- --------------------------------------------------------------------------------
January 28, 2000
Dear Shareholders:
At year-end, the Fund's shares closed at $3.125, a 19% discount from the net
asset value (NAV) of $3.86. This does not compare well with the prior year's
closing market price of $4.25, a 2% premium to the year-end 1998 NAV of $4.16.
However this loss in net asset value per share was offset by $.4825 per share
paid in dividends for 1999. All U.S. fixed income markets, including the U.S.
Treasury market, did very poorly in 1999; high yield securities actually
outperformed other classes of higher quality securities in 1999 as discussed in
more detail below.
The Fund's January 2000 distribution combined a special distribution of the
undistributed 1999 income and a monthly dividend. At a recent market price of
$3.125, annualizing the current monthly dividend of $.035, the Fund's shares had
a current yield of 13.4%. The common share dividend has been reduced due to a
number of circumstances, the most significant of which are:
o Higher interest rates increasing the Fund's cost of leverage
o Losses incurred in the portfolio
o Upgrading of the quality of our portfolio holdings with the concomitant
reduction of income
Some of the portfolio actions were taken specifically to ensure that the Fund
maintained an ample cushion of over-collateralization to safeguard the Fund's
AAA preferred stock rating. We are hopeful that we have seen the worst of this
cycle.
Performance
Given the general drop in bond prices during the year, the Fund's returns were
further reduced by the impact of leverage. Conversely, the Fund's leverage
positively impacts returns when prices, on average, are stable or improve.
Despite the Fund's relatively high degree of leverage, it outperformed the
average return of the Lipper Closed-End Fund Leveraged High Yield Average for
the year.
During the year, the Board of Directors re-appointed Wellington Management
Company, LLP to serve as the Fund's investment adviser for another twelve-month
term.
<TABLE>
<CAPTION>
Total Returns for Periods Ended December 31, 1999
-------------------------------------------------
One Year Three Years
---------- ------------------------------------
Cumulative Avg. Annual
------------ ------------
<S> <C> <C> <C>
New America High Income Fund
(NAV and Dividends)* 4.7% 16.0% 5.1%
Lipper Closed-End Fund Leveraged
High Yield Average* 2.8 15.1 4.8
New America High Income Fund
(Stock Price and Dividends) (16.9) (14.0) (4.9)
Ten Year U.S. Treasury Note (8.4) 15.0 4.8
</TABLE>
* Returns are adjusted for dilutive effect of rights offerings as calculated by
Lipper Analytical Services, Inc.
Source: Lipper Analytical Services, Inc. and The New America High Income Fund,
Inc.
<PAGE>
- --------------------------------------------------------------------------------
High Yield Market
The high yield market experienced its second consecutive year of poor returns
during the period ended December 31, 1999. Despite the market's initial recovery
during the first half of the year from the liquidity/confidence crisis wreaked
by the implosion of Long Term Capital Management's speculations and the default
of Russia during the latter half of 1998, the market again weakened during the
latter half of 1999. Market uncertainty developed in the face of poor demand, as
noted by mutual fund redemptions and limited other institutional activity, an
increase in interest rates driven by rate hikes announced by the Federal Reserve
Board, and perhaps most destabilizing, concerns about increased default rates.
With respect to the latter concern, we would first observe that default rates
did increase markedly during 1999 relative to 1998. (Moody's Issuer-Based
Default Rate nearly doubled for the twelve month period ended November 1999 to
5.9% from 3.0% for the prior period.) Upon cursory investigation, this would
seem surprising in light of the generally strong US economy. However, to some
degree, the high default rate reflects the two-year assault of weak global
markets and over-capacity as a result of the Asian crisis, recession in Japan,
and economic uncertainty in Europe. Poor commodity prices, such as in energy,
drove smaller companies, in particular, to lose access to capital at a time when
business prospects were pressured. Pricing power, as well, has all but vanished
in the global competitive arena, unfavorably positioning producers of low value
added goods. In addition, the healthcare industry was specifically damaged by
governmental change in reimbursement rates and regulations. As we head into the
year 2000, we believe that some of these trends have already shifted direction.
The Asian markets have come back with surprising gusto, Japan appears to be
bottoming, and Europe is strengthening. Latin American markets have also
stabilized since 1998 with Brazil showing much stronger resilience than
expected. Global demand for commodities should be on the upswing. US industrials
should benefit as worldwide demand/supply comes back into line; meanwhile, the
economy in the US continues to be strong. We believe the prospects for a
healthier world economy should support credit fundamentals for the market.
With respect to technical conditions, we expect the market to be somewhat more
capricious. Although the Fed has announced a bias towards further tightening,
inflation is not pervasive. Productivity continues to improve. Finally, the low
average dollar price of the high yield market and relatively high imbedded yield
may cushion the market somewhat relative to higher quality instruments (e.g.,
Treasuries) in light of potential interest rate increases. (Of note, 10-Year US
Treasuries, as reported by Lehman Brothers, returned -8.4% during 1999 whereas
the high yield market, as measured by the Lehman Brothers High Yield Index,
returned +2.4%.) High yield bonds tend to be as correlated to returns in the
equity market as they are to returns in the bond market, and at least during the
early days of the new year, both have been extremely volatile.
The Fund is highly diversified with exposure to over 150 different corporate
issuers. The top ten issuers of the Fund represent 15.6% of investments. The
average quality of the Fund is rated B1/BB- by Moody's and Standard and Poor's
respectively, and the average yield, incorporating potential calls, is 10.6%.
Average maturity and duration (including optionality) are 6.7 years and 4.7,
although we would caution that these statistics have less bearing for a high
yield bond portfolio than for an investment grade bond portfolio.
2
<PAGE>
- --------------------------------------------------------------------------------
For additional information, please visit the Fund's web-site at
www.newamerica-hyb.com. As always, we appreciate your interest in the Fund.
Sincerely,
/s/ Robert F. Birch /s/ Catherine A. Smith
Robert F. Birch Catherine A. Smith
President Senior Vice President
The New America High Income Fund, Inc. Wellington Management Company, LLP
3
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Schedule of Investments -- December 31, 1999 (Dollar Amounts in Thousands)
================================================================================
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
CORPORATE DEBT SECURITIES -- 91.63% (e)
- --------------------------------------------------------------------------------
Aerospace and Defense -- 2.19%
<S> <C> <C> <C>
$ 2,000 Argo-Tech Corporation, Senior
Subordinated Notes, 8.625%,
10/01/07 ............................ B3 $ 1,760
2,500 L-3 Communications Corporation,
Senior Subordinated Notes,
8.50%, 05/15/08 ..................... B2 2,344
3,500 Loral Space Communications,
Senior Notes, 9.50%, 01/15/06 ....... B1 3,185
3,000 Moog, Inc., Senior Subordinated
Notes, 10%, 05/01/06 ................ B1 3,067
-------
10,356
-------
Automobile -- 5.50%
7,000 Accuride Corporation, Senior
Subordinated Notes, 9.25%,
02/01/08 ............................ B2 6,440
3,500 Exide Corp., Senior Notes, 10%,
04/15/05 ............................ B1 3,395
3,500 Federal-Mogul Corporation, Notes,
7.375%, 01/15/06 .................... Ba2 3,202
3,500 Federal-Mogul Corporation, Senior
Notes, 8.80%, 04/15/07 .............. Ba2 3,409
1,500 Hayes Lemmerz International, Inc.,
Senior Subordinated Notes,
8.25%, 12/15/08 ..................... B2 1,372
2,000 Hayes Wheels International, Inc.,
Senior Subordinated Notes,
9.125%, 07/15/07 .................... B2 1,955
3,000 Key Plastics, Inc., Senior
Subordinated Notes, 10.25%,
03/15/07 ............................ B3 1,140
2,265 LDM Technologies, Inc., Senior
Subordinated Notes, 10.75%,
01/15/07 ............................ B3 2,061
1,500 Lear Corporation, Subordinated
Notes, 9.50%, 07/15/06 .............. Ba3 1,515
1,880 Prestolite Electric, Incorporated,
Senior Notes, 9.625%, 02/01/08....... B3 1,466
-------
25,955
-------
Banking -- 2.03%
3,000 Olympic Financial Ltd., Senior
Notes, 11.50%, 03/15/07 ............. B3 3,120
</TABLE>
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 710 United Companies Financial
Corporation, Subordinated
Notes, 8.375%, 07/01/05 (a)(c) ...... C $ 7
7,000 Western Financial Savings Bank,
Subordinated Capital
Debentures, 8.875%, 08/01/07 ........ B2 6,440
-------
9,567
-------
Beverage, Food and Tobacco -- 1.03%
500 Purina Mills, Inc., Senior
Subordinated Notes, 9%,
03/15/10 (a)(c) ..................... Ca 125
5,000 Vlasic Foods International, Inc.,
Senior Subordinated Notes,
10.25%, 07/01/09 .................... B2 4,763
-------
4,888
-------
Buildings and Real Estate -- 7.39%
2,580 Aracruz Celulose S.A., Notes,
10.375%, 01/31/02 (i) ............... B2 2,561
690 Associated Materials Incorporated,
Senior Subordinated Notes,
9.25%, 03/01/08 ..................... B2 663
4,000 Beazer Homes USA, Inc., Senior
Notes, 8.875%, 04/01/08 ............. Ba3 3,700
5,000 Del Webb Corporation, Senior
Subordinated Debentures,
10.25%, 02/15/10 .................... B2 4,800
2,500 D.R. Horton, Inc., Senior Notes,
8%, 02/01/09 ........................ Ba1 2,300
5,010 Kaufman and Broad Home
Corporation, Senior Subordinated
Notes, 9.625%, 11/15/06 ............. B1 5,060
4,000 The Ryland Group, Inc., Senior
Subordinated Notes, 8.25%,
04/01/08 ............................ B1 3,640
5,000 Standard Pacific Corp., Senior
Notes, 8.50%, 06/15/07 .............. Ba2 4,812
2,000 Standard Pacific Corp., Senior
Notes, 8%, 02/15/08 ................. Ba2 1,830
2,000 Toll Corp., Senior Subordinated
Notes, 7.75%, 09/15/07 .............. Ba2 1,840
4,000 U.S. Home Corporation, Senior
Subordinated Notes, 8.88%,
08/15/07 ............................ Ba2 3,690
-------
34,896
-------
</TABLE>
The accompanying notes are an integral
part of these financial statements.
