OMB APPROVAL
OMB Number: 3235-0570
Expires: November 30, 2005
Estimated average burden
hours per response..... 5.0
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 811-21043
Pioneer High Income Trust
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Dorothy E. Bourassa, Pioneer Investment Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: March 31
Date of reporting period: April 1, 2004 through March 31, 2005
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO SHAREOWNERS.
PIONEER
-----------------------
HIGH
INCOME
TRUST
Annual
Report
3/31/05
[LOGO] PIONEER
Investments(R)
Table of Contents
--------------------------------------------------------------------------------
Letter to Shareowners 1
Portfolio Summary 2
Performance Update 3
Portfolio Management Discussion 5
Schedule of Investments 9
Financial Statements 19
Notes to Financial Statements 23
Report of Independent Registered Public Accounting Firm 33
Results of Shareowner Meeting 34
Factors Considered by the Independent Trustees in
Approving the Management Contract 35
Pioneer Family of Mutual Funds 40
Trustees, Officers and Service Providers 41
Pioneer High Income Trust
LETTER TO SHAREOWNERS 3/31/05
Dear Shareowner,
--------------------------------------------------------------------------------
U.S. stocks moved higher for much of the first quarter, with the Standard &
Poor's 500 Stock Index and the Dow Jones Industrial Average advancing to
three-year highs in early March. But from that point on, soaring oil prices and
the steady ratcheting up of interest rates overwhelmed sentiment and caused
stocks to retrace their gains. The Dow Industrials and the S&P 500 each lost
about two-and-a-half percent for the period, while the tech-heavy NASDAQ
composite fell over eight percent.
With investors less welcoming of risk, large-capitalization stocks, viewed as
more stable, held up better than small- and mid-sized issues, and value stocks
were more resilient than growth stocks across all capitalization ranges.
Determined to prevent damaging inflation, the Federal Reserve Board has
repeatedly raised short-term interest rates. As a result, bond returns were
modestly negative in most sectors. Fixed-income investors also became more risk
averse; high-yield and other corporate sectors retrenched after a run of stellar
performance, while Treasuries and mortgage-backed securities showed small
declines. Municipal revenue bonds trended higher against a backdrop of heavy new
issuance by states and localities.
Higher U.S. interest rates enhanced the dollar's appeal and brought at least a
pause in its long, sharp drop. But the stronger dollar meant muted returns for
U.S. investors in overseas markets. Globally, economies rich in metals and other
industrial commodities continued to thrive on heavy demand from China and
elsewhere. Meanwhile, growth in Japan may have stalled, and Europe's expansion
moved ahead slowly.
We believe that the U.S. economy and corporate earnings will continue to grow at
a comfortable pace. And although oil prices and interest rates remain real
concerns, Pioneer's global investment experts continue to find what we believe
are attractive stocks and bonds for our domestic and international funds.
Expanding your opportunities
The quarter was like all others; different classes of investments delivered
different returns. That's why allocating your portfolio across several
investment categories is one way to seek wider opportunities. Pioneer's
disciplined approach and growing range of products are designed to help you
achieve that important objective. For thoughtful guidance on how to align your
portfolio with your goals, contact your financial professional.
Please consider a fund's investment objective, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about each fund and should be read carefully before you invest. To obtain a
prospectus and for other information on any Pioneer fund, contact your financial
advisor, call 1-800-225-6292 or visit our web site at www.pioneerfunds.com.
Respectfully,
/s/ OSBERT M. HOOD
Osbert M. Hood, President
Pioneer Investment Management, Inc.
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Trust's historical or future performance are
statements of the opinion of Trust management as of the date of this report.
These statements should not be relied upon for any other purposes. Past
performance is no guarantee of future results, and there is no guarantee that
market forecasts discussed will be realized.
1
Pioneer High Income Trust
--------------------------------------------------------------------------------
PORTFOLIO SUMMARY 3/31/05
--------------------------------------------------------------------------------
Portfolio Diversification
--------------------------------------------------------------------------------
(As a percentage of total investment portfolio)
[The following table was depicted as a pie chart in the printed material.]
Corporate Bonds & Notes 86.7%
Municipal Bonds 6.1%
Temporary Cash Investments 3.8%
Sovereign Debt Obligations 1.5%
Convertible Bonds 1.1%
CMO 0.8%
Portfolio Maturity
--------------------------------------------------------------------------------
(As a percentage of long-term holdings)
[The following table was depicted as a pie chart in the printed material.]
0-1 Year 4.1%
1-3 Years 20.6%
3-4 Years 25.0%
4-6 Years 36.9%
6-8 Years 7.9%
8+ Years 5.5%
The portfolio is actively managed, and current holdings may be different.
2
Pioneer High Income Trust
--------------------------------------------------------------------------------
PERFORMANCE UPDATE 3/31/05
--------------------------------------------------------------------------------
Share Prices and Distributions
--------------------------------------------------------------------------------
Market Value
per Common Share 3/31/05 3/31/04
$15.12 $16.57
Net Asset Value
per Common Share 3/31/05 3/31/04
$16.34 $16.20
Distributions per Net
Common Share Investment Short-Term Long-Term
(4/1/04 - 3/31/05) Income Capital Gains Capital Gains
$1.65 $0.069 $0.064
10 Largest Holdings
--------------------------------------------------------------------------------
(As a percentage of long-term holdings)*
1. Xerox Capital Trust I, 8.0%, 2/1/27 2.04%
2. Huntsman International LLC, 10.125%, 7/1/09 1.84
3. Baytex Energy, Ltd., 9.625%, 7/15/10 1.82
4. Burns, Philip Capital Property, Ltd., 9.75%, 7/15/12 1.69
5. Seabulk International, Inc., 9.5%, 8/15/13 1.59
6. GATX Financial Corp., 8.875%, 6/1/09 1.55
7. Kvaerner ASA, 0.0%, 10/30/11 1.30
8. OM Group, Inc., 9.25%, 12/15/11 1.26
9. Ship Finance International, Ltd., 8.5%, 12/15/13 1.25
10. Cia Brasileira de Bebida, 10.5%, 12/15/11 1.23
*This list excludes temporary cash and derivative investments. The portfolio is
actively managed, and current holdings may be different.
3
Pioneer High Income Trust
--------------------------------------------------------------------------------
PERFORMANCE UPDATE 3/31/05 (continued)
--------------------------------------------------------------------------------
Investment Returns
--------------------------------------------------------------------------------
The mountain chart on the right shows the change in value of a $10,000
investment made in common shares of Pioneer High Income Trust, compared to that
of the Merrill Lynch High Yield Master II Index.
------------------------------------------
Cumulative Total Returns
(As of March 31, 2005)
Net Asset Market
Period Value Price
Life-of-Trust
(4/25/02) 57.59% 39.30%
1 Year 12.72 1.97
------------------------------------------
[The following table was depicted as a mountain chart in the printed material.]
Value of $10,000 Investment
Pioneer High Merrill Lynch High
Income Trust Yield Master II Index
------------ ---------------------
4/02 $10,000 $10,000
10,462 10,169
13,942 12,428
3/05 13,930 13,291
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent month-end
performance results. Current performance may be lower or higher than the
performance data quoted.
Performance data shown represents past performance. Past performance is no
guarantee of future results. Investment return and market price will fluctuate,
and your shares may trade below net asset value ("NAV"), due to such factors as
interest rate changes, and the perceived credit quality of borrowers.
Total investment return does not reflect broker sales charges or commissions.
All performance is for common shares of the Trust.
Closed-end funds, unlike open-end funds, are not continuously offered. There is
a one-time public offering and, once issued, shares of closed-end funds are sold
in the open market through a stock exchange and frequently trade at prices lower
than their NAV. NAV is total assets less total liabilities, which includes
preferred shares, divided by the number of common shares outstanding.
When NAV is lower than market price, dividends are assumed to be reinvested at
the greater of NAV or 95% of the market price. When NAV is higher, dividends are
assumed to be reinvested at market price.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Trust distributions or the redemption of Trust
shares.
Index comparison begins April 30, 2002. The Merrill Lynch High Yield Master II
Index is a commonly accepted measure of the performance of high yield
securities. Index returns are calculated monthly, assume reinvestment of
dividends and, unlike Trust returns, do not reflect any fees, expenses or sales
charges. You cannot invest directly in an Index.
4
Pioneer High Income Trust
--------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 3/31/05
--------------------------------------------------------------------------------
Despite a series of increases in short-term interest rates that had been widely
anticipated by bond market investors, the U.S. economy continued to show
significant strength during the 12 months ended March 31, 2005, supporting
growing profits and improving credit quality in corporate bonds. The following
is an interview with Kenneth J. Taubes and Andrew Feltus, who discuss the
performance of High Income Trust during the period. Mr. Taubes is director of
Pioneer's Fixed Income Group, and Mr. Feltus is the portfolio manager
responsible for the daily management of the Trust.
Q: How did the Trust perform?
A: The Trust at net asset value performed very well, significantly outdistancing
its benchmark index for high-yield investing. For the 12 months ended March
31, 2005, Pioneer High Income Trust had a total return of 12.72% at net asset
value and 1.97% at market price, with a discount of market price-to-net asset
value of 7.5% on March 31, 2005. The benchmark Merrill Lynch High Yield
Master II Index returned 6.94% during the same period. The Trust also
continued to produce generous dividend income for shareholders. On March 31,
2005, the SEC 30-day yield of High Income Trust was 12.88%.
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
Q: What was the investment environment like during the 12 months?
A: The main change that affected the bond markets arose from the U.S. Federal
Reserve Board's decision to start tightening monetary policy by raising the
influential Fed funds rate from its extraordinarily low level of 1.00% at the
start of the period. After seven separate hikes, the rate ended the period at
2.75%. The increases did not stymie the economic recovery, and real gross
domestic product (GDP) grew at an annual rate of about 4% for much of the
period. Given the persistent economic expansion,
5
Pioneer High Income Trust
--------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 3/31/05 (continued)
--------------------------------------------------------------------------------
corporate profits continued to grow, providing a good backdrop for credit
quality and high-yield investments.
Q: What were your principal strategies?
A: We positioned the Trust to benefit from the economic recovery, emphasizing
bonds of cyclical companies in industries such as basic materials, chemicals
and transportation. Investments in basic industries accounted for 16.5% of
assets on March 31, 2005, while holdings in cyclical services industries
totaled 18.4%. At the end of the fiscal year, 71.4% of assets were invested
in domestic, high-yield corporate bonds, with average credit quality of the
portfolio standing at B-.
The Trust also had some exposure to euro-based investments, which helped as
the euro appreciated by about 11% against the U.S. dollar over the full
fiscal year. As the period progressed, however, we reduced exposure to the
euro from about 6% of assets to about 2.5%, both because the U.S. dollar
began strengthening against the euro and because European securities began to
look less attractive relative to domestic bonds.
The difference between the yields generated by our high-yield investments and
the interest costs from short-term borrowing remained attractive during the
12 months, even with the increases in short-term interest rates. This allowed
us to generate greater income by continuing to be leveraged by about 24%.
Q: What were some of the investments that most helped performance?
A: Significantly contributing to performance was our largest industry position,
in chemicals. We maintained positions in bonds of companies such as Huntsman,
Celanese, Lyondell, Resolution Performance and Invista. All those investments
added to performance.
We also were attracted to the bonds of European cable television companies,
which face less competition from satellite companies than in the United
States. We invested in securities of companies such as NTL of the United
Kingdom, Telenet of Belgium, and Kabel Deutschland of Germany. Those
investments performed well both because of the underlying business strengths
of the companies and because of the euro's appreciation.
6
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Q: What types of investments proved disappointing?
A: Intermet, a high-yield industrial company specializing in the design and
casting of structural components for the automobile industry, filed for
bankruptcy protection in September 2004 after it found that the full costs of
price increases for raw materials could not be passed on to customers. Bonds
of Merisant, the manufacturer of the artificial sweetener sold under the
trade name of Equal, also performed poorly when it ran into strong
competition from the manufacturer of Splenda.
Our investments in airline industry bonds, while being profitable, did not
appreciate as we had hoped. The airlines, which together constituted about 3%
of Trust assets, made significant progress in reducing operating costs,
especially for labor. However, they had difficulty absorbing rising fuel
expenses.
Q: What is your investment outlook?
A: With a backdrop of a continuing economic rebound and improving corporate
profitability, the business fundamentals of high-yield issuers remain strong,
and credit quality is good. However, lower-rated, high-yield bonds have
performed well over the past two years relative to other fixed-income assets,
and they are not inexpensive. We continue to pay close attention to
fundamental analysis and individual security selection and intend to avoid
taking on undue risks.
As business conditions improve, more high-yield issuers may call back their
existing bonds. In this event, we may find that our credit standards require
that we invest in lower-yielding bonds, which eventually could affect the
Trust's dividend. Similarly, a strong economy could lead to further increases
in short-term interest rates, which ultimately could affect the future
earnings of the Trust.
