266,388 15,303 38,010 36,866
Accounting fees 70,370 68,443 126,834 31,104 71,686 53,147
Legal fees 49,712 1,865 118,248 3,353 4,826 3,110
Audit fees 28,002 27,983 30,507 22,000 30,496 26,004
Trustees' fees and expenses 26,738 1,267 64,388 939 2,448 1,500
Chief Compliance Officer fees 18,209 874 44,177 642 1,661 1,049
Offering expenses -- -- -- 37,073 -- --
Organizational expense -- -- -- 18,958 -- --
Miscellaneous fees 54,704 2,778 114,571 2,845 7,494 4,275
- ------------------------------------------------------------------------------------------------------------------------
Total Expenses 7,249,369 589,186 19,897,111 520,020 782,791 571,329
- ------------------------------------------------------------------------------------------------------------------------
Fees waived and expenses
reimbursed by investment adviser -- (108,519) -- (79,159) (213,097) (96,431)
- ------------------------------------------------------------------------------------------------------------------------
Net Expenses 7,249,369 480,667 19,897,111 440,861 569,694 474,898
- ------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME/(LOSS) 706,013 (355,949) 4,157,324 (171,973) 2,081,967 (300,778)
- ------------------------------------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED
GAIN/(LOSS):
Net realized gain/(loss) from:
Investment transactions 42,662,947 (1,263,567) 92,891,290 (248,881) (306,178) 329,110
Forward foreign currency contracts -- -- -- -- (27,797) --
Foreign currency transactions (1,004,485) (46,197) (3,453,669) (107,772) (9,358) --
Net change in unrealized
appreciation/(depreciation) of:
Investments 32,001,391 (1,122,925) 94,035,924 (2,001,939) (184,858) (666,142)
Forward foreign currency contracts -- -- 1,459,574 142,877 (165,940) --
Translation of other assets
and liabilities 8,467 414 452,897 (124) 2,913 --
- ------------------------------------------------------------------------------------------------------------------------
Net Realized and Unrealized
Gain/(Loss) 73,668,320 (2,432,275) 185,386,016 (2,215,839) (691,218) (337,032)
- ------------------------------------------------------------------------------------------------------------------------
NET INCREASE/(DECREASE) IN
NET ASSETS RESULTING
FROM OPERATIONS $74,374,333 $(2,788,224) $189,543,340 $(2,387,812) $1,390,749 $(637,810)
========================================================================================================================
* The Henderson Japan-Asia Focus Fund commenced operations on January 31,
2006. The Statement of Operations reflects activity for the respective
period ended July 31, 2006.
See Notes to Financial Statements.
34
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENTS OF CHANGES IN NET ASSETS
EUROPEAN FOCUS FUND
YEAR ENDED YEAR ENDED
JULY 31, 2006 JULY 31, 2005
- ------------------------------------------------------------------------------------------------------------------------
Net investment income/(loss) $706,013 $(277,270)
Net realized gain on investments and foreign currency transactions 41,658,462 17,334,115
Net change in unrealized appreciation of investments and
foreign currency translations 32,009,858 34,220,660
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 74,374,333 51,277,505
- ------------------------------------------------------------------------------------------------------------------------
Distribution to shareholders from net realized gains:
Class A Shares (13,594,949) (9,782,041)
Class B Shares (1,787,715) (1,913,975)
Class C Shares (5,118,807) (4,702,806)
- ------------------------------------------------------------------------------------------------------------------------
(20,501,471) (16,398,822)
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from Fund share transactions:
Class A Shares 148,230,982 81,627,399
Class B Shares 4,723,768 8,033,895
Class C Shares 24,206,421 26,071,857
- ------------------------------------------------------------------------------------------------------------------------
177,161,171 115,733,151
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets 231,034,033 150,611,834
NET ASSETS:
Beginning of year 284,001,599 133,389,765
- ------------------------------------------------------------------------------------------------------------------------
End of year $515,035,632 $284,001,599
========================================================================================================================
Accumulated undistributed net investment income -- $3,954
========================================================================================================================
See Notes to Financial Statements.
35
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENTS OF CHANGES IN NET ASSETS
GLOBAL TECHNOLOGY FUND
YEAR ENDED YEAR ENDED
JULY 31, 2006 JULY 31, 2005
========================================================================================================================
Net investment loss $(355,949) $(61,678)
Net realized gain/(loss) on investments and foreign currency transactions (1,309,764) 78,562
Net change in unrealized appreciation/(depreciation) of investments
and foreign currency translations (1,122,511) 556,260
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) in net assets resulting from operations (2,788,224) 573,144
- ------------------------------------------------------------------------------------------------------------------------
Distribution to shareholders from net realized gains:
Class A Shares (86,660) (93,978)
Class B Shares (14,034) (52,458)
Class C Shares (30,862) (57,028)
- ------------------------------------------------------------------------------------------------------------------------
(131,556) (203,464)
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from Fund share transactions:
Class A Shares 23,258,647 1,754,985
Class B Shares 306,941 45,060
Class C Shares 10,383,722 302,562
- ------------------------------------------------------------------------------------------------------------------------
33,949,310 2,102,607
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets 31,029,530 2,472,287
NET ASSETS:
Beginning of year 5,593,809 3,121,522
- ------------------------------------------------------------------------------------------------------------------------
End of year $36,623,339 $5,593,809
========================================================================================================================
Accumulated net investment loss $(42,881) $(2,132)
========================================================================================================================
See Notes to Financial Statements.
36
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENTS OF CHANGES IN NET ASSETS
INTERNATIONAL OPPORTUNITIES FUND
YEAR ENDED YEAR ENDED
JULY 31, 2006* JULY 31, 2005
========================================================================================================================
Net investment income/(loss) $4,157,324 $(1,090,877)
Net realized gain on investments and foreign currency transactions 89,437,621 14,648,507
Net change in unrealized appreciation of investments
and foreign currency translations 95,948,395 37,179,542
- ------------------------------------------------------------------------------------------------------------------------
Net increase net assets resulting from operations 189,543,340 50,737,172
- ------------------------------------------------------------------------------------------------------------------------
Distribution to shareholders from net realized gains:
Class A Shares (18,561,810) (2,136,851)
Class B Shares (1,924,012) (337,425)
Class C Shares (9,420,710) (1,242,140)
Class R Shares (984) --
- ------------------------------------------------------------------------------------------------------------------------
(29,907,516) (3,716,416)
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from Fund share transactions:
Class A Shares 573,122,320 199,665,967
Class B Shares 30,922,243 16,907,328
Class C Shares 287,290,698 83,567,888
Class R Shares 125,500 --
- ------------------------------------------------------------------------------------------------------------------------
891,460,761 300,141,183
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets 1,051,096,585 347,161,939
NET ASSETS:
Beginning of year 531,372,807 184,210,868
- ------------------------------------------------------------------------------------------------------------------------
End of year $1,582,469,392 $531,372,807
========================================================================================================================
Accumulated undistributed net investment income/(loss) $706,682 $(41,855)
========================================================================================================================
* Inception for the Henderson International Opportunities Fund Class R was
September 30, 2005.
See Notes to Financial Statements.
37
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENT OF CHANGES IN NET ASSETS
JAPAN-ASIA FOCUS FUND
PERIOD ENDED
JULY 31, 2006*
========================================================================================================================
Net investment loss $(171,973)
Net realized loss on investments and foreign currency transactions (356,653)
Net change in unrealized depreciation of investments and foreign currency translations (1,859,186)
- ------------------------------------------------------------------------------------------------------------------------
Net decrease net assets resulting from operations (2,387,812)
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from Fund share transactions:
Class A Shares 40,833,226
Class C Shares 19,443,997
- ------------------------------------------------------------------------------------------------------------------------
60,277,223
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets 57,889,411
NET ASSETS:
Beginning of period --
- ------------------------------------------------------------------------------------------------------------------------
End of period $57,889,411
========================================================================================================================
Accumulated net investment loss $(142,848)
========================================================================================================================
* Inception for the Henderson Japan-Asia Focus Fund was January 31, 2006.
See Notes to Financial Statements.
38
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENTS OF CHANGES IN NET ASSETS
WORLDWIDE INCOME FUND
YEAR ENDED YEAR ENDED
JULY 31, 2006 JULY 31, 2005
========================================================================================================================
Net investment income $2,081,967 $1,604,030
Net realized loss on investments and foreign currency transactions (343,333) (8,699)
Net change in unrealized appreciation/(depreciation) of investments
and foreign currency translations (347,885) 606,730
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 1,390,749 2,202,061
- ------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders from net investment income:
Class A Shares (1,135,106) (817,450)
Class B Shares (289,236) (247,731)
Class C Shares (753,373) (678,084)
- ------------------------------------------------------------------------------------------------------------------------
(2,177,715) (1,743,265)
- ------------------------------------------------------------------------------------------------------------------------
Distribution to shareholders from net realized gains:
Class A Shares -- (41,973)
Class B Shares -- (14,005)
Class C Shares -- (39,302)
- ------------------------------------------------------------------------------------------------------------------------
-- (95,280)
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from Fund share transactions:
Class A Shares 1,932,347 8,664,945
Class B Shares 563,433 1,332,977
Class C Shares (128,275) 5,326,148
- ------------------------------------------------------------------------------------------------------------------------
2,367,505 15,324,070
- ------------------------------------------------------------------------------------------------------------------------
Net increase in net assets 1,580,539 15,687,586
NET ASSETS:
Beginning of year 34,706,631 19,019,045
- ------------------------------------------------------------------------------------------------------------------------
End of year $36,287,170 $34,706,631
========================================================================================================================
Accumulated undistributed net investment income/(loss) $(5,086) $54,446
========================================================================================================================
See Notes to Financial Statements.
39
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENTS OF CHANGES IN NET ASSETS
U.S. CORE GROWTH FUND
YEAR ENDED YEAR ENDED
JULY 31, 2006 JULY 31, 2005
========================================================================================================================
Net investment loss $(300,778) $(177,769)
Net realized gain on investments 329,110 38,189
Net change in unrealized appreciation/(depreciation) of investments (666,142) 1,727,878
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) in net assets resulting from operations (637,810) 1,588,298
- ------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders from net investment income:
Class A Shares -- (28,229)
Class B Shares -- (4,790)
Class C Shares -- (2,983)
- ------------------------------------------------------------------------------------------------------------------------
-- (36,002)
- ------------------------------------------------------------------------------------------------------------------------
Distributions to shareholders from net realized gains:
Class A Shares (99,798) --
Class B Shares (19,507) --
Class C Shares (26,965) --
- ------------------------------------------------------------------------------------------------------------------------
(146,270) --
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) in net assets from Fund share transactions:
Class A Shares (3,301,660) 12,257,751
Class B Shares (1,569,594) 1,248,710
Class C Shares (599,798) 3,239,502
- ------------------------------------------------------------------------------------------------------------------------
(5,471,052) 16,745,963
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) in net assets (6,255,132) 18,298,259
NET ASSETS:
Beginning of year 21,603,665 3,305,406
- ------------------------------------------------------------------------------------------------------------------------
End of year $15,348,533 $21,603,665
========================================================================================================================
Accumulated undistributed net investment income -- --
========================================================================================================================
See Notes to Financial Statements.
40
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENTS OF CHANGES - CAPITAL STOCK ACTIVITY
EUROPEAN FOCUS FUND
YEAR ENDED YEAR ENDED
JULY 31, 2006 JULY 31, 2005
========================================================================================================================
AMOUNT
CLASS A SHARES:
Sold $202,174,294 $101,975,879
Issued as reinvestment of dividends 11,136,219 8,416,680
Redeemed (65,079,531) (28,765,160)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $148,230,982 $81,627,399
========================================================================================================================
CLASS B SHARES:
Sold $9,111,483 $9,127,932
Issued as reinvestment of dividends 1,665,731 1,786,936
Redeemed (6,053,446) (2,880,973)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $4,723,768 $8,033,895
========================================================================================================================
CLASS C SHARES:
Sold $41,099,100 $32,096,203
Issued as reinvestment of dividends 4,628,651 4,421,535
Redeemed (21,521,330) (10,445,881)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $24,206,421 $26,071,857
========================================================================================================================
SHARES
CLASS A SHARES:
Sold 7,269,079 4,254,333
Issued as reinvestment of dividends 459,226 387,855
Redeemed (2,399,760) (1,220,760)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 5,328,545 3,421,428
========================================================================================================================
CLASS B SHARES:
Sold 335,527 392,243
Issued as reinvestment of dividends 70,642 83,973
Redeemed (231,032) (126,114)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 175,137 350,102
========================================================================================================================
CLASS C SHARES:
Sold 1,500,714 1,367,287
Issued as reinvestment of dividends 196,296 207,779
Redeemed (811,717) (452,243)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 885,293 1,122,823
========================================================================================================================
See Notes to Financial Statements.