4
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Schedule of Investments -- December 31, 1999 -- Continued
(Dollar Amounts in Thousands)
================================================================================
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
CORPORATE DEBT SECURITIES -- continued
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Chemicals, Plastics and Rubber -- 4.78%
$ 2,000 Acetex Corporation, Senior
Secured Notes, 9.75%,
10/01/03 ........................... B3 $ 1,820
7,000 Arco Chemical Co., Debentures,
9.80%, 02/01/20 .................... Ba3 7,000
1,500 Borden Chemicals and Plastics
Operating Limited Partnership,
Notes, 9.50%, 05/01/05 ............. B1 1,395
1,500 Buckeye Cellulose Corporation,
Senior Subordinated Notes,
8.50%, 12/15/05 .................... Ba3 1,466
2,500 Georgia Gulf Corp., Senior
Subordinated Notes, 10.375%,
11/01/07 (i) ....................... B1 2,609
2,010 Huntsman ICI Chemicals, LLC,
Senior Subordinated Notes,
10.125%, 07/01/09 (i) .............. B2 2,060
2,620 Lyondell Chemical Company,
Senior Subordinated Notes,
10.875%, 05/01/09 .................. B2 2,764
1,500 PCI Chemicals Canada Inc.,
Senior Secured Notes, 9.25%,
10/15/07 ........................... B3 1,155
750 Sterling Chemicals, Inc., Senior
Subordinated Notes, 11.75%,
08/15/06 ........................... Caa3 563
1,000 Texas Petrochemicals Corporation,
Senior Subordinated Notes,
Series B, 11.125%, 07/01/06 ........ Caa1 870
1,000 Texas Petrochemicals Corporation,
Senior Subordinated Notes,
11.125%, 07/01/06 .................. Caa1 870
-------
22,572
-------
Containers, Packaging and Glass -- 5.35%
1,220 Anchor Glass Container
Corporation, First Mortgage
Notes, 11.25%, 04/01/05 ............ B3 1,043
1,500 BWAY Corporation, Senior
Subordinated Notes, 10.25%,
04/15/07 ........................... B2 1,470
2,910 Consumers Packaging, Inc.,
Senior Notes, 9.75%, 02/01/07 ...... B1 2,037
</TABLE>
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 1,000 Container Corporation of America,
Senior Notes, Series B, 10.75%,
05/01/02 ........................... B2 $ 1,051
4,000 Container Corporation of America,
Senior Notes, 9.75%, 04/01/03 ...... B2 4,150
2,500 Corning Consumer Products Co.,
Senior Subordinated Notes,
9.625%, 05/01/08 ................... B3 1,963
2,000 Domtar Inc., Debentures, 9.50%,
08/01/16 ........................... Ba1 2,120
1,250 Packaging Corporation of America,
Senior Subordinated Notes,
9.625%, 04/01/09 ................... B3 1,281
2,500 Paperboard Industries International
Inc., Senior Notes, 8.375%,
09/15/07 ........................... Ba3 2,375
6,000 Silgan Corporation, Senior
Subordinated Debentures, 9%,
06/01/09 ........................... B1 5,805
2,000 Tembec Industries Inc.,
Guaranteed Senior Notes,
8.625%, 06/30/09 ................... Ba3 2,000
-------
25,295
-------
Diversified/Conglomerate Manufacturing -- 1.33%
2,500 Clark Material Handling Co.,
Senior Notes, Series D, 10.75%,
11/15/06 ........................... Caa1 775
2,000 Henry Company, Senior Notes,
10%, 04/15/08 ...................... B3 1,640
500 International Wire Group, Inc.,
Senior Subordinated Notes,
Series B, 11.75%, 06/01/05 ......... B3 516
2,500 International Wire Group, Inc.,
Senior Subordinated Notes,
11.75%, 06/01/05 ................... B3 2,581
1,000 Numatics, Incorporated, Senior
Subordinated Notes, 9.625%,
04/01/08 ........................... B3 750
-------
6,262
-------
Diversified/Conglomerate Service -- 5.19%
5,000 Allied Waste North America, Inc.,
Senior Notes, 7.625%, 01/01/06...... Ba3 4,500
</TABLE>
The accompanying notes are an integral
part of these financial statements.
5
<PAGE>
The New6 America High Income Fund, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Schedule of Investments -- December 31, 1999 -- Continued
(Dollar Amounts in Thousands)
================================================================================
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
CORPORATE DEBT SECURITIES -- continued
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 1,000 Allied Waste North America, Inc.,
Senior Subordinated Notes,
10%, 08/01/09 (i) .................. B2 $ 890
4,000 DecisionOne Corporation, Senior
Subordinated Notes, 9.75%,
08/01/07(c) ........................ C 2
1,750 DecisionOne Holdings Corp.,
Senior Discount Debentures,
11.50%, 08/01/08 (c) ............... C 1
3,500 Globo Communcacoes e
Participacoes S.A., Notes,
10.625%, 12/15/08 (i) .............. B2 2,949
2,500 Outdoor Systems, Inc., Senior
Subordinated Notes, 8.875%,
06/15/07 ........................... B1 2,588
2,500 PSINet Inc., Senior Notes, 11%,
08/01/09 ........................... B3 2,562
3,000 PSINet Inc., Senior Notes, 10%,
02/15/05 ........................... B3 2,970
2,000 Rogers Communications Inc.,
Senior Notes, 8.875%, 07/15/07...... B2 1,975
3,500 United Rentals (North America),
Inc., Senior Subordinated Notes,
9%, 04/01/09 ....................... B1 3,290
1,300 Waste Management, Inc.,
Debentures, 7.65%, 03/15/11 ........ Ba1 1,120
2,000 Waste Management, Inc., Senior
Notes, 6.875%, 05/15/09 (i) ........ Ba1 1,690
-------
24,537
-------
Diversified Natural Resources, Metals and
Minerals -- 1.06%
3,000 P&L Coal Holdings Corporation,
Senior Notes, 8.875%, 05/15/08...... Ba3 2,932
2,000 Pacifica Papers Inc., Senior Notes,
10%, 03/15/09 ...................... B1 2,070
-------
5,002
-------
Electronics -- 6.56%
3,000 Advanced Micro Devices, Inc.
Senior Secured Notes, 11%,
08/01/03 ........................... B2 2,993
4,000 Amkor Technology, Senior Notes,
9.25%, 05/01/06 (i) ................ Ba3 3,960
</TABLE>
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 1,000 Amkor Technology, Senior
Subordinated Notes, 10.50%,
05/01/09 (i) ....................... B2 $ 990
2,000 Amphenol Corporation, Senior
Subordinated Notes, 9.875%,
05/15/07 ........................... B2 2,080
1,460 ChipPAC International Company
Limited, Senior Subordinated
Notes, 12.75%, 08/01/09 (i) ........ B3 1,533
2,515 Fairchild Semiconductor
Corporation, Senior
Subordinated Notes, 10.375%,
10/01/07 ........................... B3 2,565
3,000 Integrated Circuit Systems, Inc.,
Senior Subordinated Notes,
11.50%, 05/15/09 ................... B3 2,955
670 MCMS, Inc., Senior Subordinated
Notes, 9.75%, 03/01/08 ............. B3 335
4,000 Samsung Electronics America,
Inc., Guaranteed Notes, 9.75%,
05/01/03 (i) ....................... Ba1 4,160
2,245 SCG Holding Corporation Senior
Subordinated Notes, 12%,
08/01/09 (i) ....................... B2 2,385
2,000 Unisys Corporation, Senior Notes,
7.875%, 04/01/08 ................... Ba1 1,930
2,500 WESCO Distribution, Inc., Senior
Subordinated Notes, 9.125%,
06/01/08 ........................... B2 2,350
3,000 Zilog, Inc., Senior Secured Notes,
9.50%, 03/01/05 .................... B2 2,738
-------
30,974
-------
Farming and Agriculture -- .38%
1,955 Royster-Clark, Inc., First Mortgage
Notes, 10.25%, 04/01/09 (i) ........ B2 1,779
-------
Finance -- .42%
2,000 Navistar Financial Corporation,
Senior Subordinated Notes, 9%,
06/01/02 ........................... Ba2 2,005
-------
Furnishings, Housewares, Durable Consumer
Products -- 1.31%
1,500 Nortek, Inc., Senior Notes, 9.25%,
03/15/07 ........................... B1 1,459
</TABLE>
The accompanying notes are an integral
part of these financial statements.
