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EATON VANCE
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Annual Report June 30, 1999
EATON VANCE
SENIOR
INCOME
TRUST
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EATON VANCE SENIOR INCOME TRUST as of June 30, 1999
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INVESTMENT UPDATE
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INVESTMENT ENVIRONMENT
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THE LOAN MARKET
o The volume of leveraged loan issuance continued to grow in the first half of
1999, rising to $147 billion through June 30. Following the difficulties in
the corporate bond market in the fourth quarter of 1998, many more companies
have turned to senior floating-rate loans as a financing alternative.
Concurrently, investor demand for this relatively stable asset class has
remained strong.
o In late June, the Federal Reserve raised the Federal Funds rate - a key
short-term interest rate barometer - by 25 basis points (.25%). That move
was immediately reflected in the LIBOR rate, the benchmark upon which most
floating-rate loan interest rates are based.
o Once again, the reset feature of senior floating-rate loans distinguished
them from fixed-income vehicles. The quick response to the rate hike enabled
loan investors to benefit from a trend - rising interest rates - that had a
negative impact on most income-producing asset classes.
THE FUND
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PERFORMANCE
o Based on the Fund's June, 1999 monthly dividend of $0.072 and a closing
share price of $10.00, the Fund had a market yield of 8.64%.(1) The Fund's
market yield represented a major yield advantage over many other
income-producing vehicles.
o The Fund had a total return of 4.93% during the period from inception on
October 30, 1998 through June 30, 1999. This return is based on no change in
share price and the reinvestment of $0.465 in dividends. Based on a closing
share price of $10.00 on June 30, 1999, the Fund traded at a 0.9% discount
to its net asset value.
THE FUND'S INVESTMENTS
o Industry diversification remained a major emphasis of the Fund. By June 30,
the number of industries represented by loan interests in the Fund was 48.
The average loan as a percentage of the Fund's total assets was just 0.60%.
That is significant because a decline in the average loan size lessens the
potential impact on the Fund of an adverse development for a single
borrower.
o Capstar Radio Broadcasting was the Fund's largest holding at June 30.
Capstar is a major, nationwide owner of radio stations and was recently
purchased by Chancellor Media Corp. The Telecommunications Act of 1996
enabled companies to own multiple radio properties in a single market. That
has helped large radio companies build market share while realizing
excellent economies of scale. The combined company will own 463 stations in
105 markets.
o Cable television companies remained a large focus of the Fund. Classic
Cable, Inc. was among the Fund's largest holdings. Classic owns and operates
cable systems with 190,000 customers in Midwest and Southwest rural
communities. The company offers a wide array of cable services, direct
broadcast services, and Internet access. Classic recently agreed to purchase
Buford Group, Inc., which adds another 170,000 subscribers, primarily in the
South.
o In addition to its large weightings in manufacturing, cable television and
telecommunications, the Fund maintained an exposure to less economically
sensitive areas, such as food and entertainment. Domino's, Inc. is one of
the nation's leading pizza delivery companies. The company was recently
purchased by Bain & Co., a Boston-based venture capital specialist.
o At June 30, 9.7% of the Fund's total investments were invested in high-yield
corporate bonds. The Fund had leverage (borrowing) of $152 million at June
30. That represented 29.5% of the Fund's total assets.
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Shares of the Fund are not insured by the FDIC and are not deposits or other
obligations of, or guaranteed by, any depository institution. Shares are subject
to investment risks, including possible loss of principal invested. Yield will
change.
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Fund Information
as of June 30, 1999
Performance(2)
Cumulative Total Return (by market value, NYSE)
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Life of Fund (10/30/98) 4.93%
Cumulative Total Return (at net asset value)
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Life of Fund (10/30/98) 5.88%
Five Largest Loan Sector Weightings(3)
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Manufacturing 8.3%
Cable Television 7.8%
Telecommunications -- Long Distance 7.5%
Texxtile - Apparel 5.2%
Health Care -- Misc. 4.9%
(1) The Fund's market yield is calculated by dividing the most recent dividend
per share by the share market price at the end of the period and annualizing
the result. (2) Returns are historical and are calculated by determining the
percentage change in market value or net asset value with all distributions
reinvested. (3) Loan sector weightings are subject to change due to active
management. Five largest sector weightings account for 33.7% of the Fund's
net assets, determined by dividing the total market value of the holdings by
the total net assets of the Fund.
Past performance is no guarantee of future results. Investment return and
principal value will fluctuate so that shares, when sold, may be worth more
or less than their original cost.
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EATON VANCE SENIOR INCOME TRUST as of June 30, 1999
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PORTFOLIO OF INVESTMENTS
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Senior, Secured, Floating-Rate
Interests -- 123.35%(2)
Principal
Amount Borrower Value
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Aerospace/Defense -- 3.13%
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Aerostructures Corporation
$ 4,543,622 Term loan, maturing December 31, 2003 $ 4,543,622
1,925,000 Subordinated debt, maturing September 30, 2004 1,925,000
Aircraft Braking Systems Corp.
4,806,920 Term loan, maturing September 30, 2005 4,806,920
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$ 11,275,542
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Auto parts - Aftermarket -- 0.99%
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Exide Corporation
$ 2,758,971 Term loan, maturing March 18, 2005 $ 2,758,971
J.L. French Automotive Castings, Inc.
789,474 Term loan, maturing November 30, 2006 789,474
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$ 3,548,445
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Automobile -- 3.18%
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Accuride Corporation
$ 2,000,000 Term loan, maturing January 21, 2007 $ 2,000,000
Cambridge Industries, Inc.
4,937,028 Term loan, maturing June 30, 2005 4,937,028
Collins & Aikman Products Co.
2,000,000 Term loan, maturing June 30, 2006 2,000,000
Key Plastics
997,500 Term loan, maturing March 26, 2005 997,500
Venture Holdings Trust
1,500,000 Term loan, maturing April 1, 2005 1,500,000
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$ 11,434,528
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Beverages - Alcoholic -- 0.28%
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Pabst Brewing Company
$ 1,000,000 Term loan, maturing April 30, 2004 $ 1,000,000
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$ 1,000,000
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Beverages - Soft Drink -- 0.83%
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Triarc Companies, Inc.
$ 869,913 Term loan, maturing March 1, 2006 $ 869,913
2,122,587 Term loan, maturing March 31, 2006 2,122,587
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$ 2,992,500
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Broadcast Media -- 4.43%
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American Media Operations Inc.
$ 1,000,000 Term loan, maturing April 1, 2007 $ 1,000,000
Benedek Broadcasting Corporation
1,000,000 Term loan, maturing November 20, 2007 1,000,000
Black Entertainment Television
5,000,000 Term loan, maturing June 30, 2006 5,000,000
Capstar Radio Broadcasting Corp
6,939,950 Term loan, maturing May 31, 2005 6,939,950
TLMD Aquisition Co.
2,000,000 Term loan, maturing March 31, 2007 2,000,000
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$ 15,939,950
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Building Materials -- 1.38%
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Falcon Building Products, Inc.
$ 4,971,270 Term loan, maturing June 29, 2007 $ 4,971,270
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$ 4,971,270
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Cable Television -- 7.77%
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Avalon Cable Holdings Finance, Inc.
$ 1,000,000 Term loan, maturing October 31, 2006 $ 1,000,000
Benchmark Genesis, LLC
1,000,000 Term loan, maturing September 30, 2007 1,000,000
Bresnan Telecommunications Co., LLC
2,000,000 Term loan, maturing January 29, 2008 2,000,000
Chelsea Communications, Inc.
4,937,500 Term loan, maturing December 31, 2004 4,937,500
Classic Cable, Inc.
5,000,000 Term loan, maturing October 31, 2007 5,000,000
Frontiervision Operating Partners, L.P.
