Henderson High Income Trust (LSE:HHI) — Investor Update

0:01 Good morning, ladies and gentlemen. Welcome to the HENDERSON HIGH INCOME TRUST PLC investor presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged. They can be submitted at any time via the q and a tab that's just situated on the right hand corner of your screen. Please just simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company can review all questions submitted today, we'll and publish those responses where it's appropriate to do so on the investor meet company platform. And before we begin, I would just like

0:32 to submit the following poll. And if you'd give that your kind attention, I'm sure the company would be most grateful. And I would now like to hand you over to portfolio manager, David Smith. David, good morning, sir. Good morning, and thank you. Good morning, ladies and gentlemen, and thank you for listening in. So I'm David Smith. I'm a portfolio manager on HENDERSON HIGH INCOME TRUST. It's a trust I've been involved in since 2012. And, effectively, it's an investment trust that invests in UK equity, UK equities and bonds, securities. And the objective is to generate that high income for shareholders, but also the prospects of capital growth into longer term. So I'll give a broad introduction to the trust. I'll talk a little bit about the market outlook as we see it, and then give you a few sort of talk about a few stock examples that we owe currently and why. And then obviously, we're open up to to q and a at the end.

1:27 So, you know, why why why do we want people to invest in high income? Well, as I suggested, as the name suggests, it generates a high level of income, but in a very diversified way. So if you look to the chart on the left hand side of the slide there, you know, it really does highlight the attraction of that that dividend. You know, it compares the dividend yield currently on the trust versus certain certain other asset classes, whether that be the main UK equity market in the FTSE all share, whether that be ten year government bond yields, or whether that be where current interest rates are. You know, we have a yield in... That is superior to all those other income yields on those asset classes as well. But we generate that yield in a a very diversified way. So if you look at the chart on the right hand side there, it just shows you the contribution of income from the... For the FTSE one hundred from the top 20 income paying shares.

2:19 So as you can see, for the FTSE one hundred, those top 20 income paying shares or companies actually pay out 75% of the index income. For someone like HENDERSON HIGH INCOME, those top 20 shares actually only contribute about 30%. So we generate our high level income in a much more diversified way than the overall UK equity market. So a bit of bit of background in terms of HENDERSON HIGH INCOME. You know, as I said, it is a UK equity and bond income trust. You know, our typical split between equities and bonds is 80% in equities and 20% in bonds. And I think that really is kind of our unique feature. You know, most other UK equity income trusts are just equities, whereas we do have that ability to own bonds. And I'll talk about that in a bit more detail on the next slide. We are a well established trust. We were launched back in 1989, and we've grown to about 360,000,000, of gross assets.

3:18 We are very much bottom up stock pickers, so trying to look for good quality companies that can pay and grow their dividends. And that really is a key focus for us, not just about owning companies that pay dividends, but owning companies that pay a dividend that can grow into the longer term as well. We have classified as a AIC, next generation dividend trust, and that's because we've grown our own dividend by 10... By more than ten consecutive years. And, I... I'll show you this on on the next slide. We've actually grown at 11. So as I said at the start, I've been on the trust since 2012. And since that time, we've been able to grow our dividend at a compound average growth rate of about 2% per annum over eleven consecutive years. Now what does that mean? What does that mean to the actual end investor? Well, if you were to invest £10,000 in the trust back in 2012, actually, we would have paid you back £7,500 just in dividend. So effectively a 75% return just in income, just in those dividends.

4:23 Now... And that also doesn't... That also ignores the capital growth we've seen as well. So actually, the NAV over that time, just on a capital performance, so excluding those dividend returns, actually, that NAV has grown 42% over that that time period as well. So you've got a high and growing income, a very attractive income in in my mind, but also you've had capital growth over that same same time period. It is an investment trust. So one of the key advantages of investment trust is our ability to use revenue reserves. So these are excess income we generate in a year that we can store up for for for for when income is is particularly scarce, you know, as we saw during the pandemic in twenty twenty and twenty one to be able to smooth that smooth that dividend payment. So revenue reserves where they are today cover about 50% of of the dividend payment going forward. It actually puts us in a pretty good state and pretty good position, continuing that paying that dividend and paying that... Hopefully hopefully growing that dividend at the same time going forward.