41
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENTS OF CHANGES - CAPITAL STOCK ACTIVITY
GLOBAL TECHNOLOGY FUND
YEAR ENDED YEAR ENDED
JULY 31, 2006 JULY 31, 2005
========================================================================================================================
AMOUNT
CLASS A SHARES:
Sold $26,848,979 $2,733,576
Issued as reinvestment of dividends 83,132 90,875
Redeemed (3,673,464) (1,069,466)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $23,258,647 $1,754,985
========================================================================================================================
CLASS B SHARES:
Sold $609,908 $314,935
Issued as reinvestment of dividends 13,597 49,800
Redeemed (316,564) (319,675)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $306,941 $45,060
========================================================================================================================
CLASS C SHARES:
Sold $11,006,123 $690,060
Issued as reinvestment of dividends 28,016 50,991
Redeemed (650,417) (438,489)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $10,383,722 $302,562
========================================================================================================================
SHARES
CLASS A SHARES:
Sold 2,011,592 241,368
Issued as reinvestment of dividends 6,704 7,971
Redeemed (278,107) (94,091)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 1,740,189 155,248
========================================================================================================================
CLASS B SHARES:
Sold 45,853 27,917
Issued as reinvestment of dividends 1,127 4,458
Redeemed (25,931) (29,328)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 21,049 3,047
========================================================================================================================
CLASS C SHARES:
Sold 844,506 62,341
Issued as reinvestment of dividends 2,329 4,577
Redeemed (51,845) (40,079)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 794,990 26,839
========================================================================================================================
See Notes to Financial Statements.
42
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENTS OF CHANGES - CAPITAL STOCK ACTIVITY
INTERNATIONAL OPPORTUNITIES FUND
YEAR ENDED YEAR ENDED
JULY 31, 2006* JULY 31, 2005
========================================================================================================================
AMOUNT
CLASS A SHARES:
Sold $651,069,244 $226,025,460
Issued as reinvestment of dividends 16,858,442 1,993,845
Redeemed (94,805,366) (28,353,338)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $573,122,320 $199,665,967
========================================================================================================================
CLASS B SHARES:
Sold $33,811,342 $19,306,661
Issued as reinvestment of dividends 1,753,313 312,553
Redeemed (4,642,412) (2,711,886)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $30,922,243 $16,907,328
========================================================================================================================
CLASS C SHARES:
Sold $303,720,414 $94,094,443
Issued as reinvestment of dividends 8,194,859 1,167,540
Redeemed (24,624,575) (11,694,095)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $287,290,698 $83,567,888
========================================================================================================================
CLASS R SHARES:
Sold $125,500 --
Issued as reinvestment of dividends -- --
Redeemed -- --
- ------------------------------------------------------------------------------------------------------------------------
Net increase $125,500 --
========================================================================================================================
SHARES
CLASS A SHARES:
Sold 31,820,253 13,284,389
Issued as reinvestment of dividends 905,862 121,948
Redeemed (4,616,308) (1,680,464)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 28,109,807 11,725,873
========================================================================================================================
CLASS B SHARES:
Sold 1,717,102 1,170,817
Issued as reinvestment of dividends 96,868 19,486
Redeemed (232,817) (167,180)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 1,581,153 1,023,123
========================================================================================================================
CLASS C SHARES:
Sold 15,353,195 5,650,667
Issued as reinvestment of dividends 453,256 72,835
Redeemed (1,230,243) (710,158)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 14,576,208 5,013,344
========================================================================================================================
CLASS R SHARES:
Sold 6,111 --
Issued as reinvestment of dividends -- --
Redeemed -- --
- ------------------------------------------------------------------------------------------------------------------------
Net increase 6,111 --
========================================================================================================================
* Inception for the Henderson International Opportunities Fund Class R was
September 30, 2005.
See Notes to Financial Statements.
43
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENT OF CHANGES - CAPITAL STOCK ACTIVITY
JAPAN-ASIA FOCUS FUND
PERIOD ENDED
JULY 31, 2006*
========================================================================================================================
AMOUNT
CLASS A SHARES:
Sold $42,803,721
Redeemed (1,970,495)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $40,833,226
========================================================================================================================
CLASS C SHARES:
Sold $19,928,861
Redeemed (484,864)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $19,443,997
========================================================================================================================
SHARES
CLASS A SHARES:
Sold 4,282,056
Redeemed (201,934)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 4,080,122
========================================================================================================================
CLASS C SHARES:
Sold 1,973,735
Redeemed (49,923)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 1,923,812
========================================================================================================================
* Inception for the Henderson Japan-Asia Focus Fund was January 31, 2006.
See Notes to Financial Statements.
44
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENTS OF CHANGES - CAPITAL STOCK ACTIVITY
WORLDWIDE INCOME FUND
YEAR ENDED YEAR ENDED
JULY 31, 2006 JULY 31, 2005
========================================================================================================================
AMOUNT
CLASS A SHARES:
Sold $8,564,436 $13,637,672
Issued as reinvestment of dividends 720,158 560,895
Redeemed (7,352,247) (5,533,622)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $1,932,347 $8,664,945
========================================================================================================================
CLASS B SHARES:
Sold $1,077,925 $1,809,410
Issued as reinvestment of dividends 124,733 107,164
Redeemed (639,225) (583,597)
- ------------------------------------------------------------------------------------------------------------------------
Net increase $563,433 $1,332,977
========================================================================================================================
CLASS C SHARES:
Sold $4,399,286 $6,981,093
Issued as reinvestment of dividends 437,771 442,487
Redeemed (4,965,332) (2,097,432)
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) $(128,275) $5,326,148
========================================================================================================================
SHARES
CLASS A SHARES:
Sold 789,653 1,231,930
Issued as reinvestment of dividends 66,507 50,943
Redeemed (678,752) (508,344)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 177,408 774,529
========================================================================================================================
CLASS B SHARES:
Sold 99,708 163,382
Issued as reinvestment of dividends 11,545 9,743
Redeemed (59,127) (53,185)
- ------------------------------------------------------------------------------------------------------------------------
Net increase 52,126 119,940
========================================================================================================================
CLASS C SHARES:
Sold 407,295 633,220
Issued as reinvestment of dividends 40,437 40,162
Redeemed (459,595) (191,091)
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) (11,863) 482,291
========================================================================================================================
See Notes to Financial Statements.
45
HENDERSON GLOBAL FUNDS
FINANCIAL STATEMENTS
STATEMENTS OF CHANGES - CAPITAL STOCK ACTIVITY
U.S. CORE GROWTH FUND
YEAR ENDED YEAR ENDED
JULY 31, 2006 JULY 31, 2005
========================================================================================================================
AMOUNT
CLASS A SHARES:
Sold $5,453,192 $13,693,020
Issued as reinvestment of dividends 96,301 27,714
Redeemed (8,851,153) (1,462,983)
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) $(3,301,660) $12,257,751
========================================================================================================================
CLASS B SHARES:
Sold $144,759 $1,382,473
Issued as reinvestment of dividends 18,707 4,515
Redeemed (1,733,060) (138,278)
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) $(1,569,594) $1,248,710
========================================================================================================================
CLASS C SHARES:
Sold $1,185,604 $3,336,763
Issued as reinvestment of dividends 25,900 2,827
Redeemed (1,811,302) (100,088)
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) $(599,798) $3,239,502
========================================================================================================================
SHARES
CLASS A SHARES:
Sold 498,363 1,335,855
Issued as reinvestment of dividends 8,827 2,704
Redeemed (795,287) (139,930)
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) (288,097) 1,198,629