5,000,000 Term loan, maturing March 31, 2006 5,000,000
HPI Acquisition Co., LLC
1,000,000 Subordinated debt, maturing December 31, 2005 1,000,000
2,000,000 Term loan, maturing December 31, 2006 2,000,000
Intermedia Partners Group VI (Holdco)
5,000,000 Term loan, maturing April 30, 2008 5,000,000
RCN Corporation
1,000,000 Term loan, maturing June 30, 2007 1,000,000
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$ 27,937,500
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Chemicals -- 4.81%
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Arteva B.V. (Kosa)
$ 4,960,000 Term loan, maturing December 31, 2006 $ 4,960,000
Huntsman Corporation
3,407,665 Term loan, maturing September 30, 2003 3,407,665
Lyondell Petrochemical Company
2,992,500 Term loan, maturing June 30, 2007 2,992,500
Polymer Group, Inc.
4,959,839 Term loan, maturing December 20, 2005 4,959,839
United Industries Corporation
997,500 Term loan, maturing January 20, 2006 997,500
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$ 17,317,504
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Coal -- 2.47%
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Alliance Coal Corporation
$ 3,891,963 Term loan, maturing December 31, 2002 $ 3,891,963
P&L Coal Holdings Corporation
5,000,000 Term loan, maturing June 30, 2006 5,000,000
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$ 8,891,963
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Commercial Services -- 3.32%
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Metokote Corporation
$ 1,000,000 Term loan, maturing November 2, 2005 $ 1,000,000
Nationsrent, Inc.
1,000,000 Term loan, maturing September 24, 2004 1,000,000
Safety-Kleen Services, Inc.
2,481,203 Term loan, maturing April 3, 2005 2,481,203
2,481,203 Term loan, maturing April 3, 2006 2,481,203
United Rentals, Inc.
3,000,000 Term loan, maturing June 30, 2006 3,000,000
Volume Services, Inc.
1,975,506 Term loan, maturing December 31, 2002 1,975,506
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$ 11,937,912
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Communications -- Equip/Mfrs -- 4.89%
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Amphenol Corporation
$ 5,000,000 Term loan, maturing May 19, 2006 $ 5,000,000
Communications & Power Industries, Inc.
826,855 Term loan, maturing August 11, 2000 826,855
2,879,859 Term loan, maturing August 11, 2002 2,879,859
Communications Instruments
1,000,000 Term loan, maturing March 15, 2004 1,000,000
Dynatech Corporation
989,134 Term loan, maturing March 31, 2005 989,134
989,134 Term loan, maturing March 31, 2006 989,134
989,134 Term loan, maturing March 31, 2007 989,134
Superior Telecom, Inc.
4,916,994 Term loan, maturing November 27, 2005 4,916,994
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$ 17,591,110
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Computer Software & Services -- 0.83%
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Bridge Information Systems America
$ 3,000,000 Term loan, maturing May 29, 2004 $ 3,000,000
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$ 3,000,000
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Computer Systems -- 0.28%
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Titan Corporation
$ 1,000,000 Term loan, maturing June 9, 2005 $ 1,000,000
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$ 1,000,000
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Conglomerates -- 1.93%
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American Marketing Industries, Inc.
$ 1,357,831 Term loan, maturing November 30, 2002 $ 1,357,831
626,851 Term loan, maturing November 30, 2004 626,851
SPX Corporation
4,962,500 Term loan, maturing September 30, 2006 4,962,500
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$ 6,947,182
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Containers - Metal & Glass -- 1.94%
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Graham Packaging Company
$ 4,016,953 Term loan, maturing January 31, 2007 $ 4,016,953
Tekni-Plex, Inc.
2,977,387 Term loan, maturing March 31, 2006 2,977,387
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$ 6,994,340
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Containers - Paper -- 2.89%
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Jefferson Smurfit Corporation
$ 4,477,500 Term loan, maturing March 24, 2006 $ 4,477,500
Packaging Corporation Of America
469,008 Term loan, maturing March 31, 2007 469,008
469,008 Term loan, maturing March 31, 2008 469,008
RIC Holding, Inc.
4,975,083 Term loan, maturing February 28, 2004 4,975,083
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$ 10,390,599
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Drugs -- 0.69%
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King Pharmaceuticals, Inc.
$ 2,487,500 Term loan, maturing December 22, 2006 $ 2,487,500
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$ 2,487,500
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Electrical Equipment -- 0.55%
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Gentek, Inc.
$ 1,000,000 Term loan, maturing April 30, 2007 $ 1,000,000
Stoneridge
995,000 Term loan, maturing December 31, 2005 995,000
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$ 1,995,000
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Electronics - Instrumentation & Semiconductors -- 0.81%
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Packard Bioscience Company
$ 1,897,683 Term loan, maturing March 31, 2002 $ 1,897,683
Fairchild Semiconductor Corporation
1,000,000 Term loan, maturing December 15, 2004 1,000,000
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$ 2,897,683
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Entertainment -- 3.51%
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Carmike Cinemas, Inc.
$ 1,995,000 Term loan, maturing February 25, 2005 $ 1,995,000
Hollywood Theater Holdings, Inc.
997,500 Term loan, maturing March 31, 2006 997,500
Palace Station Hotel & Casino, Inc.
1,000,000 Term loan, maturing September 30, 2000 1,000,000
Regal Cinemas Inc.
977,778 Term loan, maturing May 27, 2006 977,778
2,673,000 Term loan, maturing May 27, 2007 2,673,000
SFX Entertainment, Inc.
4,966,667 Term loan, maturing March 31, 2006 4,966,667
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$ 12,609,945
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Foods -- 4.11%
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Del Monte Corporation
$ 4,208,143 Term loan, maturing March 31, 2005 $ 4,208,143
Domino's Inc.
996,707 Term loan, maturing December 21, 2006 996,707
996,707 Term loan, maturing December 21, 2007 996,707
International Home Foods, Inc.
4,993,316 Term loan, maturing September 30, 2006 4,993,316
New World Pasta
931,000 Term loan, maturing January 28, 2006 931,000
Southern Foods Group, L.P.
2,656,357 Term loan, maturing February 28, 2006 2,656,357
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$ 14,782,230
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Hardware & Tools -- 0.55%
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Werner Holding Co.
$ 1,984,887 Term loan, maturing November 30, 2004 $ 1,984,887
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$ 1,984,887
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Health Care - Diversified -- 3.52%
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Conmed Corporation
$ 4,746,452 Term loan, maturing December 30, 2004 $ 4,746,452
Dade Behring Holdings, Inc.
1,000,000 Term loan, maturing June 30, 2005 1,000,000
1,000,000 Term loan, maturing June 30, 2006 1,000,000
FHC Health Systems, Inc.
2,477,481 Term loan, maturing April 30, 2005 2,477,481
2,477,481 Term loan, maturing April 30, 2006 2,477,481
Team Health
966,667 Term loan, maturing March 12, 2006 966,667
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$ 12,668,081
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Health Care - Misc. -- 4.92%
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Alliance Imaging, Inc.
$ 2,481,108 Term loan, maturing June 18, 2004 $ 2,481,108
1,000,000 Term loan, maturing December 18, 2005 1,000,000
Imed Corporation
4,782,034 Term loan, maturing May 31, 2005 4,782,034
Leiner Health Products Inc.
2,481,061 Term loan, maturing December 30, 2004 2,481,061
Mariner Post-Acute Network (f/k/a Paragon)
2,485,000 Term loan, maturing March 31, 2005 2,485,000
2,485,000 Term loan, maturing March 31, 2006 2,485,000
WGL Acquisition Corp.
1,979,950 Term loan, maturing July 10, 2004 1,979,950
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$ 17,694,153
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Heavy Duty Trucks & Parts -- 0.96%
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Johnstown America Industries, Inc.
$ 200,000 Term loan, maturing April 30, 2007 $ 200,000
Oshkosh Truck Corporation
1,620,000 Term loan, maturing March 31, 2005 1,620,000
1,620,000 rporationTerm loan, maturing March 31, 2006 1,620,000
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$ 3,440,000
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Hospital Management -- 1.37%
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Community Health Systems, Inc.
$ 1,797,203 Term loan, maturing December 31, 2003 $ 1,797,203
1,797,203 Term loan, maturing December 31, 2004 1,797,203
1,342,657 Term loan, maturing December 31, 2005 1,342,657
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$ 4,937,063
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Hotels - Motels -- 0.56%
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Starwood Hotels & Resorts
$ 2,000,000 Term loan, maturing February 23, 2003 $ 2,000,000
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$ 2,000,000
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Household Furnish & Appliances -- 4.44%
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Alliance Laundry Holdings LLC.