5:26 So as I said, you know, one of our unique or differentiated aspects is our ability to own bonds, and that certainly should be seen in the context of the gearing within the trust. So what do I exactly mean by that is, well, we have got some long term fixed rate bonds. You know, again, a a key advantage of trust over open ended funds is we've... We have that ability to utilize borrowings or gearing. So we've got long term fixed rate borrowings at a blended rate of 3.67%. And actually, we can invest that in a stable portfolio bond assets yielding more, that's a good way of generating that extra income for the trust. That's very much a structural element of the gearing. What else, you know, what else does a bond portfolio bring other than, you know, helping benefit and boosting that headline dividend yield?

6:17 Well, actually, it provides resilient income as well. You know, in in more macroeconomic challenges, bond income or the coupons that the companies pay on their on on their loans are actually a lot more stable than dividends. So again, it provides that resilience of income to the portfolio. It also offers diversification. I talked about that earlier in that in that chart really. You know, being able to, you know, generate income from other assets rather than just equities, again, helps diversify that income source if we do go in a more challenging macroeconomic environment. And then also it dampers down volatility. So generally bonds are a lot more stable than equities. So again, it helps dampen down that volatility. So although we've got that gearing that affords and and and supports that bond portfolio, actually, because bonds are less volatile generally than equities, it actually helps dampen down the overall volatility of the trust there as well.

7:15 So moving on, talk a little bit about what we look for in companies and what the stock selection process involves. Well, you know, in short, with what we're trying to do is find good quality companies that effectively can pay and grow their dividends in the long term, but making sure we're not gonna overpay for those types of companies in terms of valuation. So I I break it down into a sort of three stage process. So firstly, it's about fundamentals, you know, really understanding what a company's key attributes are. So, you know, I I wanna know what a company does, how it does it, how it's positioned in markets, and what the dynamics of those... Of that market is. And I guess the key things I'm trying to look for are I want a company with a robust business model. You know? Some companies that's gonna be around for the very long term, you know, ten years plus. You know, it's not gonna be adequately competed away from, you know, traditional competition or or, you know, new, you know, digital or tech businesses, etcetera. You know, I I want it to be a stable business for the longer term.

8:15 So you're looking at, you know, how it's positioned in its markets. You know? Is it a market leadership? That's what we like. Force pricing power, etcetera. You know? Does it have high barriers to entry? Again, key to make sure it can't be initially competed away. And good management teams. You know? Going through the pandemic, you know, it showed us what the quality of good management teams really bring to a company, being able to negotiate tricky, hard times that we haven't necessarily seen before. So it's good it's good to really meet those management teams of the companies we invest in to make sure they are devising a a key and sensible strategy to grow the business into the longer term. Then the next part of the process is really analyzing the financial health of the business. You know? Looking at the cash generation. Know, does it have a strong balance sheet?

9:00 You know? Does it have a well invested asset base effectively? And, you know, combining both the fundamentals and the financial health, you get a very good insight into whether a company can not only sustain their current dividend, but grow into the longer term. And those two key elements are very important for the long term total returns for a a company. You know, dividend yield plus dividend growth. And then the third part of the process is really valuation, and this really underpins the whole process. It's all very well finding a a good quality company with good financials, with strong financial health. But if the valuation is not attractive, then your capital appreciation is rather limited. It's about finding good quality companies with strong or improving financial health that you think is undervalued, and that's really the the key for us.

9:50 I talked about the importance of not just focusing on dividend yield, but also the important dividend growth as well. I think these two charts really do highlight that. The chart on the left is is really highlighting why you gotta be careful to not just focus on dividend yield. You know, despite the name HENDERSON HIGH INCOME, it's not about investing just in companies with the highest dividend yield. This chart really shows... The black bars show you what you thought you were gonna earn in dividend yield at different levels of dividend yield. And, actually, the orange bars show you what you actually got. So, actually, the higher the dividend yield there is, the less likely you are to actually earn that dividend yield. And actually, dividend yield in isolation can be a misleading guide to value. So I always say if you look at companies that have a dividend yield between 2446%, Actually, that's kind of in the sweet spot in terms of those dividends being a lot more sustainable in the longer term, and that's what history has taught us.