========================================================================================================================
CLASS B SHARES:
Sold 13,093 136,456
Issued as reinvestment of dividends 1,731 441
Redeemed (164,865) (13,490)
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) (150,041) 123,407
========================================================================================================================
CLASS C SHARES:
Sold 109,891 327,114
Issued as reinvestment of dividends 2,396 276
Redeemed (166,496) (9,446)
- ------------------------------------------------------------------------------------------------------------------------
Net increase/(decrease) (54,209) 317,944
========================================================================================================================
See Notes to Financial Statements.
46
This page deliberately left blank.
47
HENDERSON GLOBAL FUNDS
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS INDICATED
INCOME (LOSS) FROM INVESTMENT OPERATIONS: LESS DISTRIBUTIONS:
------------------------------------------- -----------------------------------------
NET DIVIDENDS DISTRIBUTIONS
NET ASSET NET REALIZED AND TOTAL FROM FROM NET
VALUE, INVESTMENT UNREALIZED GAIN FROM NET REALIZED
BEGINNING INCOME (LOSS) ON INVESTMENT INVESTMENT CAPITAL TOTAL
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS
- ------------------------------------------------------------------------------------------------------------------------------------
EUROPEAN FOCUS
CLASS A
Year Ended 7/31/2006 $25.30 0.12 (b) 5.54 5.66 0.00 (1.60) (1.60)
Year Ended 7/31/2005 20.88 0.04 (b) 6.76 6.80 0.00 (2.38) (2.38)
Year Ended 7/31/2004 15.47 (0.01)(b) 6.30 6.29 (0.06) (0.82) (0.88)
Year Ended 7/31/2003 11.61 0.16 (b) 3.76 3.92 (0.06) 0.00 (0.06)
Period Ended 7/31/2002 (a) 10.00 0.11 (b) 1.50 1.61 0.00 0.00 0.00
CLASS B
Year Ended 7/31/2006 $24.71 (0.11)(b) 5.41 5.30 0.00 (1.60) (1.60)
Year Ended 7/31/2005 20.57 (0.15)(b) 6.67 6.52 0.00 (2.38) (2.38)
Year Ended 7/31/2004 15.30 (0.21)(b) 6.30 6.09 0.00 (0.82) (0.82)
Year Ended 7/31/2003 11.54 0.02 (b) 3.76 3.78 (0.02) 0.00 (0.02)
Period Ended 7/31/2002 (a) 10.00 0.09 (b) 1.45 1.54 0.00 0.00 0.00
CLASS C
Year Ended 7/31/2006 $24.70 (0.10)(b) 5.40 5.30 0.00 (1.60) (1.60)
Year Ended 7/31/2005 20.57 (0.14)(b) 6.65 6.51 0.00 (2.38) (2.38)
Year Ended 7/31/2004 15.30 (0.20)(b) 6.29 6.09 0.00 (0.82) (0.82)
Year Ended 7/31/2003 11.53 0.03 (b) 3.76 3.79 (0.02) 0.00 (0.02)
Period Ended 7/31/2002 (a) 10.00 0.09 (b) 1.44 1.53 0.00 0.00 0.00
GLOBAL TECHNOLOGY
CLASS A
Year Ended 7/31/2006 $11.68 (0.19)(b) 0.87 0.68 0.00 (0.17) (0.17)
Year Ended 7/31/2005 10.54 (0.14)(b) 1.91 1.77 0.00 (0.63) (0.63)
Year Ended 7/31/2004 9.56 (0.20)(b) 1.18 0.98 0.00 0.00 0.00
Year Ended 7/31/2003 7.36 (0.13)(b) 2.41 2.28 (0.08) 0.00 (0.08)
Period Ended 7/31/2002 (a) 10.00 (0.16)(b) (2.48) (2.64) 0.00 0.00 0.00
CLASS B
Year Ended 7/31/2006 $11.39 (0.28)(b) 0.85 0.57 0.00 (0.17) (0.17)
Year Ended 7/31/2005 10.36 (0.21)(b) 1.87 1.66 0.00 (0.63) (0.63)
Year Ended 7/31/2004 9.48 (0.27)(b) 1.15 0.88 0.00 0.00 0.00
Year Ended 7/31/2003 7.31 (0.18)(b) 2.43 2.25 (0.08) 0.00 (0.08)
Period Ended 7/31/2002 (a) 10.00 (0.21)(b) (2.48) (2.69) 0.00 0.00 0.00
CLASS C
Year Ended 7/31/2006 $11.35 (0.28)(b) 0.86 0.58 0.00 (0.17) (0.17)
Year Ended 7/31/2005 10.34 (0.21)(b) 1.85 1.64 0.00 (0.63) (0.63)
Year Ended 7/31/2004 9.45 (0.27)(b) 1.16 0.89 0.00 0.00 0.00
Year Ended 7/31/2003 7.31 (0.18)(b) 2.40 2.22 (0.08) 0.00 (0.08)
Period Ended 7/31/2002 (a) 10.00 (0.20)(b) (2.49) (2.69) 0.00 0.00 0.00
FINANCIAL HIGHLIGHTS
RATIOS TO AVERAGE NET ASSETS:
------------------------------------------------------
ANNUALIZED RATIO OF
ANNUALIZED ANNUALIZED OPERATING EXPENSES
RATIO OF RATIO OF TO AVERAGE NET
NET ASSET NET ASSETS, OPERATING NET INVESTMENT ASSETS WITHOUT
VALUE, END OF EXPENSES TO INCOME/(LOSS) WAIVERS AND/OR PORTFOLIO
END OF TOTAL PERIOD AVERAGE TO AVERAGE EXPENSES TURNOVER
THE PERIOD RETURN (c) (000) NET ASSETS NET ASSETS REIMBURSED RATE
- ------------------------------------------------------------------------------------------------------------------------------------
EUROPEAN FOCUS
CLASS A
Year Ended 7/31/2006 $29.36 23.72% $368,593 1.59% 0.44% 1.59% 64%
Year Ended 7/31/2005 25.30 34.43 182,831 2.00 0.18 1.73 51
Year Ended 7/31/2004 20.88 41.89 79,459 2.00 (0.04) 2.15 88
Year Ended 7/31/2003 15.47 33.93 20,647 2.00 1.20 4.60 76
Period Ended 7/31/2002 (a) 11.61 16.10 2,169 2.00 0.95 22.40 67
CLASS B
Year Ended 7/31/2006 $28.41 22.79% $35,977 2.34% (0.41)% 2.34% 64%
Year Ended 7/31/2005 24.71 33.54 26,964 2.75 (0.67) 2.48 51
Year Ended 7/31/2004 20.57 40.92 15,246 2.75 (1.06) 2.90 88
Year Ended 7/31/2003 15.30 32.83 9,420 2.75 0.16 5.35 76
Period Ended 7/31/2002 (a) 11.54 15.40 2,831 2.75 0.79 23.15 67
CLASS C
Year Ended 7/31/2006 $28.40 22.80% $110,465 2.34% (0.39)% 2.34% 64%
Year Ended 7/31/2005 24.70 33.48 74,207 2.75 (0.62) 2.48 51
Year Ended 7/31/2004 20.57 40.92 38,684 2.75 (1.02) 2.90 88
Year Ended 7/31/2003 15.30 32.94 22,285 2.75 0.24 5.35 76
Period Ended 7/31/2002 (a) 11.53 15.30 5,550 2.75 0.77 23.15 67
GLOBAL TECHNOLOGY
CLASS A
Year Ended 7/31/2006 $12.19 5.83% $24,685 1.99% (1.41)% 2.50% 159%
Year Ended 7/31/2005 11.68 16.90 3,331 2.00 (1.26) 6.58 164
Year Ended 7/31/2004 10.54 10.25 1,371 2.00 (1.75) 7.01 234
Year Ended 7/31/2003 9.56 31.38 409 2.00 (1.74) 22.78 238
Period Ended 7/31/2002 (a) 7.36 (26.40) 164 2.00 (1.84) 80.48 134
CLASS B
Year Ended 7/31/2006 $11.79 5.01% $1,187 2.74% (2.20)% 3.25% 159%
Year Ended 7/31/2005 11.39 16.10 906 2.75 (1.92) 7.33 164
Year Ended 7/31/2004 10.36 9.28 794 2.75 (2.45) 7.76 234
Year Ended 7/31/2003 9.48 31.10 816 2.75 (2.48) 23.53 238
Period Ended 7/31/2002 (a) 7.31 (26.90) 412 2.75 (2.56) 81.23 134
CLASS C
Year Ended 7/31/2006 $11.76 5.11% $10,752 2.74% (2.15)% 3.25% 159%
Year Ended 7/31/2005 11.35 15.93 1,356 2.75 (1.96) 7.33 164
Year Ended 7/31/2004 10.34 9.42 957 2.75 (2.47) 7.76 234
Year Ended 7/31/2003 9.45 30.69 456 2.75 (2.50) 23.53 238
Period Ended 7/31/2002 (a) 7.31 (26.90) 289 2.75 (2.59) 81.23 134
(a) The Henderson European Focus and Global Technology Funds commenced
operations on August 31, 2001.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return excludes any applicable sales charges.
See notes to financial statements.
48-49 spread
HENDERSON GLOBAL FUNDS
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS INDICATED
INCOME (LOSS) FROM INVESTMENT OPERATIONS: LESS DISTRIBUTIONS:
-------------------------------------------- -------------------------------------------
NET DIVIDENDS DISTRIBUTIONS
NET ASSET NET REALIZED AND TOTAL FROM FROM NET
VALUE, INVESTMENT UNREALIZED GAIN FROM NET REALIZED
BEGINNING INCOME (LOSS) ON INVESTMENT INVESTMENT CAPITAL TOTAL
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS
- ------------------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL OPPORTUNITIES
CLASS A
Year Ended 7/31/2006 $17.77 0.14 (b) 4.36 4.50 0.00 (0.75) (0.75)
Year Ended 7/31/2005 14.94 0.00 (b),(*) 3.08 3.08 0.00 (0.25) (0.25)
Year Ended 7/31/2004 11.99 (0.10) (b) 3.22 3.12 0.00 (0.17) (0.17)
Year Ended 7/31/2003 10.51 0.00 (b),(*) 1.55 1.55 (0.07) 0.00 (0.07)
Period Ended 7/31/2002 (a) 10.00 (0.05) (b) 0.56 0.51 0.00 0.00 0.00
CLASS B
Year Ended 7/31/2006 $17.35 (0.03) (b) 4.25 4.22 0.00 (0.75) (0.75)
Year Ended 7/31/2005 14.70 (0.14) (b) 3.04 2.90 0.00 (0.25) (0.25)
Year Ended 7/31/2004 11.88 (0.22) (b) 3.21 2.99 0.00 (0.17) (0.17)
Year Ended 7/31/2003 10.44 (0.12) (b) 1.59 1.47 (0.03) 0.00 (0.03)
Period Ended 7/31/2002 (a) 10.00 (0.09) (b) 0.53 0.44 0.00 0.00 0.00
CLASS C
Year Ended 7/31/2006 $17.33 (0.01) (b) 4.24 4.23 0.00 (0.75) (0.75)
Year Ended 7/31/2005 14.68 (0.13) (b) 3.03 2.90 0.00 (0.25) (0.25)
Year Ended 7/31/2004 11.88 (0.22) (b) 3.19 2.97 0.00 (0.17) (0.17)
Year Ended 7/31/2003 10.44 (0.12) (b) 1.59 1.47 (0.03) 0.00 (0.03)
Period Ended 7/31/2002 (a) 10.00 (0.07) (b) 0.51 0.44 0.00 0.00 0.00
CLASS R
Period Ended 7/31/2006 (a) $19.07 0.09 (b) 3.05 3.14 0.00 (0.75) (0.75)
JAPAN-ASIA FOCUS FUND
CLASS A
Period Ended 7/31/2006 (a) $10.00 (0.03) (b) ( 0.32) (0.35) 0.00 0.00 0.00
CLASS C
Period Ended 7/31/2006 (a) $10.00 (0.07) (b) ( 0.31) (0.38) 0.00 0.00 0.00
RATIOS TO AVERAGE NET ASSETS:
-------------------------------------------------
ANNUALIZED RATIO OF
ANNUALIZED ANNUALIZED OPERATING EXPENSES
RATIO OF RATIO OF TO AVERAGE NET
NET ASSET NET ASSETS, OPERATING NET INVESTMENT ASSETS WITHOUT
VALUE, END OF EXPENSES TO INCOME/(LOSS) WAIVERS AND/OR PORTFOLIO
END OF TOTAL PERIOD AVERAGE TO AVERAGE EXPENSES TURNOVER
THE PERIOD RETURN (c) (000) NET ASSETS NET ASSETS REIMBURSED RATE
- ------------------------------------------------------------------------------------------------------------------------------------
INTERNATIONAL OPPORTUNITIES
CLASS A
Year Ended 7/31/2006 $21.52 25.98% $1,007,241 1.66% 0.68% 1.66% 100%
Year Ended 7/31/2005 17.77 20.77 332,370 2.00 (0.01) 1.84 79
Year Ended 7/31/2004 14.94 26.15 104,255 2.00 (0.68) 2.21 132
Year Ended 7/31/2003 11.99 14.84 8,371 2.00 0.01 7.21 190
Period Ended 7/31/2002 (a) 10.51 5.10 773 2.00 (0.49) 32.69 80
CLASS B
Year Ended 7/31/2006 $20.82 24.97% $77,695 2.41% (0.16)% 2.41% 100%
Year Ended 7/31/2005 17.35 19.87 37,291 2.75 (0.84) 2.59 79
Year Ended 7/31/2004 14.70 25.29 16,559 2.75 (1.52) 2.96 132
Year Ended 7/31/2003 11.88 14.10 3,888 2.75 (1.13) 7.96 190
Period Ended 7/31/2002 (a) 10.44 4.40 1,494 2.75 (0.84) 33.44 80
CLASS C
Year Ended 7/31/2006 $20.81 25.06% $497,402 2.41% (0.05)% 2.41% 100%
Year Ended 7/31/2005 17.33 19.90 161,712 2.75 (0.80) 2.59 79
Year Ended 7/31/2004 14.68 25.12 63,396 2.75 (1.46) 2.96 132
Year Ended 7/31/2003 11.88 14.12 7,560 2.75 (1.14) 7.96 190
Period Ended 7/31/2002 (a) 10.44 4.40 3,307 2.75 (0.67) 33.44 80
CLASS R
Period Ended 7/31/2006 (a) $21.46 17.07%(d) $131 1.91% 0.54% 1.91% 100%
JAPAN-ASIA FOCUS FUND
CLASS A
Period Ended 7/31/2006 (a) $9.65 (3.50)%(d) $39,381 2.00% (0.63)% 2.40% 29%
CLASS C
Period Ended 7/31/2006 (a) $9.62 (3.80)%(d) $18,508 2.75% (1.37)% 3.15% 29%
(a) The Henderson International Opportunities Fund Class A, B, and C commenced
operations on August 31, 2001. The Henderson International Opportunities
Fund Class R commenced operations on September 30, 2005. The Henderson
Japan-Asia Focus Fund commenced operations on January 31, 2006.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return excludes any applicable sales charges.
(d) Non-annualized total return for the period indicated.
(*) Amount represents less than $0.01.
See notes to financial statements.