$ 5,000,000 Term loan, maturing September 30, 2005 $ 5,000,000
Furniture Brands International, Inc.
3,500,000 Term loan, maturing June 27, 2007 3,500,000
Sealy Mattress Company
1,886,927 Term loan, maturing December 15, 2004 1,886,927
1,359,124 Term loan, maturing December 15, 2005 1,359,124
1,736,845 Term loan, maturing December 15, 2006 1,736,845
Simmons Company
714,286 Term loan, maturing October 30, 2005 714,286
1,785,714 Term loan, maturing October 30, 2006 1,785,714
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$ 15,982,896
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Household Products -- 2.22%
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The Imperial Decor Home Group, Inc.
$ 2,000,000 Term loan, maturing March 12, 2005 $ 2,000,000
1,000,000 Term loan, maturing March 12, 2006 1,000,000
The Scotts Company
2,541,466 Term loan, maturing June 30, 2006 2,541,466
2,448,875 Term loan, maturing June 30, 2007 2,448,875
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$ 7,990,341
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Insurance Brokers -- 1.92%
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Acordia, Inc.
$ 4,949,749 Term loan, maturing December 31, 2004 $ 4,949,749
Willis Corroon Corporation
970,000 Term loan, maturing February 19, 2007 970,000
485,000 Term loan, maturing February 19, 2008 485,000
485,000 Term loan, maturing August 19, 2008 485,000
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$ 6,889,749
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Leisure Time -- 4.79%
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Alliance Gaming Corporation
$ 3,484,079 Term loan, maturing January 31, 2005 $ 3,484,079
1,391,140 Term loan, maturing July 31, 2005 1,391,140
Interval International Corp.
1,046,563 Term loan, maturing December 16, 2005 1,046,563
1,046,563 Term loan, maturing December 15, 2006 1,046,563
Panavision, Inc.
4,991,667 Term loan, maturing March 31, 2005 4,991,667
Six Flags Theme Parks Inc.
5,228,873 Term loan, maturing November 30, 2004 5,228,873
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$ 17,188,885
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Machinery - Diversified -- 1.64%
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Numatics, Incorporated
$ 2,914,241 Term loan, maturing September 19, 2005 $ 2,914,241
Thermadyne MFG LLC
1,489,981 Term loan, maturing May 22, 2005 1,489,981
1,489,981 Term loan, maturing May 22, 2006 1,489,981
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$ 5,894,203
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Manufacturing - Diversified -- 8.28%
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Advanced Glassfiber Yarns LLC
$ 1,905,000 Term loan, maturing September 30, 2005 $ 1,905,000
Environmental Systems Products Hldgs, Inc.
1,990,000 Term loan, maturing September 30, 2005 1,990,000
Foamex L.P.
1,501,162 Term loan, maturing June 30, 2005 1,501,162
1,364,693 Term loan, maturing June 30, 2006 1,364,693
2,096,251 Term loan, maturing June 30, 2007 2,096,251
General Cable Corporation
2,000,000 Term loan, maturing May 31, 2007 2,000,000
Huntsman Packaging Corp.
5,000,000 Term loan, maturing June 30, 2006 5,000,000
Insilco Corporation
995,000 Term loan, maturing November 24, 2005 995,000
International Wire Group, Inc.
2,985,871 Term loan, maturing September 30, 2002 2,985,871
Neenah Foundry Company
4,991,276 Term loan, maturing September 30, 2005 4,991,276
Panolam Industries, Inc.
478,422 Term loan, maturing November 1, 2004 478,422
478,519 Term loan, maturing December 31, 2005 478,519
Tokheim Corporation
4,000,000 Term loan, maturing September 30, 2004 4,000,000
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$ 29,786,194
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Medical Products & Supplies -- 1.38%
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Stryker Corporation
$ 980,986 Term loan, maturing December 10, 2005 $ 980,986
3,994,014 Term loan, maturing December 10, 2006 3,994,014
- ----------------------------------------------------------------------------
$ 4,975,000
- ----------------------------------------------------------------------------
Metals - Misc. -- 1.38%
- ----------------------------------------------------------------------------
C II Carbon, LLC
$ 2,977,444 Term loan, maturing June 30, 2008 $ 2,977,444
U.S. Silica Company
2,000,000 Term loan, maturing June 30, 2006 2,000,000
- ----------------------------------------------------------------------------
$ 4,977,444
- ----------------------------------------------------------------------------
Miscellaneous -- 2.53%
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Coinmach Laundry Corporation
$ 4,962,312 Term loan, maturing June 30, 2005 $ 4,962,312
Kindercare Learning Centers, Inc.
3,128,464 Term loan, maturing February 13, 2006 3,128,464
Language Line, LLC
1,000,000 Term loan, maturing March 31, 2006 1,000,000
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$ 9,090,776
- ----------------------------------------------------------------------------
Natural Gas/Distrib/Pipeline -- 0.28%
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Kinder Morgan
$ 1,000,000 Term loan, maturing May 31, 2000 $ 1,000,000
- ----------------------------------------------------------------------------
$ 1,000,000
- ----------------------------------------------------------------------------
Office Equipment & Supplies -- 2.10%
- ----------------------------------------------------------------------------
Neopost (F.M.E. Corporation)
$ 3,564,236 Term loan, maturing June 24, 2006 $ 3,564,236
U.S. Office Products
3,996,049 Term loan, maturing June 9, 2006 3,996,049
- ----------------------------------------------------------------------------
$ 7,560,285
- ----------------------------------------------------------------------------
Paper & Forest Products -- 2.10%
- ----------------------------------------------------------------------------
Bear Island Paper Company, LLC
$ 4,557,193 Term loan, maturing December 31, 2005 $ 4,557,193
Blue Ridge Paper Products, Inc.
1,000,000 Term loan, maturing March 31, 2006 1,000,000
Pacifica Papers, Inc.
2,000,000 Term loan, maturing March 5, 2006 2,000,000
- ----------------------------------------------------------------------------
$ 7,557,193
- ----------------------------------------------------------------------------
Publishing -- 2.08%
- ----------------------------------------------------------------------------
Penton Media, Inc.
$ 1,488,040 Term loan, maturing May 31, 2006 $ 1,488,040
Reiman Publications
2,000,000 Term loan, maturing November 30, 2005 2,000,000
The Sheridan Group, Inc.
1,000,000 Term loan, maturing January 30, 2005 1,000,000
Von Hoffman Press, Inc.
700,752 Term loan, maturing May 30, 2004 700,752
2,275,927 Term loan, maturing May 30, 2005 2,275,927
- ----------------------------------------------------------------------------
$ 7,464,719
- ----------------------------------------------------------------------------
Restaurants -- 0.90%
- ----------------------------------------------------------------------------
Applebee's International, Inc.
$ 2,237,186 Term loan, maturing March 31, 2006 $ 2,237,186
Coco's Carrow's and Jojo's Restaurants
1,000,000 Term loan, maturing April 30, 2003 1,000,000
- ----------------------------------------------------------------------------
$ 3,237,186
- ----------------------------------------------------------------------------
Retail Stores - Food Chains -- 1.39%
- ----------------------------------------------------------------------------
Pathmark Stores, Inc.
$ 4,988,827 Term loan, maturing December 15, 2001 $ 4,988,827
- ----------------------------------------------------------------------------
$ 4,988,827
- ----------------------------------------------------------------------------
Retail Stores - Specialty -- 2.08%
- ----------------------------------------------------------------------------
Advanced Stores Company, Inc.
$ 2,000,000 Term loan, maturing April 15, 2006 $ 2,000,000
Nebraska Book Company
2,480,620 Term loan, maturing March 31, 2006 2,480,620
Travelcenters of America, Inc.
2,990,536 Term loan, maturing March 27, 2005 2,990,536
- ----------------------------------------------------------------------------
$ 7,471,156
- ----------------------------------------------------------------------------
Steel -- 1.94%
- ----------------------------------------------------------------------------
Adience, Inc.