10:48 If you look at the chart on the right hand side there, that... Those two dividend yield ranges, that two to four, four to 6% dividend yield range, actually historically has produced the best total returns. So that's why I call that two to 6% range in total is the sweet spot. Dividends are much more secure historically, and actually that that area of the market has generated the best total returns. And that's because those companies pay a good or appealing dividend yield, but also are able to grow in the longer term. And those two key elements together form the majority of a total return historically. The next chart is just looking at the long term performance track record of the trust. I probably won't dwell on this slide too much, but, you know, we have you know, since I've become portfolio manager on the trust, you know, we have significantly outperformed the benchmark and had a good return, you know, in line with the benchmark over one year, but certainly ahead of it over three, five, ten years and actually the the longer term as well.

11:51 It's probably a good time for me to be out there talking to you because one of the other elements of an investment trust is that you do have these situations where you trade, where the share price doesn't necessarily match the the net asset value of the trust. And that's one thing we're noticing across the the wider industry at the moment, but specifically for HENDERSON HIGH INCOME TRUST, where if you look over the last few years, we've generally traded quite close to our net asset value, but actually that's gone to a quite a big discount, round about 10% as we are today more recently. As generally, I think UK equities have have gone out of favor as well. But, you know, if you if you believe in the trust, believe in the value of that NAV, then actually this could, potentially look like a good buying opportunity, for investors there as well.

12:39 So that was very... A broad introduction to the trust, but I'll talk a little bit about our market outlook. And I think we're we're we're kind of cautiously optimistic, I I I kind of phrase it, in terms of our market outlook. You know, I think if you look at economics forecast for The UK economy for this year, they're around about naught point 3%. That... That's versus trend growth of about 2%. So it does feel like everyone's quite bearish out there. But I think those those bearish economic forecasts are too negative, I would I would suggest. If you look at wage growth in The UK, actually, wage growth at the moment is outstripping inflation. You know, wage growth is still coming through quite nicely at the moment, whereas other inflation is starting to fall. So actually, wage growth being ahead of of inflation actually means you are gonna see real wage growth, which is generally positive for economic growth going forward.

13:33 If you look at the chart on the right hand side there, actually, confidence is coming through again. So if you look at consumer confidence, actually, that has been recovering for quite some time now. You know, again, as those inflationary pressures are starting to subside, you look at your energy bills now, they're starting to come down, etcetera, as well. And who knows? You know? We think, you know, the next certainly six months, six to twelve months, we're expecting interest rates to start being cut. Now inflation is less of a problem for the Bank of England coming through as well. The black bar on the same chart, you know, shows business activity levels, both manufacturing service industries. Actually, you're seeing a bit more uptick in terms of the activity levels back towards more expansionary territory. So, again, things are slowly improving.

14:18 So I think that's kind of... Those two things I point to that actually make me a bit more positive than where forecasts are currently. That's not to say I think it's gonna be a booming economy, far from it, but I certainly think it's gonna be better growth than the forecasts out there, the gloomy forecasts that we're seeing currently in the marketplace.

14:39 Next couple of charts just talk about performance and valuation in The UK market. If you look at the chart on the left hand side there, it just shows you there's been huge divergence within The UK market. So the FTSE all share over the last two years or so is up about 12%. But that's been really being driven by the top 20 companies within the FTSE one hundred. So basically, the 20 largest companies in The UK have actually gone up as a group by 30%. If If you look at the rest of the portfolio that's kind of been shown by the blue line there, which is a FTSE two fifty, so mid cap area of the market, actually, that's down 10% over those two year period. So they've really been hit hard by, you know, increase in interest rates, slowing economic growth, etcetera. It's where some of the more domestic companies are situated in that in that mid cap area of the market. So there's been almost a 40% performance differential between those top 20, those largest 20 companies in the in The UK market versus a more domestic cyclical company in the in the fifty two fifty.