50-51 spread
HENDERSON GLOBAL FUNDS
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT THE PERIODS INDICATED
INCOME (LOSS) FROM INVESTMENT OPERATIONS: LESS DISTRIBUTIONS:
------------------------------------------- ----------------------------------------
NET DIVIDENDS DISTRIBUTIONS
NET ASSET NET REALIZED AND TOTAL FROM FROM NET
VALUE, INVESTMENT UNREALIZED GAIN FROM NET REALIZED
BEGINNING INCOME (LOSS) ON INVESTMENT INVESTMENT CAPITAL TOTAL
OF PERIOD (LOSS) INVESTMENTS OPERATIONS INCOME GAINS DISTRIBUTIONS
- ------------------------------------------------------------------------------------------------------------------------------------
WORLDWIDE INCOME FUND
CLASS A
Year Ended 7/31/2006 $11.03 0.71 (b) (0.22) 0.49 (0.74) 0.00 (0.74)
Year Ended 7/31/2005 10.73 0.66 (b) 0.40 1.06 (0.72) (0.04) (0.76)
Period Ended 7/31/2004 (a) 10.00 0.54 (b) 0.73 1.27 (0.54) 0.00 (0.54)
CLASS B
Year Ended 7/31/2006 $11.00 0.62 (b) (0.20) 0.42 (0.66) 0.00 (0.66)
Year Ended 7/31/2005 10.72 0.58 (b) 0.38 0.96 (0.64) (0.04) (0.68)
Period Ended 7/31/2004 (a) 10.00 0.47 (b) 0.73 1.20 (0.48) 0.00 (0.48)
CLASS C
Year Ended 7/31/2006 $11.02 0.63 (b) (0.21) 0.42 (0.66) 0.00 (0.66)
Year Ended 7/31/2005 10.73 0.58 (b) 0.39 0.97 (0.64) (0.04) (0.68)
Period Ended 7/31/2004 (a) 10.00 0.46 (b) 0.75 1.21 (0.48) 0.00 (0.48)
U.S. CORE GROWTH FUND
CLASS A
Year Ended 7/31/2006 $10.93 (0.13)(b) (0.38) (0.51) 0.00 (0.07) (0.07)
Year Ended 7/31/2005 9.69 (0.12)(b) 1.41 1.29 (0.05) 0.00 (0.05)
Period Ended 7/31/2004 (a) 10.00 (0.04)(b) (0.27) (0.31) 0.00 0.00 0.00
CLASS B
Year Ended 7/31/2006 $10.85 (0.21)(b) (0.37) (0.58) 0.00 (0.07) (0.07)
Year Ended 7/31/2005 9.67 (0.19)(b) 1.39 1.20 (0.02) 0.00 (0.02)
Period Ended 7/31/2004 (a) 10.00 (0.05)(b) (0.28) (0.33) 0.00 0.00 0.00
CLASS C
Year Ended 7/31/2006 $10.85 (0.21)(b) (0.37) (0.58) 0.00 (0.07) (0.07)
Year Ended 7/31/2005 9.67 (0.20)(b) 1.40 1.20 (0.02) 0.00 (0.02)
Period Ended 7/31/2004 (a) 10.00 (0.05)(b) (0.28) (0.33) 0.00 0.00 0.00
RATIOS TO AVERAGE NET ASSETS:
------------------------------------------------
ANNUALIZED RATIO OF
ANNUALIZED ANNUALIZED OPERATING EXPENSES
RATIO OF RATIO OF TO AVERAGE NET
NET ASSET NET ASSETS, OPERATING NET INVESTMENT ASSETS WITHOUT
VALUE, END OF EXPENSES TO INCOME/(LOSS) WAIVERS AND/OR PORTFOLIO
END OF TOTAL PERIOD AVERAGE TO AVERAGE EXPENSES TURNOVER
THE PERIOD RETURN (c) (000) NET ASSETS NET ASSETS REIMBURSED RATE
- ------------------------------------------------------------------------------------------------------------------------------------
WORLDWIDE INCOME FUND
CLASS A
Year Ended 7/31/2006 $10.78 4.70% $17,927 1.30% 6.51% 1.93% 161%
Year Ended 7/31/2005 11.03 10.07 16,375 1.30 5.98 2.08 137
Period Ended 7/31/2004 (a) 10.73 12.81 7,628 1.30 5.89 3.49 327
CLASS B
Year Ended 7/31/2006 $10.76 3.93% $5,210 2.05% 5.77% 2.68% 161%
Year Ended 7/31/2005 11.00 9.07 4,751 2.05 5.23 2.83 137
Period Ended 7/31/2004 (a) 10.72 12.08 3,344 2.05 5.29 4.24 327
CLASS C
Year Ended 7/31/2006 $10.78 3.92% $13,150 2.05% 5.78% 2.68% 161%
Year Ended 7/31/2005 11.02 9.16 13,580 2.05 5.23 2.83 137
Period Ended 7/31/2004 (a) 10.73 12.18 8,047 2.05 5.26 4.24 327
U.S. CORE GROWTH FUND
CLASS A
Year Ended 7/31/2006 $10.35 (4.69)% $10,991 2.00% (1.18)% 2.45% 98%
Year Ended 7/31/2005 10.93 13.34 14,752 2.00 (1.19) 3.37 80
Period Ended 7/31/2004 (a) 9.69 (3.10) 1,467 2.00 (1.41) 22.58 11
CLASS B
Year Ended 7/31/2006 $10.20 (5.38)% $1,292 2.75% (1.92)% 3.20% 98%
Year Ended 7/31/2005 10.85 12.46 3,002 2.75 (1.84) 4.12 80
Period Ended 7/31/2004 (a) 9.67 (3.30) 1,483 2.75 (2.21) 23.32 11
CLASS C
Year Ended 7/31/2006 $10.20 (5.38)% $3,065 2.75% (1.93)% 3.20% 98%
Year Ended 7/31/2005 10.85 12.46 3,849 2.75 (1.95) 4.12 80
Period Ended 7/31/2004 (a) 9.67 (3.30) 356 2.75 (2.21) 23.32 11
(a) The Henderson Worldwide Income Fund commenced operations on September 30,
2003. The Henderson U.S. Core Growth Fund commenced operations on April 30,
2004.
(b) Per share data was calculated using average shares outstanding during the
period.
(c) Total return excludes any applicable sales charges.
See Notes to Financial Statements.
52-53 spread
HENDERSON GLOBAL FUNDS
NOTES TO FINANCIAL STATEMENTS
NOTE 1. ORGANIZATION
Henderson Global Funds (the "Trust") was organized on May 11, 2001, as a
Delaware business trust and is registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as an open-end management investment company.
The Trust has an unlimited number of authorized shares that are divided among
six series. Henderson European Focus Fund ("European Focus"), Henderson Global
Technology Fund ("Global Technology"), Henderson International Opportunities
Fund ("International Opportunities"), Henderson Japan-Asia Focus Fund
("Japan-Asia Focus"), Henderson Worldwide Income Fund ("Worldwide Income")
(formerly Henderson Income Advantage Fund), and Henderson U.S. Core Growth Fund
("U.S. Core Growth"), (collectively, the "Funds") are each a separate series of
the Trust. Each Fund except U.S. Core Growth is non-diversified. Each of the
Funds except Japan-Asia Focus, offer Class A shares, Class B shares and Class C
shares. Japan-Asia Focus offers Class A shares and Class C shares. Class A
shares generally provide for a front-end sales charge, and Class B shares and
Class C shares provide for a contingent deferred sales charge. International
Opportunities also offers Class R shares which are not subject to a front-end or
contingent deferred sales charge. Each class of shares has equal rights as to
earnings and assets except that each class bears different distribution and
shareholder service expenses. Each class of shares has exclusive voting rights
with respect to matters that affect just that class. Income, expenses (other
than expenses attributable to a specific class), and realized and unrealized
gains and losses on investments are allocated to each class of shares based on
its relative net assets. Class B shares automatically convert to Class A shares
at the end of the month following the eighth anniversary of issuance.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
SECURITY VALUATION
Securities traded on a recognized exchange or market are generally valued at the
last reported sale price or at the official closing price. Listed securities for
which no sale was reported on that date and other securities traded in the
over-the-counter market are valued at the mean between the last bid and asked
prices.
Debt securities are valued at the last sales price or market value by
independent pricing services approved by the Trustees of the Trust. If the
pricing services are unable to provide valuations, the securities are valued at
the mean between the last bid and asked prices or if no ask is available, then
the last bid price obtained from one or more broker dealers. Such pricing
services may use various pricing techniques, which take into account appropriate
factors such as yield, quality, coupon rate, maturity, type of issue, trading
characteristics and other data, as well as broker quotes.
Short-term investments purchased with an original or remaining maturity of 60
days or less are valued at amortized cost, which approximates market value.
If market quotations are not readily available, or if the investment adviser
determines that a quotation of a security does not represent a fair value, then
the security is valued at a fair value as determined in good faith using
procedures approved by the Trustees of the Trust. The Trust has retained an
independent statistical fair value pricing service to assist in the fair
valuation process for securities principally traded in a foreign market in order
to adjust for possible changes in value that may occur between the close of the
foreign exchange and the time at which Fund shares are priced. If a security is
valued at a "fair value", that value may be different from the last quoted
market price for the security. As a result, it is possible that fair value
prices will be used by European Focus, Global Technology, International
Opportunities, Japan-Asia Focus and Worldwide Income.
SECURITY TRANSACTIONS AND INVESTMENT INCOME
Investment transactions are accounted for on trade date. Interest income is
recorded on an accrual basis and includes accretion of discounts and
amortization of premiums. Dividend income is recorded on the ex-dividend date.
Bond premium is amortized and discount is accreted over the expected life of
each applicable security. Corporate actions involving foreign securities,
including dividends, are recorded as soon as the information becomes available.
Withholding taxes on foreign dividends are accrued in accordance with the
applicable country's tax rules and rates. Securities gains and losses are
determined on the identified cost basis, which is the same basis used for
federal income tax purposes.
FOREIGN CURRENCY TRANSLATION
Investment securities and other assets and liabilities denominated in foreign
currencies are translated into U.S. dollar amounts at the date of valuation.
Purchases and sales of investment securities and income and expense items
denominated in foreign currencies are translated into U.S. dollar amounts on the
respective dates of such transactions.
The Funds do not isolate that portion of the results of operations resulting
from changes in foreign exchange rates on investments from the fluctuations
arising from changes in market prices of securities held. Such fluctuations are
included with the net realized and unrealized gain or loss from investments on
the Statement of Operations.
54
HENDERSON GLOBAL FUNDS
NOTES TO FINANCIAL STATEMENTS
Reported net realized foreign exchange gains or losses arise from sales of
foreign currencies, currency gains or losses realized between the trade date and
settlement date on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Funds' books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
fair values of assets and liabilities, other than investments in securities at
fiscal period end, resulting from changes in exchange rates.
INDEMNIFICATIONS
Under the Trust's organizational documents, its Officers and Trustees are
indemnified against certain liabilities arising out of the performance of their
duties to the Trust. In addition, in the normal course of business the Trust
enters into contracts that provide general indemnifications to other parties.
The Trust's maximum exposure under these arrangements is unknown as this would
involve future claims that may be made against the Trust that have not yet been
asserted.
USE OF ESTIMATES
The preparation of financial statements, in conformity with United States
generally accepted accounting principles, requires management to make estimates
and assumptions that affect the reported amounts and disclosures in the
financial statements. Actual results may differ from those estimates.
FORWARD FOREIGN CURRENCY CONTRACTS
The Funds (except U.S. Core Growth) may enter into forward foreign currency
contracts primarily to hedge against foreign currency exchange rate risks on
their non-U.S. dollar denominated investment securities. When entering into
forward foreign currency contracts, a Fund agrees to receive or deliver a fixed
quantity of foreign currency for an agreed-upon price on an agreed future date.
Realized gains or losses on forwards include net gains or losses on contracts
that have matured or which a Fund has terminated by entering into offsetting
closing transactions. Forward foreign currency contracts are valued daily and
the unrealized appreciation or depreciation is included in the Statement of
Assets and Liabilities. These instruments involve market risk, credit risk, or
both kinds of risks, in excess of the amount recognized in the Statement of
Operations. These risks arise from the possible inability of counterparties to
meet the terms of their contracts and from unfavorable currency fluctuations.
The Funds held the following open forward foreign currency contracts at July 31,
2006:
LOCAL UNREALIZED
VALUE AMOUNT CURRENT APPRECIATION/
DATE (000'S) VALUE (DEPRECIATION)
- -----------------------------------------------------------
INTERNATIONAL OPPORTUNITIES
- -----------------------------------------------------------
Japanese
Yen
Long 8/18/06 5,549,200 $48,536,865 $(1,463,135)
- -----------------------------------------------------------
Japanese
Yen
Short 8/18/06 5,385,850 $47,108,101 $2,891,899
===========================================================
JAPAN-ASIA FOCUS
- -----------------------------------------------------------
Japanese
Yen
Long 8/18/06 554,920 $4,853,686 $(146,313)
- -----------------------------------------------------------
Japanese
Yen
Short 8/18/06 538,585 $4,710,810 $289,190
===========================================================
WORLDWIDE INCOME
- -----------------------------------------------------------
British
Pound
Short 8/18/06 3,190 $5,961,056 $(57,251)
- -----------------------------------------------------------
Euro
Short 8/18/06 8,718 $11,150,898 $(108,689)
===========================================================
REPURCHASE AGREEMENTS
In connection with transactions in repurchase agreements, it is the Trust's
policy that its custodian either segregate or take possession of the underlying
collateral securities, the fair value of which exceeds the principal amount of
the repurchase transaction, including accrued interest, at all times. If the
value of the underlying collateral securities fall below the value of the
repurchase price plus accrued interest, the Funds will require the seller to
deposit additional collateral. If the request for additional collateral is not
met, or the seller defaults on its repurchase obligation, the Funds maintain the
right to sell the underlying collateral securities at the market value and may
claim any resulting loss against the seller. However, in the event of default or
bankruptcy by the counterparty to the agreement, realization and/or retention of
the collateral securities may be subject to legal proceedings.
55
HENDERSON GLOBAL FUNDS
NOTES TO FINANCIAL STATEMENTS
EXPENSES
Expenses are recorded on an accrual basis. Expenses of the Trust that are
directly attributable to a specific Fund are charged to that Fund. Other
expenses are allocated proportionately among each Fund within the Trust based on
average daily net assets or on another reasonable basis.
DEFERRED OFFERING COSTS
Costs incurred in connection with the offering and initial registration of
Japan-Asia Focus have been deferred in conformity with United States generally
accepted accounting principles and are being amortized on a straight-line basis
over the first twelve months after commencement of operations.