Investments in high-yield or lower-rated securities are subject to
greater-than-average risk. When interest rates rise, the prices of
fixed-income securities in the Trust will generally fall. Conversely, when
interest rates fall the prices of fixed-income securities in the Trust will
generally rise. When concentrating on one issuer, the portfolio is sensitive
to changes in the value of these securities. Investments in the Trust are
subject to possible loss due to the financial failure of underlying
securities and their
7
Pioneer High Income Trust
--------------------------------------------------------------------------------
PORTFOLIO MANAGEMENT DISCUSSION 3/31/05 (continued)
--------------------------------------------------------------------------------
inability to meet their debt obligations. These risks may increase share
price volatility.
Call 1-800-225-6292 or visit www.pioneerfunds.com for the most recent
month-end performance results. Current performance may be lower or higher
than the performance data quoted.
The performance data quoted represents past performance, which is no
guarantee of future results. Investment return and principal value will
fluctuate, and shares, when redeemed, may be worth more or less than their
original cost.
Any information in this shareholder report regarding market or economic
trends or the factors influencing the Trust's historical or future
performance are statements of the opinion of Trust management as of the date
of this report. These statements should not be relied upon for any other
purposes. Past performance is no guarantee of future results, and there is no
guarantee that market forecasts discussed will be realized.
The Trust's investment objective is a high level of current income. The Trust
may, as a secondary objective, also seek capital appreciation to the extent
consistent with its investment objective. There can be no assurance that the
Trust will achieve its investment objectives. Under normal market conditions,
the Trust invests at least 80% of its assets (net assets plus borrowing for
investment purposes) in below investment grade (high-yield) debt securities,
loans and preferred stocks. Because the Trust's investments will be
concentrated in high-yield securities, it will be subject to risks of such
securities. Below investment grade securities are commonly referred to as
"junk bonds" and are considered speculative with respect to the issuer's
capacity to pay interest and repay principal. They involve greater risk of
loss, are subject to greater price volatility and are less liquid, especially
during periods of economic uncertainty or change, than higher rated debt
securities. Risks of the investing in the Trust are discussed in greater
detail in the Trust's registrations statement on Form N-2 relating to its
common shares, which was filed with the Securities and Exchange Commission on
April 29, 2002.
8
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/05
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD ($) (unaudited) Value
COLLATERIZED MORTGAGE OBLIGATIONS - 1.1% of Net Assets
Diversified Financials - 1.1%
4,860,000 NR/Ba2 Tower 2004-2A F, 6.376%, 12/15/14 (144A) $ 4,792,439
-------------
TOTAL COLLATERIZED MORTGAGE OBLIGATIONS
(Cost $4,860,000) $ 4,792,439
-------------
CORPORATE BONDS & NOTES - 119.3%
Energy - 9.2%
Energy Equipment & Services - 4.3%
1,477,000 B+/Ba3 Holly Energy Partners, L.P., 6.25%, 3/1/15 (144A) $ 1,417,920
5,300,000 CCC+/Caa1 J. Ray McDermott SA, 11.0%, 12/15/13 (144A) 5,936,000
8,000,000 B/B2 Seabulk International, Inc., 9.5%, 8/15/13 9,200,000
1,938,000 B/B3 Transmontaigne, Inc., 9.125%, 6/1/10 2,054,280
-------------
$ 18,608,200
-------------
Oil & Gas - 4.9%
9,984,000 B-/B3 Baytex Energy, Ltd., 9.625%, 7/15/10 $ 10,583,040
3,000,000 CCC+/B3 Belden & Blake Corp., 8.75%, 7/15/12 2,977,500
765,000 B-/B3 Delta Petroleum Corp., 7.0%, 4/1/15 (144A) 738,225
5,000,000 B+/B2 Energy Partners, Ltd., 8.75%, 8/1/10 5,350,000
700,000 B+/B1 Markwest Energy, 6.875%, 11/1/14 (144A) 700,000
1,370,000 B2/B+ Stone Energy Corp., 6.75%, 12/15/14 1,328,900
-------------
$ 21,677,665
-------------
Total Energy $ 40,285,865
-------------
Materials - 25.2%
Chemicals - 15.0%
550,000 B+/B1 ARCO Chemical Co., 9.375%, 12/15/05 $ 569,250
4,635,000 B+/B1 ARCO Chemical Co., 9.8%, 2/1/20 5,237,550
2,900,000 CCC+/B3 Aventine Renewable Energy, 9.01%, 12/15/11
(144A) 2,943,500
3,700,000 BBB-/Baa3 Basell Finance Co., 8.1%, 3/15/27 (144A) 3,750,742
2,550,000 BB-/NR Braskem SA, 11.75%, 1/22/14 2,856,000
2,535,000(a) B-/Caa2 Crystal US Holdings, 0.0%, 10/1/14 (144A) 1,774,500
5,800,000 BB+/Baa3 Ferro Corp., 7.125%, 4/1/28 5,783,673
1,300,000 BB+/Baa3 Ferro Corp., 7.625%, 5/1/13 1,321,368
EURO 7,870,000 B/B3 Huntsman International LLC, 10.125%, 7/1/09 10,662,917
5,000,000 B+/B1 Invista, 9.25%, 5/1/12 (144A) 5,500,000
4,500,000 BBB-/Ba1 Methanex Corp., 8.75%, 8/15/12 5,197,500
7,100,000 B-/Caa1 OM Group, Inc., 9.25%, 12/15/11 7,313,000
400,000 CCC+/B3 Resolution Performance Products LLC, 9.5%,
4/15/10 426,000
The accompanying notes are an integral part of these financial statements.
9
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/05 (continued)
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD ($) (unaudited) Value
Chemicals (continued)
5,750,000(d) CCC/Caa2 Resolution Performance Products LLC, 13.5%,
11/15/10 $ 6,210,000
EURO 4,970,000 CCC+/Caa1 Rhodia SA, 9.25%, 6/1/11 6,265,466
-------------
$ 65,811,466
-------------
Construction Materials - 1.6%
6,000,000 BB-/B1 Texas Industries, Inc., 10.25%, 6/15/11 $ 6,795,000
-------------
Containers & Packaging - 4.0%
3,000,000 B-/B2 Anchor Glass Container Corp., 11.0%, 2/15/13 $ 2,707,500
2,000,000 B+/B1 Crown Euro Holdings SA, 9.5%, 3/1/11 2,195,000
EURO 1,950,000 B+/NR Crown Euro Holdings SA, 10.25%, 3/1/11 2,851,099
800,000 CCC+/Caa2 Graham Packaging Co., Inc., 9.875%, 10/15/14 (144A) 800,000
4,020,000 BB-/B1 Greif Bros. Corp., 8.875%, 8/1/12 4,341,600
4,650,000 B/B2 Vitro Envases, 10.75%, 7/23/11 (144A) 4,743,000
-------------
$ 17,638,199
-------------
Metals & Mining - 3.6%
2,900,000 BB-/B1 CSN Islands VIII Corp., 9.75%, 12/16/13 (144A) $ 2,987,000
2,800,000 BB-/B1 CSN Islands IX Corp., 10.0%, 1/15/15 (144A) 2,884,000
2,875,000 B-/B3 Edgen Acquisition Corp., 9.875%, 2/1/11 (144A) 2,882,188
5,035,000 B+/B1 Freeport-McMoRan Copper & Gold, Inc., 10.125%,
2/1/10 5,588,850
1,440,000 B-/B3 IMCO Recycling Escrow, 9.0%, 11/15/14 (144A) 1,512,000
-------------
$ 15,854,038
-------------
Paper & Forest Products - 1.0%
4,500,000 B/Caa1 Mercer International, Inc., 9.25%, 2/15/13 $ 4,252,500
-------------
Total Materials $ 110,351,203
-------------
Industrials - 29.7%
Aerospace & Defense - 1.1%
4,675,000 B/B2 Hawk Corp., 8.75%, 11/1/14 $ 4,791,875
-------------
Airlines - 4.2%
401,841 CCC+/Caa2 American Airlines, Inc., 8.97%, 3/29/08 $ 337,743
1,100,000 NR/B3 American Airlines, Inc., 10.38%, 3/4/06 1,031,250
2,065,000(d) CCC/Caa2 AMR Corp., 9.0%, 8/1/12 1,559,075
2,440,000 CCC/Caa2 AMR Corp., 9.8%, 10/1/21 1,598,200
3,200,000 CCC/Caa2 AMR Corp., 10.2%, 3/15/20 2,096,000
6,000,000 B/B3 Continental Airlines, Inc., Series D, 7.568%, 12/1/06 4,776,642
5,610,000 CCC+/Caa1 Northwest Airlines, Inc., 8.7%, 3/15/07 4,067,250
3,875,000(d) CCC+/Caa1 Northwest Airlines, Inc., 9.875%, 3/15/07 2,886,875
-------------
$ 18,353,035
-------------
The accompanying notes are an integral part of these financial statements.
10
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD ($) (unaudited) Value
Building Products - 0.8%
3,160,000 B-/B3 Builders FirstSource, Inc., 7.02438%, 2/15/12
(144A) $ 3,112,600
500,000 B-/B3 U.S. Concrete, Inc., 8.375%, 4/1/14 497,500
-------------
$ 3,610,100
-------------
Commercial Services & Supplies - 9.0%
3,500,000 B-/Caa1 Allied Security Escrow, 11.375%, 7/15/11 $ 3,587,500
1,850,000 B/B2 Brickman Group, Ltd., Series B, 11.75%,
12/15/09 2,090,500
6,275,000 B/B3 Clean Harbors, Inc., 11.25%, 7/15/12 (144A) 6,996,625
3,250,000 B-/B3 Cornell Companies, Inc., 10.75%, 7/1/12 3,363,750
5,020,000 B-/Caa1 Hydrochem Industrial Services, Inc., 9.25%,
2/15/13 (144A) 4,919,600
2,700,000 B-/B3 Knowledge Learning Corp., Inc., 7.75%, 2/1/15
(144A) 2,605,500
4,820,000 CCC+/Caa1 Park-Ohio Industries, Inc., 8.375%, 11/15/14 (144A) 4,651,300
5,650,000(d) B+/B2 United Rentals North America, Inc., 7.75%,
11/15/13 5,480,500
5,800,000 CCC/Ca Waste Services, Inc., 9.5%, 4/15/14 (144A) 5,858,000
-------------
$ 39,553,275
-------------
Construction & Engineering - 3.5%
NOK 27,300,000(a) NR/NR Kvaerner ASA, 0.0%, 10/30/11 $ 3,674,933
8,897,000(a) NR/NR Kvaerner ASA, 0.0%, 10/30/11 7,562,450
3,890,000(d) B+/Ba3 Shaw Group, Inc., 10.75%, 3/15/10 4,220,650
-------------
$ 15,458,033
-------------
Electrical Equipment - 1.3%
5,790,000 CCC+/B3 Altra Industrial Motion, 9.0%, 12/1/11 (144A) $ 5,732,100
-------------
Machinery - 1.6%
3,300,000 B-/B3 American Rock Salt Co., LLC, 9.5%, 3/15/14 $ 3,399,000
1,980,000 B/B3 Hines Nurseries, Inc., 10.25%, 10/1/11 2,138,400
1,217,000 B/B2 Manitowac Co., Inc., 10.5%, 8/1/12 1,381,295
-------------
$ 6,918,695
-------------
Marine - 4.8%
5,000,000(d) BB+/Ba3 CP Ships, Ltd., 10.375%, 7/15/12 $ 5,712,500
6,000,000(a) CCC+/Caa2 H-Lines Finance Holding, 0.0%, 4/1/13 (144A) 4,680,000
1,300,000 CCC+/B3 Horizon Lines LLC, 9.0%, 11/1/12 (144A) 1,384,500
7,350,000 B/B1 Ship Finance International, Ltd., 8.5%, 12/15/13 7,276,500
2,000,000 BB-/Ba3 Stena AB, 7.0%, 12/1/16 1,850,000
-------------
$ 20,903,500
-------------
The accompanying notes are an integral part of these financial statements.