15:43 That's why if you look across the... To the chart on the right hand side there, it just shows you valuations across the space, both in the 5,100 and the two fifty are quite a low level at the moment. As you can see from that chart, you know, we're in territory we haven't been for some time now, you know, only cheaper in the in the GFC. And, you know, I don't think the economic environment is as bad as we saw in the GFC. So I think there is huge value across the market cap space within that... Within within both the the large cap and the smaller cap area of the market. Now, also, The U... The valuations in The UK market, very different from overseas markets. So, you know, we're we're not just cheap versus our own history, we're cheap versus the, you know, The US market, versus European market, etcetera.

16:29 And I think when you speak to other people, other, you know, other investment professionals, you know, they will point to the fact that The UK market, you know, you're lacking big growth companies, you know. Where's the growth coming from? You're just boring, dull, mature companies in The UK market. Well, actually, I'm I'm kind of trying to get out there to say, you know, just spelling that myth really. You know, we do have companies that can grow. And I've got a couple of examples of ones we own in the portfolio. So the first one is is is three I. So it's a private equity group, and its main holding within the company is is a holding in action, which is a a discount retailer across Europe, really. And it's been growing phenomenally well and successfully over the last few years, really. You can see it there on the chart on the right hand side there. So the profits have grown by almost 900% over the last ten years.

17:20 And it's a really attractive business model to us. Effectively, a discount retailer, you know, it limits the number of products it sells, so it's got huge buying power in in terms of its suppliers. You know, one of the one of the interesting stats is it's the... It's Coca Cola's biggest customers across Europe. So using that buying power to get discounts on the product, it can then reinvest in price for the consumer, I. Lower the price to consumer, brings in more volume in the store, then has to buy more from the supplier, and then gets bigger savings as it grows as a business. And that becomes a self fulfilling business model as well that continually invest in price. It's been a huge success across Europe, huge

18:05 more growth going forward. So it's up to about two and a half thousand stores, and we think that store estate can grow, can probably double over the next or or more than double over the next ten years. So again, very good growth business that's got huge growth to go for, but you just have to be out of... In The UK market context, have to look for these sort of opportunities within the space there as well. Another example, probably more a smaller company within the portfolio that we own, is Cranswick. Maybe some of you heard of it, but essentially it supplies pork and chicken based products into UK supermarkets. So think your gourmet sausages, bacon, cooked cooked chickens, etcetera. You know, this is a very well invested business.

18:52 It's a... Because of that investment that's continually gone in, actually, it's it's it's a low cost provider. So it's been winning a lot of market share of the competition that, you know, haven't been invested, you know, don't have the same reputation for quality, for service, for cost. And essentially, because of that, it's grown very nicely over... Again, over the last ten year period. Not not quite as fast as action, but still growing your profits by a 164% over that time period. That's that's huge growth for a company of its size. And again, you know, there's huge opportunities for that continued growth. You know? It's recently signed a contract with the likes of McDonald's where it's gonna be again, you know, provide those chicken based products to to McDonald's, and that can that can expand over the next few years and win more, you know, win more share, more contract, more content for what McDonald's sells as well. So a good business, again, continuing continued investment for those growth opportunities, good returns for for shareholders as well. So, again, it's a company we like, a company we've obviously been investing in for some time, but continue to see the good growth opportunities as well. So hope that gives you a feel. You know? You know, there's a lot of negative sentiment around The UK equities at the moment in The UK market.

20:10 But if you look close enough, there are some very good quality, good companies that are paying attractive or appealing dividend that are growing very quickly that maybe some of the people have missed out there as well. You know, I've talked a little bit about, you know, the discount The UK market trades at relative to global indices. And you can kind of see that on the chart on the on the right hand side there. You know, the MSCI World ex UK valuation on a price to earnings basis is 18 times now. Again, you look at the FTSE all share with with Danny 11 times. So there's a huge differential. But if you look at the chart on the on the... The pie chart on the left hand side there, this is the underlying geographical exposure of the portfolio.