$ 1,374,938 Term loan, maturing April 30, 2005 $ 1,374,938
614,071 Term loan, maturing July 30, 2005 614,071
Ucar Global Enterprises, Inc.
4,997,619 Term loan, maturing December 31, 2003 4,997,619
- ----------------------------------------------------------------------------
$ 6,986,628
- ----------------------------------------------------------------------------
Telecommunications - Long Distance -- 7.49%
- ----------------------------------------------------------------------------
American Cellular Wireless LLC.
$ 2,244,375 Term loan, maturing June 25, 2007 $ 2,244,375
2,244,375 Term loan, maturing December 25, 2007 2,244,375
Cellular, Inc Financial Corporation
1,500,000 Term loan, maturing March 31, 2007 1,500,000
3,500,000 Term loan, maturing March 31, 2008 3,500,000
Centennial Cellular Corp.
2,487,500 Term loan, maturing November 30, 2006 2,487,500
2,487,500 Term loan, maturing November 30, 2007 2,487,500
Davel Communications
2,491,667 Term loan, maturing June 23, 2005 2,491,667
Microcell Connexions
1,000,000 Term loan, maturing December 30, 2005 1,000,000
Spectrasite Communications, Inc.
1,000,000 Term loan, maturing June 30, 2006 1,000,000
Sygnet Operating Company (Dobson)
555,556 Term loan, maturing March 31, 2007 555,556
444,444 Term loan, maturing December 23, 2007 444,444
Tritel Holding Corp.
2,000,000 Term loan, maturing December 31, 2007 2,000,000
Western PCS Holding Corporation
2,500,000 Term loan, maturing June 30, 2007 2,500,000
Western Wireless
2,500,000 Term loan, maturing March 31, 2004 2,500,000
- ----------------------------------------------------------------------------
$ 26,955,417
- ----------------------------------------------------------------------------
Textile - Apparel Mfg. -- 5.20%
- ----------------------------------------------------------------------------
Cluett American Corp
$ 4,950,000 Term loan, maturing May 18, 2005 $ 4,950,000
Globe Manufacturing Corp
3,900,000 Term loan, maturing July 31, 2006 3,900,000
Joan Fabrics Corporation
1,989,139 Term loan, maturing June 30, 2005 1,989,139
2,979,871 Term loan, maturing June 30, 2006 2,979,871
The William Carter Company
4,896,907 Term loan, maturing October 31, 2003 4,896,907
- ----------------------------------------------------------------------------
$ 18,715,917
- ----------------------------------------------------------------------------
Transportation - Misc. -- 2.31%
- ----------------------------------------------------------------------------
Evergreen International Aviation, Inc.
$ 720,184 Term loan, maturing April 30, 2002 $ 720,184
1,435,522 Term loan, maturing April 30, 2003 1,435,522
204,152 Term loan, maturing May 31, 2003 204,152
MTL
2,672,065 Term loan, maturing August 28, 2005 2,672,065
2,290,341 Term loan, maturing February 28, 2006 2,290,341
Transportation Manufacturing Operations, Inc.
1,000,000 Term loan, maturing June 15, 2006 1,000,000
- ----------------------------------------------------------------------------
$ 8,322,264
- ----------------------------------------------------------------------------
Total Senior, Secured, Floating-Rate Interests
(identified cost $443,701,967) $ 443,701,967
- ----------------------------------------------------------------------------
CORPORATE BONDS & NOTES -- 13.45%
Principal
Amount
(000's omitted) Security Value
- ----------------------------------------------------------------------------
Apparel -- 0.60%
- ----------------------------------------------------------------------------
Hosiery Corp. of America, Inc.
$ 1,000 13.75%, 8/1/02 $ 1,085,000
William Carter Co.
1,000 Sr. Sub. Notes, 10.375%, 12/1/06 1,022,500
- ----------------------------------------------------------------------------
$ 2,107,500
- ----------------------------------------------------------------------------
Auto and Parts -- 0.21%
- ----------------------------------------------------------------------------
J.L. French Automotive Casting
$ 750 11.50%, 6/1/09(1) $ 768,750
- ----------------------------------------------------------------------------
$ 768,750
- ----------------------------------------------------------------------------
Broadcasting and Cable -- 0.90%
- ----------------------------------------------------------------------------
Golden Sky Systems
$ 1,000 12.375%, 8/1/06(1) $ 1,110,000
Pegasus Commerce
1,000 9.75%, 12/1/06(1) 1,005,000
Telewest PLC
1,000 11.25%, 11/1/08(1) 1,127,500
- ----------------------------------------------------------------------------
$ 3,242,500
- ----------------------------------------------------------------------------
Business Services -- 0.49%
- ----------------------------------------------------------------------------
Avis Rental Car
$ 500 11.00%, 5/1/09(1) $ 506,250
Federal Data Corp.
750 Sr. Sub. Notes, 10.125%, 8/1/05 723,750
Viasystems, Inc.
600 Sr. Sub. Notes, 9.75%, 6/1/07 528,000
- ----------------------------------------------------------------------------
$ 1,758,000
- ----------------------------------------------------------------------------
Business Services - Miscellaneous -- 0.92%
- ----------------------------------------------------------------------------
Anthony Crane Rentals
$ 500 Sr. Notes, 10.375%, 8/1/08(1) $ 485,000
NationsRent, Inc.
1,000 Sr. Sub. Notes, 10.375%, 12/15/08(1) 995,000
Neff Corp.
1,000 Sr. Sub. Notes, 10.25%, 6/1/08(1) 1,000,000
Richmont Marketing Special
1,000 Sr. Sub. Notes, 10.125%, 12/15/07(1) 845,000
- ----------------------------------------------------------------------------
$ 3,325,000
- ----------------------------------------------------------------------------
Chemicals -- 0.79%
- ----------------------------------------------------------------------------
Huntsman ICI Chemicals, LLC
$ 1,000 10.125%, 7/1/09(1) $ 1,010,000
Lyondell Chemical
1,000 Senior Notes, 9.875%, 5/1/07(1) 1,015,000
Polaroid Corp.
750 11.50%, 2/15/06 800,625
- ----------------------------------------------------------------------------
$ 2,825,625
- ----------------------------------------------------------------------------
Communications Services -- 0.20%
- ----------------------------------------------------------------------------
Loral Space and Commerce
$ 200 9.50%, 1/15/06 $ 174,500
NTL, Inc.
500 11.50%, 10/1/08 547,500
- ----------------------------------------------------------------------------
$ 722,000
- ----------------------------------------------------------------------------
Consumer Products -- 0.11%
- ----------------------------------------------------------------------------
Glenoit Corp.
$ 500 Sr. Sub. Notes, 11.00%, 4/15/07 $ 413,125
- ----------------------------------------------------------------------------
$ 413,125
- ----------------------------------------------------------------------------
Containers and Packaging -- 0.43%
- ----------------------------------------------------------------------------
Consumers International, Inc.
$ 500 Sr. Notes, 10.25%, 4/1/05 $ 507,500
Stone Container Corp.
1,000 1st Mtg. Notes, 10.75%, 10/1/02 1,042,500
- ----------------------------------------------------------------------------
$ 1,550,000
- ----------------------------------------------------------------------------
Engineering and Construction -- 0.27%
- ----------------------------------------------------------------------------
Level 3 Communications, Inc.
$ 1,000 Sr. Notes, 9.125%, 5/1/08 $ 987,500
- ----------------------------------------------------------------------------
$ 987,500
- ----------------------------------------------------------------------------
Entertainment -- 0.41%
- ----------------------------------------------------------------------------
Premier Parks, Inc.
$ 750 9.75%, 6/15/07 $ 761,250
Regal Cinemas, Inc.
750 9.50%, 6/1/08(1) 705,000
- ----------------------------------------------------------------------------
$ 1,466,250
- ----------------------------------------------------------------------------
Foods -- 0.34%
- ----------------------------------------------------------------------------
B & G Foods, Inc.
$ 500 Sub. Notes, 9.625%, 8/1/07 $ 473,125
Del Monte Corp.