11
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/05 (continued)
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD ($) (unaudited) Value
Road & Rail - 3.3%
4,525,000 CCC+/B3 Atlantic Express Transportation, 12.25%, 4/15/08
(144A) $ 4,304,406
400,000 B/B2 Grupo Transportacion Ferroviaria Mexicana,
SA de CV, 10.25%, 6/15/07 424,000
2,550,000 B/B2 Grupo Transportacion Ferroviaria Mexicana,
SA de CV, 11.75%, 6/15/09 2,550,000
2,900,000 B-/B2 Progress Rail/Metal, 7.75%, 4/1/12 (144A) 2,900,000
3,925,000 B-/B3 Trailer Bridge, Inc., 9.25%, 11/15/11 (144A) 4,047,656
-------------
$ 14,226,062
-------------
Transportation - 0.1%
535,000 B-/Caa1 K&F Acquisition, Inc., 7.75%, 11/15/14 (144A) $ 518,950
-------------
Total Industrials $ 130,065,625
-------------
Consumer Discretionary - 11.4%
Automobiles & Components - 2.6%
1,900,000 B/B3 Cooper Standard Auto, 8.375%, 12/15/14 (144A) $ 1,543,750
5,475,000 B-/Caa1 Stanadyne Corp., 10.0%, 8/15/14 5,639,250
1,530,000 B-/B3 Tenneco Automotive, Inc., 8.625%, 11/15/14
(144A) 1,487,925
2,600,000 B-/B3 UGS Corp., 10.0%, 6/1/12 (144A) 2,873,000
-------------
$ 11,543,925
-------------
Hotels, Restaurants & Leisure - 2.3%
1,600,000 BB-/Ba3 Grupo Posadas SA, 8.75%, 10/4/11 (144A) $ 1,704,000
2,990,000 CCC+/B2 MeriStar Hospitality Operating Partnership, L.P.,
10.5%, 6/15/09 3,199,300
1,500,000 B-/Caa1 Pinnacle Entertainment, Inc., 8.25%, 3/15/12 1,500,000
2,500,000 CCC+/Caa1 True Temper Sports, Inc., 8.375%, 9/15/11 2,325,000
1,225,000 B+/B1 Turning Stone Casino Resort Enterprise, 9.125%,
12/15/10 (144A) 1,272,469
-------------
$ 10,000,769
-------------
Household Durables - 0.1%
500,000 B+/Ba3 WCI Communities, Inc., 6.625%, 3/15/15 (144A) $ 475,000
-------------
Media - 3.3%
EURO 3,750,000 B-/B2 Kabel Deutschland Gmbh, 10.75%, 7/1/14
(144A) $ 5,641,278
3,000,000 B-/B3 LodgeNet Entertainment Corp., 9.5%, 6/15/13 3,270,000
5,085,000 B/B1 Sheridan Acquisition Corp., 10.25%, 8/15/11 5,402,813
-------------
$ 14,314,091
-------------
The accompanying notes are an integral part of these financial statements.
12
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD ($) (unaudited) Value
Multiline Retail - 0.8%
3,800,000 BB+/Ba2 J.C. Penney Co., Inc., 8.125%, 4/1/27 $ 3,686,000
------------
Specialty Retail - 1.7%
3,840,000 B/B3 Asbury Automotive Group, Inc., 9.0%, 6/15/12 $ 3,916,800
3,720,000 B/B3 Pep Boys-Manny, Moe & Jack 7.5%, 12/15/14 3,571,200
------------
$ 7,488,000
------------
Textiles - 0.6%
3,700,000(a) B-/Caa2 Jostens Holding Corp., 0.0%, 12/1/13 $ 2,701,000
------------
Total Consumer Discretionary $ 50,208,785
------------
Consumer Staples - 7.0%
Beverages - 1.6%
5,885,000 BBB/Baa3 Cia Brasileira de Bebida, 10.5%, 12/15/11 $ 7,120,850
------------
Food Products - 2.2%
9,000,000 B-/B3 Burns, Philip Capital Property, Ltd., 9.75%,
7/15/12 $ 9,810,000
------------
Food & Staples Retailing - 3.2%
5,750,000 CCC+/Caa2 Doane Pet Care Co., 9.75%, 5/15/07 $ 5,635,000
550,000 B-/B2 Duane Reade, Inc., 7.01% 12/15/10 (144A) 555,500
4,700,000 CCC/Caa1 Duane Reade, Inc., 9.75%, 8/1/11 4,136,000
3,380,000 B+/B2 Wornick Co., 10.875%, 7/15/11 3,532,100
------------
$ 13,858,600
------------
Total Consumer Staples $ 30,789,450
------------
Health Care - 6.4%
Health Care Equipment & Supplies - 1.1%
4,950,000(d) CCC+/B3 Hanger Orthopedic Group, Inc., 10.375%, 2/15/09 $ 4,912,875
------------
Health Care Providers & Services - 4.2%
2,160,000 B-/Caa1 AMR HoldCo/Emcare HoldCo, 10.0%, 2/15/15
(144A) $ 2,246,400
5,485,000 B-/B3 Ardent Health Services, 10.0%, 8/15/13 6,499,725
1,500,000 B/B1 National Nephrology Associates, Inc., 9.0%,
11/1/11 (144A) 1,663,125
2,000,000 CCC+/B3 NDCHealth Corp., 10.5%, 12/1/12 2,055,000
2,335,000 BBB-/Ba3 PacifiCare Health Systems, Inc., 10.75%, 6/1/09 2,580,175
3,355,000 CCC+/Caa1 Rural/Metro Corp., 9.875%, 3/15/15 (144A) 3,447,263
------------
$ 18,491,688
------------
Pharmaceuticals - 1.1%
4,900,000 CCC+/Caa1 Warner Chilcott Corp., 8.75%, 2/1/15 (144A) $ 4,924,500
------------
Total Health Care $ 28,329,063
------------
The accompanying notes are an integral part of these financial statements.
13
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/05 (continued)
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD ($) (unaudited) Value
Financials - 11.6%
Capital Markets - 1.2%
4,950,000 B/B3 Refco Finance Holdings, 9.0%, 8/1/12 (144A) $ 5,247,000
------------
Diversified Financials - 6.3%
5,587,000(a) CCC+/Caa1 Alamosa Delaware, Inc., 0.0%, 7/31/09 $ 6,075,862
6,135,000 B/B3 Dollar Financial Group, 9.75%, 11/15/11 6,533,775
7,950,000 BBB-/Baa3 GATX Financial Corp., 8.875%, 6/1/09 8,975,073
EURO 2,000,000 B-/B3 MDP Acquisitions Plc, 10.125%, 10/1/12 2,872,219
EURO 2,500,000 CCC+/Caa1 Ray Acquisition SCA, 9.375%, 3/16/15 (144A) 3,041,985
------------
$ 27,498,914
------------
Insurance - 4.1%
5,300,000 BB/Ba1 Allmerica Financial Corp., 7.625%, 10/15/25 $ 5,678,261
3,380,000 BBB-/NR Kingsway America, Inc., 7.5%, 2/1/14 3,467,018
4,000,000 BBB-/Baa3 Odyssey Re Holdings Corp., 7.65%, 11/1/13 4,339,416
4,535,000 B+/B2 Presidential Life Corp., 7.875%, 2/15/09 4,535,000
------------
$ 18,019,695
------------
Total Financials $ 50,765,609
------------
Information Technology - 4.7%
Communications Equipment - 0.7%
2,900,000(d) B/B2 Lucent Technologies, Inc., 7.25%, 7/15/06 $ 2,965,250
------------
Electronic Equipment & Instruments - 1.3%
215,000 B/B2 General Cable Corp., 9.5%, 11/15/10 $ 236,500
1,130,000 B/B1 Sanmina-SCI Corp., 6.75%, 3/1/13 (144A) 1,059,375
4,000,000 BB-/Ba2 Sanmina-SCI Corp., 10.375%, 1/15/10 4,480,000
------------
$ 5,775,875
------------
Office Electronics - 2.7%
11,830,000 B-/Ba3 Xerox Capital Trust I, 8.0%, 2/1/27 $ 11,830,000
------------
Total Information Technology $ 20,571,125
------------
Telecommunication Services - 11.6%
Diversified Telecommunication Services - 2.5%
5,600,000 CCC+/Caa1 Eschelon Operating Co., 8.375%, 3/15/10 $ 4,872,000
4,025,000 B+/B2 GCI, Inc., 7.25%, 2/15/14 3,904,250
EURO 1,590,000 B-/B3 NTL Cable Plc, 8.75%, 4/15/14 (144A) 2,205,922
------------
$ 10,982,172
------------
Wireless Telecommunications Services - 9.1%
1,100,000 B-/B2 Airgate PCS, Inc., 6.41%, 10/15/11 (144A) $ 1,122,000
3,900,000 CCC/B3 Horizon PCS, Inc., 11.375%, 7/15/12 (144A) 4,426,500
2,200,000(a) CCC+/Caa1 Inmarsat Finance II Plc, 0.0%, 11/15/12 1,551,000
The accompanying notes are an integral part of these financial statements.
14
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD ($) (unaudited) Value
Wireless Telecommunications Services (continued)
600,000(a) CCC-/Caa2 IWO Escrow Co., 0.0%, 1/15/15 (144A) $ 384,000
2,875,000 CCC+/B3 IWO Escrow Co., 6.32%, 1/15/12 (144A) 2,932,500
6,855,000 CCC/B3 MetroPCS, Inc., 10.75%, 10/1/11 6,992,100
5,150,000 B-/B3 Mobifon Holdings BV, 12.5%, 7/31/10 6,289,438
3,230,000 BB-/Ba3 Mobile Telesystems, 9.75%, 1/30/08 (144A) 3,439,950
3,000,000(d) CCC/Caa2 Rural Cellular Corp., 9.75%, 1/15/10 2,745,000
3,250,000 NR/Baa3 Tele Norte Leste Participacoes S.A., 8.0%,
12/18/13 3,233,750
6,025,000 CCC/Caa1 UbiquiTel Operating Co., 9.875%, 3/1/11 6,642,563
-------------
$ 39,758,801
-------------
Total Telecommunication Services $ 50,740,973
-------------
Utilities - 2.5%
Electric Utilities - 2.0%
1,912,500 BBB-/Baa3 Empresa Electrica Guacolda SA, 8.625%, 4/30/13
(144A) $ 2,102,595
6,582,236 NR/NR Ormat Funding Corp., 8.25%, 12/30/20 6,615,147
-------------
$ 8,717,742
-------------
Multi-Utilities - 0.5%
2,300,000 B+/B1 Reliant Energy, Inc., 6.75%, 12/15/14 $ 2,144,750
-------------
Total Utilities $ 10,862,492
-------------
TOTAL CORPORATE BONDS & NOTES
(Cost $485,687,880) $ 522,970,190
-------------
CONVERTIBLE BONDS & NOTES - 1.5% of Net Assets
Health Care - 0.6%
Pharmaceuticals - 0.6%
2,500,000 NR/NR IVAX Corp., 1.875%, 12/15/24 (144A) $ 2,812,500
-------------
Total Health Care $ 2,812,500
-------------
Information Technology - 0.9%
Electronic Equipment & Instruments - 0.9%
4,000,000 B/B1 SCI Systems, Inc., 3.0%, 3/15/07 $ 3,855,000
-------------
Total Information Technology $ 3,855,000
-------------
TOTAL CONVERTIBLE BONDS & NOTES
(Cost $6,001,443) $ 6,667,500
-------------
MUNICIPAL BONDS - 8.5% of Net Assets
Florida - 1.2%
4,800,000 NR/NR Capital Tribal Agency Rev., Seminole Tribe, 10.0%,
10/1/33 $ 5,395,968
-------------
The accompanying notes are an integral part of these financial statements.
15
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/05 (continued)
--------------------------------------------------------------------------------
Principal S&P/Moody's
Amount Ratings
USD ($) (unaudited) Value
Indiana - 3.0%
1,650,000 BB+/Ba3 East Chicago Industrial Pollution Ctl. Rev., 7.0%,
1/1/14 $ 1,740,750
3,000,000 BB+/Ba3 East Chicago Industrial Pollution Ctl. Rev., 7.125%,
6/1/07 3,191,850
3,665,000 BB+/Ba3 Indiana Dev. Fin. Auth. Pollution Ctl. Rev., 7.25%,
11/1/11 3,887,099
4,250,000 BB+/Ba3 Indiana Dev. Fin. Auth. Rev., 5.75%, 10/1/11 4,470,745
-------------
$ 13,290,444
-------------
Michigan - 0.6%
3,000,000 NR/NR Wayne Charter County, Spl. Arpt. Facs. Rev.,
6.75%, 12/1/15 $ 2,614,950
-------------
New Jersey - 1.9%
4,525,000 B/Caa2 New Jersey Economic Dev. Auth. Rev., 7.0%,
11/15/30 $ 3,899,645
4,000,000 BBB/Baa3 Tobacco Settlement Financing Corp., 7.0%,
6/1/41 4,284,160
-------------
$ 8,183,805
-------------
New York - 0.9%
3,475,000 BB-/Ba2 New York City Ind. Dev. Agcy., British Airways Plc
Proj., 7.625%, 12/1/32 $ 3,636,344
-------------
North Carolina - 0.9%
4,800,000 NR/NR Charlotte, Spl. Facs. Rev., Charlotte/Douglas Int'l
Airport, 5.60%, 7/1/27 $ 2,490,000
2,000,000 NR/NR Charlotte, Spl. Facs. Rev., Charlotte/Douglas Int'l
Airport, 7.75%, 2/1/28 1,400,000
-------------
$ 3,890,000
-------------
TOTAL MUNICIPAL BONDS
(Cost $30,560,368) $ 37,011,511
-------------
SOVEREIGN DEBT OBLIGATIONS - 2.0% of Net Assets
Brazil - 0.8%
ITL 4,800,000,000 BB-/Ba1 Banco Nacional de Desenvolimento Bndes, 8.0%,
4/28/10 $ 3,274,178
-------------
Ecuador - 0.7%
3,515,000 BB-/Caa1 Federal Republic of Ecuador, 8.0%, 8/15/30 (144A) $ 3,163,500
-------------
Russia - 0.5%
2,320,000 BBB-/Baa3 Russian Federation, 5.0%, 3/31/30 $ 2,383,800
-------------
TOTAL SOVEREIGN DEBT OBLIGATIONS
(Cost $5,950,277) $ 8,821,478
-------------
The accompanying notes are an integral part of these financial statements.