6
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Schedule of Investments -- December 31, 1999 -- Continued
(Dollar Amounts in Thousands)
================================================================================
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
CORPORATE DEBT SECURITIES -- continued
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 3,500 Nortek, Inc., Senior Notes,
9.125%, 09/01/07 .................... B1 $ 3,395
1,405 Simmons Company, Senior
Subordinated Notes, 10.25%,
03/15/09 ............................ B3 1,331
-------
6,185
-------
Grocery -- .14%
850 Homeland Stores, Inc., Senior
Subordinated Notes, 10%,
08/01/03 ............................ (f) 680
-------
Healthcare, Education and Childcare -- 6.71%
2,500 Alaris Medical Systems, Inc.,
Senior Subordinated Notes,
9.75%, 12/01/06 ..................... B3 2,150
4,000 Beverly Enterprises, Inc., Senior
Notes, 9%, 02/15/06 ................. Ba3 3,770
4,000 Columbia/HCA Healthcare
Corporation, Notes, 7.25%,
05/20/08 ............................ Ba2 3,563
2,000 ConMed Corporation, Senior
Subordinated Notes, 9%,
03/15/08 ............................ B3 1,870
2,500 DJ Orthopedics LLC, Senior
Subordinated Notes, 12.625%,
06/15/09 ............................ B3 2,450
2,500 Fisher Scientific International Inc.,
Senior Subordinated Notes, 9%,
02/01/08 ............................ B3 2,394
1,460 Kinetic Concepts, Inc., Senior
Subordinated Notes, 9.625%,
11/01/07 ............................ B3 1,080
2,595 Mediq/PRN Life Support Services,
Inc., Senior Subordinated Notes,
11%, 06/01/08 ....................... B3 1,038
2,500 Owens & Minor, Inc., Senior
Subordinated Notes, 10.875%,
06/01/06 ............................ B1 2,575
2,500 Tenet Healthcare Corporation,
Senior Subordinated Notes,
8.625%, 01/15/07 .................... Ba3 2,406
2,500 Tenet Healthcare Corporation,
Senior Subordinated Notes,
8.125%, 12/01/08 .................... Ba3 2,369
</TABLE>
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 2,135 Triad Hospitals Holdings, Inc.,
Senior Subordinated Notes,
11%, 05/15/09 ....................... B1 $ 2,210
5,500 Universal Hospital Services, Inc.,
Senior Notes, 10.25%, 03/01/08....... B3 3,823
-------
31,698
-------
Hotels, Motels, Inns and Gaming -- 2.73%
5,000 John Q. Hammons Hotels, L.P.,
First Mortgage Notes, 8.875%,
02/15/04 ............................ B2 4,525
2,000 Harrah's Operating Company, Inc.,
Guaranteed Senior
Subordinated Notes, 7.875%,
12/15/05 ............................ Ba2 1,955
1,500 Hollywood Casino Corporation,
Senior Secured Notes, 11.25%,
05/01/07 ............................ B3 1,552
3,500 Lady Luck Gaming Corporation,
First Mortgage Notes, 11.875%,
03/01/01 ............................ B2 3,535
1,500 Venetian Casino Resort, LLC,
Mortgage Notes, 12.25%,
11/15/04 ............................ B3 1,309
-------
12,876
-------
Leisure, Amusement, Motion Pictures and
Entertainment -- 2.66%
2,500 Carmike Cinemas, Inc., Senior
Subordinated Notes, 9.375%,
02/01/09 ............................ B2 2,163
3,500 Echostar DBS Corporation, Senior
Notes, 9.25%, 02/01/06 .............. B2 3,526
4,000 Fox/Liberty Networks, LLC, Senior
Notes, 8.875%, 08/15/07 ............. Ba1 4,090
2,000 Loews Cineplex Entertainment
Corporation, Senior
Subordinated Notes, 8.875%,
08/01/08 ............................ B3 1,760
1,000 Time Warner Telecom LLC, Senior
Notes, 9.75%, 07/15/08 .............. B2 1,030
-------
12,569
-------
</TABLE>
The accompanying notes are an integral
part of these financial statements.
7
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Schedule of Investments -- December 31, 1999 -- Continued
(Dollar Amounts in Thousands)
================================================================================
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
CORPORATE DEBT SECURITIES -- continued
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Machinery -- 1.74%
$ 1,500 Anthony Crane Rental, L.P., Senior
Notes, 10.375%, 08/01/08 ............. B3 $ 1,260
2,500 Bucyrus International, Inc., Senior
Notes, 9.75%, 09/15/07 ............... B1 1,875
2,790 Grove Worldwide LLC, Senior
Subordinated Notes, 9.25%,
05/01/08 ............................. Caa1 837
2,000 The IT Group, Inc., Senior
Subordinated Notes, 11.25%,
04/01/09 ............................. B3 1,940
2,500 Neenah Corporation, Senior
Subordinated Notes, 11.125%,
05/01/07 ............................. B3 2,314
-------
8,226
-------
Mining, Steel, Iron and Non-Precious Metals -- 5.46%
3,000 AK Steel Corporation, Senior
Notes, 9.125%, 12/15/06 .............. Ba2 3,037
1,000 AK Steel Corporation, Senior
Notes, 7.875%, 02/15/09 .............. Ba2 945
2,500 Armco Inc., Senior Notes, 9%,
09/15/07 ............................. Ba2 2,534
4,000 Bayou Steel Corporation, First
Mortgage Notes, 9.50%,
05/15/08 ............................. B1 3,730
1,500 CSN Iron, S.A., Guaranteed
Notes, 9.125%, 06/01/07 (i) .......... B2 1,253
3,100 The LTV Corporation, Senior
Notes, 11.75%, 11/15/09 (i) .......... Ba3 3,255
4,500 The LTV Corporation, Senior
Notes, 8.20%, 09/15/07 ............... Ba3 4,118
2,000 Pen Holdings, Inc., Senior Notes,
9.875%, 06/15/08 ..................... B2 1,890
3,640 Weirton Steel Corporation, Senior
Notes, 11.375%, 07/01/04 ............. B2 3,494
1,625 Wells Aluminum Corporation,
Senior Notes, 10.125%,
06/01/05 ............................. B2 1,560
-------
25,816
-------
Oil and Gas -- 2.97%
4,225 Clark Refining and Marketing, Inc.,
Senior Notes, 8.375%, 11/15/07........ Ba3 2,746
</TABLE>
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 5,000 Frontier Oil Corporation, Senior
Notes, 9.125%, 02/15/06 .............. B2 $ 4,575
1,005 Plains Resources Inc., Senior
Subordinated Notes, 10.25%,
03/15/06 ............................. B2 980
1,900 RAM Energy, Inc., Senior Notes,
11.50%, 02/15/08 ..................... Caa1 855
1,760 RBF Finance Co., Senior Secured
Notes, 11%, 03/15/06 ................. Ba3 1,888
3,500 Tuboscope Inc., Senior Notes,
7.50%, 02/15/08 ...................... Ba2 2,970
-------
14,014
-------
Personal and Non-Durable Consumer
Products -- 1.79%
1,005 Bell Sports, Inc., Senior
Subordinated Notes, 11%,
08/15/08 ............................. B3 995
2,000 Evenflo Company, Inc., Senior
Notes, 11.75%, 08/15/06 .............. B2 1,960
2,680 Polaroid Corporation, Notes,
11.50%, 02/15/06 ..................... Ba3 2,653
3,000 True Temper Sports, Inc. Senior
Subordinated Notes, 10.875%,
12/01/08 ............................. B3 2,865
-------
8,473
-------
Personal Transportation -- 1.48%
1,500 Atlas Air, Inc., Senior Notes,
10.75%, 08/01/05 ..................... B2 1,538
2,430 Hermes Europe Railtel B.V.,
Senior Notes, 11.50%, 08/15/07........ B3 2,497
3,500 Valujet, Inc., Senior Notes,
10.25%, 04/15/01 ..................... B3 2,940
-------
6,975
-------
Printing, Publishing and Broadcasting -- 10.15%
2,500 The Ackerly Group, Inc., Senior
Subordinated Notes, 9%, 01/15/09...... B2 2,444
2,500 Adelphia Communications
Corporation, Senior Notes,
9.875%, 03/01/07 ..................... B1 2,538
4,050 Adelphia Communications
Corporation, Senior Notes,
8.375%, 02/01/08 ..................... B1 3,777
950 Adelphia Communications
Corporation, Senior Notes,
7.75%, 01/15/09 ...................... B1 850
</TABLE>
The accompanying notes are an integral
part of these financial statements.