651 Sr. Notes, 12.25%, 4/15/07 735,630
- ----------------------------------------------------------------------------
$ 1,208,755
- ----------------------------------------------------------------------------
Health Services -- 0.15%
- ----------------------------------------------------------------------------
Dade International, Inc.
$ 500 Sr. Sub. Notes, 11.125%, 5/1/06 $ 528,750
- ----------------------------------------------------------------------------
$ 528,750
- ----------------------------------------------------------------------------
Information Services -- 0.66%
- ----------------------------------------------------------------------------
Psinet, Inc.
$ 1,250 11.50%, 11/1/08(1) $ 1,325,000
Verio, Inc.
1,000 11.25%, 12/1/08(1) 1,052,500
- ----------------------------------------------------------------------------
$ 2,377,500
- ----------------------------------------------------------------------------
Lodging and Gaming -- 0.83%
- ----------------------------------------------------------------------------
Argosy Gaming
$ 500 10.75%, 6/1/09(1) $ 513,750
Coast Hotels and Casinos, Inc.
500 Sr. Sub. Notes, 9.50%, 4/1/09(1) 483,750
Hollywood Casino
1,000 Senior Notes 144A, 11.25%, 5/1/07(1) 1,012,500
Majestic Star Casino, LLC
1,000 10.875%, 7/1/06(1) 990,000
- ----------------------------------------------------------------------------
$ 3,000,000
- ----------------------------------------------------------------------------
Manufacturing -- 0.81%
- ----------------------------------------------------------------------------
Amkor Technology, Inc.
$ 1,000 9.25%, 5/1/06(1) $ 975,000
Fisher Scientific
1,000 9.00%, 2/1/08(1) 950,000
Transdigm Inc.
1,000 10.375%, 12/1/08(1) 985,000
- ----------------------------------------------------------------------------
$ 2,910,000
- ----------------------------------------------------------------------------
Medical Products -- 0.39%
- ----------------------------------------------------------------------------
Alliance Imaging
$ 1,500 Variable Rate, 9.54%, 12/15/05 $ 1,395,000
- ----------------------------------------------------------------------------
$ 1,395,000
- ----------------------------------------------------------------------------
Oil and Gas - Equipment and Services -- 0.28%
- ----------------------------------------------------------------------------
Leviathan Natural Gas
$ 990 10.375%, 6/1/09 $ 1,014,750
- ----------------------------------------------------------------------------
$ 1,014,750
- ----------------------------------------------------------------------------
Oil and Gas - Exploration Production -- 0.28%
- ----------------------------------------------------------------------------
Western Natural Gas
$ 1,000 10.00%, 6/15/09(1) $ 1,010,000
- ----------------------------------------------------------------------------
$ 1,010,000
- ----------------------------------------------------------------------------
Paper and Forest Products -- 0.34%
- ----------------------------------------------------------------------------
Repap New Brunswick, Inc.
$ 750 Sr. Notes, 9.00%, 6/1/04 $ 695,625
S.D. Warren Co.
500 Sr. Sub. Notes, 12.00%, 12/15/04 540,000
- ----------------------------------------------------------------------------
$ 1,235,625
- ----------------------------------------------------------------------------
Printing and Business Products -- 0.35%
- ----------------------------------------------------------------------------
MDC Communications Corp.
$ 1,250 Sr. Sub. Notes, 10.50%, 12/1/06 $ 1,262,500
- ----------------------------------------------------------------------------
$ 1,262,500
- ----------------------------------------------------------------------------
Publishing -- 0.49%
- ----------------------------------------------------------------------------
American Lawyer Media
$ 1,000 9.75%, 12/15/07 $ 1,025,000
Von Hoffman Press, Inc.
750 Sr. Sub. Notes, 10.875%, 5/15/07(1) 753,750
- ----------------------------------------------------------------------------
$ 1,778,750
- ----------------------------------------------------------------------------
Retail - Food and Drug -- 0.66%
- ----------------------------------------------------------------------------
AFC Enterprises, Inc.
$ 550 Sr. Sub Notes, 10.25%, 5/15/07 $ 566,500
King Pharm, Inc.
750 10.75%, 2/15/09 778,125
Pantry, Inc.
1,000 Sr. Sub. Notes, 10.25%, 10/15/07 1,012,500
- ----------------------------------------------------------------------------
$ 2,357,125
- ----------------------------------------------------------------------------
Retail - General -- 0.70%
- ----------------------------------------------------------------------------
Advance Stores Co., Inc.
$ 1,250 Sr. Sub. Notes, 10.25%, 4/15/08 $ 1,206,250
Kindercare Learning Ctrs., Inc.
1,000 Sr. Sub. Notes, 9.50%, 2/15/09 947,500
Tuesday Morning Corp.
345 Sr. Sub. Notes, 11.00%, 12/15/07 360,525
- ----------------------------------------------------------------------------
$ 2,514,275
- ----------------------------------------------------------------------------
Retail - Specialty and Apparel -- 0.14%
- ----------------------------------------------------------------------------
Ames Department Stores
$ 500 10.00%, 4/15/06(1) $ 493,125
- ----------------------------------------------------------------------------
$ 493,125
- ----------------------------------------------------------------------------
Telephone Utilities -- 0.21%
- ----------------------------------------------------------------------------
Nextlink Communications
$ 750 10.75%, 6/1/09 $ 772,500
- ----------------------------------------------------------------------------
$ 772,500
- ----------------------------------------------------------------------------
Trucks and Parts -- 0.20%
- ----------------------------------------------------------------------------
Pacer International, Inc.
$ 750 11.75%, 6/1/07(1) $ 731,250
- ----------------------------------------------------------------------------
$ 731,250
- ----------------------------------------------------------------------------
Wireline Communication Services -- 1.01%
- ----------------------------------------------------------------------------
Dobson/Signet Communications Corp.
$ 625 12.25%, 12/15/08(1) $ 653,125
Esprit Telecom Group PLC
1,000 Sr. Notes, 11.50%, 12/15/07 1,067,500
Hyperion Telecommunications, Inc.
1,000 Sr. Notes, 12.25%, 9/1/04 1,050,000
Metronet Communications
750 10.625%, 11/1/08(1) 849,375
- ----------------------------------------------------------------------------
$ 3,620,000
- ----------------------------------------------------------------------------
Wireline Communication Services - International -- 0.28%
- ----------------------------------------------------------------------------
Primus Telecom Group
$ 1,000 Sr. Notes, 11.25%, 1/15/09(1) $ 1,005,000
- ----------------------------------------------------------------------------
$ 1,005,000
- ----------------------------------------------------------------------------
Total Corporate Bonds & Notes (identified cost $47,504,640) $ 48,381,155
- ----------------------------------------------------------------------------
Commercial Paper -- 1.41%
- ----------------------------------------------------------------------------
Associates Corp.
$ 5,083 5.75%, 7/1/99 $ 5,083,000
- ----------------------------------------------------------------------------
Total Commercial Paper (amortized cost $5,083,000) $ 5,083,000
- ----------------------------------------------------------------------------
Total Investments -- 100.0% (identified cost $496,289,607) $ 497,166,122
- ----------------------------------------------------------------------------
Other Assets, Less Liabilities -- (38.21%) $(137,460,876)
- ----------------------------------------------------------------------------
Total Net Assets -- 100% $ 359,705,246
- ----------------------------------------------------------------------------
(1) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. It is the Fund's
intention to hold this security until maturity.
(2) Senior secured floating rate interests often require prepayments from excess
cash flow or permit the borrower to repay at its election. The degree to
which borrowers repay, whether as a contractual requirement or at their
election, cannot be predicted with accuracy. As a result, the actual
remaining maturity may be substantially less than the stated maturities
shown. However, it is anticipated that the senior secured floating rate
interests will have an expected average life of approximately three years.