20:57 So an investment in The UK market or certainly HENDERSON high income is not necessarily investment in The UK economy. You know, The UK market is a very global market in terms of where companies generate the revenues and profits from. Again, HENDERSON HIGH INCOME, similar to that, we are very broadly diversified in terms of the companies we own and the and the geographical exposure of where they get those revenues and profits from. So you're effectively still investing in The UK market, investing in HENDERSON HIGH INCOME. You are getting underlying global exposure, but you're getting on The UK discount given where the valuation are... Is trading relative to to global indices. And also given that, you know, our own discount on HENDERSON HIGH INCOME or... Is at minus 10%, effectively, you're getting double exposure on a UK discount on a second discount as well, which I think is is rather attractive at the moment.

21:52 Next slide just talks about current positioning. Pie chart is just our sector exposure. Again, broad diversification in terms of some of the exposures we have there. You know, the two biggest sort of sectors there, consumer staples, you know, everyday items provide that stability, you know, pretty defensive holdings there, offset by probably a similar sort of weighting in in financials. So more cyclicality, etcetera, as well. But, you know, good broad diversification as well. And then you got the the the top 10 holdings there on the right hand side as well. There's some some balance between defensiveness, bit of growth businesses in in likes of, you know, RELX, three I that I spoke about, but also some cyclicality as well, like some NatWest, Rio Tinto there as as well.

22:41 And then finally, just... I I I guess just a just a recap before we open up to questions. So, you know, why HENDERSON HIGH INCOME, as I said, you know, providing a high level of dividend income, but also a growing income... Growing income stream. 6.6% dividend yield has grown about 2% compound annual growth rate over the last eleven years consecutively. You know, I I do sit in a very experienced team at Janus Henderson that really do focus on not just income funds, but income investment trusts. And we do have a very, you know, clear focus on making sure that we own companies that provide income stability. So, you know, focusing on dividend growth as well as dividend yield, but also having revenue reserves there to protect the income going forward if we do get into more difficult environments for for income. And then a long term track record definitely does sort of stand out in that regard. But I'll leave it there and open it up to to any questions you may have. Perfect, David. That's great. Thank you very much indeed for your presentation this morning. Ladies and gentlemen, please do continue to submit your questions just by using the q and a tab that's situated on the right hand corner of your screen.

23:48 But just while the company takes a few moments to review those questions that were submitted already, I would like to remind you that a recording of this presentation along with a copy of the slides and the published q and a can be accessed via your investor dashboard. David, as you can see there in the q and a tab, we have received a number of questions throughout your presentation this morning. And thank you to all of those on the call for taking the time to submit their questions. But, David, perhaps if we just dive straight into it, the first question that we have here reads as follows. Considering the macroeconomic outlook and the possibility of interest rate cuts in 2024, how is the company positioned to capitalize on the potential opportunities in the market whilst managing the associated risks effectively? Sure. So so I think one of the things we did back in q four last year was actually we started positioning the portfolio more towards cyclicals and more towards those sort of companies that probably benefit in an interest rate cut environment.

24:43 So, you know, we we had new positions in the likes of Taylor Wimpey, the house builder, you know, trading at a discount to NAV at the time, you know, very high dividend yield. We thought that could be sustainable. We also bought into British land, new holding, a real estate company. Again, it feels like, a lot of the value, or sort of real estate values was troughing. At that level, you're starting to see rental growth come back again. Again, trading at big big discounts with NAV. And if you get certainty of that NAV, again, you know, I think that could be a good good good environment. But it's a few a few other names there, you know, bought into the, the homewares retailer again and improving, you know, consumer outlook, consumer housing, improving or recovering housing market, etcetera, you know, as interest rates are cut, again, gonna be boom for that that sort of company. So we have been shifting the portfolio more towards, you know, cyclicality, you know, those companies that can benefit from interest rate cuts. You know, it's not a one way bet. You know, again, you know, having, you know, been doing fund management from... Since two thousand and seven, eight, you know, I, you know, I recognize that, you know, we've gotta still have a broad diversified portfolio to, you know, manage some of those risks because not all companies in this sort of tough economic environment are gonna, you know, do as do as well as others. So, you know, you need to be careful about not putting all your eggs in one basket, keeping that broad diversification.