FEDERAL INCOME TAXES
The Trust's policy is that each Fund continue to comply with the requirements of
Subchapter M of the Internal Revenue Code that are applicable to regulated
investment companies and to distribute substantially all its taxable income to
shareholders. Therefore, no federal income tax provision is required.
The Funds intend to utilize provisions of the federal income tax laws which
allow them to carry a realized capital loss forward for eight years following
the year of loss and offset such losses against any future realized capital
gains. None of the Funds had any capital loss carryforwards for tax purposes
from prior years. At July 31, 2006, Worldwide Income had a $462,857 accumulated
capital loss carryforward for tax purposes which expires on July 31, 2014.
At July 31, 2006, the following funds deferred post-October losses which will be
recognized on the first day of the following year:
CURRENCY LOSS CAPITAL LOSS
DEFERRED DEFERRED
- --------------------------------------------------------
Global Technology $42,881 $1,229,093
Worldwide Income 89,942 57,314
========================================================
On July 13th, 2006, the Financial Accounting Standards Board ("FASB") released
Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" ("FIN 48").
Fin 48 provides guidance for how uncertain tax positions should be recognized,
measured, presented and disclosed in the financial statements. FIN 48 requires
the evaluation of tax positions taken or expected to be taken in the course of
preparing the fund's tax returns to determine whether the tax positions are
"more likely than not" of being sustained by the applicable tax authority. Tax
positions not deemed to meet the more likely than not threshold would be
recorded as a tax benefit or expense in the current year. Adoption of FIN 48 is
required for fiscal years beginning after December 15, 2006 and is to be applied
to all open tax years as of the effective date. At this time, management is
evaluating the implications of FIN 48 and its impact in the financial statements
has not yet been determined.
DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded on the ex-dividend date.
Distributions from net investment income and net realized capital gains are
determined in accordance with federal income tax regulations, which may differ
from United States generally accepted accounting principles. These book/tax
differences are either temporary or permanent in nature. To the extent these
differences are permanent, they are reclassified within the capital accounts
based on their federal tax-basis treatment. Accordingly, at July 31, 2006, the
Funds reclassified the following amounts between paid-in capital, undistributed
net investment income (loss) and accumulated net realized gain (loss):
ACCUMULATED
UNDISTRIBUTED ACCUMULATED
NET INVESTMENT NET REALIZED
PAID-IN CAPITAL INCOME/(LOSS) GAIN/(LOSS)
- ---------------------------------------------------------------
European
Focus $2,701 $(709,967) $707,266
- ---------------------------------------------------------------
Global
Technology (327,783) 315,200 12,583
- ---------------------------------------------------------------
International
Opportunities 2,701 (3,408,787) 3,406,086
- ---------------------------------------------------------------
Japan-Asia
Focus (111,386) 29,125 82,261
- ---------------------------------------------------------------
Worldwide
Income 4,823 36,216 (41,039)
- ---------------------------------------------------------------
U.S. Core
Growth (302,533) 300,778 1,755
===============================================================
These reclassifications relate to the deductibility of certain expenses and the
character of realized gains/losses on foreign currency transactions and PFIC
transactions for tax purposes and had no impact on the net asset value of the
Funds.
56
HENDERSON GLOBAL FUNDS
NOTES TO FINANCIAL STATEMENTS
The tax character of distributions paid during the years ended July 31, 2006 and
July 31, 2005 were as follows:
ORDINARY LONG-TERM
JULY 31, 2006 INCOME CAPITAL GAINS
- ---------------------------------------------------------
European Focus $9,939,146 $10,562,325
Global Technology -- 131,556
International Opportunities 15,982,117 13,925,399
Japan-Asia Focus -- --
Worldwide Income 2,177,715 --
U.S. Core Growth -- 146,270
=========================================================
ORDINARY LONG-TERM
JULY 31, 2005 INCOME CAPITAL GAINS
- ---------------------------------------------------------
European Focus $11,559,805 $4,839,017
Global Technology 131,809 71,655
International Opportunities 3,314,485 401,931
Worldwide Income 1,838,545 --
U.S. Core Growth 36,002 --
=========================================================
As of July 31, 2006, the components of distributable earnings on a tax basis
were as follows:
UNDISTRIBUTED UNDISTRIBUTED UNREALIZED
ORDINARY LONG-TERM APPRECIATION
INCOME CAPITAL GAIN (DEPRECIATION)
- -----------------------------------------------------------
European
Focus $9,405,936 $26,433,316 $84,060,118
- -----------------------------------------------------------
Global
Technology -- -- (582,523)
- -----------------------------------------------------------
International
Opportunities 39,594,125 40,404,292 134,271,394
- -----------------------------------------------------------
Japan-Asia
Focus -- -- (2,276,426)
- -----------------------------------------------------------
Worldwide
Income -- -- 412,615
- -----------------------------------------------------------
U.S. Core
Growth -- 315,647 815,254
===========================================================
Ordinary income and net realized gains/losses may differ for book and tax basis
reporting purposes due to post-October losses, which are not recognized for tax
purposes until the first day of the following fiscal year, tax deferral on wash
sales and PFIC transactions.
NOTE 3. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Pursuant to an Investment Advisory Agreement, Henderson Global Investors (North
America) Inc. ("HGINA") acts as the Funds' investment adviser. HGINA is an
indirect wholly owned subsidiary of Henderson Global Investors (Holdings) plc,
which is an indirect wholly owned subsidiary of Henderson Group plc. HGINA
supervises the investments of the Funds and receives a management fee for such
services. The fee is calculated daily and paid monthly based on each Fund's
average daily net assets (or average daily managed assets with the respect to
Worldwide Income) at the following annual rates:
European Focus First $500 million 1.00%
Next $1 billion 0.90%
Over $1.5 billion 0.85%
- ---------------------------------------------------------------
Global Technology First $500 million 1.00%
Next $500 million 0.95%
Over $1 billion 0.90%
- ---------------------------------------------------------------
International Opportunities First $1 billion 1.10%
Next $1 billion 0.95%
Over $2 billion 0.85%
- ---------------------------------------------------------------
Japan-Asia Focus First $500 million 1.00%
Next $1 billion 0.90%
Over $1.5 billion 0.85%
- ---------------------------------------------------------------
Worldwide Income1 First $500 million 0.85%
Next $500 million 0.75%
Next $500 million 0.70%
Over $1.5 billion 0.65%
- ---------------------------------------------------------------
U.S. Core Growth2 First $150 million 1.10%
Next $350 million 0.90%
Over $500 million 0.85%
===============================================================
1 The fee for Worldwide Income is based upon the Fund's average daily managed
assets. Managed assets mean the total assets of the Fund (including any
assets attributable to any leverage that may be outstanding) minus the sum
of accrued liabilities (other than debt representing financial leverage).
Since the Fund pays the Adviser based on the Fund's average daily managed
assets, the Adviser's fee will be higher if the Fund is leveraged.
2 Effective August 1, 2006 the management fee for U.S. Core Growth was
lowered to 0.95% on the first $150 million of average daily net assets and
0.85% for the balance of average daily net assets thereafter.
Pursuant to separate contractual Expense Limitation Agreements, HGINA has agreed
to waive or limit its advisory fee and, if necessary, to reimburse other
operating expenses of each Fund in order to limit total annual expenses, less
distribution and service fees, to 1.75% of average daily net assets for European
Focus, Global Technology, International Opportunities, Japan-Asia Focus and U.S.
Core Growth and to 1.05% of average daily net assets for Worldwide Income.
57
HENDERSON GLOBAL FUNDS
NOTES TO FINANCIAL STATEMENTS
These agreements are effective through July 31, 2020. Under the Expense
Limitation Agreements, the annual expense limit including distribution and
service fees as a percentage of average daily net assets is as follows:
CLASS A CLASS B & C CLASS R
- -------------------------------------------------------------
European
Focus 2.00% 2.75% N/A
- -------------------------------------------------------------
Global
Technology 2.00 2.75 N/A
- -------------------------------------------------------------
International
Opportunities 2.00 2.75 2.25%
- -------------------------------------------------------------
Japan-Asia
Focus 2.00 2.75 N/A
- -------------------------------------------------------------
Worldwide Income 1.30 2.05 N/A
- -------------------------------------------------------------
U.S. Core Growth 2.00 2.75 N/A
=============================================================
HGINA may recover from Worldwide Income, U.S. Core Growth and Japan-Asia Focus
reimbursed expenses relating to previous years provided the Fund's current
expense ratio falls below the expense limitation. The recovery of reimbursed
expenses is effective through September 30, 2006 for Worldwide Income, April 30,
2007 for U.S. Core Growth and January 31, 2009 for Japan-Asia Focus. The
remaining amount of potentially recoverable expenses at July 31, 2006 for
Worldwide Income, U.S. Core Growth and Japan-Asia Focus was $684,917, $365,405,
and $79,159, respectively.
Henderson Investment Management Limited ("HIML") is the sub-adviser for European
Focus, Global Technology, International Opportunities, and Japan-Asia Focus
pursuant to a Sub-Advisory Agreement. HIML is a direct wholly owned subsidiary
of Henderson Global Investors (Holdings) plc.
HIML receives a fee for its services, paid by HGINA from its management fee,
based on each Fund's average daily net assets as set forth below:
European Focus First $500 million 0.90%
Next $1 billion 0.80%
Over $1.5 billion 0.75%
- ----------------------------------------------------------------
Global Technology First $500 million 0.90%
Next $500 million 0.85%
Over $1 billion 0.80%
- ----------------------------------------------------------------
International Opportunities First $1 billion 1.00%
Next $1 billion 0.85%
Over $2 billion 0.75%
- ----------------------------------------------------------------
Japan-Asia Focus First $500 million 0.90%
Next $1 billion 0.80%
Over $1.5 billion 0.75%
================================================================
Gardner Lewis Asset Management L.P. ("Gardner Lewis") is the sub-adviser for
U.S. Core Growth pursuant to a Sub-Advisory Agreement. Gardner Lewis provides
investment management services to U.S. Core Growth (including portfolio
management and trade execution). Gardner Lewis receives a fee for its services,
paid by HGINA from its management fee, based on the Fund's average daily net
assets as set forth below:
U.S. Core Growth First $50 million 0.85%
Next $100 million 0.65%
Over $150 million 0.50%
================================================================
The Funds bear a portion of the compensation paid to the Chief Compliance
Officer of the Trust. This compensation is reflected as Chief Compliance Officer
fees in the Statement of Operations.
At July 31, 2006, HGINA owned 21,638 Global Technology Class A shares.
HGINA is a direct subsidiary of Henderson International Inc. ("HII"). At July
31, 2006, HII owned the following number of shares in the following Funds:
SHARES
- ----------------------------------------------------------------
International Opportunities Class R 1,311
Japan-Asia Focus Class A 75,000
Japan-Asia Focus Class C 5,000
U.S. Core Growth Class A 10,190
================================================================
NOTE 4. COMPENSATION OF TRUSTEES AND OFFICERS
Trustees who are not interested persons of the Trust receive from the Trust an
annual retainer of $10,000 for service on the board and $1,500 retainer for
service on the Valuation Committee. Each such Trustee receives a fee of $3,000
for each regular quarterly meeting attended in person and $1,000 for attendance
by conference telephone at any meeting of the Trusts' Board of Trustees other
than the regular quarterly meeting. The Independent Chairman of the Trust
receives an annual supplemental retainer of $10,000. Trustees are reimbursed for
any out-of-pocket expenses relating to attendance at such meetings. The
Trustees' fees and Independent Chairman annual retainer compensation are
reflected as Trustees' fees in the Statement of Operations. None of the Trust's
officers, other than the Chief Compliance Officer is compensated by the Trust.
Certain officers of the Trust are also officers of HGINA.
NOTE 5. DISTRIBUTION
The Trust has adopted a distribution plan for Class A, Class B, Class C, and
Class R shares of the Funds in
58
HENDERSON GLOBAL FUNDS
NOTES TO FINANCIAL STATEMENTS
accordance with Rule 12b-1 under the 1940 Act (the "12b-1 Plan"). Under the
12b-1 Plan, each Fund pays the distributor an annual fee of 0.25% of the average
daily net assets attributable to its Class A shares, an annual fee of 1.00% of
the average daily net assets attributable to its Class B and C shares, and an
annual fee of .50% of average daily net assets attributable to its Class R
shares. The 12b-1 Plan is used to induce or compensate financial intermediaries
(including brokerage firms, depository institutions and other firms) to provide
distribution and/or services to the Funds and their shareholders.