8
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Schedule of Investments -- December 31, 1999 -- Continued
(Dollar Amounts in Thousands)
================================================================================
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
CORPORATE DEBT SECURITIES -- continued
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 1,500 Allbritton Communications
Company, Senior Subordinated
Notes, 8.875%, 02/01/08 ............ B3 $ 1,425
1,250 APP International Finance
Company B.V., Guaranteed
Secured Notes, 11.75%,
10/01/05 ........................... Caa1 1,038
2,000 Boise Cascade Corp., Debentures,
9.45%, 11/01/09 .................... Baa3 2,132
2,000 Century Communications Corp.,
Senior Notes, 8.875%, 01/15/07...... B1 1,935
2,500 Chancellor Media Corporation of
Los Angeles, Senior
Subordinated Notes, 9.375%,
10/01/04 ........................... B1 2,562
1,500 Chancellor Media Corporation of
Los Angeles, Senior
Subordinated Notes, 8.125%,
12/15/07 ........................... B1 1,502
2,250 CSC Holdings, Inc., Senior
Debentures, Series B, 8.125%,
08/15/09 ........................... Ba2 2,239
4,000 Doman Industries Limited, Senior
Notes, 8.75%, 03/15/04 ............. Caa1 3,400
2,500 Doman Industries Limited, Senior
Secured Notes, 12%, 07/01/04 ....... B3 2,603
3,500 Lin Television Corporation, Senior
Subordinated Notes, 8.375%,
03/01/08 ........................... B2 3,281
2,000 Mail-Well I Corporation, Senior
Subordinated Notes, 8.75%,
12/15/08 ........................... B1 1,940
2,500 Multicanal S.A., Notes, 9.25%,
02/01/02 ........................... B1 2,319
2,500 Pindo Deli Finance Mauritius
Limited, Guaranteed Senior
Notes, 10.75%, 10/01/07 ............ Caa1 1,800
1,500 Sullivan Graphics, Inc., Senior
Subordinated Exchange Notes,
12.75%, 08/01/05 ................... Caa1 1,553
2,500 Sun Media Corporation, Senior
Subordinated Notes, 9.50%,
02/15/07 ........................... B1 2,481
</TABLE>
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 6,255 World Color Press, Inc., Senior
Subordinated Notes, 8.375%,
11/15/08 ........................... Baa3 $ 6,113
-------
47,932
-------
Telecommunications -- 9.88%
1,500 BTI Telecom Corp., Senior Notes,
10.50%, 09/15/07 ................... B3 1,380
3,500 Charter Communications Holdings,
LLC, Senior Notes, 8.25%,
04/01/07 ........................... B2 3,238
2,000 Concentric Network Corporation,
Senior Notes, 12.75%, 12/15/07...... 2,100
3,000 FLAG Limited, Senior Notes,
8.25%, 01/30/08 .................... Ba3 2,760
3,500 Global Crossing Holdings Ltd.,
Senior Notes, 9.125%, 11/15/06
(i) ................................ Ba2 3,461
1,180 GST Network Funding Inc., Senior
Secured Discount Exchange
Notes, 0.00%/10.50%, 05/01/08
(g) ................................ (f) 572
3,500 Hyperion Telecommunications,
Inc., Senior Secured Notes,
12.25%, 09/01/04 ................... B3 3,789
2,500 Innova, S. de R.L., Senior
Exchange Notes, 12.875%,
04/01/07 ........................... B3 2,225
2,000 Insight Midwest, L.P., Senior
Notes, 9.75%, 10/01/09 (i) ......... B1 2,055
1,500 Intermedia Communications Inc.,
Senior Notes, 9.50%, 03/01/09 ...... B2 1,444
2,000 Intermedia Communications Inc.,
Senior Notes, 8.875%, 11/01/07...... B2 1,870
1,500 Intermedia Communications Inc.,
Senior Notes, 8.50%, 01/15/08 ...... B2 1,376
5,000 McLeodUSA Incorporated, Senior
Notes, 9.25%, 07/15/07 ............. B1 5,000
2,315 Metromedia Fiber Network, Inc.,
Senior Notes, 10%, 12/15/09 ........ B2 2,361
2,000 NTL Incorporated, Senior Notes,
10%, 02/15/07 ...................... B3 2,075
1,000 RCN Corporation, Senior Notes,
10.125%, 01/15/10 .................. B3 999
2,000 RCN Corporation, Senior Notes,
10%, 10/15/07 ...................... B3 1,995
</TABLE>
The accompanying notes are an integral
part of these financial statements.
9
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Schedule of Investments -- December 31, 1999 -- Continued
(Dollar Amounts in Thousands)
================================================================================
<TABLE>
<CAPTION>
Principal Moody's Value
Amount/Units Rating (Note 1(a))
- --------------------------------------------------------------------------------
CORPORATE DEBT SECURITIES -- continued
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
$ 2,000 Rogers Cantel Inc., Senior
Secured Debentures, 9.75%,
06/01/16 .......................... Ba3 $ 2,230
1,000 Rogers Cantel Inc., Senior
Secured Notes, 8.30%,
10/01/07 .......................... Ba3 1,002
3,000 Verio, Inc., Senior Notes, 11.25%,
12/01/08 .......................... B3 3,150
500 Viatel, Inc., Senior Notes, 11.50%,
03/15/09 .......................... B3 508
1,000 Winstar Equipment II Corp.,
Guaranteed Senior Secured
Exchange Notes, 12.50%,
03/15/04 .......................... B3 1,080
-------
46,670
-------
Textiles and Leather -- 1.40%
2,320 Pillowtex Corporation, Senior
Subordinated Notes, 9%,
12/15/07 .......................... Ca 998
6,250 WestPoint Stevens, Inc., Senior
Notes, 7.875%, 06/15/08 ........... Ba3 5,594
-------
6,592
-------
Total Corporate Debt Securities
(Total cost of $466,757)........... 432,794
-------
</TABLE>
<TABLE>
<CAPTION>
Moody's
Shares Rating
- --------------------------------------------------------------------------------
PREFERRED STOCK -- .64% (e)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Banking -- 0.00%
57,935 WestFed Holdings, Inc.,
Cumulative, Series A, Preferred
Stock, 15.50% (a)(d)(h) .......... (f) $ 0
Machinery -- .28%
1,350 Fairfield Manufacturing Company,
Inc., Cumulative Exchangeable
Preferred Stock, 11.25% .......... (f) 1,323
Personal, Food and Miscellaneous Services -- .36%
275 SF Holdings Group, Inc.,
Exchangeable Preferred Stock,
13.75% (c) ....................... (f) 1,375
</TABLE>
<TABLE>
<CAPTION>
Moody's Value
Shares Rating (Note 1(a))
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
66 SF Holdings, Group, Inc.,
Exchangeable Preferred Stock,
13.75% (c)(i) .................. (f) $ 330
------
1,705
------
Total Preferred Stock
(Total cost of $9,072)........ 3,028
------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
COMMON STOCK and WARRANTS -- .12% (e)
- --------------------------------------------------------------------------------
<S> <C> <C>
12,500 Benedek Communications
Corporation, Warrants, exp.
07/01/07 (b)(h) ................... $ 25
515 Concentric Network Corporation,
Warrants, exp. 12/15/07 (h)(i) .... 136
1,750 DecisionOne Holdings Corp.,
Warrants, exp. 08/01/07 (h) ....... 0
37,620 Fitzgeralds Gaming Corporation,
Common Stock (b)(h) ............... 4
8,086 MGC Communications, Inc.,
Common Stock (h) .................. 411
3,000 Olympic Financial Ltd., Warrants,
exp. 03/15/07 (h) ................. 0
1,017 SF Holdings Group, Inc., Class C,
Common Stock (h)(i) ............... 0
27,474 WestFed Holdings, Inc., Series B,
Common Stock (a)(d)(h) ............ 0
---
Total Common Stock and Warrants
(Total cost of $288)............... 576
---
</TABLE>
The accompanying notes are an integral
part of these financial statements.