See notes to financial statements
<PAGE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 1999
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Statement of Assets and Liabilities
As of June 30, 1999
Assets
- ------------------------------------------------------------------------------
Investments, at value
(identified cost, $496,289,607) $497,166,122
Cash 13,636,130
Receivable for investments sold 1,085,120
Interest receivable 3,840,077
Prepaid expenses 33,652
- ------------------------------------------------------------------------------
Total assets $515,761,101
- ------------------------------------------------------------------------------
Liabilities
- ------------------------------------------------------------------------------
Amounts due under commercial paper program $152,000,000
Dividends payable 253,141
Deferred facility fee income 3,011,098
Payable to affiliate for Trustees' fees 8,330
Accrued expenses:
Interest 605,624
Operating expense 177,662
- ------------------------------------------------------------------------------
Total liabilities $156,055,855
- ------------------------------------------------------------------------------
Net Assets for 35,660,000 shares of beneficial
interest outstanding $359,705,246
- ------------------------------------------------------------------------------
Sources of Net Assets
- ------------------------------------------------------------------------------
Paid-in capital $355,878,889
Accumulated net realized loss
(computed on the basis of identified cost) 298,920
Accumulated undistributed net investment income 2,650,922
Net unrealized appreciation
(computed on the basis of identified cost) 876,515
- ------------------------------------------------------------------------------
Total $359,705,246
- ------------------------------------------------------------------------------
Net Asset Value
- ------------------------------------------------------------------------------
($359,705,246 / 35,660,000 shares of
beneficial interest outstanding $ 10.09
- ------------------------------------------------------------------------------
See notes to financial statements
<PAGE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 1999
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
Statement of Operations
For the Period Ended
June 30, 1999(1)
Investment Income
- ------------------------------------------------------------------------------
Interest $26,948,271
Facility fees earned 830,036
Miscellaneous 73,590
- ------------------------------------------------------------------------------
Total investment income $27,851,897
- ------------------------------------------------------------------------------
Expenses
- ------------------------------------------------------------------------------
Investment adviser fee $ 2,747,986
Administration fee 806,604
Trustees fees and expenses 8,330
Interest 4,743,724
Legal and accounting services 274,385
Organization expenses 147,669
Custodian fee 123,066
Loan program structuring expense 63,699
Transfer and dividend disbursing agent fees 62,226
Printing and postage 26,875
Registration fees 21,781
Miscellaneous 353,524
- ------------------------------------------------------------------------------
Total expenses $ 9,379,869
- ------------------------------------------------------------------------------
Deduct --
Reduction of investment adviser fee $ 579,350
Reduction of administration fee 173,333
- ------------------------------------------------------------------------------
Total expense reductions $ 752,683
- ------------------------------------------------------------------------------
Net expenses $ 8,627,186
- ------------------------------------------------------------------------------
Net investment income $19,224,711
- ------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
- ------------------------------------------------------------------------------
Net realized gain (loss) --
Investment transactions (identified cost basis) $ 298,920
- ------------------------------------------------------------------------------
Net realized gain $ 298,920
- ------------------------------------------------------------------------------
Change in unrealized appreciation (depreciation) --
Investments (identified cost basis) $ 876,515
- ------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) $ 876,515
- ------------------------------------------------------------------------------
Net realized and unrealized gain $ 1,175,435
- ------------------------------------------------------------------------------
Net increase in net assets from operations $20,400,146
- ------------------------------------------------------------------------------
(1) For the period from the start of business, October 30, 1998, to
June 30, 1999.
See notes to financial statements
<PAGE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 1999
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS CONT'D
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
Increase (Decrease) For the Period Ended
in Net Assets June 30, 1999(1)
- ----------------------------------------------------------------------------
From operations --
Net investment income $ 19,224,711
Net realized gain 298,920
Net change in unrealized appreciation (depreciation) 876,515
- ----------------------------------------------------------------------------
Net increase in net assets from operations $ 20,400,146
- ----------------------------------------------------------------------------
Distributions to shareholders --
From net investment income $ (16,581,900)
- ----------------------------------------------------------------------------
Total distributions to shareholders $ (16,581,900)
- ----------------------------------------------------------------------------
Transactions in shares of beneficial interest --
Proceeds from sale of shares $ 356,500,000
Offering costs (713,000)
- ----------------------------------------------------------------------------
Net increase in net assets from Fund share transactions $ 355,787,000
- ----------------------------------------------------------------------------
Net increase in net assets $ 359,605,246
- ----------------------------------------------------------------------------
Net Assets
- ----------------------------------------------------------------------------
At beginning of period $ 100,000
- ----------------------------------------------------------------------------
At end of period $ 359,705,246
- ----------------------------------------------------------------------------
Accumulated undistributed net investment income
included in net assets
- ----------------------------------------------------------------------------
At end of period $ 2,650,922
- ----------------------------------------------------------------------------
(1) For the period from the start of business, October 30, 1998, to
June 30, 1999.
See notes to financial statements
<PAGE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 1999
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS CONT'D
- --------------------------------------------------------------------------------
Statement of Cash Flows
For the Period Ended
Increase (Decrease) in Cash June 30, 1999(1)
- -----------------------------------------------------------------------------
Cash Flows From (Used For) Operating Activities --
Purchases of loan interests and corporate bonds $(610,073,800)
Proceeds from sales and principal repayments 118,164,962
Interest received 23,054,715
Facility fees received 3,810,644
Miscellaneous income received 73,590
Interest paid (4,138,100)
Operating expenses paid (3,731,122)
Net increase in short-term investments (5,083,000)
- -----------------------------------------------------------------------------
Net cash used for operating activities $(477,922,111)
- -----------------------------------------------------------------------------
Cash Flows From (Used For) Financing Activities --
Proceeds from shares sold $ 356,500,000
Payments for offering costs (713,000)
Cash distributions paid (16,328,759)
Net increase in amounts due under commercial paper program 152,000,000
- -----------------------------------------------------------------------------
Net cash from financing activities $ 491,458,241
- -----------------------------------------------------------------------------
Net increase in cash $ 13,536,130
- -----------------------------------------------------------------------------
Cash at Beginning of Period $ 100,000
- -----------------------------------------------------------------------------
Cash at End of Period $ 13,636,130
- -----------------------------------------------------------------------------
Reconciliation of Net Increase in Net Assets
From Operations to Net Cash Used For
Operating Activities
- -----------------------------------------------------------------------------
Net Increase in net assets from operations $ 20,400,146
Increase in receivable for investments sold (1,085,120)
Increase in interest receivable (3,840,077)
Increase in prepaid expenses (33,652)
Increase in deferred facility fee income 3,011,098
Increase in payable to affiliate 8,330
Increase in accrued expenses 783,286
Net increase in investments (497,166,122)
- -----------------------------------------------------------------------------
Net cash used for operating activities $(477,922,111)
- -----------------------------------------------------------------------------
(1) For the period from the start of business, October 30, 1998, to
June 30, 1999.
See notes to financial statements
<PAGE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 1999
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS CONT'D
- --------------------------------------------------------------------------------
Financial Highlights
Period Ended
June 30, 1999(1)(2)
- ----------------------------------------------------------------------------
Net asset value -- Beginning of period $ 10.000
- ----------------------------------------------------------------------------
Income (loss) from operations(1)(2)
- ----------------------------------------------------------------------------
Net investment income $ 0.539
Net realized and unrealized gain 0.036
- ----------------------------------------------------------------------------
Total income from operations $ 0.575
- ----------------------------------------------------------------------------
Less distributions
- ----------------------------------------------------------------------------
From net investment income $ (0.465)
- ----------------------------------------------------------------------------
Total distributions $ (0.465)
- ----------------------------------------------------------------------------
Offering costs charged to paid-in capital $ (0.020)
- ----------------------------------------------------------------------------
Net asset value -- End of period $ 10.090
- ----------------------------------------------------------------------------
Market value -- End of period $ 10.000
- ----------------------------------------------------------------------------
Total Return(4) 4.93%
- ----------------------------------------------------------------------------
Ratios/Supplemental Data+
- ----------------------------------------------------------------------------
Net assets, end of period (000's omitted) $359,705
Ratios (As a percentage of average daily net assets):
Net operating expenses 1.65%(3)
Net interest expense 2.02%(3)
Net investment income 8.17%(3)
Portfolio Turnover 27%
- ----------------------------------------------------------------------------
+ The operating expenses of the Trust reflect a reduction of the investment
adviser fee and the administation fee. Had such actions not been taken, the
ratios and net investment income per share would have been as follows:
Ratios (As a percentage of average daily net assets):
Operating expenses 1.97%(3)
Interest expense 2.02%(3)
Net investment income 7.85%(3)
Net investment income per share $ 0.518
- ----------------------------------------------------------------------------
(1) For the period from the start of business, October 30, 1998, to June 30,
1999.