NOTE 6. INVESTMENT TRANSACTIONS
Purchases and sales of investment securities, excluding short-term investments,
for the Funds during the year ended July 31, 2006, were as follows:
PURCHASES SALES
- ----------------------------------------------------------------
European Focus $400,456,238 $245,407,010
Global Technology 64,852,750 33,029,227
International Opportunities 1,736,612,767 960,252,187
Japan-Asia Focus 69,440,500 12,201,003
Worldwide Income 53,172,240 52,486,933
U.S. Core Growth 20,401,991 26,242,381
================================================================
The U.S. federal income tax basis of the Funds' investments excluding foreign
currency and forward currency contracts at July 31, 2006, and the gross
unrealized appreciation and depreciation, were as follows:
EUROPEAN GLOBAL
FOCUS TECHNOLOGY
- ----------------------------------------------------------------
Cost $429,479,969 $36,751,164
- ----------------------------------------------------------------
Gross unrealized appreciation 98,464,031 1,967,907
- ----------------------------------------------------------------
Gross unrealized depreciation (14,402,614) (2,550,498)
- ----------------------------------------------------------------
Net unrealized appreciation/
(depreciation) 84,061,417 (582,591)
================================================================
INTERNATIONAL JAPAN-ASIA
OPPORTUNITIES FOCUS
- ----------------------------------------------------------------
Cost $1,438,227,981 $59,994,076
- ----------------------------------------------------------------
Gross unrealized appreciation 174,129,332 1,454,869
- ----------------------------------------------------------------
Gross unrealized depreciation (39,858,488) (3,731,200)
- ----------------------------------------------------------------
Net unrealized appreciation/
(depreciation) 134,270,844 (2,276,331)
================================================================
WORLDWIDE U.S. CORE
INCOME GROWTH
- ----------------------------------------------------------------
Cost $37,883,616 $14,534,212
- ----------------------------------------------------------------
Gross unrealized appreciation 601,668 1,526,752
- ----------------------------------------------------------------
Gross unrealized depreciation (192,000) (711,498)
- ----------------------------------------------------------------
Net unrealized appreciation/
(depreciation) 409,668 815,254
================================================================
Identified cost may differ for book and tax basis reporting purposes primarily
due to tax deferral of losses on wash sales, PFIC transactions and amortization
of premiums reflected as of July 31, 2006.
NOTE 7. SIGNIFICANT CONCENTRATIONS
European Focus, Global Technology, International Opportunities, Japan-Asia Focus
and Worldwide Income invest a substantial percentage of their assets in
securities of foreign issuers. Worldwide Income may also invest a substantial
percentage of its assets in securities of emerging market countries. These
investments may involve certain considerations and risks not typically
associated with investments in the United States as a result of, among other
factors, the possibility of future political and economic developments and the
level of governmental supervision and regulation of securities markets in the
respective countries. Some countries in which the Funds invest may require
government approval for repatriation of investment income, capital or the
proceeds for sales of securities by foreign investors. In addition, if there is
deterioration in a country's balance of payments or for other reasons, a country
may impose temporary restrictions on foreign capital remittances abroad. In
addition, changes in currency exchange rates will affect the value of
investments denominated in a foreign currency, as well as investment income
derived from those securities.
Worldwide Income invests primarily in income producing securities with a focus
on foreign investment grade debt. It may also invest in lower quality high yield
securities. Investing in high yield securities may involve greater risks and
considerations not typically associated with investing in U.S. Government bonds
and other high quality fixed-income securities. These securities are
non-investment grade securities, often referred to as "junk bonds". Economic
downturns may disrupt the high yield market and impair the ability of issuers to
repay principal and interest. Also, an increase in interest rates would likely
have an adverse impact on the value of such obligations. More over, high yield
securities may be less liquid due to the extent that there is no established
secondary market and because of a decline in value of such securities.
59
HENDERSON GLOBAL FUNDS
NOTES TO FINANCIAL STATEMENTS
The Funds may invest a high percentage of their net assets in specific sectors
of the market in order to achieve a potentially greater investment return. As a
result, the economic, political and regulatory developments in a particular
sector of the market, positive or negative, have a greater impact on a Fund's
net assets and will cause the value of its shares to fluctuate more than if the
Fund did not concentrate its investments in a particular sector. In particular,
Global Technology concentrates its investments in issuers within specific
industries of the technology and telecommunications sectors. Valuations of
companies in these sectors are typically subject to greater volatility than
other sectors.
NOTE 8. BORROWING ARRANGEMENTS
Prior to June 30, 2006, the Trust had a $30 million credit facility. Effective
June 30, 2006, the Trust increased the credit facility to $80 million. The
credit facility was entered into to facilitate portfolio liquidity. Interest is
charged to each participating fund based on its borrowings at a rate per annum
equal to the Federal Funds rate plus 0.50%. In addition, a commitment fee of
0.10% per annum is accrued and apportioned among the participating funds based
on their pro-rata portion of the utilized line of credit. The commitment fee is
included in Miscellaneous fees on the Statement of Operations. No amounts were
borrowed under this facility during the year ended July 31, 2006.
NOTE 9. REDEMPTION FEE
The Funds may impose a redemption fee of 2.00% on shares redeemed within 30 days
of purchase. The fee, which is not a sales charge, is retained by the Funds and
not paid to HGINA or its affiliates. Redemption fees are included in amount
redeemed on the Statements of Changes - Capital Stock Activity. Redemptions fees
during the year ended July 31, 2006 were as follows:
Redemption Fees
- ----------------------------------------------------------------
European Focus $9,507
Global Technology 387
International Opportunities 16,854
Japan-Asia Focus 4,090
Worldwide Income 1,742
U.S. Core Growth 1,073
================================================================
60
HENDERSON GLOBAL FUNDS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Trustees and Shareholders
Henderson Global Funds
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Henderson European Focus Fund, Henderson
Global Technology Fund, Henderson International Opportunities Fund, Henderson
Worldwide Income Fund (formerly the Henderson Income Advantage Fund), Henderson
U.S. Core Growth Fund, and Henderson Japan-Asia Fund (collectively, the
"Funds"), comprising the Henderson Global Funds, as of July 31, 2006, and the
related statements of operations, the statements of changes in net assets and
the financial highlights for the periods indicated therein. These financial
statements and financial highlights are the responsibility of the Funds'
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. Our
audits included consideration of internal control over financial reporting as a
basis for designing audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the
Funds' internal control over financial reporting. Accordingly, we express no
such opinion. An audit also includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements and financial
highlights, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
Our procedures included confirmation of securities owned as of July 31, 2006, by
correspondence with the custodian and brokers or by other appropriate auditing
procedures where replies from brokers were not received. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the respective portfolios constituting the Henderson Global Funds at July 31,
2006, and the results of their operations, changes in their net assets and their
financial highlights for the periods indicated therein in conformity with U.S.
generally accepted accounting principles.
/s/ Ernst & Young LLP
Chicago, Illinois
September 8, 2006
61
This page deliberately left blank.
62
HENDERSON GLOBAL FUNDS
UNAUDITED INFORMATION
PROXY VOTING POLICIES
The Funds have filed with the Securities and Exchange Commission their proxy
voting records for the 12-month period ending June 30, 2006 on Form N-PX, which
must be filed each year by August 31. Form N-PX and a description of the Funds'
proxy voting policies and procedures are available on the Securities and
Exchange Commission's website at http://www.sec.gov. The Funds' proxy voting
records and proxy voting policies and procedures are also available without
charge, upon request, by calling 866.443.6337 or by visiting the Funds' website
at http://www.hendersonglobalfunds.com.
QUARTERLY PORTFOLIO OF INVESTMENTS
A Portfolio of Investments is filed as of the end of the first and third quarter
of each fiscal year on Form N-Q. The Funds have filed with the Securities and
Exchange Commission the Form N-Q and it is available on the Securities and
Exchange Commission's website at http://www.sec.gov. Additionally, the Portfolio
of Investments may be reviewed and copied at the Commission's Public Reference
Room in Washington, DC. Information on the operation of the Public Reference
Room may be obtained by calling 1.800.SEC.0330. The quarterly Portfolio of
Investments are also available without charge, upon request, by calling
866.443.6337 or by visiting the Funds' website at
http://www.hendersonglobalfunds.com.
APPROVAL OF CONTINUATION OF INVESTMENT ADVISORY AGREEMENT
The Board of Trustees of Henderson Global Funds, a majority of whom are not
affiliated with the Adviser or either sub-adviser ("Independent Trustees"),
oversees the management of each of the Funds and, as required by law, determines
at least annually whether to continue the investment advisory agreement and the
sub-advisory agreement for the respective Funds.
In connection with their most recent consideration of those agreements for the
Funds (other than Japan-Asia Focus Fund, for which the initial term of the
advisory and sub-advisory agreements will terminate on August 30, 2007), the
Trustees received and reviewed a substantial amount of information provided by
Henderson Global Investors (North America) Inc. (the "Adviser") and the
respective sub-advisers in response to detailed requests of the Independent
Trustees and their independent legal counsel. The Trustees also discussed with
representatives of management the operations of the Funds and the nature and
quality of the advisory and other services provided to the Funds by the Adviser
and the sub-advisers. The Independent Trustees also received and reviewed a
memorandum from their counsel regarding their responsibilities in considering
continuation of the agreements. Throughout their consideration of the agreements
the Independent Trustees were advised by their independent legal counsel. The
Independent Trustees met on two separate occasions with management to consider
the agreements, and at each of those meetings they also met separately in
executive session with their counsel.
At a meeting held on June 9, 2006, based on their evaluation of the information
provided by the Adviser and the sub-advisers and other information, the Trustees
determined that the overall arrangements between each Fund and the Adviser were
fair and reasonable in light of the nature and quality of the services provided
by the Adviser and the respective sub-adviser, the fees charged for those
services, and other matters that the Trustees considered relevant in the
exercise of their business judgment. At that meeting the Trustees, including all
of the Independent Trustees, unanimously approved the continuation of the
investment advisory agreement and the sub-advisory agreement for each Fund
(other than Japan-Asia Focus Fund) through August 30, 2007, subject to earlier
termination as provided in each agreement, and, in the case of U.S. Core Growth,
with an amendment of the investment advisory agreement to reduce the rate of
investment advisory fee charged by the Adviser on the first $500 million of
average net assets.
In considering the continuation of the agreements, the Trustees reviewed and
analyzed various factors that they determined were relevant, including the
factors described below, none of which by itself was considered dispositive.
However, the material factors and conclusions that formed the basis for the
Trustees' determination to approve the continuation of the agreements are
discussed separately below.
1. NATURE, EXTENT AND QUALITY OF SERVICES
The Trustees reviewed and considered the nature, extent and quality of the
services provided to the Funds by the Adviser and each sub-adviser, taking into
account the investment objective and strategy of each Fund and the knowledge
they had gained from their regular meetings with management on at least a
quarterly basis. In addition, the Trustees reviewed the resources and key
personnel of the Adviser and sub-advisers, especially the personnel who provide
investment management services to the Funds. The Trustees also considered other
services provided to the Funds by the Adviser and the sub-advisers, such as
managing the execution of portfolio transactions and the selection of
broker-dealers for those transactions, monitoring adherence to the Funds'
investment restrictions, producing shareholder
63
HENDERSON GLOBAL FUNDS
UNAUDITED INFORMATION
reports, providing support services for the Trustees and Trustee committees and
overseeing the activities of other service providers, including monitoring
compliance with various policies and procedures of the funds and with applicable
securities laws and regulations.
The Trustees concluded that the nature and extent of the services provided by
the Adviser and sub-adviser to each Fund were appropriate and consistent with
the terms of the respective advisory agreements, that the quality of those
services, other than regarding the performance of U.S. Core Growth, had been
consistent with or superior to quality norms in the industry and that the Funds
were likely to benefit from the continued provision of those services. They also
concluded that the Adviser and each sub-adviser had sufficient personnel, with
the appropriate education and experience, to serve the Funds effectively and had
demonstrated its continuing ability to attract and retain well-qualified
personnel.
2. PERFORMANCE OF THE FUNDS
The Trustees considered the short-term and longer-term performance of the Funds.
They reviewed information comparing each Fund's performance with the performance
of the Fund's benchmark and with the performance of comparable funds and peer
groups identified by Lipper Inc. ("Lipper"), an independent provider of
investment company data. They concluded that the performance of most Funds was
good to very good. Although the performance of U.S. Core Growth lagged that of
its peers for its first two full years of operation, they concluded that two
years is a short time for assessing performance.