10
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Schedule of Investments -- December 31, 1999 -- Continued
(Dollar Amounts in Thousands)
================================================================================
<TABLE>
<CAPTION>
Principal Value
Amount (Note 1 (a))
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 4.21% (e)
- --------------------------------------------------------------------------------
<S> <C> <C>
$19,880 Paribas Corporation, Repurchase
Agreement, 2.80%, 01/03/00,
(Collateral U.S. Treasury Notes,
5.75%, 11/30/02, $20,444
principal) ........................... $ 19,880
--------
Total Short-Term Investments
(Total cost of $19,880)............... 19,880
--------
TOTAL INVESTMENTS (Total cost of $495,997) $456,278
========
</TABLE>
(a) Denotes issuer is in bankruptcy proceedings.
(b) Restricted as to public resale. At the date of acquisition, these
securities were valued at cost. The total value of restricted securities
owned at December 31, 1999 was $29 or .01% of total assets.
(c) Non-income producing security which is on non-accrual and/or has defaulted
on interest payments.
(d) Security is valued at fair value using methods determined by the Board of
Directors. The total value of these securities at December 31, 1999 was $0.
(e) Percentages indicated are based on total assets of $472,335.
(f) Not rated.
(g) Security is a step interest bond. Interest on these bonds accrue based upon
the effective interest rate.
(h) Non-income producing.
(i) Securities are exempt from registration under Rule 144A of the Securities
Act of 1933. Such securities may be resold, normally to qualified
institutional buyers in transactions exempt from registration. See Note
1(a) of the Notes to Financial Statements for valuation policy. Total
market value of Rule 144A securities amounted to $38,056 as of December 31,
1999.
The accompanying notes are an integral
part of these financial statements.
11
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
Balance Sheet
December 31, 1999
================================================================================
<TABLE>
<S> <C>
Assets: (Dollars in thousands,
except per share amounts)
INVESTMENTS IN SECURITIES, at value (Identified
cost of $495,997, see Schedule of Investments
and Notes 1 and 2) .......................... $456,278
INTEREST RATE SWAP, at fair value
(Note 7) .................................... 3,915
RECEIVABLES:
Interest and dividends ....................... 12,036
OTHER ASSETS .................................. 58
PREPAID EXPENSES .............................. 48
--------
Total assets ................................ $472,335
--------
Liabilities:
PAYABLES:
Dividend payable on common stock ............. $ 1,391
Dividend payable on preferred stock .......... 2,394
ACCRUED EXPENSES (Note 3) ..................... 335
--------
Total liabilities ........................... $ 4,120
--------
Net Assets:
AUCTION TERM PREFERRED STOCK:
$1.00 par value, 1,000,000 shares authorized,
8,400 shares issued and outstanding,
liquidation preference of $25,000 per share
(Notes 5 and 6) ............................ $210,000
--------
COMMON STOCK:
$0.01 par value, 200,000,000 shares authorized,
66,900,549 shares issued and outstanding ... $ 669
CAPITAL IN EXCESS OF PAR VALUE ................ 335,359
UNDISTRIBUTED NET INVESTMENT INCOME
(Note 2) .................................... 457
ACCUMULATED NET REALIZED LOSS FROM
SECURITIES TRANSACTIONS (Note 2) ............ (42,466)
NET UNREALIZED DEPRECIATION ON
INVESTMENTS AND INTEREST RATE SWAPS ......... (35,804)
--------
Net assets applicable to common stock
(Equivalent to $3.86 per share, based on
66,900,549 shares outstanding) ............. $258,215
--------
Total Net Assets .............................. $468,215
========
</TABLE>
- --------------------------------------------------------------------------------
Statement of Operations
For the Year Ended
December 31, 1999
================================================================================
<TABLE>
<S> <C>
Investment Income: (Note 1) (Dollars in thousands,
except per share amounts)
Interest income .............................. $ 46,216
Dividend income .............................. 57
Other income ................................. 257
--------
Total investment income ..................... $ 46,530
--------
Expenses:
Cost of leverage:
Preferred and auction fees ................... $ 472
--------
Total cost of leverage $ 472
--------
Professional services expenses:
Management fees (Note 3) ..................... $ 1,200
Custodian and transfer agent fees ............ 275
Legal fees ................................... 120
Audit fees ................................... 68
--------
Total professional services expenses ........ $ 1,663
--------
Administrative expenses:
General administrative fees .................. $ 351
Directors' fees .............................. 217
Miscellaneous expenses ....................... 67
NYSE fees .................................... 57
Shareholder meeting expenses ................. 34
--------
Total administrative expenses ............... $ 726
--------
Total expenses .............................. $ 2,861
--------
Net investment income ....................... $ 43,669
--------
Realized and Unrealized Gain (Loss) on
Investment Activities:
Realized loss on investments ................. $(36,780)
--------
Change in net unrealized depreciation on
investments ................................. $ 13,351
Unrealized change on interest rate swap
agreements (net of unrealized cumulative
transition loss of $3,123) ................ 3,915
--------
Total change in net unrealized depreciation
on investments and interest rate swaps ... $ 17,266
--------
Net loss on investments ..................... $(19,514)
--------
Net increase in net assets resulting from
operations ................................. $ 24,155
--------
Cost of Preferred Leverage:
Distributions to preferred stockholders ...... $(11,313)
Net swap settlement disbursements (Note 7) ... (740)
--------
Total cost of preferred leverage ............ $(12,053)
--------
Net increase in net assets resulting from
operations less cost of preferred leverage .. $ 12,102
========
- ----------------------------------------------------------------
Amount Available for Distribution to
Common Stockholders
Net investment income ........................ $ 43,669
Total cost of preferred leverage ............ (12,053)
--------
Net amount available for distribution to
common stockholders ...................... $ 31,616
========
</TABLE>
The accompanying notes are an integral
part of these financial statements.
12
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
Statements of Changes in Net Assets
================================================================================
<TABLE>
<CAPTION>
For the Years Ended December 31,
1999 1998
--------- ---------
<S> <C> <C>
From Operations: (Dollars in thousands, except per share amounts)
Net investment income ......................................................... $ 43,669 $ 43,927
Realized gain (loss) on investments, net ...................................... (36,780) 4,849
Change in net unrealized depreciation on investments and other financial
instruments .................................................................. 17,266 (55,251)
--------- ---------
Net increase (decrease) in net assets resulting from operations .............. $ 24,155 $ (6,475)
--------- ---------
From Fund Share Transactions:
Proceeds from sale of Auction Term Preferred Stock Series D
(2,400 shares), net of $729 of offering costs and sales load
(Note 5) ..................................................................... $ -- $ 59,271
Proceeds from rights offering (16,241,851 shares), net of $297
of offering costs (Note 11) .................................................. -- 76,365
Net asset value of 1,136,530 shares and 1,068,852 shares issued to
common stockholders for reinvestment of dividends in 1999 and
1998, respectively ........................................................... 4,692 5,140
--------- ---------
Increase in net assets resulting from fund share transactions ................ $ 4,692 $ 140,776
--------- ---------
Distributions to Stockholders:
Preferred dividends ($1,347 and $1,263 per share, respectively) ............... $ (11,313) $ (10,607)
Net swap settlement disbursements ............................................. (740) (49)
Common Dividends:
From net investment income ($.48 and $.54 per share in 1999 and 1998,
respectively) ............................................................... (32,097) (33,641)
In excess of net investment income ($0 and $0 per share in 1999 and
1998, respectively) ......................................................... -- (111)
--------- ---------
Decrease in net assets resulting from distributions to stockholders .......... $ (44,150) $ (44,408)
--------- ---------
Total net increase (decrease) in net assets .................................... $ (15,303) $ 89,893
--------- ---------
Net Assets Applicable to Common and Preferred Stock:
Beginning of period ........................................................... $ 483,518 $ 393,625
--------- ---------
End of period (Including $457 and $782 of undistributed net investment
income at December 31, 1999 and December 31, 1998, respectively) ............. $ 468,215 $ 483,518
========= =========
</TABLE>
The accompanying notes are an integral
part of these financial statements.