16
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
S&P/Moody's
Ratings
Shares (unaudited) Value
TEMPORARY CASH INVESTMENTS - 5.3% of Net Assets
Security Lending Collateral - 5.3%
23,215,401 Securities Lending Investment Fund, 2.74% $ 23,215,401
-------------
TOTAL TEMPORARY CASH INVESTMENTS
(Cost $23,215,401) $ 23,215,401
-------------
TOTAL INVESTMENTS IN SECURITIES - 137.7%
(Cost $556,275,369) (b)(c) $ 603,478,519
-------------
OTHER ASSETS AND LIABILITIES - (3.2)% $ (14,159,295)
-------------
PREFERRED SHARES AT REDEMPTION VALUE,
INCLUDING DIVIDENDS PAYABLE - (34.5)% $(151,015,820)
-------------
NET ASSETS APPLICABLE TO COMMON
SHAREOWNERS - 100.0% $ 438,303,404
=============
NR Security not rated by S&P or Moody's.
(144A) Security is exempt from registration under Rule 144A of the Securities
Act of 1933. Such securities may be resold normally to qualified
institutional buyers in a transaction exempt from registration. At March
31, 2005, the value of these securities amounted to $154,844,788 or 35.3%
of total net assets applicable to common shareowners.
(a) Indicates a security that has a zero coupon that remains in effect until
a predetermined date at which time the stated coupon rate becomes
effective until final maturity.
(b) At March 31, 2005, the net unrealized gain on investments based on cost
for federal income tax purposes of $556,633,123 was as follows:
Aggregate gross unrealized gain for all investments in which there is an excess of
value over tax cost $ 52,999,492
Aggregate gross unrealized loss for all investments in which there is an excess of
tax cost over value (6,154,096)
------------
Net unrealized gain $ 46,845,396
============
For financial reporting purposes net unrealized gain was $47,203,150 cost
of investments aggregated $556,275,369.
The accompanying notes are an integral part of these financial statements.
17
Pioneer High Income Trust
--------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS 3/31/05 (continued)
--------------------------------------------------------------------------------
(c) Distribution of investments by country of issue, as a percentage of total holdings,
is as follows:
United States 78.2%
Canada 3.6
Norway 3.1
Brazil 2.7
France 2.4
Australia 1.6
Mexico 1.6
Romania 1.0
Turkey 1.0
Russia 1.0
Germany 0.9
Great Britain 0.6
Netherlands 0.6
Ecuador 0.5
Ireland 0.5
Chile 0.4
Sweden 0.3
-----
100.0%
=====
(d) At March 31, 2005, the following securities were out on loan:
Principal
Amount Description Market Value
------------------------------------------------------------------------------------------
$1,961,750 AMR Corp., 9.0%, 8/1/12 $ 1,481,121
983,000 CP Ships, Ltd., 10.375%, 7/15/12 1,123,077
4,702,250 Hanger Orthopedic Group, Inc., 10.375%, 2/15/09 4,666,983
2,755,000 Lucent Technologies, Inc., 7.25%, 7/15/06 2,816,988
3,681,250 Northwest Airlines, Inc., 9.875%, 3/15/07 2,742,531
950,000 Resolution Performance Products LLC, 13.5%, 11/15/10 1,026,000
2,375,000 Rural Cellular Corp., 9.75%, 1/15/10 2,173,125
3,695,500 Shaw Group, Inc., 10.75%, 3/15/10 4,009,618
2,395,000 United Rentals North America, Inc., 7.75%, 11/15/13 2,323,150
-----------
$22,362,593
===========
Note: Principal amounts are denominated in U.S. dollars unless otherwise
denoted.
EURO Euro
ITL Italian Lira
NOK Norwegian Krone
Purchases and sales of securities (excluding temporary cash investments) for
the year ended March 31, 2005, aggregated $307,663,168 and $310,828,354,
respectively.
The accompanying notes are an integral part of these financial statements.
18
Pioneer High Income Trust
--------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES 3/31/05
--------------------------------------------------------------------------------
ASSETS:
Investments in securities, at value (including securities loaned
of $22,362,593) (cost $556,275,369) $603,478,519
Receivables -
Investment securities sold 4,683,031
Interest and foreign tax reclaim 12,310,636
Forward foreign currency portfolio hedge contract - net 48,185
Prepaid expenses and other assets 74,081
------------
Total assets $620,594,452
------------
LIABILITIES:
Payables -
Investment securities purchased $ 3,290,102
Upon return of securities loaned 23,215,401
Due to custodian - foreign currencies, at value
(cost $2,839,035) 2,845,602
Due to custodian 1,487,308
Due to affiliate 304,713
Accrued expenses 132,102
------------
Total liabilities $ 31,275,228
------------
PREFERRED SHARES AT REDEMPTION VALUE:
$25,000 liquidation value per share applicable to 6,040
shares, including dividends payable of $15,820 $151,015,820
------------
NET ASSETS APPLICABLE TO COMMON SHAREOWNERS:
Paid-in capital $381,698,634
Undistributed net investment income 2,683,678
Accumulated net realized gain on investments 6,668,417
Net unrealized gain on investments 47,203,150
Net unrealized gain on forward foreign currency contracts and
other assets and liabilities denominated in foreign currencies 49,525
------------
Net assets applicable to common shareowners $438,303,404
============
NET ASSET VALUE PER SHARE:
No par value (unlimited number of shares authorized)
Based on $438,303,404/26,823,948 common shares $ 16.34
============
The accompanying notes are an integral part of these financial statements.
19
Pioneer High Income Trust
--------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
--------------------------------------------------------------------------------
For the Year Ended 3/31/05
INVESTMENT INCOME:
Interest $54,295,775
Dividends 12,014
Income from securities loaned, net 183,924
-----------
Total investment income $54,491,713
-----------
EXPENSES:
Management fees $ 3,501,075
Transfer agent fees and expenses 64,851
Administrative reimbursements 80,510
Auction agent fees 405,012
Custodian fees 90,501
Registration fees 23,967
Professional fees 72,759
Printing expense 28,695
Trustees' fees 14,635
Miscellaneous 59,611
-----------
Total expenses $ 4,341,616
-----------
Net investment income $50,150,097
-----------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) from:
Investments $12,577,507
Forward foreign currency contracts and other assets
and liabilities denominated in foreign currencies (1,324,740) $11,252,767
----------- -----------
Change in net unrealized gain (loss) on:
Investments $(6,548,333)
Forward foreign currency contracts and other assets
and liabilities denominated in foreign currencies (431,404) $(6,979,737)
----------- -----------
Net gain on investments and foreign
currency transactions $ 4,273,030
-----------
DIVIDENDS AND DISTRIBUTIONS TO PREFERRED
SHAREOWNERS FROM:
Net investment income $(2,727,375)
Net realized gains (79,055)
-----------
Total distributions $(2,806,430)
-----------
Net increase in net assets applicable to common
shareowners resulting from operations $51,616,697
===========
The accompanying notes are an integral part of these financial statements.
20
Pioneer High Income Trust
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
--------------------------------------------------------------------------------
For the Years Ended 3/31/05 and 3/31/04
Year Ended Year Ended
3/31/05 3/31/04
FROM OPERATIONS:
Net investment income $ 50,150,097 $ 47,304,411
Net realized gain on investments and foreign
currency transactions 11,252,767 20,354,640
Net unrealized gain (loss) on investments and
foreign currency transactions (6,979,737) 52,659,636
Dividends and distributions to preferred
shareowners from:
Net investment income (2,727,375) (1,565,017)
Net realized gains (79,055) -
------------ ------------
Net increase in net assets applicable to common
shareowners resulting from operations $ 51,616,697 $118,753,670
------------ ------------
DIVIDENDS AND DISTRIBUTIONS TO COMMON
SHAREOWNERS FROM:
Net investment income ($1.65 and $1.65 per share,
respectively) $(44,211,566) $(44,088,258)
Net realized capital gains ($0.13 and $0.00 per
share, respectively) (3,558,745) -
------------ ------------
Total distributions to common shareowners $(47,770,311) $(44,088,258)
------------ ------------
FROM TRUST SHARE TRANSACTIONS:
Reinvestment of distributions $ 900,543 $ 1,434,661
Preferred share offering costs charged to
paid-in capital - (666,972)
------------ ------------
Net increase in net assets applicable to
common shareowners resulting from Trust
share transactions $ 900,543 $ 767,689
------------ ------------
Net increase in net assets applicable to
common shareowners $ 4,746,929 $ 75,433,101
NET ASSETS APPLICABLE TO COMMON SHAREOWNERS:
Beginning of year 433,556,475 358,123,374
------------ ------------
End of year (including undistributed (distributions in
excess of) net investment income of $2,683,678
and $(585,108), respectively) $438,303,404 $433,556,475
============ ============
The accompanying notes are an integral part of these financial statements.
21
Pioneer High Income Trust
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
Year Year 4/25/02(b)
Ended Ended to
3/31/05 3/31/04 3/31/03
Per Common Share Operating Performance
Net asset value, beginning of period $ 16.20 $ 13.43 $ 14.33(c)
-------- -------- --------
Increase (decrease) from investment operations:(a)
Net investment income $ 1.87 $ 1.77 $ 1.41
Net realized and unrealized gain (loss) on investments and
foreign currency transactions 0.15 2.73 (0.81)
Dividends and distributions to preferred shareowners:
Net investment income (0.10) (0.06) (0.04)
Net realized gains -(d) - -
-------- --------- --------
Net increase from investment operations $ 1.92 $ 4.44 $ 0.56
Dividends and distributions to common shareowners:
Net investment income (1.65) (1.65) (1.38)
Net realized gains (0.13) - -
Changes in (estimated) offering costs charged to paid-in capital
with respect to issuance of:
Common shares - - (0.03)
Preferred shares - (0.02) (0.05)
-------- -------- --------
Net increase (decrease) in net asset value $ 0.14 2.77 $ (0.90)
-------- -------- --------
Net asset value, end of period(e) $ 16.34 $ 16.20 $ 13.43
-------- -------- --------
Market value, end of period(e) $ 15.12 $ 16.57 $ 14.49
======== ======== ========
Total return(f) 1.97% 27.33% 7.29%
Ratios to average net assets of common shareowners
Net expenses(g) 1.00% 0.96% 0.87%(h)
Net investment income before preferred share dividends(g) 11.60% 11.64% 11.62%(h)
Preferred share dividends 0.63% 0.39% 0.37%(h)
Net investment income available to common shareowners 10.97% 11.25% 11.25%(h)
Portfolio turnover 54% 66% 49%
Net assets of common shareowners, end of period (in thousands) $438,303 $433,556 $358,123
Preferred shares outstanding (in thousands) $151,000 $151,000 $101,000
Asset coverage per preferred share, end of period $ 97,569 $ 96,781 $113,647
Average market value per preferred share $ 25,000 $ 25,000 $ 25,000
Liquidation value, including dividends payable, per preferred share $ 25,003 $ 25,000 $ 25,003
Ratios to average net assets of common shareowners before
reimbursement of organization expenses
Net expenses(g) 1.00% 0.96% 0.88%(h)
Net investment income before preferred share dividends(g) 11.60% 11.64% 11.61%(h)
Preferred share dividends 0.63% 0.39% 0.37%(h)
Net investment income available to common shareowners 10.97% 11.25% 11.24%(h)
(a) The per common share data presented above is based upon the average common
shares outstanding for the periods presented.
(b) Trust shares were first publicly offered on April 26, 2002.
(c) Net asset value immediately after the closing of the first public offering
was $14.30.
(d) Amount is less than $0.01 per common share.
(e) Net asset value and market value are published in Barron's on Saturday, The
Wall Street Journal on Monday and The New York Times on Monday and
Saturday.
(f) Total investment return is calculated assuming a purchase of common shares
at the current market value on the first day and a sale at the current
market value on the last day of the periods reported. Dividends and
distributions, if any, are assumed for purposes of this calculation to be
reinvested at prices obtained under the Trust's dividend reinvestment plan.
Total investment return does not reflect brokerage commissions. Total
investment returns less than a full period are not annualized. Past
performance is not a guarantee of future results.
(g) Ratios do not reflect the effect of dividend payments to preferred
shareowners.
(h) Annualized.
The information above represents the audited operating performance data for a
share of common stock outstanding, total investment return, ratios to average
net assets of common shareowners and other supplemental data for the periods
indicated. This information has been determined based upon financial
information provided in the financial statements and market value data for the
Trust's common shares.
The accompanying notes are an integral part of these financial statements.
22
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/05
--------------------------------------------------------------------------------
1. Organization and Significant Accounting Policies
Pioneer High Income Trust (the "Trust") was organized as a Delaware statutory
trust on January 30, 2002. Prior to commencing operations on April 25, 2002, the
Trust had no operations other than matters relating to its organization and
registration as a diversified, closed-end management investment company under
the Investment Company Act of 1940, as amended.