3. COSTS OF SERVICES PROVIDED AND PROFITS REALIZED BY THE ADVISOR
The Trustees examined information on the fees and other expenses paid by each
Fund in comparison to information for other comparable funds as provided by
Lipper. They noted that the contractual rate of management fees for most of the
Funds before fee waivers, and the total expense ratio, were above the mean
management fee rate and expense ratio of the respective peer group of funds
selected by Lipper. However, they also noted that the relatively small asset
size of most of the Funds contributed to their high expense ratios. After
discussion with the Trustees, the Adviser agreed to reduce its annual rate of
advisory fee to U.S. Core Growth as a percentage of average daily net assets
from 1.10% to .95% on the first $150 million and from .90% to .85% on the next
$350 million.
The Trustees considered the methodology used by the sub-advisers in determining
compensation payable to portfolio managers, the very competitive environment for
investment management talent and the competitive market for mutual funds in
different distribution channels.
The Trustees also reviewed the Adviser's management fees for certain
non-affiliated sub-advised funds (for which the Adviser or an affiliate provides
only portfolio management services). Although in some instances sub-advisory fee
rates for various investment strategies were lower than management fees for
Funds having a similar strategy, the Trustees noted that the Adviser performs
significant additional services for the Funds that it does not provide to those
other clients, including administrative services, oversight of the Funds' other
service providers, trustee support, regulatory compliance and numerous other
services and that, in serving the Funds, the Adviser assumes many legal risks
that it does not assume in its other clients.
The Trustees reviewed information on the profitability of (or loss) to the
Adviser and its affiliates of their relationships with each Fund, as well as an
explanation of the methodology utilized in allocating various expenses among the
Funds and other clients. The Trustees also reviewed the financial statements of
the Adviser and its parent company and its corporate structure. In their review,
the Trustees considered whether the Adviser and each sub-adviser receive
adequate incentives to manage the Funds effectively. The Trustees recognized
that profitability comparisons among fund managers are difficult because very
little comparative information is publicly available and profitability of any
manager is affected by numerous factors, including the organizational structure
of the particular manager, the types of funds and other accounts it manages,
possible other lines of business, the methodology for allocating expenses and
the manager's capital structure and cost of capital. However, based on the
information available and taking those factors into account, the Trustees
concluded that the Adviser's profitability with respect to each Fund in relation
to the services rendered was not unreasonable. Finally, the Trustees considered
the financial condition of the Adviser and each sub-adviser, which they found to
be sound.
The Trustees concluded that the management fees and other compensation payable
by each Fund to the Adviser (in the case of U.S. Core Growth, after the
reduction in the rate of fees), as well as the fees paid by the Adviser to the
sub-advisers were reasonable in relation to the nature and quality of the
services provided, taking into account the fees charged by other advisers for
managing comparable mutual funds with similar strategies and the fees the
Adviser charges to other clients. The Trustees also concluded that the overall
expense ratio of each Fund was reasonable, taking into account the size of the
Fund, the quality of services provided by the Adviser and the Fund's
sub-adviser, the investment performance of the Fund and the expense limitations
agreed to by the Adviser.
64
HENDERSON GLOBAL FUNDS
UNAUDITED INFORMATION
4. ECONOMIES OF SCALE
The Trustees received and considered information about the potential of the
Adviser to experience economies of scale as the assets of the Funds increase.
They noted that the contractual management fees paid by most of the Funds were
above the mean management fee rate of the Fund's peer group selected by Lipper;
but, by virtue of the expense limitations, the Adviser is subsidizing most Funds
because they have not reached adequate scale. The Trustees also noted that the
advisory agreement included breakpoints in the fee schedules for each Fund,
thereby sharing more economies of scale with each Fund if the assets of the Fund
increase significantly. Based on all of the information they reviewed, the
Trustees concluded that the current fee structure of each Fund (in the case of
U.S. Core Growth after the reduction in the rate of fees) was reasonable and
that those rates of fees do reflect a sharing between the Adviser and the Fund
of economies of scale at the current asset level of the Fund.
5. OTHER BENEFITS TO THE ADVISER
The Trustees also considered benefits that accrue to the Adviser and its
affiliates from their relationship with the Funds and the use by the
sub-advisers of commissions paid on portfolio brokerage transactions of the
Funds to obtain research products and services benefiting the Fund and/or other
clients of the sub-adviser. The Trustees concluded that the sub-adviser's use of
commissions paid by the Funds to obtain research products and services was
consistent with regulatory requirements and was likely to benefit the Funds.
After full consideration of the above factors as well as other factors that were
instrumental in analyzing the management arrangements, the Trustees, including
all of the Independent Trustees, concluded that the continuation of the
investment advisory and sub-advisory agreement for each Fund was in the best
interest of the Fund and its shareholders.
FEDERAL TAX INFORMATION
Certain tax information for the Funds is required to be provided to shareholders
based on the Funds' income and distributions for the taxable year ended July 31,
2006. The amounts shown may differ from those elsewhere in this report due to
differences between tax and financial reporting requirements. In January 2007,
shareholders will receive Form 1099-DIV which will include their share of
foreign tax credit, qualified dividends and capital gains distributed during the
calendar year 2006. Shareholders are advised to check with their tax advisors
for information on the treatment of these amounts on their individual income tax
returns.
Under Section 853 of the Internal Revenue Code, the Funds designated foreign
taxes paid and foreign source income for the fiscal year ended July 31, 2006 as
follows:
FOREIGN FOREIGN
TAXES PAID SOURCE INCOME
- ----------------------------------------------------------
European Focus $707,663 $8,183,095
International Opportunities 2,226,906 24,771,283
==========================================================
Under Section 854 (b)(2) of the Internal Revenue Code, the Funds designated
qualified dividends for the fiscal year ended July 31, 2006 as follows:
European Focus $8,183,095
Global Technology 74,862
International Opportunities 21,304,552
Japan-Asia Focus 211,080
Worldwide Income 12,803
U.S. Core Growth 157,519
==========================================================
SHAREHOLDER EXPENSE
As a shareholder of the Funds, you incur two types of costs: (1) transaction
costs, including sales charges (loads) on purchase payments and redemption fees
and (2) ongoing costs, including management fees, distribution (12b-1) fees,
shareholder services fees and other Fund expenses. The example in Table 1 and
Table 2 is intended to help you understand your ongoing costs of investing in
the Funds and to compare these costs with ongoing costs of investing in other
mutual funds. It is based on an investment of $1,000 invested at the beginning
of the period and held for the entire six-month period ended July 31, 2006.
ACTUAL EXPENSES
Table 1 provides information about actual account values and actual expenses.
You may use the information in this line, together with the amount invested, to
estimate the expenses that you incurred over the period. Simply divide your
account value at the end of the period by $1,000 (for example, an $8,600 account
value divided by $1,000 = 8.6), then multiply the result by the number under the
heading entitled "Expenses Paid During Period" to estimate the expenses
attributable to your investment during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
Table 2 provides information about hypothetical account values and hypothetical
expenses based on the Funds' actual expense ratios and an assumed rate of return
of 5% per year before expenses, which is not the Funds' actual return. Thus you
should not use the hypothetical account values and expenses to estimate your
actual ending account balance or the expense attributable to your investment
65
HENDERSON GLOBAL FUNDS
UNAUDITED INFORMATION
during the period. Rather, these figures are provided to enable you to compare
the ongoing costs of investing in the Funds and other funds. To do so, compare
the 5% hypothetical examples with the 5% hypothetical examples that appear in
the shareholder reports of other funds.
Expenses paid during the period include amounts reflected in the Funds'
Statement of Operations net of reinvestment by the investment advisor. The
annualized expense ratios used in the example are as follows:
CLASS A CLASS B CLASS C CLASS R
- ----------------------------------------------------------
European
Focus 1.56% 2.31% 2.31% N/A
- ----------------------------------------------------------
Global
Technology 1.98 2.73 2.73 N/A
- ----------------------------------------------------------
International
Opportunities 1.63 2.37 2.37 1.88%
- ----------------------------------------------------------
Japan-Asia
Focus 2.00 N/A 2.75 N/A
- ----------------------------------------------------------
Worldwide
Income 1.30 2.05 2.05 N/A
- ----------------------------------------------------------
U.S. Core
Growth 2.00 2.75 2.75 N/A
==========================================================
Please note that the expenses do not reflect shareowner transaction costs such
as front end sales charges and redemption fees. These fees are described for
each Fund and share class in the Performance Summary of this report on pages 3,
5, 7, 9, 11 and 13. Table 2 is useful in comparing ongoing costs only, and will
not help you determine the relative total costs of owning different funds. In
addition, if these transaction costs were included, your costs would have been
higher.
66
HENDERSON GLOBAL FUNDS
UNAUDITED INFORMATION
TABLE 1
BEGINNING ENDING
ACCOUNT ACCOUNT EXPENSES
VALUE VALUE PAID
FEBRUARY 1, JULY 31, DURING
ACTUAL 2006 2006 THE PERIOD*
- -----------------------------------------------------------
European Focus
Class A $1,000.00 $1,064.93 $7.99
Class B 1,000.00 1,060.87 11.80
Class C 1,000.00 1,060.49 11.80
- -----------------------------------------------------------
Global Technology
Class A 1,000.00 892.39 9.29
Class B 1,000.00 888.47 12.78
Class C 1,000.00 888.89 12.79
- -----------------------------------------------------------
International Opportunities
Class A 1,000.00 1,040.12 8.25
Class B 1,000.00 1,035.82 11.96
Class C 1,000.00 1,036.36 11.97
Class R 1,000.00 1,038.22 9.50
- -----------------------------------------------------------
Japan-Asia Focus
Class A 1,000.00 965.00 9.74
Class C 1,000.00 962.00 13.38
- -----------------------------------------------------------
Worldwide Income
Class A 1,000.00 1,027.49 6.54
Class B 1,000.00 1,022.80 10.28
Class C 1,000.00 1,022.75 10.28
- -----------------------------------------------------------
U.S. Core Growth
Class A 1,000.00 914.31 9.49
Class B 1,000.00 911.53 13.03
Class C 1,000.00 911.53 13.03
==========================================================
TABLE 2
BEGINNING ENDING
HYPOTHETICAL ACCOUNT ACCOUNT EXPENSES
(ASSUMING A VALUE VALUE PAID
5% RETURN FEBRUARY 1, JULY 31, DURING
BEFORE EXPENSES) 2006 2006 THE PERIOD*
- -----------------------------------------------------------
European Focus
Class A $1,000.00 $1,017.26 $7.80
Class B 1,000.00 1,013.54 11.53
Class C 1,000.00 1,013.54 11.53
- -----------------------------------------------------------
Global Technology
Class A 1,000.00 1,015.18 9.89
Class B 1,000.00 1,011.46 13.62
Class C 1,000.00 1,011.46 13.62
- -----------------------------------------------------------
International Opportunities
Class A 1,000.00 1,016.92 8.15
Class B 1,000.00 1,013.25 11.83
Class C 1,000.00 1,013.25 11.83
Class R 1,000.00 1,015.68 9.40
- -----------------------------------------------------------
Japan-Asia Focus
Class A 1,000.00 1,015.08 9.99
Class C 1,000.00 1,011.36 13.71
- -----------------------------------------------------------
Worldwide Income
Class A 1,000.00 1,018.55 6.51
Class B 1,000.00 1,014.83 10.24
Class C 1,000.00 1,014.83 10.24
- -----------------------------------------------------------
U.S. Core Growth
Class A 1,000.00 1,015.08 9.99
Class B 1,000.00 1,011.36 13.71
Class C 1,000.00 1,011.36 13.71
==========================================================
* Expenses are equal to the Funds' Class A, Class B, Class C and Class R
shares annualized net expense ratio multiplied by the average account value
over the period multiplied by 181 days in the period and divided by 365 (to
reflect the one-half year period).
67
HENDERSON GLOBAL FUNDS
TRUSTEES AND OFFICERS
POSITION(S) TERM OF OTHER
NAME, ADDRESS AND WITH OFFICE AND PRINCIPAL OCCUPATIONS DIRECTORSHIPS
AGE1 THE TRUST2 TIME SERVED3 DURING PAST FIVE YEARS HELD
- ------------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT TRUSTEES
- ------------------------------------------------------------------------------------------------------------------------------------
C . Gary Gerst, 67 Chairman Since 2001 President, KCI Inc. (private s-corporation Director, Florida Office
and Trustee investing in non-public investments.) Property Company Inc.
(real estate
investment fund).
Roland C. Baker, 67 Trustee Since 2001 President and Chief Executive Officer, Director, Ceres
First Penn-Pacific Life Insurance Company Group, Inc. (life
(consultant to financial services industry). and health insurance
holding company);
Director, North
American Company for
Life and Health
Insurance (a
provider of life
insurance, health
insurance and
annuities);
Director, Golden
State Mutual Life
Insurance Co.