13
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
Financial Highlights
Selected Per Share Data and Ratios
For Each Share of Common Stock Outstanding Throughout the Period
================================================================================
<TABLE>
<CAPTION>
For the Years Ended December 31,
1999 1998 (d) 1997 (d) 1996 1995 1994 (c) 1993 1992 (a)
-------- ------- -------- ------ ------ --------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE:
Beginning of period ........ $ 4.16 $ 5.03 $ 4.94 $ 4.71 $ 4.13 $ 5.15 $ 4.32 $ 3.79
-------- ------- ------ ------ ------ ------- ------ ------
NET INVESTMENT INCOME .66 .71# .70# .69 .67 .72# .59 .57
NET REALIZED AND
UNREALIZED
GAIN (LOSS) ON
INVESTMENTS AND
OTHER FINANCIAL
INSTRUMENTS ................ (.30) (.81)# .25# .22 .62 (.82)# .89 .57
-------- ------- ------ ------ ------ ------- ------ ------
TOTAL FROM
INVESTMENT
OPERATIONS ............... .36 (.10) .95 .91 1.29 (.10) 1.48 1.14
-------- ------- ------ ------ ------ ------- ------ ------
DISTRIBUTIONS:
Dividends from net
investment income:
To preferred
stockholders
(including
net swap settlement
receipts/payments) ....... (.18) (.17) (.16) (.16) (.17) (.17) (.05) (.06)
To common
stockholders ............. (.48) (.54) (.53) (.52) (.50) (.53) (.53) (.55)
Dividends in excess of
net investment income:
To common
stockholders .............. -- -- (.01) -- (.04) -- (.07) --
-------- ------- ------ ------ ------ ------- ------ ------
TOTAL
DISTRIBUTIONS ............ (.66) (.71) (.70) (.68) (.71) (.70) (.65) (.61)
-------- ------- ------ ------ ------ ------- ------ ------
Effect of rights offering and
related expenses; and
Auction Term Preferred
Stock offering costs and
sales load ................. -- (.06) (.16) -- -- (.22) -- --
-------- ------- ------ ------ ------ ------- ------ ------
NET ASSET VALUE:
End of period .............. $ 3.86 $ 4.16 $ 5.03 $ 4.94 $ 4.71 $ 4.13 $ 5.15 $ 4.32
======== ======= ====== ====== ====== ======= ====== ======
PER SHARE MARKET VALUE:
End of period .............. $ 3.13 $ 4.25 $ 5.63 $ 5.13 $ 4.75 $ 4.00 $ 5.13 $ 4.13
======== ======= ====== ====== ====== ======= ====== ======
TOTAL INVESTMENT RETURN+ .... (16.92)% (15.15)% 21.97% 19.89% 33.50% (11.88)% 40.08% 29.70%
======== ======= ====== ====== ====== ======= ====== ======
</TABLE>
The accompanying notes are an integral
part of these financial statements.
14
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
Financial Highlights
Selected Per Share Data and Ratios
For Each Share of Common Stock Outstanding Throughout the Period -- Continued
================================================================================
<TABLE>
<CAPTION>
For the Years Ended December 31,
1999 1998 (d) 1997 (d)
--------- --------- ---------
<S> <C> <C> <C>
NET ASSETS, END OF
PERIOD, APPLICABLE
TO COMMON STOCK (b) .............. $ 258,215 $ 273,518 $ 243,625
========= ========= =========
NET ASSETS, END OF
PERIOD, APPLICABLE
TO PREFERRED
STOCK (b) ........................ $ 210,000 $ 210,000 $ 150,000
========= ========= =========
TOTAL NET ASSETS, END
OF PERIOD (b) .................... $ 468,215 $ 483,518 $ 393,625
========= ========= =========
EXPENSE RATIOS:
Ratio of interest expense
to average net assets** ......... -- -- --
Ratio of preferred and
other debt expenses to
average net assets** ............ .18% .14% .13%
Ratio of operating
expenses to average
net assets** .................... .89% .82% .92%
Ratio of litigation settlement
expense to average net
assets** ........................ -- -- --
--------- --------- ---------
RATIO OF TOTAL EXPENSES
TO AVERAGE NET ASSETS** .......... 1.07% .96% 1.05%
========= ========= =========
RATIO OF NET INVESTMENT
INCOME TO AVERAGE
NET ASSETS** ..................... 16.36% 15.22% 13.86%
RATIO OF TOTAL EXPENSES
TO AVERAGE NET
ASSETS APPLICABLE
TO COMMON AND
PREFERRED STOCK .................. .60% .58% .66%
PORTFOLIO TURNOVER
RATE ............................. 66.74% 124.67% 108.84%
<CAPTION>
For the Years Ended December 31,
1996 1995 1994 (c) 1993 1992 (a)
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
NET ASSETS, END OF
PERIOD, APPLICABLE
TO COMMON STOCK (b) .............. $ 176,408 $ 164,823 $ 141,590 $ 130,673 $ 107,897
========= ========= ========= ========= =========
NET ASSETS, END OF
PERIOD, APPLICABLE
TO PREFERRED
STOCK (b) ........................ $ 100,000 $ 100,000 $ 100,000 $ 35,000 $ 35,000
========= ========= ========= ========= =========
TOTAL NET ASSETS, END
OF PERIOD (b) .................... $ 276,408 $ 264,823 $ 241,590 $ 165,673 $ 142,897
========= ========= ========= ========= =========
EXPENSE RATIOS:
Ratio of interest expense
to average net assets** ......... -- -- .01% 1.83% 3.95%
Ratio of preferred and
other debt expenses to
average net assets** ............ .16% .18% .22% .51% .87%
Ratio of operating
expenses to average
net assets** .................... 1.16% 1.39% 1.31% 2.01% 1.63%
Ratio of litigation settlement
expense to average net
assets** ........................ -- .80% -- -- --
--------- --------- --------- --------- ---------
RATIO OF TOTAL EXPENSES
TO AVERAGE NET ASSETS** .......... 1.32% 2.37% 1.54% 4.35% 6.45%
========= ========= ========= ========= =========
RATIO OF NET INVESTMENT
INCOME TO AVERAGE
NET ASSETS** ..................... 14.36% 14.61% 15.89% 11.86% 13.49%
RATIO OF TOTAL EXPENSES
TO AVERAGE NET
ASSETS APPLICABLE
TO COMMON AND
PREFERRED STOCK .................. .83% 1.44% .89% 3.38% 4.82%
PORTFOLIO TURNOVER
RATE ............................. 53.45% 62.66% 58.56% 85.76% 129.86%
</TABLE>
(a) Prior to the appointment on February 19, 1992 of Wellington Management
Company, LLP, the Fund was advised by Ostrander Capital Management, L.P.
(b) Dollars in thousands.
(c) The Fund entered into a refinancing transaction on January 4, 1994, and the
per share data and ratios for the year ended December 31, 1994 reflect this
transaction.
(d) As discussed in Note 5, the Fund issued Series C ATP on May 6, 1997 and
Series D ATP on May 20, 1998. The per share data and ratios for the years
ended December 31, 1997 and 1998 reflect these transactions.
** Ratios calculated on the basis of expenses and net investment income
applicable to the common shares relative to the average net assets of the
common stockholders only. The expense ratio and net investment income ratio
do not reflect the effect of dividend payments (including net swap
settlement receipts/payments) to preferred stockholders.
# Calculation is based on average shares outstanding during the indicated
period due to the per share effect of the Fund's June 1994, March 1997 and
March 1998 rights offerings.
+ Total investment return is calculated assuming a purchase of common stock at
the current market value on the first day and a sale at the current market
value on the last day of each year reported. Dividends and distributions are
assumed for purposes of this calculation to be reinvested at prices obtained
under the dividend reinvestment plan. This calculation does not reflect
brokerage commissions.
The accompanying notes are an integral
part of these financial statements.
15
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
Information Regarding
Senior Securities
================================================================================
<TABLE>
<CAPTION>
As of December 31,
1999 1998 1997
------------- ------------- -------------
<S> <C> <C> <C>
TOTAL AMOUNT OUTSTANDING:
Notes ................................. $ -- $ -- $ --
Preferred Stock ....................... 210,000,000 210,000,000 150,000,000
Short-term Loan ....................... -- -- --
ASSET COVERAGE:
Per Note (1) .......................... $ -- $ -- $ --
Per Preferred Stock Share (2) ......... 55,740 57,562 65,604
Per $1,000 of Short-term Loan (1) ..... -- -- --
INVOLUNTARY LIQUIDATION PREFERENCE:
Preferred Stock Share (3) ............. $ 25,000 $ 25,000 $ 25,000
APPROXIMATE MARKET VALUE:
Per Note .............................. $ -- $ -- $ --
Per Preferred Stock Share (3) ......... 25,000 25,000 25,000
Per $1,000 of Short-term Loan ......... -- -- --
<CAPTION>
As of December 31,
1996 1995 1994 1993
------------- ------------- ------------- --------------
<S> <C> <C> <C> <C>
TOTAL AMOUNT OUTSTANDING:
Notes ................................. $ -- $ -- $ -- $ --
Preferred Stock ....................... 100,000,000 100,000,000 100,000,000 35,000,000
Short-term Loan ....................... -- -- -- 45,000,000
ASSET COVERAGE:
Per Note (1) .......................... $ -- $ -- $ -- $ --
Per Preferred Stock Share (2) ......... 69,102 66,206 60,398 473,351
Per $1,000 of Short-term Loan (1) ..... -- -- -- 4,682
INVOLUNTARY LIQUIDATION PREFERENCE:
Preferred Stock Share (3) ............. $ 25,000 $ 25,000 $ 25,000 $ 100,000
APPROXIMATE MARKET VALUE:
Per Note .............................. $ -- $ -- $ -- $ --
Per Preferred Stock Share (3) ......... 25,000 25,000 25,000 100,000
Per $1,000 of Short-term Loan ......... -- -- -- 1,000
</TABLE>
<TABLE>
<CAPTION>
As of December 31,
1992
------------------
<S> <C>
TOTAL AMOUNT OUTSTANDING:
Notes ..................................... $45,490,000
Preferred Stock ........................... 35,000,000
Short-term Loan ........................... --
ASSET COVERAGE:
Per Note (1) .............................. $ 4,141
Per Preferred Stock Share (2) ............. 408,277
Per $1,000 of Short-term Loan (1) ......... --
INVOLUNTARY LIQUIDATION PREFERENCE:
Preferred Stock Share (3) ................. $ 100,000
APPROXIMATE MARKET VALUE:
Per Note .................................. $ 1,000
Per Preferred Stock Share (3) ............. 100,000
Per $1,000 of Short-term Loan ............. --
</TABLE>
(1) Calculated by subtracting the Fund's total liabilities (not including senior
securities) from the Fund's total assets and dividing such amounts by the
number of Notes outstanding.