The Trust invests in below investment grade (high-yield) debt securities and
preferred stocks. These high-yield securities may be convertible into equity
securities of the issuer. Debt securities rated below investment grade are
commonly referred to as "junk bonds" and are considered speculative. These
securities involve greater risk of loss, are subject to greater price
volatility, and are less liquid, especially during periods of economic
uncertainty or change, than higher rated debt securities.
The Trust's financial statements have been prepared in conformity with U.S.
generally accepted accounting principles that require the management of the
Trust to, among other things, make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of contingent assets
and liabilities at the date of the financial statements, and the reported
amounts of income, expenses and gains and losses on investments during the
reporting year. Actual results could differ from those estimates. The following
is a summary of significant accounting policies followed by the Trust in the
preparation of its financial statements, which are consistent with those
policies generally accepted in the investment company industry:
A. Security Valuation
Security transactions are recorded as of trade date. Equity securities are
valued at the last sales price on the principal exchanges where they are
traded. Fixed income securities are valued at prices supplied by independent
pricing services, which consider such factors as Treasury spreads, yields,
maturities and ratings. Valuations may be supplemented by dealers and other
sources, as required. Securities for which market quotations are not readily
available are valued at their fair values as determined by, or under the
direction of, the Board of Trustees. Trading in foreign securities is
substantially completed each day at various times prior to the
23
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/05 (continued)
--------------------------------------------------------------------------------
close of the NYSE. The values of such securities used in computing the net
asset value of the Trust's shares are determined as of such times. The Trust
may also use the fair value of a security, including a non-U.S. security,
when the closing market price on the primary exchange where the security is
traded no longer accurately reflects the value of the security as of the
close of the exchange. As of March 31, 2005, the Trust had no fair valued
securities. Temporary cash investments are valued at amortized cost.
Dividend income is recorded on the ex-dividend date, except that certain
dividends from foreign securities where the ex-dividend date may have passed
are recorded as soon as the Trust becomes aware of the ex-dividend data in
the exercise of reasonable diligence. Discount and premium on debt securities
are accreted or amortized daily, respectively, on an effective yield to
maturity basis and are included in interest income. Premiums and discounts
related to certain mortgage-backed securities are amortized or accreted in
proportion to the underlying monthly paydowns. Interest income, including
income on interest bearing cash accounts, is recorded on an accrual basis.
The Trust's investments in foreign markets or countries with limited
developing markets may subject the Trust to a greater degree of risk than in
a developed market. These risks include disruptive political or economic
conditions and the possible imposition of adverse governmental laws or
currency exchange restrictions.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
B. Foreign Currency Translation
The books and records of the Trust are maintained in U.S. dollars. Amounts
denominated in foreign currencies are translated into U.S. dollars using
current exchange rates.
Net realized gains and losses on foreign currency transactions represent,
among other things, the net realized gains and losses on foreign currency
contracts, disposition of foreign currencies and the difference between the
amount of income accrued and the U.S. dollars actually received. Further, the
effects of changes in foreign currency exchange rates on investments are not
segregated in the
24
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
statement of operations from the effects of changes in market price of those
securities but are included with the net realized and unrealized gain or loss
on investments.
C. Forward Foreign Currency Contracts
The Trust enters into forward foreign currency contracts (contracts) for the
purchase or sale of a specific foreign currency at a fixed price on a future
date as a hedge or cross-hedge against either specific investment
transactions (settlement hedges) or portfolio positions (portfolio hedges).
All contracts are marked to market daily at the applicable exchange rates,
and any resulting unrealized gains or losses are recorded in the Trust's
financial statements. The Trust records realized gains and losses at the time
a portfolio hedge is offset by entry into a closing transaction or
extinguished by delivery of the currency. Risks may arise upon entering into
these contracts from the potential inability of counterparties to meet the
terms of the contract and from unanticipated movements in the value of
foreign currencies relative to the U.S. dollar (see Note 4).
D. Federal Income Taxes
It is the Trust's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its taxable income and net realized capital gains, if any, to its
shareowners. Therefore, no federal income tax provision is required.
The amounts and characterizations of distributions to shareowners for
financial reporting purposes are determined in accordance with federal income
tax rules. Therefore, the source of the Trust's distributions may be shown in
the accompanying financial statements as either from or in excess of net
investment income or net realized gain on investment and foreign currency
transactions, or from paid-in capital, depending on the type of book/tax
differences that may exist.
At March 31, 2005, the Trust reclassified $57,630 to increase undistributed
net investment income and to decrease accumulated net realized gain on
investments. The reclassification has no impact on the net asset value of the
Trust and presents the Trust's capital accounts on a tax basis.
25
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/05 (continued)
--------------------------------------------------------------------------------
The tax character of current year distributions paid to common and
preferred shareowners during the years ended March 31, 2005 and March 31,
2004 was as follows:
--------------------------------------------------------------------------------
2005 2004
Distributions paid from:
Ordinary Income $48,778,440 $45,653,275
Net long-term capital gains 1,798,301 -
----------- -----------
Total taxable distribution $50,576,741 $45,653,275
=========== ===========
--------------------------------------------------------------------------------
The following shows components of distributable earnings on a federal income
tax basis at March 31, 2005.
--------------------------------------------------------------------------------
Undistributed ordinary income $ 7,839,430
Long-term capital gain 5,722,883
Dividend Payable (15,820)
Unrealized appreciation 43,058,277
-----------
Total $56,604,770
===========
--------------------------------------------------------------------------------
The difference between the unrealized appreciation on a book-basis of
$47,252,675 shown on the Statement of Assets and Liabilities and tax-basis
unrealized appreciation of $43,058,277 shown above is primarily attributable
to the tax deferral of losses on straddles, the realization for tax purposes
of unrealized gains on certain foreign currency contracts, and the difference
between book and tax amortization methods for premiums and discounts on fixed
income securities.
E. Repurchase Agreements
With respect to repurchase agreements entered into by the Trust, the value of
the underlying securities (collateral), including accrued interest received
from counterparties, is required to be at least equal to or in excess of the
repurchase agreement at the time of purchase. The collateral for all
repurchase agreements is held in safekeeping in the customer-only account of
the Trust's custodian, or subcustodians. Pioneer Investment Management, Inc.
("PIM"), the Trust's investment adviser is responsible for determining that
the value of the collateral remains at least equal to the repurchase price.
26
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
F. Securities Lending
The Trust lends securities in its portfolio to certain broker-dealers or
other institutional investors, with the Trust's custodian acting as the
lending agent. When entering into a loan, the Trust receives collateral which
is maintained by the custodian and earns income in the form of negotiated
lenders' fees. The Trust also continues to receive interest or payments in
lieu of dividends on the securities loaned. Unrealized gain or loss on the
fair value of the loaned securities that may occur during the term of the
loan will be for the account of the Trust. The loans are secured by
collateral of at least 102%, at all times, of the fair value of the
securities loaned. The amount of the collateral will be adjusted daily to
reflect any price fluctuation in the value of the loaned securities. The
Trust has the right under the securities lending arrangement to recover the
securities on loan from the borrower on demand. The Trust invests cash
collateral in the Securities Lending Investment Fund which is managed by
Brown Brothers Harriman & Co., the Trust's custodian.
G. Automatic Dividend Reinvestment Plan
All common shareowners automatically participate in the Automatic Dividend
Reinvestment Plan (the "Plan"), under which participants receive all
dividends and capital gain distributions (collectively, "dividends") in full
and fractional common shares of the Trust in lieu of cash. Shareowners may
elect not to participate in the Plan. Shareowners not participating in the
Plan receive all dividends and capital gain distributions in cash.
Participation in the Plan is completely voluntary and may be terminated or
resumed at any time by notifying Mellon Investor Services LLC, the agent for
shareowners in administering the Plan (the "Plan Agent"), prior to any
dividend record date; otherwise such termination or resumption will be
effective with respect to any subsequently declared dividend or other
distribution. Whenever the Trust declares a dividend on common shares payable
in cash, participants in the Plan will receive the equivalent in common
shares acquired by the Plan Agent either (i) through receipt of additional
unissued but authorized common shares from the Trust or (ii) by purchase of
outstanding common shares on the New York Stock Exchange or elsewhere. If, on
the payment date for any dividend the net asset value per common share is
equal to or less than the market price per share plus
27
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/05 (continued)
--------------------------------------------------------------------------------
estimated brokerage trading fees ("market premium"), the Plan Agent will
invest the dividend amount in newly issued common shares. The number of newly
issued common shares to be credited to each account will be determined by
dividing the dollar amount of the dividend by the net asset value per common
share on the date the shares are issued, provided that the maximum discount
from the then current market price per share on the date of issuance does not
exceed 5%. If, on the payment date for any dividend, the net asset value per
common share is greater than the market value ("market discount"), the Plan
Agent will invest the dividend amount in common shares acquired in
open-market purchases. There are no brokerage charges with respect to newly
issued common shares. However, each participant will pay a pro rata share of
brokerage trading fees incurred with respect to the Plan Agent's open-market
purchases. Participating in the Plan does not relieve shareowners from any
federal, state or local taxes, which may be due on dividends paid in any
taxable year. Shareowners holding Plan shares in a brokerage account may not
be able to transfer the shares to another broker and continue to participate
in the Plan.
2. Management Agreement
PIM, a wholly owned indirect subsidiary of Unicredito Italiano S.p.A.
("Unicredito Italiano") manages the Trust's portfolio. Management fees are
calculated weekly at the annual rate of 0.60% of the Trust's average weekly
managed assets. "Managed assets" is the average weekly value of the Trust's
total assets minus the sum of the Trust's liabilities, which liabilities
exclude debt related to leverage, short-term debt and the aggregate liquidation
preference of any outstanding preferred shares. At March 31, 2005, $304,713 was
payable to PIM related to management fees.
In addition, under PIM's management and administration agreements, certain
other services and costs are paid by PIM and reimbursed by the Trust. For the
year ended March 31, 2005, the Trust recorded $80,510 as "Administrative
reimbursements" on the statement of operations.
PIM has retained Princeton Administrators, L.P., an affiliate of Merrill Lynch,
Pierce, Fenner & Smith Incorporated, to provide certain administrative services
to the Trust on its behalf. PIM pays Princeton Administrators, L.P., a monthly
fee at an annual rate of 0.07% of the average weekly value of the Trust's
managed assets, subject to a
28
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
minimum monthly fee of $10,000. Princeton Administrators, L.P. receives no
compensation directly from the Trust.
3. Transfer Agents
Pioneer Investment Management Shareholder Services, Inc. ("PIMSS"), a wholly
owned indirect subsidiary of UniCredito Italiano, through a sub-transfer agency
agreement with Mellon Investor Services LLC, provides substantially all
transfer agent and shareowner services related to the Trust's common shares at
negotiated rates which are paid by the Trust. Deutsche Bank Trust Company
Americas is the transfer agent, registrar, dividend paying agent and redemption
agent with respect to the Trust's Auction Market Preferred Shares ("AMPS"). The
Trust pays Deutsche Bank Trust Company Americas an annual fee, as is agreed to
from time to time by the Trust and Deutsche Bank Trust Company Americas, for
providing such services.
4. Forward Foreign Currency Contracts
During the year ended March 31, 2005, the Trust had entered into contracts that
obligate the Trust to deliver currencies at specified future dates. At the
maturity of a contract, the Trust must make delivery of the foreign currency.
Alternatively, prior to the settlement date of contracts, the Trust may close
out such contracts by entering into an offsetting hedge contract.
Open portfolio hedges at March 31, 2005 were as follows:
--------------------------------------------------------------------------------
Net Net
Contracts In Exchange Settlement Unrealized
Currency to Deliver For Date Value Gain
-------- ---------- --- ---- ----- ----
EURO 23,500,000 $30,606,400 4/26/05 $30,558,215 $48,185
--------------------------------------------------------------------------------
As of March 31, 2005, the Trust had no outstanding forward currency settlement
hedges.
5. Trust Shares
There are an unlimited number of common shares of beneficial interest
authorized. Of the 26,823,948 common shares of beneficial interest outstanding
at March 31, 2005 PIM owned 6,981 shares.
29
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/05 (continued)
--------------------------------------------------------------------------------
Transactions in common shares of beneficial interest for the years ended March
31, 2005 and March 31, 2004 were as follows:
--------------------------------------------------------------------------------
3/2005 3/2004
Shares outstanding at beginning of year 26,768,347 26,674,075
Reinvestment of distributions 55,601 94,272
---------- ----------
Shares outstanding at end of year 26,823,948 26,768,347
========== ==========
--------------------------------------------------------------------------------
The Trust may classify or reclassify any unissued common shares of beneficial
interest into one or more series of preferred shares of beneficial interest. As
of March 31, 2005, there were 6,040 AMPS as follows: Series M7-2,020, Series
W28-2,020 and Series TH7-2,000.
Dividends on Series M7 AMPS and Series TH7 AMPS are cumulative at a rate, which
is reset every seven days based on the results of an auction. Dividends on
Series W28 AMPS are also cumulative at a rate reset every 28 days based on the
results of an auction. Dividend rates ranged from 1.03% to 2.95% during the year
ended March 31, 2005.