(2) Net investment income per share was computed using average shares
outstanding.
(3) Annualized.
(4) Total return is calculated assuming a purchase at market value on the
first day and a sale at the market value on the last day of the period
reported. Dividends and distributions, if any, are assumed reinvested on
the reinvestment date. Total return is not computed on an annualized
basis.
See notes to financial statements
<PAGE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 1999
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1 Significant Accounting Policies
- --------------------------------------------------------------------------------
Eaton Vance Senior Income Trust (the Trust) is an entity commonly known as a
Massachusetts business trust and is registered under the Investment Company
Act of 1940 as a non-diversified closed-end management investment company. The
following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
policies are in conformity with generally accepted accounting principles.
A Investment Valuation -- The Trust's investments in interests in senior
secured floating rate loans (Senior Loans) are valued at fair value by the
Trust's investment adviser, Eaton Vance Management (EVM), under procedures
established by the Trustees as permitted by Section 2(a)(41) of the Investment
Company Act of 1940. Such procedures include the consideration of relevant
factors, data and information relating to fair value, including (i) the
characteristics of and fundamental analytical data relating to the Senior
Loan, including the cost, size, current interest rate, period until next
interest rate reset, maturity and base lending rate of the Senior Loan, the
terms and conditions of the loan and any related agreements and the position
of the loan in the borrower's debt structure; (ii) the nature, adequacy and
value of the collateral, including the Trust's rights, remedies and interests
with respect to the collateral; (iii) the creditworthiness of the borrower,
based on evaluations of its financial condition, financial statements and
information about the borrower's business, cash flows, capital structure and
future prospects; (iv) information relating to the market for the Senior Loan
including price quotations for and trading in the Senior Loan and interests in
similar loans and the market environment and investor attitudes towards the
Senior Loan and interests in similar loans; (v) the reputation and financial
condition of the agent bank and any intermediate participant in the loan; and
(vi) general economic and market conditions affecting the fair value of the
Senior Loan. Other portfolio securities (other than short-term obligations,
but including listed issues) may be valued on the basis of prices furnished by
one or more pricing services which determine prices for normal,
institutional-size trading units of such securities using market information,
transactions for comparable securities and various relationships between
securities which are generally recognized by institutional traders. In certain
circumstances, portfolio securities will be valued at the last sales price on
the exchange that is the primary market for such securities, or the last
quoted bid price for those securities for which the over-the-counter market is
the primary market or for listed securities in which there were no sales
during the day. The value of interest rate swaps will be determined in
accordance with a discounted present value formula and then confirmed by
obtaining a bank quotation. Short-term obligations which mature in sixty days
or less are valued at amortized cost, if their original term to maturity when
acquired by the Trust was 60 days or less or are valued at amortized cost
using their value on the 61st day prior to maturity, if their original term to
maturity when acquired by the Trust was more then 60 days, unless in each case
this is determined not to represent fair value. Repurchase agreements are
valued at cost plus accrued interest. Other portfolio securities for which
there are no quotations or valuations are valued at fair value as determined
in good faith by or on behalf of the Trustees.
B Income -- Interest income from Senior Loans is recorded on the accrual basis
at the then-current interest rate, while all other interest income is
determined on the basis of interest accrued, adjusted for amortization of
premium or discount when required for federal income tax purposes. Facility
fees received are recognized as income over the expected term of the loan.
C Federal Taxes -- The Trust's policy is to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute to shareholders each year all of its taxable income, including any
net realized gain on investments. Accordingly, no provision for federal income
or excise tax is necessary.
D Expense Reduction -- Investors Bank & Trust Company (IBT) serves as
custodian of the Trust. Pursuant to the custodian agreement, IBT receives a
fee reduced by the credits which are determined based on the average daily
cash balances the Portfolio maintains with IBT. All significant credit
balances used to reduce the Trust's custodian fees are reported as a
reduction of expenses on the Statement of Operations.
E Use of Estimates -- The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts
of revenue and expense during the reporting period. Actual results could
differ from those estimates.
F Offering Costs -- Costs incurred by the Trust in connection with the initial
offering of Trust shares were recorded as a reduction of paid-in capital.
G Other -- Investment transactions are accounted for on the date the
investments are purchased or sold. Gains and losses on securities sold are
determined on the basis of identified cost.
2 Distributions to Shareholders
- --------------------------------------------------------------------------------
Distributions to shareholders are recorded on the ex-dividend date. The Trust
distinguishes between distributions on a tax basis and a financial reporting
basis. Generally accepted accounting principles require that only
distributions in excess of tax basis earnings and profits be reported in the
financial statements as a tax return of capital. Differences in the
recognition or classification of income between the financial statements and
tax earnings and profits which result in temporary over-distributions for
financial statement purposes are classified as distributions in excess of net
investment income or accumulated net realized gains. Permanent differences
between book and tax accounting relating to distributions are reclassified to
paid-in capital.
3 Shares of Beneficial Interest
- --------------------------------------------------------------------------------
The agreement and Declaration of Trust permits the Trustees to issue an
unlimited number of full and fractional $0.01 par value shares of beneficial
interest. Transactions in Trust shares were as follows:
Period Ended
June 30, 1999(1)
---------------------------------------------------------------
Sales 35,660,000
---------------------------------------------------------------
Net increase 35,660,000
---------------------------------------------------------------
(1) For the period from the start of business, October 30, 1998, to June 30,
1999.
4 Investment Adviser Fee and Other Transactions with Affiliates
- --------------------------------------------------------------------------------
The investment adviser fee, computed at a monthly rate of 17/240 of 1% (0.85%
annually) of the Trust's average weekly gross assets, was earned by EVM as
compensation for investment advisory services rendered to the Trust. For the
period ended June 30, 1999, the fee was equivalent to 0.85% (annualized) of
the Trust's average daily gross assets for such period and amounted to
$2,747,986. Except for Trustees of the Trust who are not members of EVM's
organization, officers and Trustees receive remuneration for their services to
the Trust out of such investment adviser fee. EVM also serves as the
administrator of the Trust. An administration fee, computed at the monthly
rate of 1/48 of 1% (0.25% annually) of the average weekly gross assets of the
Trust, is paid to EVM for administering business affairs of the Trust. For the
period ended June 30, 1999, the fee was equivalent to 0.25% (annualized) of
the Trust's average daily gross assets for such period and amounted to
$806,604. To enhance the net income of the Trust, EVM made reductions of its
investment adviser and administration fees in the amounts of $579,350 and
$173,333, respectively.
Certain of the officers and one Trustee of the Trust are officers of EVM.
5 Investment Transactions
- --------------------------------------------------------------------------------
The Trust invests primarily in Senior Loans. The ability of the issuers of the
Senior Loans held by the Trust to meet their obligations may be affected by
various factors including economic developments in a specific industry. The
cost of purchases and the proceeds from principal repayments and sales of
Senior Loans and corporate bonds aggregated $610,073,800 and $119,250,082,
respectively, for the period from the start of business, October 30, 1998, to
June 30, 1999.
6 Short-Term Debt and Credit Agreements
- --------------------------------------------------------------------------------
The Trust has entered into a revolving credit agreement that will allow the
Trust to borrow $178 million to support the issuance of commercial paper and
to permit the Trust to invest in accordance with its investment practices.
Interest is charged under the revolving credit agreement at the bank's base
rate or at an amount above either the bank's adjusted certificate of deposit
rate or federal funds effective rate. Interest expense includes a commitment
fee of approximately $170,000 which is computed at the annual rate of 0.15% on
the unused portion of the revolving credit agreement. There were no borrowings
under this agreement during the period. As of June 30, 1999, the Trust had
commercial paper outstanding of $152,000,000, at an interest rate of 5.12%.