26:11 But it but it's at the margin. We're shifting that portfolio. We're... We've been adding to those names we think can do do a little bit better there as well. Perfect. Thank you. Just turning to the next question that we have here, which asks, why is the gearing at 22%? How is this funded? With RCF, what rate? Yeah. So so the gearing, there's two elements of the gearing. So the first part is the structural gearing, which is the gearing that backs the bond portfolio. So currently, we're invested 15% in the bond portfolio. And then once you strip out that that element of structural gearing, the gearing that goes in towards the equity portfolio, that's around about 7% at the moment. So together, that's that's the 22%.

26:58 So we got we got a two forms of of debt in the in in the trust. So firstly, it's a private placement debt. So fixed rate borrowings out to out for another fifteen years at 3.67%. So that's fixed rate. And the other portion of the debt is

27:17 through RCF. We've paying a margin of about 88 basis points over over Sonia. So pretty competitive margin. And clearly, you know, if interest rates cut, then our interest charge will will come down in that facility as well. The split between the two were about 40% in the fixed rate borrowings and about 60% in the RCF. That's great. Thank you. The next question asks, the trust has seen its NAV discount push out to around 10%. I presume this has been in part due to the recent merger with HDIV. Is the board looking to reduce this divergence in the near term? I'm not sure it's specifically a direct result of our merger with HENDERSON Diversified Income Trust, you know, which which got completed in January.

28:09 You know, we had already moved to a 7% discount prior to the to the margin becoming ineffective. And actually, you look across the wider investment trust space, actually, you've seen discounts widen across the piece, both in terms of the alternative space, which obviously big discounts, but in terms of the mainstream UK sort of equity space as well. And we're not out of kilter with, you know, the AIC UK equity income sector. You know, that's an average discount around 10%. So we're kind of in line with the average. You know, are the are are the board looking at ways to bring that discount in?

28:46 Yes. It's it's a topic for board meetings. We certainly discuss it a lot of times. I think where we are today in line with the sector, I don't think necessarily we're we're thinking about doing buybacks. I think we're gonna explore other ways to try and bring that discount in and just, I. E, create more buyers. And that's through, you know you know, doing more marketing. You know? We've had, you know, a relaunch of the website recently. We have got a big ongoing advertising campaign just just launched recently. Exciting times, I think. You know, that's the way you can stimulate that demand because, you know, it is a... We think it is a very attractive proposition given the dividend yield, given the dividend growth, and actually given the long term long term track record... Performance track record of the trust. So I think there's ways we can do it. Now, clearly, if that doesn't work, then there's alternative ways we can look at it going forward. But I wanna try the marketing side first before we think about alternatives.

29:42 Perfect. Thank you. The next question that we have here relates to dividends, and it asks, can the dividend be maintained and increased over the next three to five years?

29:54 I think given... What can I say about the dividend without giving too much forward guidance? You know, we do a lot of stress testing in terms of different scenarios for our companies and where it can go over the next few years. And I produce that to the board at every board meeting there. You know, we have a very well, broad diversified portfolio. You know? As I said before, it's not just equities. It's it's bonds as well. And bond coupon is a lot more stable and more resilient in downturns than than equities. And plus we've got those revenue reserves. So we've got, you know, 50% of the dividend is covered in... By reserves. So that, again, that gives me confidence. So there's no reason with those examples or those those reasons why we shouldn't be able to continue to pay and hopefully grow the dividend to the longer term. You know, we're proud of that eleven year consecutive track record, so we're kinda keen to keen to push it on, I guess.

30:54 Perfect. Thank you. The next question asks, during a bear market, are you able to stay in cash, or do you have to be fully invested at all times, or would you change the mix of bonds to equities?