(2) Calculated by subtracting the Fund's total liabilities (including the Notes
but not including the Preferred Stock) from the Fund's total assets and
dividing such amount by the number of Preferred Shares outstanding.
(3) Plus accumulated and unpaid dividends.
The accompanying notes are an integral
part of these financial statements.
16
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
Notes to Financial Statements
December 31, 1999
================================================================================
(1) Significant Accounting and Other Policies
The New America High Income Fund, Inc. (the Fund) was organized as a
corporation in the state of Maryland on November 19, 1987 and is registered with
the Securities and Exchange Commission as a diversified, closed-end investment
company under the Investment Company Act of 1940. The Fund commenced operations
on February 26, 1988. The investment objective of the Fund is to provide high
current income while seeking to preserve stockholders' capital through
investment in a professionally managed, diversified portfolio of "high yield"
fixed-income securities.
The Fund invests primarily in fixed maturity corporate debt securities that
are rated less than investment grade. Risk of loss upon default by the issuer is
significantly greater with respect to such securities compared to investment
grade securities because these securities are generally unsecured and are often
subordinated to other creditors of the issuer and because these issuers usually
have high levels of indebtedness and are more sensitive to adverse economic
conditions, such as a recession, than are investment grade issuers. In some
cases, the collection of principal and timely receipt of interest is dependent
upon the issuer attaining improved operating results, selling assets or
obtaining additional financing.
See the schedule of investments for information on individual securities as
well as industry diversification and credit quality ratings.
The Fund's financial statements have been prepared in conformity with
generally accepted accounting principles that require the management of the Fund
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
revenues and expenses during the reporting periods. Actual results could differ
from those estimates.
The following is a summary of significant accounting policies consistently
followed by the Fund, which are in conformity with those generally accepted in
the investment company industry.
(a) Valuation of Investments--Investments for which market quotations are
readily available are stated at market value, which is determined by using the
most recently quoted bid price provided by an independent pricing service or
principal market maker. Independent pricing services provide market quotations
based primarily on quotations from dealers and brokers, market transactions,
accessing data from quotations services, offering sheets obtained from dealers
and various relationships between securities. Short-term investments having
maturities of 60 days or less are stated at amortized cost, which approximates
market value. Following procedures approved by the Board of Directors,
investments for which market quotations are not readily available (primarily
fixed-income corporate bonds and notes) are stated at fair value on the basis of
subjective valuations furnished by securities dealers and brokers. Other
investments, with a cost of approximately $4,919,000 and a value of $0, are
valued in good faith at fair market value using methods determined by the Board
of Directors.
(b) Interest and Dividend Income--Interest income is accrued on a daily
basis. Discount on short-term investments is amortized to investment income.
Market discounts or premiums on corporate debt securities are not amortized for
financial statement purposes. All income on original issue discount and step
interest bonds is accrued based on the effective interest method for both
financial reporting and tax reporting purposes as required by federal income tax
regulations. Dividend payments received in additional securities are recorded on
the ex-dividend date in an amount equal to the value of the security on such
date.
(c) Federal Income Taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code of 1986, as amended, applicable to
regulated
17
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
Notes to Financial Statements--Continued
December 31, 1999
================================================================================
investment companies and to distribute substantially all of its taxable income
to its shareholders each year. Accordingly, no federal income tax provision is
required.
(2) Tax Matters and Distributions
At December 31, 1999, the total cost of securities (excluding temporary
cash investments) for federal income tax purposes was approximately
$476,208,000. Aggregate gross unrealized gain on securities in which there was
an excess of value over tax cost was approximately $7,896,000. Aggregate
unrealized loss on securities in which there was an excess of tax cost over
value was approximately $43,791,000. Net unrealized loss for tax purposes at
December 31, 1999 was approximately $35,895,000.
At December 31, 1999, the Fund had approximate capital loss carryovers
available to offset future capital gain, if any, to the extent provided by
regulations:
<TABLE>
<CAPTION>
Carryover Available Expiration Date
------------------- ------------------
<S> <C>
$ 2,227,000 December 31, 2002
35,580,000 December 31, 2007
----------------
$ 37,807,000
================
</TABLE>
To the extent that capital loss carryovers are used to offset realized
capital gains, it is unlikely that gains so offset will be distributed to
shareholders.
Distributions on common stock are declared based upon annual projections of
the Fund's investment company taxable income. The Fund records all dividends and
distributions payable to shareholders on the ex-dividend date and declares and
distributes income dividends monthly.
In accordance with Statement of Position 93-2, the Fund has recorded
several reclassifications in the capital accounts. These reclassifications have
no impact on the net asset value of the Fund and are designed generally to
present undistributed net investment income or accumulated net realized gains
and losses on a tax basis, which is considered to be more informative to the
shareholder. As of December 31, 1999, the Fund has reclassified approximately
$74,000 primarily related to amortization of market discounts on corporate bonds
and gains on foreign currency transactions from accumulated net realized loss
from securities transactions to undistributed net investment income. The Fund
has also reclassified approximately $25,000 to capital in excess of par value
consisting of approximately ($107,000) and $82,000 from accumulated net realized
loss and undistributed net investment income, respectively, to reflect the
permanent differences resulting from the tax accounting for interest rate swap
agreements entered into by the Fund. In addition, the Fund has reclassified
approximately $34,426,000, related to the expiration of unused capital loss
carryovers from accumulated net realized loss from securities transactions to
capital in excess of par value.
The difference between earnings for financial statement purposes and
earnings for tax purposes is primarily due to the tax treatment of the
amortization of market discounts on corporate bonds.
(3) Investment Advisory Agreement
Wellington Management Company, LLP, the Fund's Investment Advisor, earned
approximately $1,200,000 in management fees during the year ended December 31,
1999. Management fees paid by the Fund to Wellington Management are calculated
at .45 of 1% (on an annual basis) of the average weekly value of the Fund's net
assets attributable to common stock ($258.2 million at December 31, 1999). At
December 31, 1999, the fee payable to the Investment Advisor was approximately
$99,000, which was included in accrued expenses on the accompanying balance
sheet.
(4) Forward Foreign Currency Contracts
The Fund has in the past entered into forward foreign currency contracts in
connection with the purchase and sale of foreign investments but does not expect
to enter into any in the future. All commitments were marked to market at the
applicable exchange rates and any unre-
18
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
Notes to Financial Statements--Continued
December 31, 1999
================================================================================
alized gains or losses were recorded in the Fund's financial statements. The
aggregate principal amounts of the contracts were not recorded in the financial
statements. The Fund records realized gains or losses at the time the forward
contract is offset by entry into a closing transaction or by delivery of the
currency. Risks may arise upon entering into these contracts from the potential
inability of counterparties to meet the terms of their contracts and from
unanticipated movements in the value of a foreign currency relative to the U.S.
dollar. At December 31, 1999 there were no forward foreign currency contracts
outstanding.
(5) Auction Term Preferred Stock (ATP)
On January 4, 1994, the Fund issued 1,200 shares of Series A ATP and 800
shares of Series B ATP. The underwriting discount of $1,500,000 and offering
expenses of $336,000 associated with the ATP offering were recorded as a
reduction of the capital in excess of par value on common stock. On May 6, 1997,
the Fund issued 2,000 shares of Series C ATP. The underwriting discount of
$437,500 and offering expenses of $297,000 were recorded as a reduction of the
capital in excess of par value on common stock. On May 20, 1998, the Fund issued
2,400 shares of Series D ATP. The underwriting discount of $510,000 and offering
expenses of $219,000 were recorded as a reduction of the capital in excess of
par value on common stock. The ATP's dividends are cumulative at a rate
determined at an auction, and dividend periods will typically be 28 days unless
notice is given for periods to be longer or shorter than 28 days. At December
31, 1999 the dividend periods for all series of ATP had been extended to between
56 and 112 days. Dividend rates ranged from 4.88% to 6.42% for the year ended
December 31, 1999.