The Trust may not declare dividends or make other distributions on its common
shares or purchase any such shares if, at the time of the declaration,
distribution or purchase, asset coverage with respect to the outstanding
preferred shares would be less than 200%.
The AMPS are redeemable at the option of the Trust, in whole or in part, on any
dividend payment date at $25,000 per share plus any accumulated or unpaid
dividends, whether or not declared. The AMPS are also subject to mandatory
redemption at $25,000 per share plus any accumulated or unpaid dividends,
whether or not declared, if certain requirements relating to the composition of
the assets and liabilities of the Trust as set forth in the Agreement and
Declaration of Trust are not satisfied.
The holders of AMPS have voting rights equal to the holders of the Trust's
common shares (one vote per share) and will vote together with holders of the
common shares as a single class. However, holders of AMPS are also entitled to
elect two of the Trust's Trustees. In addition, the Investment Company Act of
1940, as amended, requires that along with approval by shareowners that might
otherwise be required, the approval of the holders of a majority of any
outstanding
30
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
preferred shares, voting separately as a class would be required to (a) adopt
any plan of reorganization that would adversely affect the preferred shares and
(b) take any action requiring a vote of security holders, including, among other
things, changes in the Trust's subclassification as a closed-end management
investment company or changes in its fundamental investment restrictions.
6. Subsequent Events
Subsequent to March 31, 2005, the Board of Trustees of the Trust declared a
dividend from undistributed net investment income of $0.1375 per common share
payable April 29, 2005, to shareowners of record on April 15, 2005.
For the period April 1, 2005 to April 30, 2005, dividends declared on preferred
shares totaled $366,087 in aggregate for the three outstanding preferred share
series.
ADDITIONAL INFORMATION (unaudited)
During the period, there have been no material changes in the Trust's
investment objective or fundamental policies that have not been approved by the
shareowners. There have been no changes in the Trust's charter or By-Laws that
would delay or prevent a change in control of the Trust which have not been
approved by the shareowners. There have been no changes in the principal risk
factors associated with investment in the Trust. There have been no changes in
the persons who are primarily responsible for the day-to-day management of the
Trust's portfolio.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Trust may purchase, from time to time, its common
shares in the open market.
31
Pioneer High Income Trust
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS 3/31/05 (continued)
--------------------------------------------------------------------------------
IMPORTANT TAX INFORMATION (unaudited)
The Pioneer High Income Trust paid a long-term capital gain distribution of
$0.064136 per share to common shareholders of record on December 13, 2004.
Additionally, the following summarizes the long-term capital gain distributions
paid to preferred shareholders during the year:
--------------------------------------------------------------------------------
Payable Date Long-Term Capital Gain
--------------------------------------------------------------------------------
Series M 12/14/2004 $ 9.77
Series M 12/21/2004 $ 3.20
Series W 12/30/2004 $12.76
Series TH 12/10/2004 $10.21
Series TH 12/17/2004 $ 3.33
--------------------------------------------------------------------------------
32
Pioneer High Income Trust
--------------------------------------------------------------------------------
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
--------------------------------------------------------------------------------
To the Board of Trustees and Shareowners
of Pioneer High Income Trust:
We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of Pioneer High Income Trust (the "Trust") as of
March 31, 2005, and the related statement of operations for the year then ended,
the statements of changes in net assets for each of the two years in the period
then ended, and the financial highlights for each of the three years in the
period then ended. These financial statements and financial highlights are the
responsibility of the Trust's 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. We were
not engaged to perform an audit of the Trust's internal control over financial
reporting. 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 Trust's 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 March 31, 2005, 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
Pioneer High Income Trust at March 31, 2005, the results of its operations for
the year then ended, the changes in its net assets for each of the two years in
the period then ended, and the financial highlights for each of the three years
in the period then ended, in conformity with U.S. generally accepted accounting
principles.
/s/ Ernst & Young LLP
Boston, Massachusetts
May 17, 2005
33
Pioneer High Income Trust
--------------------------------------------------------------------------------
RESULTS OF SHAREOWNER MEETING
--------------------------------------------------------------------------------
On November 10, 2004, Pioneer High Income Trust held its annual meeting of
shareowners to elect Trustees. All Trustees were elected. Here are the detailed
results of the votes.
Proposal 1 - To elect Class II Trustees.
--------------------------------------------------------------------------------
Nominee Affirmative Withheld
--------------------------------------------------------------------------------
John F. Cogan, Jr. 3,473 2
Dr. R.H. Egdahl 20,753,573 229,554
Stephen K. West 20,754,782 228,345
--------------------------------------------------------------------------------
34
Pioneer High Income Trust
--------------------------------------------------------------------------------
FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT
--------------------------------------------------------------------------------
The Investment Company Act of 1940 requires that the Board of Trustees and a
majority of the Independent Trustees (collectively the "Trustees") voting
separately annually approve the Trust's Management Contract (the "Management
Contract"). The Trustees have determined that the terms of the Management
Contract are fair and reasonable and that renewal of the contract will enable
the Trust to receive quality investment advisory services at a cost deemed
reasonable and is in the best interests of the Trust and its shareowners. In
making such determinations, the Independent Trustees relied upon the assistance
of counsel to the Independent Trustees and counsel to the Trust.
Throughout the year, the Independent Trustees regularly met in executive
sessions separately from the Interested Trustees of the Trust and any officers
of Pioneer Investment Management, Inc., the Trust's adviser (the "Investment
Adviser"), or its affiliates. While the Trustees, including the Independent
Trustees, act on all major matters relating to the Trust, a significant portion
of the activities of the Board of Trustees (including certain of those described
herein) is conducted through committees whose members are comprised exclusively
of Independent Trustees. Such committee meetings are attended by officers of the
Trust or the Investment Adviser to the extent requested by the committee.
In evaluating the Management Contract, the Trustees conducted a review that was
specifically focused upon the renewal of the Management Contract, and also
relied upon their knowledge, resulting from their meetings throughout the year,
of the Investment Adviser, its services and the Trust. Both in meetings
specifically addressed to renewal of the Management Contract and at other
meetings during the course of the year, the Trustees, including the Independent
Trustees, received materials relating to the Investment Adviser's investment and
management services under the Management Contract. These materials included
information on (i) the investment performance of the Trust, a peer group of
funds and two relevant indices, in each case selected by the Independent
Trustees for this purpose, (ii) the general investment outlook in the markets in
which the Trust invests, (iii) the procedures employed to determine the value of
each of the Trust's assets, (iv) the Investment Adviser's management of the
relationships with the Trust's unaffiliated service providers, (v) the record of
compliance with the Trust's investment policies and restrictions and with the
Trust's Code of Ethics and the structure and responsibilities of the
35
Pioneer High Income Trust
--------------------------------------------------------------------------------
FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT (continued)
--------------------------------------------------------------------------------
Investment Adviser's compliance department, (vi) the nature, cost and character
of non-investment management services provided by the Investment Adviser and its
affiliates, (vii) the disclosures included in the Trust's reports to
shareowners, and (viii) analyses of the benefits and costs of the use of
leverage through the issuance of the Trust's preferred shares and the
sensitivity of such analysis to changes in interest rates.
Specifically in connection with the Independent Trustees' review of the
Management Contract, the Independent Trustees requested and the Investment
Adviser provided additional information in order to evaluate the quality of the
Investment Adviser's services and the reasonableness of the fee under the
Management Contract. Among other items, this information included data or
analyses of (1) investment performance for one year and life of the Trust
periods for the Trust and a peer group selected by the Independent Trustees for
this purpose, (2) management fees incurred by a peer group of funds selected by
the Independent Trustees for this purpose, (3) the advisory fees of comparable
portfolios of other clients of the Investment Adviser, (4) expense ratios for
the Trust and a peer group of funds selected by the Independent Trustees for
this purpose, (5) the overall organization of the Investment Adviser, (6) the
Investment Adviser's financial results and condition, including its and certain
of its affiliates profitability from services performed for the Trust, (7)
administrative reimbursements paid to the Investment Adviser or affiliates, (8)
investment management staffing, and (9) operating expenses paid to third
parties.
The following summarizes matters considered by the Trustees in connection with
their renewal of the Trust's Management Contract. The Trustees did not identify
any single factor as all-important or controlling, and the summary does not
detail all the matters that were considered.
A. Ancillary Benefits to Shareowners. The Trustees considered the benefits to
shareowners of investing in a closed-end fund that is part of an established
group of open and closed-end funds and which has a favorable reputation in
the secondary market for closed-end funds. The Trustees also noted that the
relationship of the market price relative to the Trust's net assets
attributed to its common shares was comparable relative to other closed-end
funds with similar investment approaches.
36
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
B. Compliance and Investment Performance. The Trustees determined that the
Investment Adviser had policies and systems reasonably designed to achieve
compliance with the Trust's investment objective and regulatory requirements.
The Trustees also reviewed the Trust's investment performance based on total
return, as well as the Trust's performance compared to both the performance
of a peer group and two relevant indices, in each case selected by the
Independent Trustees for this purpose. The Trust's performance based on total
return was in the third quintile of the peer group for the 12 months ended
June 30, 2004 and was in the second quintile from inception through June 30,
2004. (In all quintile rankings referred to throughout this discussion first
quintile is most favorable to the Trust's shareowners. Thus, highest relative
performance would be first quintile and lowest relative expenses also would
be first quintile.) The Trustees concluded that the performance of the Trust
supported the continuation of the Management Contract.
C. The Investment Adviser's Personnel and Methods. The Trustees reviewed the
background of members of the team responsible for the daily management of the
Trust and the Trust's investment objective and discipline. The Independent
Trustees also have had discussions with senior management of the Investment
Adviser responsible for investment operations and the senior management of
the Investment Adviser's fixed income group. Among other things, the Trustees
considered the number, education and experience of the Investment Adviser's
investment staff and their use of technology and emphasis on analytics in
view of the risk profile of securities in which the Trust invests. The
Trustees concluded that the Investment Adviser had the quality and depth of
personnel and the well-developed methods essential to performing its duties
under the Management Contract.
D. Nature and Quality of Other Services. The Trustees considered the nature,
quality, cost and extent of other services provided to shareowners of the
Trust, including administrative and shareowner services performed by the
Investment Adviser under the Management Contract. The Trustees also
considered the reasonableness of the arrangements for reimbursement of the
Investment Adviser's out-of-pocket costs and expenses, including overhead,
for certain administrative services that the Investment Adviser is not
required to provide under the Management Contract. The Trustees
37
Pioneer High Income Trust
--------------------------------------------------------------------------------
FACTORS CONSIDERED BY THE INDEPENDENT TRUSTEES IN
APPROVING THE MANAGEMENT CONTRACT (continued)
--------------------------------------------------------------------------------
also considered the nature and extent of the other services provided by the
Investment Adviser's affiliates under other contracts and its supervision of
third party service providers. Based on these considerations, the Trustees
concluded that the nature, quality, cost and extent of such services are
satisfactory and reliable and serve the shareowners of the Trust well.
E. Management Fee and Expenses. The Trustees considered the Investment Adviser's
fee under the Management Contract relative to the management fees charged by
a peer group of funds selected by the Independent Trustees for this purpose
using data provided by an independent third party. The Trust's management fee
for the 12 months ended June 30, 2004 was in the first quintile relative to
the management fees paid by the other funds in that peer group for the
comparable period. The Trustees determined that the fee under the Management
Contract was reasonable and fair in light of both the overall nature and
quality of services provided by the Investment Adviser and the fees charged
by the funds in the peer group. The Trustees also considered the Trust's
expense ratio and expense ratios of a peer group of funds selected by the
Independent Trustees for this purpose. The Trust's expense ratio for the 12
months ended June 30, 2004 was in the first quintile of the applicable peer
group for the most recent fiscal year of the peer group for the comparable
period. The Trustees concluded that the Trust's overall expense ratio was
lower than that of comparable funds.
F. Profitability. The Trustees considered the level of the Investment Adviser's
profits with respect to the management of the Pioneer funds, including
details with respect to the Trust. This consideration included a review of
the Investment Adviser's methodology in allocating certain of its costs to
the management of each fund. The Trustees also considered the financial
results realized by the Investment Adviser in connection with the operation
of the Trust. They further considered the profits realized by the Investment
Adviser and its affiliates from non-fund businesses that may benefit from or
be related to the Trust's business. The Trustees considered the Investment
Adviser's profit margins in comparison with the limited available industry
data. The Trustees concluded that the Investment Adviser's profits from
management of the Pioneer funds, including the financial results derived from
the Trust, bear a reasonable relationship to the services rendered and are
fair for
38
Pioneer High Income Trust
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
the management of the Trust in light of the business risks involved.
G. Economies of Scale. The Trustees considered whether the Trust has
appropriately benefited from any economies of scale, and whether there is
potential for realization of any further economies of scale. Since the Trust
is a closed-end fund and its size is relatively stable and at the level of
assets that was anticipated when the management fee was initially set, the
Trustees concluded that economies of scale were not a relevant consideration.