(provider of life
insurance and
annuities to African
Americans).
Faris F. Chesley, 67 Trustee Since 2002 Chairman, Chesley, Taft & Associates, LLC, None.
since 2001; Vice Chairman, ABN-AMRO, Inc.
(a financial services company), 1998-2001.
INTERESTED TRUSTEES AND OFFICERS OF THE TRUST
- ------------------------------------------------------------------------------------------------------------------------------------
Charles H. Trustee Since 2001 Managing Director, Henderson Global None
Wurtzebach4, 57 Investors (North America) Inc. ("HGINA").
Sean M. Dranfield4, 40 Trustee and Since 2001 Director, North American Retail Distribution, None
President HGINA; Executive Director, North American
Business Development, Henderson
Investment Management Limited.
Kenneth A. Kalina, 46 Chief Since 2005 Chief Compliance Officer, HGINA, 2005; N/A
Compliance Chief Compliance Officer, Columbia Wanger
Officer Asset Management, L.P., 2004-2005; Compliance
Officer, Treasurer and Chief Financial Officer,
Columbia Wanger Asset Management, L.P., 2000;
Assistant Treasurer, Columbia Acorn Trust and
Wanger Advisors Trust, 1995-2005.
Alanna N. Palmer, 31 Vice President Since 2002 Director, Retail Marketing and Product
Management, HGINA, since 2006, Associate
Director since 2001. N/A
Scott E. Volk, 35 Vice President Since 2001 Director, Retail Finance and Operations, N/A
HGINA, since 2002 and Finance Manager
2001-2002.
Karen Buiter, 41 Treasurer Since 2004 Operations Manager, HGINA, since 2004; N/A
Assistant Controller, Code Hennessey &
Simmons, 2002-2004.
68
HENDERSON GLOBAL FUNDS
TRUSTEES AND OFFICERS
POSITION(S) TERM OF OTHER
NAME, ADDRESS AND WITH OFFICE AND PRINCIPAL OCCUPATIONS DIRECTORSHIPS
AGE1 THE TRUST2 TIME SERVED3 DURING PAST FIVE YEARS HELD
- ------------------------------------------------------------------------------------------------------------------------------------
INTERESTED TRUSTEES AND OFFICERS OF THE TRUST
- ------------------------------------------------------------------------------------------------------------------------------------
Andrew Tedeschi, 41 Assistant Since 2006 Assistant Treasurer, HGINA, since 2006; N/A
Treasurer Section Manager, Van Kampen Funds,
2001-2006.
Christopher K. Secretary Since 2004 Legal Counsel, HGINA, since 2004; N/A
Yarbrough, 31 Attorney, Bell, Boyd & Lloyd LLC,
2000-2004.
Kristin E. Rice, 35 Assistant Since 2005 Paralegal, HGINA. N/A
Secretary
1. Each person's address is 737 North Michigan Avenue, Suite 1950, Chicago, IL
60611. Age is as of July 31, 2006.
2. Currently, all Trustees oversee all six series of the Trust.
3. A Trustee may serve until his death, resignation or removal. The officers
of the Trust are elected annually by the Board.
4. These Trustees are interested persons of the Trust because of their
employment relationship with Henderson Global Investors (North America)
Inc., the investment adviser to the Funds.
THE STATEMENT OF ADDITIONAL INFORMATION FOR HENDERSON GLOBAL FUNDS INCLUDES
ADDITIONAL INFORMATION ABOUT THE TRUSTEES AND IS AVAILABLE WITHOUT CHARGE BY
CALLING 1.866.4HENDERSON (1.866.443.6337).
69
HENDERSON GLOBAL FUNDS
TRUSTEES
C. Gary Gerst, Chairman
Roland C. Baker
Faris F. Chesley
Sean Dranfield
Charles H. Wurtzebach
OFFICERS
Sean Dranfield, President
Alanna N. Palmer, Vice President
Scott E. Volk, Vice President
Karen Buiter, Treasurer
Christopher K. Yarbrough, Secretary
Kenneth A. Kalina, Chief Compliance Officer
Kristin Rice, Assistant Secretary
Andrew Tedeschi, Assistant Treasurer
INVESTMENT ADVISER
Henderson Global Investors (North America) Inc.
737 North Michigan Avenue, Suite 1950
Chicago, IL 60611
TRANSFER AGENT
State Street Bank & Trust Company
State Street Financial Center
One Lincoln Street
Boston, MA 02111
FOR MORE INFORMATION
Please call 1.866.4HENDERSON
(1.866.443.6337)
or visit our website:
www.hendersonglobalinvestors.com
The views expressed in this report and information about the Funds' portfolio
holdings are for the period covered by this report and are subject to change
hereafter. This report is submitted for the general information of the
shareholders of the Funds. It is not authorized for distribution to prospective
investors unless preceded or accompanied by an effective prospectus, which
includes information regarding the Funds' risks, objectives, fees and expenses,
experience of its management, and other information. Henderson Global Investors
is the name under which various subsidiaries of Henderson Group plc, a UK
limited company, provide investment products and services.
70
Henderson Global Funds
737 N. Michigan Avenue, Suite 1950
Chicago, IL 60611
1.866.4HENDERSON (1.866.443.6337)
www.hendersonglobalinvestors.com
Foreside Fund Services, LLC, Distributor (September, 2006)
Item 2. Code of Ethics.
(a) Henderson Global Funds (the "Trust" or the "registrant") has adopted a Code
of Ethics that applies to the Trust's principal executive officer and
principal financial officer (the "Code").
(b) No disclosures are required by this Item 2(b).
(c) There have been no amendments to the Code during the reporting period for
Form N-CSR.
(d) There have been no waivers granted by the Trust to individuals covered by
the Code during the reporting period for Form N-CSR.
(e) Not applicable.
(f) A copy of the Code may be obtained free of charge by calling 866-343-6337.
Item 3. Audit Committee Financial Expert.
(a)(1) The Board of Trustees of the Trust has determined that it has three
audit committee financial experts serving on the Trust's Audit
Committee that possess the attributes identified in Item 3(b) to
Form N-CSR.
(2) The names of the audit committee financial experts are:
Roland C. Baker
Faris F. Chesley
C. Gary Gerst
Each audit committee financial expert has been deemed to be
"independent" as that term is defined in Item 3(a)(2) of Form N-CSR.
Item 4. Principal Accountant Fees and Services.
(a) Audit Fees - $ 140,500 and $109,400 are the aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountant to the registrant for the audit of the registrant's annual financial
statements or services normally provided by the accountant in connection with
statutory and regulatory filings or engagements for the those fiscal years.
(b) Audit Related Fees - There were no fees billed in each of the last two
fiscal years for assurance and related services rendered by the principal
accountant to the registrant that are reasonably related to the performance of
the audit of the registrant's financial statements and are not reported under
paragraph (a) of this Item 4.
There were no fees billed in each of the last two fiscal years for assurance and
related services rendered by the principal accountant to the investment adviser
that are reasonably related to the performance of the audit of the registrant's
financial statements that were required to be pre-approved by the Audit
Committee as described in paragraph (e)(1) of this Item 4.
(c) Tax Fees - $ 27,000 and $27,200 are the aggregate fees billed in each of the
last two fiscal years for professional services rendered by the principal
accountant to the registrant for tax compliance, tax advice, tax planning and
tax return preparation. These services consisted of the principal accountant
reviewing the registrant's excise tax returns, distribution requirements and RIC
tax returns, as well as consults regarding the tax consequences of specific
investments.
$ 0 and $5,000 are the aggregate fees billed in each of the last two fiscal
years for professional services rendered by the principal accountant to the
investment adviser for tax compliance, tax advice and tax planning that were
required to be pre-approved by the Audit Committee as described in paragraph
(e)(1) of this Item 4.
(d) All Other Fees - There were no fees billed in each of the last two fiscal
years for products and services provided by the principal accountant to the
registrant, other than the services reported in paragraph (a) - (c) of this Item
4.
There were no fees billed in each of the last two fiscal years for products and
services provided by the principal accountant to the investment adviser that
were required to be pre-approved by the Audit Committee as described in
paragraph (e)(1) of this Item 4.
(e) Pre-Approval Policies and Procedures
(1) Pursuant to the registrant's Audit Committee Charter, the Audit Committee
shall pre-approve any engagement of the independent auditors to provide any
services (other than prohibited non-audit services) to the Trust, the investment
adviser and any entity controlling, controlled by, or under common control with
the investment adviser that provides ongoing services to the Trust (if the
engagement relates directly to the operations and financial reporting of the
Trust) (collectively, the "Adviser"), including the fees and other compensation
to be paid to the independent auditors. Any member of the Audit Committee may
grant such pre-approval. Any such delegated pre-approval shall be presented to
the Audit Committee by the member who approved the engagement. Pre-approval of
non-audit services is not required, if: (a) the aggregate amount of all
non-audit services provided to the Trust is less than 5% of the total fees paid
by the Trust to its independent auditors during the fiscal year in which the
non-audit services are provided; (b) the services were not recognized by
management at the time of the engagement as non-audit services; and (c) such
services are promptly brought to the attention of the Audit Committee by
management and the Audit Committee approves them (which may be by delegation as
provided for above) prior to the completion of the audit.
The independent auditors shall not perform any of the following non-audit
services for the Trust ("prohibited non-audit services"): (a) bookkeeping or
other services related to the accounting records or financial statements of the
Trust; (b) financial information systems design and implementation; (c)
appraisal or valuation services, fairness opinions, or contribution-in-kind
reports; (d) actuarial services; (e) internal audit outsourcing services; (f)
management functions or human resources; (g) broker or dealer, investment
adviser, or investment banking services; (h) legal services and expert services
unrelated to the audit; and (i) any other services that the Public Company
Accounting Oversight Board determines are impermissible.
(2) None of the services provided to the registrant described in paragraphs
(b)-(d) of Item 4 were pre-approved by the Audit Committee pursuant to paragraph
(c)(7)(i)(C) of Rule 2-01 of Regulation S-X. All of the fees billed for services
provided to the Adviser described in paragraphs (b)-(d) of Item 4 were required
to be pre-approved by the Audit Committee as described in paragraph (e)(1) of
Item 4.
(f) No disclosures are required by this Item 4(f).
(g) $27,000 and $27,200 are the approximate aggregate non-audit fees billed in
each of the last two fiscal years for services rendered by the principal
accountant to the registrant. $185,070 and $181,850 are the approximate
aggregate non-audit fees billed in each of the last two fiscal years for
services rendered by the principal accountant to the Adviser.
(h) The registrant's Audit Committee has determined that the non-audit services
E&Y has rendered to the Adviser that were not required to be pre-approved by the
Audit Committee because they did not relate directly to the operations and
financial reporting of the registrant were compatible with maintaining E&Y's
independence.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Schedule of Investments.
Schedule of Investments is included as a part of the report to shareholders
filed under Item 1 of this Form N-CSR. 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.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's board of trustees, where those
changes were implemented after the registrant last provided disclosure in
response to this Item.
Item 11. Controls and Procedures.
(a) The registrant's principal executive officer and principal financial
officer have evaluated the registrant's disclosure controls and procedures
within 90 days of this filing and have concluded that the registrant's
disclosure controls and procedures were effective, as of that date, in
ensuring that information required to be disclosed by the registrant in
this Form N-CSR was recorded, processed, summarized and reported timely.
(b) There were no changes in the registrant's internal controls over financial
reporting (as defined in Rule 30a-3(d) under the Investment Company Act of
1940) that occurred during the registrant's second fiscal quarter of the
period covered by this report that has materially affected, or is
reasonably likely to materially affect, the registrant's internal controls
over financial reporting.
Item 12. Exhibits.
(a)(1) Not applicable.
(a)(2) The certifications required by Rule 30a-2(a) under the 1940 Act
(17 CFR 270.30a-2(a)) are attached hereto.
(a)(3) Not applicable.
(b) The certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR
270.30a-2(b)) and Section 906 of the Sarbanes-Oxley Act of 2002 are attached
hereto.
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.
HENDERSON GLOBAL FUNDS
By: /s/ Sean Dranfield
------------------
Sean Dranfield
President (principal executive officer) of Henderson Global Funds
Date: September 28, 2006
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/ Sean Dranfield
------------------
Sean Dranfield
President (principal executive officer) of Henderson Global Funds
Date: September 28, 2006
By: /s/ Karen Buiter
----------------
Karen Buiter
Treasurer (principal financial officer) of Henderson Global Funds
Date: September 28, 2006