The ATP is redeemable, at the option of the Fund, or subject to mandatory
redemption (if the Fund is in default of certain coverage requirements) at a
redemption price equal to $25,000 per share plus accumulated and unpaid
dividends. The ATP has a liquidation preference of $25,000 per share plus
accumulated and unpaid dividends. The Fund is required to maintain certain asset
coverages with respect to the ATP under the Fund's Charter and the 1940 Act.
(6) ATP Auction-Related Matters
Bankers Trust Company (BTC) serves as the ATP's auction agent pursuant to
an agreement entered into on January 4, 1994. The term of the agreement is
unlimited and may be terminated by either party. BTC may resign upon notice to
the Fund, such resignation to be effective on the earlier of the 90th day after
the delivery of such notice and the date on which a successor auction agent is
appointed by the Fund. The Fund may also replace BTC as auction agent at any
time.
After each auction, BTC as auction agent will pay to each broker-dealer,
from funds provided by the Fund, a maximum service charge at the annual rate of
.25 of 1% or such other percentage subsequently agreed to by the Fund and the
broker-dealers, of the purchase price of shares placed by such broker-dealers at
such auction. In the event an auction scheduled to occur on an auction date
fails to occur for any reason, the broker-dealers will be entitled to service
charges as if the auction had occurred and all holders of shares placed by them
had submitted valid hold orders. The Fund incurred approximately $472,000 for
service charges through December 31, 1999. This amount is included under the
caption preferred and auction fees in the accompanying statement of operations.
(7) Interest Rate Swaps
The Fund entered into four interest payment swap arrangements with
BankBoston, N.A. (BBNA) for the purpose of partially hedging its dividend
payment obligations with respect to the ATP. Pursuant to each of the Swap
Arrangements the Fund makes payments to BBNA on a monthly basis at fixed annual
rates. In exchange for such payments BBNA makes payments to the Fund on a
monthly basis at a variable rate determined with reference to one month LIBOR.
The variable rates ranged from 4.80% to 6.48% for the year
19
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
Notes to Financial Statements--Continued
December 31, 1999
================================================================================
ended December 31, 1999. The effective date, notional amount, maturity and fixed
rates of the swaps are as follows:
<TABLE>
<CAPTION>
Notional Fixed
Effective Contract Annual
Date Amount Maturity Rate
<S> <C> <C> <C>
10/7/97 $20 million 10/7/02 6.07%
6/2/98 $15 million 6/2/03 5.90%
12/7/98 $25 million 12/7/03 5.58%
2/8/99 $65 million 2/7/04 5.83%
</TABLE>
Swap transactions, which involve future settlement, give rise to credit
risk. Credit risk is the amount of loss the Fund would incur in the event
counterparties failed to perform according to the terms of the contractual
commitments. The Fund is exposed to credit loss in the event of nonperformance
by counterparties on interest rate swaps, but the Fund does not anticipate
nonperformance by any counterparty. While notional contract amounts are used to
express the volume of interest rate swap agreements, the amounts potentially
subject to credit risk, in the event of nonperformance by counterparties, are
substantially smaller.
Until December 31, 1998, the Fund followed hedge accounting
(off-balance-sheet) with respect to the swap agreements and settled the net
amount receivable or payable from each party every 30 days. For the year ended
December 31, 1999, the Fund's obligations under the swap agreements were more
than the amount received from BBNA by approximately $740,000 and is included in
the accompanying statement of operations.
In January 1999, the Fund early adopted Statement of Financial Accounting
Standards No. 133, Accounting for Derivative Instruments and Hedging Activities.
This statement requires an entity to recognize all freestanding derivative
instruments in the balance sheet as either assets or liabilities and measure
them at fair value. Any change in the unrealized gain or loss is recorded in
current earnings. The effect of adoption on the Fund's net asset value per share
was a decrease of approximately $0.05 per share.
The estimated fair value of the interest rate swap agreements at the date
of adoption amounted to approximately $3,123,000 unrealized loss. This amount
has been recorded as a reduction to the cost of the interest rate swap
agreements, with a corresponding transition adjustment recorded in "Change in
net unrealized depreciation on investments." The estimated fair value of the
interest rate swap agreements at December 31, 1999 amounted to approximately
$3,915,000 and is presented in the accompanying balance sheet.
(8) Repurchase Agreements
At the time the Fund enters into a repurchase agreement, the value of the
underlying security, including accrued interest, will be equal to or exceed the
value of the repurchase agreement, and, in the case of repurchase agreements
exceeding one day, the value of the underlying security, including accrued
interest, is required during the term of the agreement to be equal to or exceed
the value of the repurchase agreement.
The underlying securities for all repurchase agreements are held in
safekeeping in an investment account of State Street Bank and Trust Company
(SSBT), the Fund's custodian, at the Federal Reserve Bank of Boston. In the case
of repurchase agreements exceeding one day, SSBT's Money Market Department
monitors the market value of the underlying securities by pricing them daily,
and in the event any individual repurchase agreement is not fully
collateralized, SSBT advises the Fund and additional collateral is obtained.
(9) Purchase and Sales of Securities
Purchases and proceeds of sales or maturities of long-term securities
during the year ended December 31, 1999 were as follows:
<TABLE>
<S> <C>
Purchases of securities $305,002,000
Sales of securities $298,635,000
</TABLE>
(10) Certain Transactions
A partner of Goodwin, Procter & Hoar, general counsel to the Fund, serves
as a Director of the Fund. Fees earned by Goodwin, Procter & Hoar amounted to
approximately
20
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
Notes to Financial Statements--Continued
December 31, 1999
================================================================================
$94,000 for the year ended December 31, 1999. The Fund paid approximately
$225,000 during the year ended December 31, 1999 to two officers of the Fund for
the provision of certain administrative services.
(11) Rights Offering
The Fund issued to stockholders of record as of the close of business on
February 10, 1998, rights to subscribe for an aggregate of 16,241,851 shares of
common stock, $.01 par value per share, of the Fund. One right was issued for
each three full shares of common stock beneficially held on the record date. The
rights entitled a stockholder to acquire at the subscription price of $4.72 per
share one share for each right held. The subscription price was 92% of the
average of the last reported sales price of the Fund's Common Stock on the New
York Stock Exchange on March 18, 1998, the expiration date and the nine
preceding business days. On March 25, 1998, the Fund completed its rights
offering. Proceeds of approximately $76,662,000 and shares of 16,241,851 were
recorded. In addition, the deferred offering expense balance of $297,000 was
netted against the rights offering proceeds.
- --------------------------------------------------------------------------------
From time to time in the future, the Fund may effect redemptions and/or
repurchases of its ATP as provided in the applicable constituent instruments or
as agreed upon by the Fund and sellers. The Fund intends to effect such
redemptions and/or repurchases to the extent necessary to maintain applicable
asset coverage requirements.
21
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
Independent Auditor's Report
================================================================================
To the Shareholders and Board of Directors of The New America High Income Fund,
Inc.:
We have audited the accompanying statement of assets and liabilities of The
New America High Income Fund, Inc. (the Fund), including the schedule of
portfolio investments, as of December 31, 1999, and the related statements of
operations for the year then ended, the statement of changes in net assets for
each of the two years in the period then ended, and the selected per share data
and ratios for the periods presented. These financial statements and per share
data and ratios are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and per
share data and ratios based on our audits.
We conducted our audits 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 per share data
and ratios are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1999, by correspondence with the custodian and brokers. 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 audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and selected per share data and
ratios referred to above present fairly, in all material respects, the financial
position of The New America High Income Fund, Inc. as of December 31, 1999, 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 selected per share
data and ratios for the periods presented, in conformity with generally accepted
accounting principles.
ARTHUR ANDERSEN, LLP
Boston, Massachusetts
January 28, 2000
22
<PAGE>
The New America High Income Fund, Inc.
- --------------------------------------------------------------------------------
================================================================================
Directors
Robert F. Birch
Joseph L. Bower
Richard E. Floor
Bernard J. Korman
Franco Modigliani
Ernest E. Monrad
Officers
Robert F. Birch - President
Ellen E. Terry - Vice President, Treasurer
Richard E. Floor - Secretary
Investment Advisor
Wellington Management Company, LLP
75 State Street
Boston, MA 02109
Administrator
The New America High Income Fund, Inc.
33 Broad Street
Boston, MA 02109
(617) 263-6400
Custodian and Transfer Agent
State Street Bank and Trust Company
P.O. Box 8200
Boston, MA 02266-8200
(617) 328-5000 ext. 6406
(800) 426-5523
Independent Public Accountants
Arthur Andersen, LLP
225 Franklin Street
Boston, MA 02110
Listed: NYSE
Symbol: HYB
Web site: www.newamerica-hyb.com
23
<PAGE>
[Back Cover]
State Street Bank and Trust Company
P.O. Box 8200
Boston, Massachusetts 02266-8200
[Front Cover]
The New
America
High Income
Fund, Inc.
[Graphic: ----------------------------------------------
New America Annual
H I G H ----------------------------------------------
I N C O M E Report
F U N D] ----------------------------------------------
December 31, 1999
----------------------------------------------