H. Other Benefits to the Investment Adviser. The Trustees also considered the
character and amount of fees paid by the Trust, other than under the
Management Contract, for services provided by the Investment Adviser and
affiliates. The Trustees further considered the revenues and profitability of
the Investment Adviser's businesses other than the fund business, including
the Investment Adviser's institutional investment advisory business. The
Trustees considered the intangible benefits that accrue to the Investment
Adviser and its affiliates by virtue of its relationship with the Trust and
the Pioneer funds as a group. The Trustees concluded that all these types of
benefits accruing to the Investment Adviser were reasonable in the context of
the overall relationship between the Investment Adviser and the Trust.
Conclusion. The Trustees, in light of the Investment Adviser's overall
performance, considered it appropriate to continue to retain the management
services of the Investment Adviser. Based on their evaluation of all material
factors deemed relevant and the advice of independent counsel, the Trustees
concluded that the Management Contract with the Trust is fair and reasonable and
voted to approve the continuation of the Management Contract for another year.
39
Pioneer High Income Trust
--------------------------------------------------------------------------------
THE PIONEER FAMILY OF MUTUAL FUNDS
--------------------------------------------------------------------------------
Please consider a fund's investment objectives, risks, charges and expenses
carefully before investing. The prospectus contains this and other information
about a fund and should be read carefully before you invest or send money. To
obtain a prospectus and for other information on any Pioneer fund, contact your
advisor, call 1-800-225-6292 or visit our web site at www.pioneerfunds.com.
U.S. Equity Pioneer Ibbotson Growth
Pioneer Fund Allocation Fund
Pioneer Balanced Fund Pioneer Ibbotson Aggressive
Pioneer Cullen Value Fund Allocation Fund
Pioneer Equity Income Fund
Pioneer Equity Opportunity Fund International/Global Equity
Pioneer Growth Opportunities Fund Pioneer Emerging Markets Fund
Pioneer Growth Shares Pioneer Europe Select Fund
Pioneer Mid Cap Growth Fund Pioneer Europe Fund
Pioneer Mid Cap Value Fund Pioneer International Equity Fund
Pioneer Oak Ridge Large Cap Pioneer International Value Fund
Growth Fund
Pioneer Oak Ridge Small Cap Fixed Income
Growth Fund Pioneer America Income Trust
Pioneer Papp America-Pacific Pioneer Bond Fund
Rim Fund Pioneer California Tax Free
Pioneer Papp Small and Mid Cap Income Fund
Growth Fund Pioneer Global High Yield Fund
Pioneer Papp Stock Fund Pioneer High Yield Fund
Pioneer Papp Strategic Pioneer Municipal Bond Fund
Growth Fund Pioneer Short Term Income Fund
Pioneer Real Estate Shares Pioneer Strategic Income Fund
Pioneer Research Fund Pioneer Tax Free Income Fund
Pioneer Small Cap Value Fund
Pioneer Small Company Fund Money Market
Pioneer Value Fund Pioneer Cash Reserves Fund*
Pioneer Tax Free Money
Asset Allocation Market Fund
Pioneer Ibbotson Moderate
Allocation Fund
* An investment in the Fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the Fund
seeks to preserve the value of your investment at $1.00 per share, it is
possible to lose money by investing in the Fund.
40
Pioneer High Income Trust
--------------------------------------------------------------------------------
TRUSTEES, OFFICERS AND SERVICE PROVIDERS
--------------------------------------------------------------------------------
Investment Adviser
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Independent Registered Public Accounting Firm
Ernst & Young LLP
Legal Counsel
Wilmer Cutler Pickering Hale and Dorr LLP
Transfer Agent
Pioneer Investment Management Shareholder Services, Inc.
Shareowner Services and Sub-Transfer Agent
Mellon Investor Services LLC
Preferred Share Auction/Transfer Agent and Registrar
Deutsche Bank Trust Company Americas
Sub-Administrator
Princeton Administrators, L.P.
Trustees and Officers
The Trust's Board of Trustees provides broad supervision over the Trust's
affairs. The officers of the Trust are responsible for the Trust's operations.
The Trust's Trustees and officers are listed below, together with their
principal occupations during the past five years. Trustees who are interested
persons of the Trust within the meaning of the Investment Company Act of 1940
are referred to as Interested Trustees. Trustees who are not interested persons
of the Trust are referred to as Independent Trustees. Each of the Trustees
serves as a trustee of each of the 80 U.S. registered investment portfolios for
which Pioneer Investment Management, Inc. ("Pioneer") serves as investment
adviser (the "Pioneer Funds"). The address for all Interested Trustees and all
officers of the Trust is 60 State Street, Boston, Massachusetts 02109.
The Trust's statement of additional information provides more detailed
information regarding the Trust's Trustees and is available upon request,
without charge, by calling 1-800-225-6292.
Proxy Voting Policies and Procedures of the Trust are available without charge,
upon request, by calling our toll free number (1-800-225-6292). Information
regarding how the Trust voted proxies relating to portfolio securities during
the most recent 12-month period ended June 30 is publicly available to
shareowners at www.pioneerfunds.com and on the SEC's web site at
http://www.sec.gov.
41
Pioneer High Income Trust
--------------------------------------------------------------------------------
INTERESTED TRUSTEES
--------------------------------------------------------------------------------
Positions Held Length of Service Principal Occupation During Other Directorships Held
Name and Age With the Trust and Term of Office Past Five Years by this Trustee
John F. Cogan, Jr. (78)* Chairman of the Trustee since 2002. Deputy Chairman and a Director of Chairman and Director
Board, Term expires in 2007. Pioneer Global Asset Management of ICI Mutual Insurance
Trustee and S.p.A. ("PGAM"); Non-Executive Company; Director of
President Chairman and a Director of Pioneer Harbor Global Company,
Investment Management USA Inc. Ltd.
("PIM-USA"); Chairman and a
Director of Pioneer; Director of
Pioneer Alternative Investment
Management Limited (Dublin);
President and a Director of Pioneer
Alternative Investment Management
(Bermuda) Limited and affiliated
funds; President and Director of
Pioneer Funds Distributor, Inc.
("PFD"); President of all of the
Pioneer Funds; and Of Counsel
(since 2000, partner prior to
2000), Wilmer Cutler Pickering Hale
and Dorr LLP (counsel to PIM-USA
and the Pioneer Funds).
*Mr. Cogan is an Interested Trustee because he is an officer or director of Pioneer and certain of its affiliates
-----------------------------------------------------------------------------------------------------------------------------------
Osbert M. Hood (52)** Trustee and Trustee since 2003. President and Chief Executive None
Executive Vice Term expires in 2005. Officer, PIM-USA since May 2003
President (Director since January 2001);
President and Director of Pioneer
since May 2003; Chairman and
Director of Pioneer Investment
Management Shareholder Services,
Inc. ("PIMSS") since May 2003;
Executive Vice President of all of
the Pioneer Funds since June 2003;
Executive Vice President and Chief
Operating Officer of PIM-USA,
November 2000 to May 2003;
Executive Vice President, Chief
Financial Officer and Treasurer,
John Hancock Advisers, L.L.C.,
Boston, MA, November 1999 to
November 2000; Senior Vice
President and Chief Financial
Officer, John Hancock Advisers,
L.L.C., April 1997 to November 1999
**Mr. Hood is an Interested Trustee because he is an officer or director of Pioneer and certain of its affiliates
-----------------------------------------------------------------------------------------------------------------------------------
42
Pioneer High Income Trust
--------------------------------------------------------------------------------
INDEPENDENT TRUSTEES
--------------------------------------------------------------------------------
Positions Held Length of Service Principal Occupation During Other Directorships Held
Name, Age and Address With the Trust and Term of Office Past Five Years by this Trustee
David R. Bock** (61) Trustee Trustee since 2005. Senior Vice President and Chief Director of The
3050 K. Street NW, Term expires in 2007. Financial Officer, I-trax, Inc. Enterprise Social
Washington, DC 20007 (publicly traded health care Investment Company
services company) (2001-present); (privately-held
Managing Partner, Federal City affordable housing
Capital Advisors (boutique finance company);
merchant bank) (1995-2000; 2002 Director of New York
to 2004); Executive Vice Mortgage Trust (publicly
President and Chief Financial traded mortgage REIT)
Officer, Pedestal Inc.
(internet-based mortgage trading
company) (2000-2002)
** Mr. Bock became a Trustee of the Trust on January 1, 2005.
-----------------------------------------------------------------------------------------------------------------------------------
Mary K. Bush (57) Trustee Trustee since 2002. President, Bush International Director of Brady
3509 Woodbine Street, Term expires in 2006. (international financial Corporation (industrial
Chevy Chase, MD 20815 advisory firm) identification and
specialty coated material
products manufacturer),
Millennium Chemicals,
Inc. (commodity
chemicals), Mortgage
Guaranty Insurance
Corporation, and R.J.
Reynolds Tobacco
Holdings, Inc. (tobacco)
-----------------------------------------------------------------------------------------------------------------------------------
Margaret B.W. Graham (58) Trustee Trustee since 2002. Founding Director, The Winthrop None
1001 Sherbrooke Street West, Term expires in 2005. Group, Inc. (consulting firm);
Montreal, Quebec, Canada Professor of Management, Faculty
H3A 1G5 of Management, McGill University
-----------------------------------------------------------------------------------------------------------------------------------
43
Pioneer High Income Trust
-------------------------------------------------------------------------------
INDEPENDENT TRUSTEES
-------------------------------------------------------------------------------
Positions Held Length of Service Principal Occupation During Other Directorships Held
Name, Age and Address With the Trust and Term of Office Past Five Years by this Trustee
Marguerite A. Piret (57) Trustee Trustee since 2002. President and Chief Executive Director of New America
One Boston Place, 28th Floor, Term expires in 2006. Officer, Newbury, Piret & High Income Fund, Inc.
Boston, MA 02108 Company, Inc. (investment banking (closed-end investment
firm) company)
-----------------------------------------------------------------------------------------------------------------------------------
Stephen K. West (76) Trustee Trustee since 2002. Senior Counsel, Sullivan & Director, The Swiss
125 Broad Street, Term expires in 2007. Cromwell (law firm) Helvetia Fund, Inc.
New York, NY 10004 (closed-end investment
company) and
AMVESCAP PLC
(investment managers)
-----------------------------------------------------------------------------------------------------------------------------------
John Winthrop (68) Trustee Trustee since 2002. President, John Winthrop & Co., None
One North Adgers Wharf, Term expires in 2005. Inc. (private investment firm)
Charleston, SC 29401
-----------------------------------------------------------------------------------------------------------------------------------
44
Pioneer High Income Trust
-------------------------------------------------------------------------------
TRUST OFFICERS
-------------------------------------------------------------------------------
Positions Held Length of Service Principal Occupation During Other Directorships Held
Name, Age and Address With the Trust and Term of Office Past Five Years by this Trustee
Dorothy E. Bourassa (57) Secretary Since September, Secretary of PIM-USA; Senior Vice None
2003. Serves at President- Legal of Pioneer; and
the discretion Secretary/Clerk of most of
of the Board PIM-USA's subsidiaries since
October 2000; Secretary of all of
the Pioneer Funds since September
2003 (Assistant Secretary from
November 2000 to September 2003);
and Senior Counsel, Assistant
Vice President and Director of
Compliance of PIM-USA from April
1998 through October 2000
-----------------------------------------------------------------------------------------------------------------------------------
Christopher J. Kelley (40) Assistant Since September, Assistant Vice President and None
Secretary 2003. Serves at Senior Counsel of Pioneer since
the discretion of July 2002; Vice President and
the Board Senior Counsel of BISYS Fund
Services, Inc. (April 2001 to
June 2002); Senior Vice President
and Deputy General Counsel of
Funds Distributor, Inc. (July
2000 to April 2001; Vice
President and Associate General
Counsel from July 1996 to July
2000); Assistant Secretary of all
Pioneer Funds since September
2003
-----------------------------------------------------------------------------------------------------------------------------------
David C. Phelan (47) Assistant Since September, Partner, Wilmer Cutler Pickering None
Secretary 2003. Serves at Hale and Dorr LLP; Assistant
the discretion Secretary of all Pioneer Funds
of the Board since September 2003
-----------------------------------------------------------------------------------------------------------------------------------
Vincent Nave (59) Treasurer Since 2002. Vice President-Fund Accounting, None
Serves at the Administration and Custody
discretion of Services of Pioneer; and
the Board Treasurer of all of the Pioneer
Funds (Assistant Treasurer from
June 1999 to November 2000)
-----------------------------------------------------------------------------------------------------------------------------------
45
Pioneer High Income Trust
-------------------------------------------------------------------------------
TRUST OFFICERS
-------------------------------------------------------------------------------
Positions Held Length of Service Principal Occupation During Other Directorships Held
Name and Age With the Trust and Term of Office Past Five Years by this Officer
Mark E. Bradley (45) Assistant Since November, Deputy Treasurer of Pioneer since None
Treasurer 2004. Serves at 2004; Treasurer and Senior Vice
the discretion President, CDC IXIS Asset
of the Board Management Services from 2002 to
2003; Assistant Treasurer and
Vice President, MFS Investment
Management from 1997 to 2002; and
Assistant Treasurer of all of the
Pioneer Funds since November 2004
-----------------------------------------------------------------------------------------------------------------------------------
Luis I. Presutti (40) Assistant Since 2002. Assistant Vice President-Fund None
Treasurer Serves at the Accounting, Administration and
discretion of Custody Services of Pioneer; and
the Board Assistant Treasurer of all of the
Pioneer Funds since November 2000
-----------------------------------------------------------------------------------------------------------------------------------
Gary Sullivan (47) Assistant Since 2002. Fund Accounting Manager-Fund None
Treasurer Serves at the Accounting, Administration and
discretion of Custody Services of Pioneer; and
the Board Assistant Treasurer of all of the
Pioneer Funds since May 2002
-----------------------------------------------------------------------------------------------------------------------------------
Katherine Kim Sullivan (31) Assistant Since September, Fund Administration Manager-Fund None
Treasurer 2003. Serves at Accounting, Administration and
the discretion Custody Services since June 2003;
of the Board Assistant Vice President-Mutual
Fund Operations of State Street
Corporation from June 2002 to
June 2003 (formerly Deutsche Bank
Asset Management); Pioneer Fund
Accounting, Administration and
Custody Services (Fund Accounting
Manager from August 1999 to May
2002, Fund Accounting Services
Supervisor from 1997 to July
1999); Assistant Treasurer of all
Pioneer Funds since September
2003
-----------------------------------------------------------------------------------------------------------------------------------
46
Pioneer High Income Trust
--------------------------------------------------------------------------------
TRUST OFFICERS
--------------------------------------------------------------------------------
Positions Held Length of Service Principal Occupation During Other Directorships Held
Name and Age With the Trust and Term of Office Past Five Years by this Officer
Martin J. Wolin (37) Chief Since October, Chief Compliance Officer of None
Compliance 2004. Serves at Pioneer (Director of Compliance
Officer the discretion and Senior Counsel from November
of the Board 2000 to September 2004); Vice
President and Associate General
Counsel of UAM Fund Services,
Inc. (mutual fund administration
company) from February 1998 to
November 2000; and Chief
Compliance Officer of all of the
Pioneer Funds
-----------------------------------------------------------------------------------------------------------------------------------
The outstanding capital stock of PFD, PIM and PIMSS is indirectly wholly owned
by UniCredito Italiano S.p.A. ("UniCredito Italiano"), one of the largest
banking groups in Italy. PIM, the Trust's investment adviser, provides
investment management and financial services to mutual funds, institutional and
other clients.