Maximum and average borrowings for the period from the start of business,
October 30, 1998, to June 30, 1999 were $155,000,000 and $142,000,000,
respectively, and the average interest rate was $5.08%.
7 Federal Income Tax Basis of Investments
- --------------------------------------------------------------------------------
The cost and unrealized appreciation/depreciation in value of the investments
owned at June 30, 1999, as computed on a federal income tax basis, were as
follows:
Aggregate cost $496,289,607
-------------------------------------------------------------------------
Gross unrealized appreciation $ 1,229,875
Gross unrealized depreciation (353,360)
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Net unrealized appreciation $ 876,515
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<PAGE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 1999
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INDEPENDENT AUDITORS' REPORT
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To the Trustees and Shareholders
of Eaton Vance Senior Income Trust
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We have audited the accompanying statement of assets and liabilities, including
the portfolio of investments, of Eaton Vance Senior Income Trust (the Trust) as
of June 30, 1999, and the related statements of operations, changes in net
assets, and cash flows and the financial highlights for the period from the
start of business, October 30, 1998, to June 30, 1999. 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 audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements and financial highlights are
free of material misstatement. Our procedures included confirmation of
securities and Senior Loans owned at June 30, 1999 by correspondence with the
custodian, brokers and selling or agent banks; where replies were not received
from brokers or selling or agent banks, we performed other auditing procedures.
An audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes assessing
the accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights, referred to
above, present fairly, in all material respects, the financial position of Eaton
Vance Senior Income Trust at June 30, 1999, the results of its operations, the
changes in its net assets, its cash flows and its financial highlights for the
period from the start of business, October 30, 1998 to June 30, 1999 in
conformity with generally accepted accounting principles.
As discussed in Note 1A, the financial statements include Senior Loans held by
the Trust valued at $443,701,967 (123.35% of net assets of the Trust), which
values are fair values determined by the Trust's investment adviser in the
absence of actual market values. Determination of fair value involves subjective
judgment, as the actual market value of a particular Senior Loan or security can
be established only by negotiations between the parties in a sale transaction.
We have reviewed the procedures established by the Trustees and used by the
Trust's investment adviser in determining the fair values of such Senior Loans
and securities and have inspected underlying documentation, and in the
circumstances, we believe that the procedures are reasonable and the
documentation appropriate.
DELOITTE & TOUCHE LLP
Boston, Massachusetts
August 13, 1999
<PAGE>
EATON VANCE SENIOR INCOME TRUST
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DIVIDEND REINVESTMENT PLAN
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The Trust offers a dividend reinvestment plan (the "Plan") pursuant to which
shareholders automatically have dividends and capital gains distributions
reinvested in common shares (the "Shares") of the Trust unless they elect
otherwise through their investment dealer. On the distribution payment date, if
the net asset value per Share is equal to or less than the market price per
Share plus estimated brokerage commissions then new Shares will be issued. The
number of Shares shall be determined by the greater of the net asset value per
Share or 95% of the market price. Otherwise, Shares generally will be purchased
on the open market by the Plan Agent. Distributions subject to income tax (if
any) are taxable whether or not shares are reinvested.
If your shares are in the name of a brokerage firm, bank, or other nominee,
you can ask the firm or nominee to participate in the Plan on your behalf. If
the nominee does not offer the Plan, you will need to request that your shares
be re-registered in your name with the Trust's transfer agent, First Data
Investor Services Group or you will not be able to participate.
The Plan Agent's service fee for handling distributions will be paid by the
Trust. Each participant will be charged their pro rata share of brokerage
commissions on all open-market purchases.
Plan participants may withdraw from the Plan at any time by writing to the Plan
Agent at the address noted on the following page. If you withdraw, you will
receive shares in your name for all Shares credited to your account under the
Plan. If a participant elects by written notice to the Plan Agent to have the
Plan Agent sell part or all of his or her Shares and remit the proceeds, the
Plan Agent is authorized to deduct a $5.00 fee plus brokerage commissions from
the proceeds.
If you wish to paticipate in the Plan and your shares are held in your own name,
you may complete the form on the following page and deliver it to the Plan
Agent.
Any inquiries regarding the Plan can be directed to the Plan Agent, First Data
Investor Services Group, at 1-800-331-1710.
<PAGE>
EATON VANCE SENIOR INCOME TRUST
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APPLICATION FOR PARTICIPATION IN DIVIDEND REINVESTMENT PLAN
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This form is for shareholders who hold their common shares in their own names.
If your common shares are held in the name of a brokerage firm, bank, or other
nominee, you should contact your nominee to see if it will participate in the
Plan on your behalf. If you wish to participate in the Plan, but your brokerage
firm, bank or nominee is unable to participate on your behalf, you should
request that your common shares be re-registered in your own name which will
enable your participation in the Plan.
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The following authorization and appointment is given with the understanding that
I may terminate it at any time by terminating my participation in the Plan as
provided in the terms and conditions of the Plan.
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Please print exact name on account:
-----------------------------------------------
Shareholder signature Date
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Shareholder signature Date
Please sign exactly as your common shares are
registered. All persons whose names appear on
the share certificate must sign.
YOU SHOULD NOT RETURN THIS FORM IF YOU WISH TO RECEIVE YOUR DIVIDENDS AND
DISTRIBUTIONS IN CASH. THIS IS NOT A PROXY.
THE AUTHORIZATION FORM, WHEN SIGNED, SHOULD BE MAILED TO THE FOLLOWING ADDRESS:
Eaton Vance Senior Income Trust
c/o First Data Investor Services Group
P.O. Box 8030
Boston, MA 02266-8030
800-331-1710
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NUMBER OF EMPLOYEES
The Trust is organized as a Massachusetts business trust and is registered under
the Investment Company Act of 1940, as amended, as a closed-end, nondiversified,
management investment company and has no employees.
<PAGE>
NUMBER OF SHAREHOLDERS
As of June 30, 1999, our records indicate that there are 320 registered
shareholders and approximately 14,500 shareholders owning Trust shares in
"street" name, such as through brokers, banks, and other financial
intermediaries.
If you are a "street" name shareholder and wish to directly receive our reports,
which contain important information about the Trust, please write or call:
Eaton Vance Distributors, Inc.
The Eaton Vance Building
255 State Street
Boston, MA 02109
1-800-225-6265
NEW YORK STOCK EXHANGE SYMBOL
The New York Stock Exchange symbol is EVF.
<PAGE>
EATON VANCE SENIOR INCOME TRUST as of June 30, 1999
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MANAGEMENT
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Officers Trustees
JAMES B. HAWKES JESSICA M. BIBLIOWICZ
President, Chief Executive President and Chief Executive Officer,
Officer and Trustee National Financial Partners
SCOTT H. PAGE DONALD R. DWIGHT
Vice President and President, Dwight Partners, Inc.
Co-Portfolio Manager
SAMUEL L. HAYES, III
PAYSON F. SWAFFIELD Jacob H. Schiff Professor of Investment
Vice President and Banking Emeritus Harvard University
Co-Portfolio Manager Graduate School of Business Administration
MICHAEL W. WEILHEIMER NORTON H. REAMER
Vice President Chairman and Chief Executive Officer,
United Asset Management Corporation
JAMES L. O'CONNOR
Treasurer
LYNN A. STOUT
Professor of Law,
ALAN R. DYNNER Georgetown University Law Center
Secretary
JACK L. TREYNOR
Investment Adviser and Consultant
<PAGE>
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<PAGE>
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<PAGE>
INVESTMENT ADVISER AND ADMINISTRATOR OF
EATON VANCE SENIOR INCOME TRUST
Eaton Vance Management
The Eaton Vance Building
255 State Street
Boston, MA 02109
CUSTODIAN
Investors Bank & Trust Company
200 Clarendon Street
Boston, MA 02116
TRANSFER AGENT
First Data Investor Services Group
Attention: Eaton Vance Funds
P.O. Box 5123
Westborough, MA 01581-5123
EATON VANCE SENIOR INCOME TRUST
THE EATON VANCE BUILDING
255 STATE STREET
BOSTON, MA 02109
2-2241-8/99 SITSRC-8/99