31:06 Yeah. I mean, certainly, we've we've got a lot of flexibility in what we can do. You know, I think one of the things we'd probably look to do first if we did if we did think that we're gonna go into a bear market was probably shift more away from equities and certainly utilize bonds first. In terms of the level of cash, we can certainly lower the gearing, definitely. I think there will always be a little bit gearing just to structurally fund that bond portfolio and get that extra income for shareholders. But certainly, we can play around with the actual level of gearing. But I think the first protocol will probably be changing the asset allocation between bonds and equities. If I think back to, you know, over the lifetime of the trust, you know, where we are at 15% in bonds, you know, we've been highest 35% probably before my time, but certainly that's that's the sort of level we have been... We have got up to in in the past. And, you know, if if we are worried about equities, then certainly that's that's an area... You know, that's one one aspect we can use and that place that that flexibility as I mentioned.

32:11 Thank you. Just turning to the next question. The report says ICG was a significant contributor. What's the contribution a one off, or does it fit in with the two to 4% dividend yield that you described as sustainable and ideal for long term returns? Yeah. So so ICG or or Intermediate Capital Group, it's a business we've owned for a long time, to be fair, over ten years, I think. And it's, you know, it's a very good high quality business in a very... And this is, you know, it's basically market leading and specialized niche. It does private credit, but they're very much the mid market area, which not not a lot of the big guys play into. And they have very good, strong, long term track record. So as an asset manager, private credit, very good long term performance track record, grown really well as it's become a popular space in the alternatives area of the market.

33:08 And through that growth, it's generally, you know, driven that huge dividend growth over the same time period. So it used to be a big high yielder for us. And obviously, as that dividend yield has come down, so shares have been very successful. But given we've got certainty over actually dividend growth is still gonna come through, we're kinda happy to hold it. So it's been a very good long term successful holding for us. Given the prospects of the business and the asset class going forward, you know, I'm still happy to hold it from here as well because I think there's still value... There's still good upside from from where the current valuation is. Perfect. Thank you. And just turning to the final question that we've got here, which asks, what is the dividend cover? Yeah. So in terms of dividend cover, terms of revenue we generate versus the dividend we pay out of, you know, we were fully covered last year.

34:01 So we paid out around about 98% of our income. You know? Typically, we are an income in trust, so we're gonna pay out the majority of, of our income out as dividend. But it's a good place to be in in terms of the last two years we've fully covered the dividend, as well. You know? Clearly, in two thousand and twenty and twenty one, when we went through the pandemic where we saw big dividend cuts across the market, you know, we had to utilize a little bit of revenue reserves to pay out. But actually, over the last two years, back in 2022 and '23, we've been back covering that dividend fully. And, you know, I suspect going forward that that's a place we we would like to be, you know, put in a little bit of extra income back into those revenue reserves, you know, for the next downturn to come whenever that may be. Perfect, David. That's great. And thank you very much indeed for being so generous of your time then addressing all of those questions that came in from investors. And, of course, if there are any further questions that do come through, we'll make these available to you immediately after the presentation has ended, just for you to review to then add any additional responses, of course, where it's appropriate to do so, and we'll publish all those responses out on the platform.

35:03 But, David, perhaps before really just looking to redirect those on the call to provide you with their feedback, which I know is particularly important to yourself and the company, if I could please just ask you for a few closing comments to wrap up with, that'd be

35:14 great. Yeah. I mean, it's just to just to thank again people for for taking the time out of their busy busy schedules to listen in to me. You know, if you wanna know more information about the trust, then please do visit do visit the the website. It's a brand new website only launched a couple of months ago. So please get on there, and there's a way to sign up to communications going forward from the website if you... If you're if you're interested. I'll, you know, advise people if if they are to to to please have a look out for that. Perfect, David. That's great. And thank you once again for updating investors this morning. Could I please ask investors not to close this session as you'll now be automatically redirected for the opportunity to provide your feedback in all of the management team can really better understand your views and expectations? This will only take a few moments to complete, but I'm sure will be greatly valued by the company. On behalf of the management team of HENDERSON HIGH INCOME TRUST PLC, we would like to thank you for attending today's presentation.

36:07 That now concludes today's session. So good afternoon to you all.