47
This page for your notes.
This page for your notes.
This page for your notes.
This page for your notes.
This page for your notes.
--------------------------------------------------------------------------------
HOW TO CONTACT PIONEER
--------------------------------------------------------------------------------
We are pleased to offer a variety of convenient ways for you to contact Mellon
for assistance or information.
You can call Mellon Investor Services LLC for:
Account Information 1-800-710-0935
Telecommunications Device for the Deaf (TDD) 1-800-231-5469
Or write to Mellon Investor Services LLC:
For Write to
General inquiries, lost dividend checks P.O. Box 3315
South Hackensack, NJ
07606-1915
Change of address, account consolidation P.O. Box 3316
South Hackensack, NJ
07606-1916
Lost stock certificates P.O. Box 3317
South Hackensack, NJ
07606-1917
Stock transfer P.O. Box 3312
South Hackensack, NJ
07606-1912
Dividend reinvestment plan (DRIP) P.O. Box 3338
South Hackensack, NJ
07606-1938
For additional information, please contact your investment advisor or visit our
web site www.pioneerfunds.com.
The Trust files a complete statement of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareholders may view the filed Form N-Q by visiting the Commission's
web site at http://www.sec.gov. The filed form may also be viewed and copied at
the Commission's Public Reference Room in Washington, DC. Information regarding
the operations of the Public Reference Room may be obtained by calling
1-800-SEC-0330.
ITEM 2. CODE OF ETHICS.
(a) Disclose whether, as of the end of the period covered by the report, the
registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions, regardless of
whether these individuals are employed by the registrant or a third party. If
the registrant has not adopted such a code of ethics, explain why it has not
done so.
The registrant has adopted, as of the end of the period covered by this report,
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer and controller.
(b) For purposes of this Item, the term "code of ethics" means written standards
that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in
reports and documents that a registrant files with, or submits to, the
Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and
regulations;
(4) The prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) The registrant must briefly describe the nature of any amendment, during the
period covered by the report, to a provision of its code of ethics that applies
to the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, and that relates to any element of the code of
ethics definition enumerated in paragraph (b) of this Item. The registrant must
file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless
the registrant has elected to satisfy paragraph (f) of this Item by posting its
code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by
undertaking to provide its code of ethics to any person without charge, upon
request, pursuant to paragraph (f)(3) of this Item.
The registrant has made no amendments to the code of ethics during the period
covered by this report.
(d) If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of ethics to
the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, that relates to one or more of the items set forth
in paragraph (b) of this Item, the registrant must briefly describe the nature
of the waiver, the name of the person to whom the waiver was granted, and the
date of the waiver.
Not applicable.
(e) If the registrant intends to satisfy the disclosure requirement under
paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from,
a provision of its code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of this
Item by posting such information on its Internet website, disclose the
registrant's Internet address and such intention.
Not applicable.
(f) The registrant must:
(1) File with the Commission, pursuant to Item 10(a), a copy of its code
of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller,
or persons performing similar functions, as an exhibit to its annual
report on this Form N-CSR;
(2) Post the text of such code of ethics on its Internet website and
disclose, in its most recent report on this Form N-CSR, its Internet
address and the fact that it has posted such code of ethics on its
Internet website; or
(3) Undertake in its most recent report on this Form N-CSR to provide to
any person without charge, upon request, a copy of such code of ethics
and explain the manner in which such request may be made.
See Item 10(2)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a) (1) Disclose that the registrant's board of trustees has determined that
the registrant either:
(i) Has at least one audit committee financial expert serving on its audit
committee; or
(ii) Does not have an audit committee financial expert serving on its audit
committee.
The registrant's Board of Trustees has determined that the registrant has at
least one audit committee financial expert.
(2) If the registrant provides the disclosure required by paragraph
(a)(1)(i) of this Item, it must disclose the name of the audit committee
financial expert and whether that person is "independent." In order to be
considered "independent" for purposes of this Item, a member of an audit
committee may not, other than in his or her capacity as a member of the audit
committee, the board of trustees, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or other
compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as defined in
Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)).
Ms. Marguerite A. Piret, an independent trustee, is such an audit committee
financial expert.
(3) If the registrant provides the disclosure required by paragraph (a)(1)
(ii) of this Item, it must explain why it does not have an audit committee
financial expert.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption AUDIT FEES, the aggregate fees billed for each
of the last two fiscal years for professional services rendered by the principal
accountant for the audit of the registrant's annual financial statements or
services that are normally provided by the accountant in connection with
statutory and regulatory filings or engagements for those fiscal years.
Audit Fees
Fees for audit services provided to the Trust, including
fees associated with the filings to update its Form N-2
and issuance of comfort letters, totaled approximately
$20,800 in 2005 and $44,500 in 2004.
(b) Disclose, under the caption AUDIT-RELATED FEES, the aggregate fees billed in
each of the last two fiscal years for assurance and related services by the
principal accountant 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. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
Audit-Related Fees
Fees for the Trusts audit-related services totaled
approximately $8,000 in 2005 and $17,500 in 2004.
These services included a review of the semi annual
financial statements and issuance of agreed upon
procedures report to the rating agencies.
(c) Disclose, under the caption TAX FEES, the aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice, and tax planning. Registrants shall
describe the nature of the services comprising the fees disclosed under this
category.
Tax Fees
Fees for tax compliance services, primarily for tax
returns, totaled approximately $6,000 and $3,600 for
2005 and 2004, respectively.
(d) Disclose, under the caption ALL OTHER FEES, the aggregate fees billed in
each of the last two fiscal years for products and services provided by the
principal accountant, other than the services reported in paragraphs (a) through
(c) of this Item. Registrants shall describe the nature of the services
comprising the fees disclosed under this category.
Other Fees
There were no fees for other services provided to the
Trust during the fiscal years ended March 31, 2005 and
2005.
(e) (1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
PIONEER FUNDS
APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES
PROVIDED BY THE INDEPENDENT AUDITOR
SECTION I - POLICY PURPOSE AND APPLICABILITY
The Pioneer Funds recognizes the importance of maintaining the independence of
their outside auditors. Maintaining independence is a shared responsibility
involving Pioneer Investment Management, Inc ("PIM"), the audit committee and
the independent auditors.
The Funds recognizes that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
----------------------- --------------------------- -----------------------------------------------
------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- -------------------------
------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
----------------------- --------------------------- -----------------------------------------------
--------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
----------------------- ------------------------- -----------------------------------------------
------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
------------------------------------------- ------------------------------
--------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
--------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
Non-Audit Services
Beginning with non-audit service contracts entered into
on or after May 6, 2003, the effective date of the new
SEC pre-approval rules, the Trusts audit committee is
required to pre-approve services to affiliates defined by
SEC rules to the extent that the services are determined
to have a direct impact on the operations or financial
reporting of the Trust. For the years ended March 31,
2005 and 2005, there were no services provided to an
affiliate that required the Trusts audit committee pre-
approval.
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal accountant's engagement to audit the registrant's financial statements
for the most recent fiscal year that were attributed to work performed by
persons other than the principal accountant's full-time, permanent employees.
N/A
(g) Disclose the aggregate non-audit fees billed by the registrant's accountant
for services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant for each of
the last two fiscal years of the registrant.
The Fund's independent auditor, Ernst & Young
LLP ("E&Y"), recently has advised the Securities
and Exchange Commission, the Public Company
Accounting Oversight Board, and the Audit
Committee of the Fund's Board of Trustees that
certain non-audit work performed by E&Y's China
affiliate has raised questions regarding E&Y's
independence with respect to its performance of
audit services for the Fund. In July 2004, E&Y
became aware that member firms in China ("E&Y
China") provided certain tax services to offices of
UniCredito Italiano, S.p.A. ("UCI"), a member of
the Fund's Investment Company Complex. The
services included receipt and disbursement of
monies transferred to E&Y China by UCI in
payment of individual expatriate income taxes due
on returns prepared by E&Y China for certain UCI
employees located in China from October 1998 to
May 2003. E&Y became auditors of the Fund in
May 2002. These expatriate tax services were
discontinued in May 2003. The fees received by
E&Y China for all such services totaled $3,685.
The Fund's Audit Committee and E&Y have
discussed the matter, including the nature of the
services provided, the personnel involved in
providing the services and the fees received by
E&Y for performing the services. The Committee
continues to review the facts and circumstances
surrounding the matter, including the issue of
whether the monies transferred for employees' taxes
were de facto monies due the employees for tax
payments rather than monies belonging to UCI.
E&Y has informed the Audit Committee that based
on its internal reviews and the de minimis nature of
the services provided and fees received, it does not
believe its independence with respect to the Fund
has been impaired.
Aggregate Non-Audit Fees
The aggregate non-audit fees for the Trust and affiliates,
as previously defined, totaled approximately $15,100 in
2005 and $25,100 in 2004.
(h) Disclose whether the registrant's audit committee of the board of trustees
has considered whether the provision of non-audit services that were rendered to
the registrant's investment adviser (not including any subadviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.
The Trust's audit committee of the Board of Trustees has
considered whether the provision of non-audit services
that were rendered to the Affiliates (as defined) that were
not pre-approved pursuant to paragraph (c)(7)(ii) of Rule
2-01 of Regulation S-X is compatible with maintaining
the principal accountant's independence.
ITEMS 5-6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on
this Form N-CSR must, unless it invests exclusively in non-voting securities,
describe the policies and procedures that it uses to determine how to vote
proxies relating to portfolio securities, including the procedures that the
company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
N/A
ITEM 8. [RESERVED]
ITEM 9. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, about the effectiveness of the registrant's disclosure
controls and procedures (as defined in Rule 30a-2(c) under the Act (17 CFR
270.30a-2(c))) based on their evaluation of these controls and procedures as of
a date within 90 days of the filing date of the report that includes the
disclosure required by this paragraph.
The registrant's principal executive officer and principal financial
officer have concluded, that the registrant's disclosure controls and
procedures are effective based on their evaluation of these controls and
procedures as of a date within 90 days of the filing date of this report.
(b) Disclose whether or not there were significant changes in the registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
There were no significant changes in the registrant's internal controls or
in other factors that could significantly affect these controls subsequent to
the date of their evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.
ITEM 10. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit.
(b) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 under the Act
(17 CFR 270.30a-2).
Filed herewith.
SIGNATURES
[See General Instruction F]
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.
(Registrant) Pioneer High Income Trust
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr, President
Date May 27, 2005
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 (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr., President
Date May 27, 2005
By (Signature and Title)* /s/ Vincent Nave
Vincent Nave, Treasurer
Date May 27, 2005
* Print the name and title of each signing officer under his or her signature.